Tesla Model 3 - Make or Break ?? | Page 17 | FerrariChat

Tesla Model 3 - Make or Break ??

Discussion in 'General Automotive Discussion' started by F2003-GA, Feb 4, 2018.

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  1. Etcetera

    Etcetera Two Time F1 World Champ
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    It looks like it didn't put its dentures in.
     
  2. BMW.SauberF1Team

    BMW.SauberF1Team F1 World Champ

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  3. NEP

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    Tesla Crushes Quarterly Delivery Record With 83,500 Deliveries In Q3

    October 2nd, 2018


    Tesla increased deliveries more than 100% quarter over quarter in Q3.

    Q3 deliveries totaled 55,840 Model 3, 14,470 Model S, and 13,190 Model X.

    Tesla has released its preliminary delivery and production numbers for Q3 2018, with a total of 83,500 vehicles delivered to customers, which amounts to a more than 100% increase versus the next highest quarter in history … which was Q2 2018.

    Model 3
    The sharp upticks in delivery and the supporting production demonstrate that Tesla has indeed stabilized production of the Tesla Model 3, which accounted for 55,840 of the total deliveries. For the entire first year of its production life, Tesla struggled to build the Model 3, only achieving its initial production target of 5,000 vehicles per week in the very last week of June.

    Never satisfied with yesterday’s news, Tesla immediately followed up with the announcement that it was adding an all-wheel drive (AWD) and “Performance” build of its Model 3. At the same time, it opened up ordering of the Model 3 to all US and Canadian customers, regardless of whether they had a reservation or not. It essentially blasted open the floodgates for Model 3 orders, but with a huge asterisk.

    The Model 3 is still only available in a $49,000 base configuration, meaning that there are still hundreds of thousands of customers waiting for the promise of an affordable Tesla at the $35,000 price point, for the Standard Range configuration.

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    What that means for Tesla is that all of the 55,840 Model 3s delivered to customers were higher end, higher profit builds that are critical for the company to achieve profitability this quarter. Musk noted that if Tesla was able to achieve a base production and delivery rate of 5,000 of these higher end Model 3s per week, profitability would be within reach. All signs point to this happening — though, the official financials will be released next month after they have had time to work through all of the nuances of corporate accounting.

    Tesla also consumed the electric vehicle market in the US in Q3 with its impressive ramp up of the Model 3. According to Tasha Keeney of ARK Invest on CNBC, “Tesla right now, has over 80% market share for EVs in the US. The Model 3 is the top grossing car in the US. So, really, Tesla has reached escape velocity.” That again comes with its own asterisk, as the production and delivery results must be sustainable and we know that while the company may have moved up a few levels in the production hell it was mired in for the better part of a year, delivery hell still has some significant kinks to be worked out before Q3’s results can be deemed sustainable.

    Delivery Hell
    Elon Musk called all hands on deck over this past weekend to achieve these numbers, even welcoming a love army of volunteers to come assist with the delivery process at its service centers around the world — especially North America — in the mad dash to Q4.

    A Tesla software engineer shared that the rush to hit Q3 targets pulled in everyone from “Interns, VPs, and everyone in between” to prep Model 3s for delivery in the last few days of the quarter.

    Tesla admitted as much in its update today, sharing that, “With production stabilized, delivery and outbound vehicle logistics were our main challenges during Q3. We made many improvements to these processes throughout the quarter, and plan to make further improvements in Q4 so that we can scale successfully. As part of this effort, we plan to continue to expand direct deliveries to customers at their home or office, a service we launched in Q3 to improve customer convenience.”

    The delivery process may have its issues, but Tesla shared that it produced 5,300 Model 3s in the last week of the quarter, which highlights that it has indeed found a way to stabilize production of the Model 3 above the magical rate of 5,000 vehicles per week, even with the introduction of the All-Wheel Drive and Performance configurations. The next target is 6,000 per week.

    The high volume of Model 3 demand is again to blame (if you want to put it that way) for the spike in delivery issues, as Tesla yet again is faced with managing 2, 3, or 4 times the volumes it had ever done in the past. As we recently noted, Tesla went from essentially no mass produced cars to a rate of approximately 300,000–400,000 per year in just 6 years.

    Tesla noted that, “In just Q3, we delivered more than 80% of the vehicles that we delivered in all of 2017, and we delivered about twice as many Model 3s as we did in all previous quarters combined.”

