I like the new Roadster and the Semi.

I hope they really did hit 5000 units a week and not 5000* units a week.

Musk is claiming 7000 made last week - 5000 M3 (a tad late, but ok) and 2000 S/X. If that's real and not fudged, it might even be good for a squeeze. One more move up and even I'll jump on longer term early next year puts.

Musk is claiming that he "factory gated" 5000 M3s last week.

https://electrek.co/2018/07/01/tesla...ion-elon-musk/

Weasel words. What does "factory gate" mean? Who knows.

This is a pretty good guess:

yeah, talking about psychology has no place ITT.

Back to the matter at hand: Musk being a cuck and his relationship with his father

How are people playing a bankruptcy here?

Short to $0: This trade it doesn't matter so much when you get in as the % return is the same. The main issue getting in low is a snap rally or somehow getting squeezed which is hard/impossible up here at $350.

Puts: LEAPS on Jan 20 are at 1.25 for the lowest? strike of $20. This pays out a 15 bagger

What expectations do people have of the gap between reality/market continuing as bankruptcy approaches?

I'm big fan of your analysis on Tesla/Elon but 7000 combined would be impressive?! You gotta give it to Musk, he's an expert at convincing people to be slaves/dedicating their lives to Tesla/making him richer. Regarding production numbers, what point would you get worried and start to question if your wrong?

Probably a production rate of 4000-4500 on the last week with 8-9 days worth of vehicles going through the gate during 7 days.

Not that production rate really matters.

Well no, it's hilarious incompetence. Any car CEO who's failed like Musk has would be fired.

But yeah, it's a nice headline number. It gives confidence to investors/bulls - like paint huffers they only need fumes to get high, and this is more than fumes. It demoralizes some shorts. It knocks out the the more insane of the bear cases - that Tesla can't get proper production lines up and running at at least a reasonable volume (my bear case never had that as part of it).

It's all about speed and profit for me. If Tesla:

- Proved that they can raise capital (they have to be under SEC sanctions at this point)
- Hit 7000/week of M3 this year
- Had demand for these cars
- Are able to sell them all at a price ($40K+ given their costs it seems) without losses

Then I think they have a chance to survive until the crunch happens and credit dries up in the next recession ramping into Model Y.

There are really four parts:

1. Production competence
2. Does real volume demand exist at a non-loss price?
3. Can they get enough money to continue operations as they scale?
4. Can they compete with exploding superior competition from the majors in 2019?

At this point, (1) has improved slightly if these numbers are real
(2) remains to be seen. Given that their non-loss price is about $45K, we'll see.
(3) is 95% no imo. This is dire given that they are dead broke and have everything mortgaged. Mitigated for the near term if they can raise, for the long term it remains an enormous problem, hence needing blowout on (2).
(4) is 95% no imo.

Longtime lurker ITT, opened an account to take a position on this today.



Thanks to the posters ITT for sharing their thoughts/research, GL me!

I honestly expected a bigger jump now that tesla has become a real car company

Ok so according to Tesla, the makeshift "tent" line contributed 1000 of the 5000. So their sustainable build rate on the normal lines without the last minute hand made tent hail mary looks about 3000/week (i.e. a disaster).

What is the deal with the tent? Would love some opinions on this. They claim it was hundreds of millions cheaper than there other lines and put up in no time. But if such things worked/were cheaper, Tesla would have used that to begin with, as would the other car makers. So what is the downside? Extreme cost in terms of labor? Unreliability of production/high percentage of lemons? I truly don't understand.

Downside obviously is it's not permanent and inclement weather (I am thinking dust storms) could destroy millions of dollars of equipment and work in progress inventory. Factories really are just big warehouses (steel tent of you will) with equipment inside.

3000 a week at this point isn't really a disaster relative to expectations. As I pointed out many times, Tesla has been increasing production between 8 and 12% a week (not always but overall they fit a geometric curve really well) and they are pretty much still on that curve. Reasonable observers probably also expected Tesla to be nearer the lower end of that expectation as Model 3 production gets higher and harder to scale.

There is probably some shenanigans with how Tesla is recording revenues but if you look at their cash flow statement, you should see Tesla has been running barely negative operating cash flow for years. This suggests they can turn operating cash flow positive basically at any time (undoubtedly at the expense of growth rates) but it's obviously not their focus now.

Basically Tesla priority looks like this:
Break even (basically) on operating cash (Musk saying they'd die if they produced the base M3 now)
Maximize production growth
Cut costs to free up more cash for growth
Raise capital to fund more growth
.
.
.
.
Turn a profit

This has been obvious for years.

7000/week is a virtual lock for Tesla.
Demand is undoubtedly there. Reservations and "orders" where Musk extracts what amounts to unearned revenue liability show this conclusively.
Remarkable consistency in operating cash flow suggests Tesla is intentionally operating at slight loss to maximize growth. Even if they will never deliver 35k M3s at profit, they probably dont ever have to.
Yeah, they can get money. The production numbers are more than good enough so far. Consensus has been a capital raise is coming some time late this year even as Musk insisted he doesnt want to do a capital raise.
Yes, they can compete with majors. The majors think Tesla can compete and Tesla has enough brand cache to charge a premium even with inferior product for at least a few product cycles. There is nobody else in the industry that is synonymous with "fast EV"

Thanks, and that makes sense, but I don't buy the weather explanation as the main thing. Enclosed buildings aren't expensive. Apart from that, the hundreds of millions of dollars represents robots and hours spent precision engineering it all. Doing that is obviously +EV/necessary or wouldn't be used, so hand making in a makeshift line must be -EV...but how in terms of cost/reliability?
This doesn't seem right to me. Tesla pulled in $10 billion in in flowing capital, plus another 10 billion in debt, plus various subsidies. They are now drowning in near term liabilities with no net assets. This isn't "barely negative" operating cash flow that I can see. It's hugely negative.