    Model S & X
    It’s mind-boggling to think that just a few years ago, we were all obsessed with Model X, and a few years before that, Model S. The two vehicles continue to impress and attract new customers to the ordering portal, as Tesla delivered 27,660 Model S and X, which is “slightly higher than Q2 and in line with our full-year guidance.” Of that, Tesla delivered 14,470 Model S and 13,190 Model X to customers in Q3.

    Summary
    Tesla achieved a momentous quarter of production and delivery numbers, but the big question outstanding is clearly around profitability. The high-level metrics look good regarding production and delivery numbers, but cash reigns supreme and that’s where all eyes are going to be focused for the next few weeks as Tesla closes its books. Elon Musk shared in the Q2 earnings call that the company should be able to achieve profitability in Q3 and sustainably from there onward. That’s a tall order for a company that has, to date, been known as a “cash burning machine” (the link lays into that term).

    Looking to the future, Tesla continues to have opportunities to gobble up new EV market share, create new EV drivers, and bring in more cash. The Model 3 currently is not available as a lease, which Tesla is expected to open up at some point. The $35,000 Standard Range build will bring the car to hundreds of thousands of new reservation holders. And the Model 3 is still only officially available to buyers in the US and Canada, with the whole rest of the world waiting for its turn.

    Breaking out of North America will open up lucrative new markets for the Model 3 in Europe and beyond. For the Chinese market, Tesla continues to step on the accelerator in order to quickly build its third Gigafactory, in Shanghai, which will allow it to dodge the steep 40% tariffs for goods moved into the country that have eroded Chinese sales over the last few months.

    3+ years ahead on battery tech.

    3+ years ahead on autonomous hardware.

    3+ years ahead on autonomous data — only company collecting data from customer cars.


    https://cleantechnica.com/2018/10/02/tesla-breaks-quarterly-delivery-record-with-83500-deliveries-in-q3/
     
  4. F2003-GA

    F2003-GA F1 World Champ
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    TSLA earnings due Wednesday o_O
     
  5. NEP

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    Tesla Swings to a Profit: What You Need to Know
    Soaring Model 3 sales gave Tesla's business a big boost.


    October 24, 2018

    There was one looming question on everyone's mind headed into Tesla's (NASDAQ:TSLA) third-quarter earnings release on Wednesday: Would the electric-car maker report a profit?

    Not only did the electric-car company report a meaningful profit, but it also racked up $881 million in free cash flow and reaffirmed its expectation for more profits and positive cash flow in Q4. The news bodes well for Tesla's longer-term prospects as Model 3 production increases.




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    Model 3. Image source: Tesla.


    "Q3 2018 was a truly historic quarter for Tesla," the company said in the opening sentence of its third-quarter shareholder letter. It would be difficult for even a Tesla critic to disagree. Not only was the Model 3 the best-selling car in the U.S. measured by revenue, but the company's dwindling cash position also did a 180. Cash and cash equivalents increased by $731 million to $3 billion.

    In addition, the company's Model 3-driven 221% year-over-year increase in vehicle deliveries helped revenue soar 127% as Tesla swung from a significant loss per share of $3.70 in the year-ago quarter to earnings per share of $1.75.

    Highlights
    • Tesla delivered 56,065 Model 3's during Q3, up more than 200% sequentially.
    • Third-quarter Model 3 deliveries were higher than total Model S or Model X deliveries in any 12-month period in the company's history.
    • Tesla had an operating margin of 6.1%.
    • Tesla's Model 3 gross margin was just over 20% -- up from "slightly positive" in Q2 and above guidance for 15%.
    • Gross margin for Tesla's overall automotive business was 25.8%, up from 20.6% in the second quarter of 2018.
    • Megawatt-hours of energy storage deployments were up 118% year over year and 18% sequentially.
    • Tesla is on track with its goal to triple energy storage deployments in 2018 compared with 2017.

    Looking ahead
    Tesla's strong guidance suggests its heightened sales levels and newfound profitability are sustainable. Management said it remains on track with its goal to deliver a total 100,000 Model S and X vehicles in 2018. In addition, the company forecast a further increase in Model 3 production and deliveries in Q4 compared with Q3.

    Importantly, Tesla expects to remain profitable in Q4, with its cash position forecast to remain "at least flat in spite of our plan to repay $230 million of convertible notes in cash during Q4."

    Looking further out, Tesla said it is still working hard to bring the Model 3's starting price to the company's promised $35,000 level, citing its recent introduction of a more affordable, "mid-range" Model 3 for $46,000 as evidence of the company's progress. "Better than expected Model 3 cost reduction is allowing us to bring more affordable options to the market sooner," the company said. In addition, Tesla noted it is still targeting a Model 3 gross margin of 25%.



    https://www.fool.com/investing/2018/10/24/tesla-swings-to-a-profit-what-you-need-to-know.aspx
     
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  6. MalcQV

    MalcQV F1 Rookie

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    Sounds promising. Maybe by 2021/22 the Model 3 will be available here in the UK.
     
  7. NEP

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    "Company co-founder Elon Musk has revealed on Twitter that right-hand drive versions of the Model 3 (for UK buyers) will “probably” arrive in the middle of next year [2019]. Left-hand drive examples (for the European market) are due in the first half of next year [2019].

    The tech billionaire says that the electric car, which is left-hand drive as standard, is designed so that only small engineering and “tooling” adjustments are needed to build right-hand drive variants."
     
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  8. F2003-GA

    F2003-GA F1 World Champ
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    Something smells fishy about Tesla numbers. Why did so many executives leave the company if they really were on track for this kind of quarter :confused:
     
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  9. Bas

    Bas Four Time F1 World Champ

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    The list is so basterd long I can't/won't list them all.

    Why was the earnings moved up by 2 weeks? Hiding something.
    Top of the line Model 3 demand is utterly exhausted. They made 300m profit swinging all the expensive Model 3's they could. That's it.
    The amount of cars returning for repairs is simply staggering. Enormous. Paint defects ($$$), car ''bricked'', moisture in lights (leaving the car unable to be registered in some documented cases), panels missing, panels falling off after some rain, broken glass on delivery, damaged interiors and so on.
    The new ''cheaper'' 3 at 45K they struggle to make any money on, even with it's low range battery which is only 1500 dollar cheaper to produce. Felon himself has said they can't make the 35K 3 as they can't afford it ''yet''. In ''3 to 6 months'' the 35K car will be available. I dread to think what all will be wrong with that, if the 45-80K 3 is this poor quality...how in the ****ing **** is he going to shave off 10K in producing costs? Another car that simply won't happen.
    Staggering amount of model 3 are sitting in parking lots of empty buildings, industrial sites and whatnot.
    The Q2 ''we build 5o00 cars in a week" headline was just that, a week. Rest of the quarter it was nowhere near that. Just a production ramp up in final week again to 5100 (well below Felon's target, which he's strangely quiet about).
    And so on.

    Remember guys. Enron posted a ''great quarter'' weeks before they collapsed. Trade carefully (long and short).
     
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  10. F2003-GA

    F2003-GA F1 World Champ
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    Well said and I completely concur with your thoughts
    IMO this was shot in the arm of adrenal it will wear off
    They have no capital to compete with the big boys
    But the market is silly I wouldn't be surprised if they raise
    more cash based on a stupid valuation and the excuse
    they'll give is the new factory in China. Tesla will limp on
    for several years unfortunately
     
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  11. Bas

    Bas Four Time F1 World Champ

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    I've got a strong suspicion they've got a wells notice so they can't raise. If he didn't have one, he'd raised already.

    Tesla's big news last week or so was that they leased a bit of land in china. Leased. Lol.

    IMO they're on their very last legs. They'll claim they're doing amazing until the day they're (forced) to file BK.

    ****, Felon hates the shorts so much I wouldn't put it past him to do a stock split. He'll do anything to piss of shorts. If just one of them hits a massive stop loss he'll consider it mission achieved....
     
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  12. Bas

    Bas Four Time F1 World Champ

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    FBI is investigating. Criminal investigation.

    At least we know why they rushed their earnings!
     
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  13. F2003-GA

    F2003-GA F1 World Champ
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    Just hope they got some investigators that understand car business financials o_O
     
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  14. Bas

    Bas Four Time F1 World Champ

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    Just need someone that can add and subtract.

     
  15. F2003-GA

    F2003-GA F1 World Champ
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    :D:D:D
     
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  16. NEP

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    3 Big Surprises in Tesla's Q3 Earnings
    The electric-auto maker shocked Wall Street by posting a big profit in the third quarter.

    October 29, 2018


    Tesla (NASDAQ:TSLA) caught investors off guard last Wednesday by reporting a massive third-quarter profit of $312 million. This was just the third time in the company's history that it has reported a quarterly profit under GAAP accounting rules, and it easily set a new earnings record for Tesla.