And I disagree that they can just stop and have profitability. For one, car makers constantly need to upgrade models and lines to stay relevant. For two, by Musk's own take, Tesla needs to go the millions of cars produced to reach the scale to survive, which will take $100 billion in capital coming from somewhere.

i guess if you just rent that thing (i guess that's what they did?), place it on ground you already own, **** all safety regulations, find some government official to actually let you operate in there and pray nothing bad happens for the time you use it...
that's cheaper than building an actual building that you want to use 20years+.

to reach an arbitrary target so people keep handing you money to burn? i guess you can do that.

to build a sustainable company that will give you a nice return on your investment?

Tesla's operating cash flow over revenues is -0.5% last year, -3.7% in 2016, and about -13% in 2015.

I was pushing it with "years" but Tesla has been moving so fast 2.5 years feels like an eternity. Anyway, point remains that Tesla is aware as it gets bigger it will need to get closer to internally financing st least its operations. Musk's tweet on how base M3 would kill Tesla and Tesla's own drive toward break even OCF give it away.

A temporary structure oddly enough may actually be appropriate for Tesla since they are obviously still experimenting with how to config the production lines and producing beta (maybe release candidate level beta) products.

What do you base this on? They can barely make 3000/week on the existing lines and had to add a makeshift tent outside.

Demand is there for fictional products - a $28K Model 3 after subsidies and a $150K long range powerful truck. But BMW could have 500K preorders if they were offering $50K cars for $35K.

I don't see any evidence that demand is there for actual products in volume, at the price Tesla needs and wants to sell them at. Model S/X topped out at 100K and are in decline now. Given the huge selling prices and probable margins on well worked out lines, they would sell more if demand was there.

This seems like nonsense to me

The car market just isn't that large at $50K. $28K is another story.

This seems very weak and contrary to the evidence/logic of the situation. Reliable rumors are that Musk has been begging all around the world for investments and has been turned down.

But the strongest argument that he hasn't been able to raise (either SEC investigation or no one willing to undewrite) is that Musk has had to greatly scale back capex including production and prototyping and research capex, greatly hurting his company. The notion that he's keeping it in his pants for now is just not credible. You don't damage your company's long term prospects, try to desperately raise cash however you can, when you can just go to the capital markets like you have many times before to keep running the business optimally.

He's either under SEC investigation or no bank will underwrite him or both. I don't know which. If it's the latter, perhaps these production numbers and recent stock price surge will help. Perhaps.

Porsche has gotten there with glowing reviews for the iPace. Multiple others are coming online next years. It's gg for fast long range Evs - others have them at a much lower price and with nicer features than Tesla, and it will only get worse by the month. Cars aren't iPhones. Price matters and the top of the car matters.

Tesla is red on the day now, amazingly, -2%, $365 to $335 in two hours. CFRA, a firm with a good history of fraud spotting, downgraded them to sell an hour ago.

That, sir is a well timed short. Up 8% / $6K profit. Bravo.

Seriously perfect timing and posted it

Really nice

forgive my (near unlimited) ignorance but does having a stop at 200 limit your upside dramatically? Like if tesla hits 200 any time soon that means the bears are correct and it'll be a 0 soon after no?

Just sell. Odds you'll get cheaper than $250 even in the mega bull case > 90%. They are absurdly overpriced even if the best-possible bull case plays out.

I don't think that $200 says a lot. Tesla should hit under $200 in most bullish scenarios. It'll be a decade before they grow into their valuation (if they do), in the meantime it will correct at some point.

Show me any 3 months period in the past 3 years where Tesla failed to increase production by at least 50% in a 3 months period.

I wouldn't be shocked if such time period existed but I'd be surprised.

Did you mean to say 5%? Typo? Otherwise I don't understand your question. 1.5^12 = 130x.

edit: Unless you mean year on year by quarter and that's also massively not true (i.e. 3Q16 vs 3Q17)...and it's actually flat lined since 3Q17 as M3 stalled, so there are more quarters like that. In fact it appears to be far from true in nearly all quarters.



Bear in mind that this is coming off a base where they are producing 1-2% of what the majors are with near unlimited debt-free capital from capital raises; it's only from shocking incompetence that growth isn't >50% YoY by quarter.

No, I meant 50% in 3 months. Not 50% per month for 3 months. Their geometric growth actually is pretty much about 30-50% per month but it hasn't been consistent month to month.

7000 is a virtual lock by end of year because even with your 4k/week now, TSLA can easily get to where they need to be given historical growth rates and about 5 months to go this year.

Ok, you are completely disconnected from reality (see: graph above). Amazing.

That is an extraordinary statement you just made. My mind doesn't get blown often but you've managed it. Congratulations. I can't for the life of me fathom what must be going on in your head to make that statement.