    That said, the mere fact that the electric vehicle pioneer turned profitable was not especially shocking. While analysts had on average expected a small loss, Tesla had previously projected that it would be profitable for the quarter. Yet there were plenty of surprises in the earnings report. Here are three big ones.

    Model 3 gross margin surges past expectations
    Three months ago, Tesla reported that Model 3 gross margin was "slightly positive" in the second quarter. At the time, it forecast that Model 3 gross margin would improve to around 15% in the third quarter and around 20% in the fourth quarter, on the way to a long-term goal of 25%.

    Tesla began delivering more expensive all-wheel-drive versions of the Model 3 last quarter. It also increased the production rate. These two factors clearly supported a big improvement in gross margin. Yet with the mix of Model 3 cars certain to gravitate toward cheaper versions over time, it was hard to see a path from Tesla's projected Q3 Model 3 gross margin of 15% to the long-term goal of a 25% gross margin -- even allowing for further manufacturing cost reductions.

    However, Tesla at least partially addressed this concern by reporting Model 3 gross margin in excess of 20% for the third quarter. This quickly put the company close to reaching its long-term margin target for its newest vehicle. The margin outperformance was particularly notable because it represented a clean break from Tesla's track record of repeatedly missing its forecasts.

    Tesla will still need to achieve substantial cost reductions to offset the introduction of cheaper Model 3 options, but the 25% long-term gross margin target looks a lot more plausible now than it did a week ago.

    Operating expenses decline
    The unexpectedly high gross margin result for the Model 3 was the most important factor in Tesla's earnings beat. However, strong operating expense control also played a big role.

    In the second quarter, while research and development (R&D) spending rose less than 5% year over year, Tesla's selling, general, and administrative (SG&A) expenses surged 40% year over year and 9% sequentially. Considering that Tesla's vehicle deliveries doubled in the third quarter compared to the second quarter, it would have been natural to expect another big step-up in SG&A expense last quarter.

    Instead, SG&A expense declined 3% sequentially to $730 million. On a year-over-year basis, SG&A was up just 12%. Tesla also reported a sequential decline of 9% and a year-over-year increase of just 6% on the R&D line. Tesla attributed the strong cost performance to recent cost-cutting actions and having already completed most of the development work for the Model 3.

    Tesla's Model 3 gross margin beat may have been the main factor in bringing the company to profitability last quarter, but spending discipline was the difference between eking out a profit and reporting blowout earnings.

    Incredible free cash flow
    Lastly, Tesla's cash flow performance was even more impressive than its earnings. Operating cash flow surged to $1.4 billion in the third quarter after being negative in the first two quarters of the year. Previously, Tesla had never generated more than roughly $500 million of operating cash flow in a quarter.

    Free cash flow reached $881 million last quarter, which was substantially higher than Tesla's net income. Part of the discrepancy came from the $205 million in share-based compensation that Tesla handed out, while working capital improvements also made a modest contribution.

    However, Tesla's strong free cash flow primarily reflected rock-solid operating performance. That suggests there was more to its big earnings beat than accounting tricks. It also means that Tesla's goal of remaining profitable in Q4 -- and hopefully in 2019 as well -- could be within reach.


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  17. NEP

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    Awakened Tesla Short Seller (+ 4 CleanTechnica Charts)

    October 30th, 2018

    As you may have seen, a longtime Tesla bear and short seller recently made a full, high-speed, screeching U-turn and starting supporting Tesla. The explanation included 4 CleanTechnica charts regarding Tesla sales versus the competition’s sales.

    I’ll take this opportunity to shamelessly plug becoming a CleanTechnica member, supporter, or ambassador to help us do the independent cleantech reporting and analysis that we do.


    Matt Pressman of EVANNEX first notified me of Citron Research’s use of our charts, and he also notified me of a rather stunning follow-up news item: “Citron’s Tesla U-turn dealt short sellers a $1.11 billion loss.”

    Holy whuzzuh?

    If you wanted to monitor and investigate human insanity in a large societal format, I’ve got a few political groups I could recommend (including one down in Brazil and one right here in the US of A). But sticking to the topic of this article, I have to admit that I find Tesla short sellers an enjoyably fascinating case study. Naturally, they are part of the wider stock market case study, which is an absolute wonder of the world. Let’s dive in.


    The first question, and one we commonly skip over, is why one analyst — like Citron Research — changing its opinion on a firm/stock results in so much of a shift in the investments of others.

    If you’ve invested a large portion of money — or, for example, if a group of you have invested $1.11 billion collectively — on thorough financial analysis, why would someone else’s shift in assumptions make you change your investment. Do you not have your own assumptions solidly planted and based on actual news?

    Andrew Left of Citron Research determined that —

    It looks like Tesla really can produce cars.

    And it turns out a ton of people genuinely do want to buy them.

    And this years-long hype about competitors eating Tesla’s lunch seems to be more fantasy than anything else.

    (Not a real quote.)

    But why did $1.11 billion follow Left’s move to the other side of TSLA?

    Do many short sellers not actually do their own research? Do they not have their own assumptions and spreadsheets to justify their bets? Or did all of them somehow “wake up” and come to the same conclusions at more or less the same time and thanks in part to Left’s new take on the story?

    Curious minds want to know.

    The thing is, though, sometimes you just need to hear something from the right person. I’ve been publishing Tesla sales charts for years and have been telling essentially the same story all along the way. The charts have gotten more dramatic — downright nasty — but they are what I’ve projected for years, based largely on Tesla’s own projections. But why would a Tesla short seller believe me? I’m obviously “biased,” right? Indeed, I doubt they all of a sudden became CleanTechnica ambassadors and thanked us for our work. However, it’s a hugely different story when one of your own — someone who has long been helping to drive the anti-Tesla narrative — all of a sudden says, “Oh, whoops, I was wrong. And, actually, you should take a look at these charts from this Tesla fanboy. It’s getting really hard to deny the pro-Tesla narrative.” (Not a real quote.)

    Has anything really changed at Tesla, fundamentally? No. The only thing that fundamentally changed was one vocal investor’s viewpoint on the story. And that apparently shifted $1.11 billion. (Note: I’m not sure a regression analysis was applied to this case to conclusively support the claim, but decent logic seems to be behind the math.)

    Rather than assuming they all updated their spreadsheets, though, there’s another way to explain the $1.11 billion change of heart based on Left’s report. There’s a funny assumption that most stock market positions are based on solid financial analysis and spreadsheet conclusions. I’m not the first to point out, however, that much investment is based on emotions and mass socio-psychological analysis. Investments shift all the time — and in very large quantities — based on what people think other people think about a company (or the economy as a whole). Actually, massive amounts of money shift based on what people think other people think other people think about a company. Perhaps short sellers didn’t care what Andrew Left thought about Tesla, but perhaps they thought other people cared a great deal about what Left thought.

    Such is the nature of large groups of humans.

    Naturally, timing was a big factor in this story. Andrew Left came out with his dramatically revised conclusions after Tesla released 3rd quarter sales and just before it released 3rd quarter financial summaries. Anyone who had been following the story closely should have seen that Tesla actually sold far more cars than short sellers were expecting and that the margins must have been pretty high on those cars, given the versions of the Model 3 the company was selling (and not selling). All you had to do was take those numbers and plug them into a simple spreadsheet and you could see Tesla was likely to be profitable. Yet, either short sellers didn’t dare do so or they didn’t dare believe their eyes after doing so. Then along came Left, who said, “Hey, this is sort of wild, but Tesla makes a lot of money.” (Not a real quote.) That woke up some sleeping bears who decided that, okay, it was time to go terrorize some other company.

    But some bears are deeper sleepers than others. While $1.11 billion might have decided it was time to stop being skeptical on Tesla, billions more remained short. Even after Left’s research note came out and gave Tesla stock a bump, 33.79 million shares were still shorted ($9.94 billion worth of them), meaning that Tesla was still the most shorted U.S. stock on the stock market. At the time that Reuters article about the $1.11 billion loss was written and it was assumed that the initial effect of Left’s change of heart was settled, Tesla’s stock price was $288.77, and Tesla had not yet released its Q3 financials and shareholder letter. Tesla released those after the market closed on Wednesday, October 4. The market closed at $288.50 that day and opened at $317.38 the next day. Tesla’s numbers were good, very good, and more investors came to the conclusion Left had landed on a few days earlier.

    The stock price is now up to $334.85. Who knows what the future holds? The stock market is volatile and Tesla stock is much more volatile than most — a “roller-coaster ride” that, ironically, gravitates to the same metaphor commonly used for riding in a Tesla.

    But a few things are clear. First of all, in the short term at least, Citron Research’s decision to bail on its short position just before Tesla’s Q3 report and conference call was a financially fruitful move. Tesla’s stock price is up a whopping 27% at the moment compared to a week ago. By swinging all the way from short to long, Citron Research must have made a nice chunk of change.

    Additionally, anyone who quickly followed Andrew Left’s lead must have made some good money as well. Jumping from $288.50 to $334.85 ain’t half bad, even if it doesn’t match a move from $263.67 to $334.85. So, while my note above that it’s sort of ridiculous to change your position on a company based on someone else’s assumptions and spreadsheet conclusions, the cold truth of the matter is that doing so is sometimes an effective way to read the market and be ahead of the curve. In other words, it’s not all about math — it’s also about psychology and sociology.


    As a final note, the thing that many of these Tesla short sellers don’t seem to realize is that Tesla longs aren’t “playing the market” like they are. Tesla longs — of which I am one — have determined that Tesla is a solid company with an excellent leader, a tremendous track record of executing on its goals, and unmatched expertise innovating on electric vehicles and clean energy (which are market segments we see rising strongly in the coming decades). Whether we came to the conclusion yesterday or years ago when the stock price was $30, we assume that Tesla will keep growing as it continues to produce the best electric cars — well, the best cars overall. We expect that sales will keep growing strongly as more people find out what a Tesla is. Some of us don’t fret about short-term changes in the stock price, and certainly don’t try to pump it up, because we just assume the market as a whole will eventually come to understand the Tesla story. We assume more people will come to understand that Tesla’s on-the-ground financials (including real-world assets) will improve year over year as Tesla continues to innovate.

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    Tesla’s stock price rose from $30 to $100 as more people consumed the Tesla story, and many of us assume it will grow from $330 to $1000 in a similar fashion over time, even if that means occasionally dropping 25% based on human fear, uncertainty, and doubt.

    Another thing we assume is that more of the market will sooner or later start trusting Elon Musk, the unofficial “Nothing of Tesla,” more than Tesla short sellers. There’s still approximately $10.97 billion of short interest in TSLA. Andrew Left may have … left. Others may have followed him based on his new take on Tesla. But it appears that $11 billion not only doesn’t buy the story, but specifically buys the story that Tesla is going down. If the Tesla story gets better and better, what happens to that $11 billion?

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  18. NEP

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    Latest Tesla news: Now FBI to investigate Tesla's Model 3 production forecasts

    FBI examining Tesla statements from 2017 - but company hasn't yet received subpoena

    30 October 2018

    Tesla is facing a new investigation, this time by the FBI, over claims that it misled investors by wildly overstating its Model 3 production forecasts.

    The FBI is conducting what has been described as a criminal investigation, but the investigation would appear to be at an early stage, with reports suggesting that FBI agents have only just contacted former Tesla employees to interview them. Furthermore, the FBI hasn't yet issued a formal subpoena for information from Tesla, either.


    A Tesla spokesman told Associated Press that the company had been transparent about the difficulties it faced increasing production of the Model 3.

    He added that the company had cooperated with what he described as a "voluntary request" for documents from the Justice Department earlier this year, but said that the company has received no additional requests from the authorities for a number of months.

    The claims over an FBI investigation were made over the weekend by the Wall Street Journal. The investigation is centring on company claims that it would be making up to 5,000 Model 3s a week by the end of 2017. In the end, it made just 2,700 Model 3s throughout the whole of 2017, and didn't hit the 5,000 unit production target until the end of June 2018 following a colossal corporate effort.

    The investigation is being run out of the US attorney's office in San Francisco, California, and has intensified following Elon Musk's run-in with the Securities and Exchange Commission (SEC) over his plans to take the company private. This culminated in a $20 million fine for Musk and a $20 million fine for Tesla. [see below and next page for more]

    The FBI investigation is based on claims made by Musk in a conference call with analysts in February 2017, in which he explained the company's plans to ramp-up production of the Model 3 throughout 2017. The Model 3 is the vehicle intended to drive Tesla from being a niche, luxury car maker into the mid-range, with annual sales of 500,000 units or more.

    In July 2017, Musk reiterated his belief that the company would achieve his target as he pushed suppliers to ramp-up deliveries in anticipation. However, the Model 3 body shop wasn't even fully functional in September and the company, even at that late stage, was hand-building a number of key parts.

    29 October 2018: The $20 million fine from the US stock market regulator, the Securities and Exchange Commission, was "worth it", Elon Musk has claimed.

    The Tesla founder and CEO was responding to a question posed by one of his Twitter followers, with the fine coming after an investigation by the SEC into claims made by Musk in August - also made via the medium of Twitter - that he was planning to take the company private, "funding secured".

    It quickly transpired that funding was far from secured and Musk was forced to backtrack, claiming that taking the company would take longer than he had anticipated.

    Musk declared just an hour after his "worth it" tweet that he was going to take a break from Twitter. However, investors may be concerned over Musk's attitude and the lack of progress so far on a new chairman to rein-in Musk's impulses.

    Under the terms of the settlement between Musk, Tesla and the SEC, Tesla needs to appoint an independent chairman by 13 November - just two weeks time - and two new independent directors. Musk may also have to give up his personal Twitter account or stop using it in connection with any corporate purpose.

    Musk's "funding secured" tweets were made on 7 August, and claimed that he was planning to take the company private at a price of $420 per share - a premium of just over 20 per cent of the company's stock price (which has since nose-dived) at the time. His tweets implied that the only remaining barrier to the privatisation would be a shareholder vote.

    "The SEC's complaint alleged that, in truth, Musk knew that the potential transaction was uncertain and subject to numerous contingencies. Musk had not discussed specific deal terms, including price, with any potential financing partners, and his statements about the possible transaction lacked an adequate basis in fact," the SEC claims.

    In the immediate aftermath of the "funding secured" tweet, Tesla stock rose by six per cent. The SEC claims that Musk's actions caused "significant market disruption".

    However, when it became clear that funding was far from secured, Tesla's stock priced plunged, and continued to fall throughout most of the quarter - until the company posted an unexpected profit last week.

    The SEC investigation and fine isn't the end of the matter, though, with private investors - many of them short sellers burned by Musk's tweets - also suing the company and Musk over the August company privatisation claims.

    25 October 2018: Tesla's stock price has leapt in value by almost 20 per cent as a result of the company posting a surprise profit in its third quarter financials.

    The company's stock price rose from under $260 earlier this week, before the stock price rose on speculation that the company could post an unexpected third-quarter profit. At the time of writing, Tesla stock was trading at more than $311 per share.

    Musk aside, much of the quarter for the company was dominated by a battle to jack-up production to meet a backlog of orders for its latest car, the Model 3.

    Margin growth was caused by gradual cost improvements driven by lowering labour hours per vehicle, reduced cost of raw materials, and various other cost efficiencies
    That battle also entailed shifting production from purely rear-wheel drive models to all-wheel drive models. The company claimed that it had produced 5,300 Model 3s in the final week of the quarter.

    It also boasted that it had delivered 56,065 Model 3s to customers during the quarter, with the majority of those customers trading up from vehicles costing less than $35,000 - the target price of a future entry level Model 3.

    "We have taken a step forward by recently introducing a medium range version that has a 260-mile EPA- [Environmental Protection Agency] estimated range and a starting price of $46,000. Better than expected Model 3 cost reduction is allowing us to bring more affordable options to the market sooner," the company stated in a letter accompanying its results announcement.

    In total, the company delivered a further 27,710 Model S and Model X cars to customers, making a total of 83,775 deliveries.

    The company expects to continue to increase both production and deliveries, while the gross margin for the Model 3 is expected to remain stable
    Furthermore, with the focus on improving output, the company also successfully improved its profit margins, while warning that average revenue per vehicle is set to drop as the company introduces cheaper Model 3 variants, with the target to introduce a long-promised $35,000 model variant soon.

    "Margin growth was caused by gradual cost improvements driven by lowering labour hours per vehicle, reduced cost of raw materials, and various other cost efficiencies," the company revealed.

    Overall, the company posted automotive revenues of $6.1 billion in the third quarter of 2018, up by 158 per cent compared to the $2.36 billion it posted in the same period last year.

    As a result, the company posted a pre-tax profit of $271.3 million, and a net income of $311.5 million - well ahead of expectations.

    The quarter had been punctuated by a virtual meltdown of the company's founder and CEO, Elon Musk
    More important, perhaps, the company has also greatly improved its cashflow position.

    Its consolidated statement of cash flows indicates that the company enjoyed positive cashflow of $739.7 million during the quarter, increasing cash and cash equivalents from $2.78 billion at the beginning of the quarter to $3.52 billion by the end of the quarter.

    Furthermore, the company expects cash flow to remain around even for the rest of the year, despite plans to repay $230 million of convertible loans with cash in the fourth quarter.

    This should go a long way to alleviate investor and analyst concerns over the company's short- and medium-term future.

    In the fourth quarter, the company expects to continue to increase both production and deliveries, while the gross margin for the Model 3 is expected to remain stable "as manufacturing efficiencies and fixed cost absorption offset a slightly lower trim mix and the negative impact of tariffs from Chinese sourced components".

    Overall, the company revealed, the impact of tariffs on Chinese imports levied by President Trump would cost the company about $50 million.

    The quarter had been punctuated by a virtual meltdown of the company's founder and CEO, Elon Musk, who was accused by the SEC of using Twitter to boost the company's stock price by claiming that he planned to take the company private, "funding secured".

    He later backtracked. See below for the whole story as it (and Musk) unravelled.





    https://www.v3.co.uk/v3-uk/news/3061322/latest-tesla-news-now-fbi-to-investigate-teslas-model-3-production-forecasts
     
  19. Bas

    Bas Four Time F1 World Champ

    Mar 24, 2008
    41,300
    ESP
    Full Name:
    Bas
    Not yet Subpoenaed, Says Felon. According to him they don't have a Wells notice, either ;).

    Continues taunting the SEC. Even Enron boys weren't this arrogant. Meanwhile twitter/facebook/tesla forums are FULL of people ever more agitated with the poor quality of service, cars falling apart, shocking quality of brand new cars, not getting their deposits back months after requesting. PS Felon tweeted the other day if you don't like the car, return and get all your money back no questions asked. So far every person I've seen attempting this had their request for return denied, LOL.

    Trade wisely, folks.
     
  20. Jaguar36

    Jaguar36 Formula Junior

    Nov 8, 2010
    834
    Cherry Hill, NJ
    And yet Tesla has far and away the highest owner satisfaction ratings.
     
  21. BMW.SauberF1Team

    BMW.SauberF1Team F1 World Champ

    Dec 4, 2004
    14,244
    Why wouldn't they rate it highly? The following that company gets reminds me of Apple. No matter what they do including mess-ups their fan following won't care and still blindly follow and pay above the price of competition even with less features and other objective measurements.
     
    Bas likes this.
  22. TheMayor

    TheMayor Nine Time F1 World Champ
    Rossa Subscribed

    Feb 11, 2008
    98,534
    Vegas baby
    You cannot buy land in China. All you can do is lease it. Typically if its a factory its a very long lease - like 100 years. The China government owns all land.
     
    Jaguar36 and Bas like this.
  23. NEP

    NEP F1 Rookie

    Jul 19, 2010
    4,059
    On Earth
    Full Name:
    Nigel
    Tesla: Some Spooky Charts

    October 30, 2018

    Summary
    Jaguar i-Pace did quite well in October.

    What happens when you slash capital expenditures?

    Interest rates continue to rise.

    Just a week removed from Tesla's (TSLA) Q3 earnings report that smashed expectations, we are approaching the day of the year that really keeps dentists in business. Halloween is upon us, a chance for many to show off some really innovative costumes and for others to give a fright. With perhaps the scariest day of the year here, let's look at some charts that definitely might spook some Tesla investors.

    October was an important month for the competition, as Jaguar really started to ramp up deliveries of its Tesla competitor, the i-Pace, in Norway, one of Tesla's most important markets. As you can see in the chart below, Jaguar is now up to almost 600 cumulative deliveries. I combined this with a chart that shows how Tesla sales cumulatively compare against 2017 since the start of September for each year.

    [​IMG] (Source: Norway EV stats, seen here and here)

    In the first roughly three weeks of September, Tesla was up 375 units over 2017 for September deliveries. However, things have turned south since, and as we just about finish the second month of this tracking period, the cumulative number is now a minus 62. Yes, there's the possibility of some vehicles being sent to the Netherlands for the expiring tax credit, but you cannot ignore the i-Pace and its progress.

    By the way, with just over 200 units in October so far for Tesla in Norway, what happened to smoothing out the delivery process so that there wasn't such a reliance on the final month of the quarter? Tesla first stated this during the Q1 2018 investor letter, and in the Q2 2018 letter management said that process had been realigned and things would smooth out over the next two quarters. We didn't see that happen in Q3 by any accounts, and Q4 doesn't look off to that kind of start either if Norway is an example.



    https://seekingalpha.com/article/4216144-tesla-spooky-charts
     
    Bas likes this.
  24. Bas

    Bas Four Time F1 World Champ

    Mar 24, 2008
    41,300
    ESP
    Full Name:
    Bas
    That's because it's a cult.
     

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