Shorts have to be sweating a little now. Huge short position in tesla, seems to be few shares left to borrow atm. If solarcity deal, A/P death and Q2 delivery miss isn't taking the stock down much when will the stampede to cover start?

It just seems like the strong bears in this thread have a unfalsifiable position. The long bears ITT aren't even willing to go on record on here that they are long bears. So then can we assume that you think Tesla will be bankrupt (or at least worth less than it's current "overvalued status") in 2 years? 5 years? 10 years?

You could say the narrative of Tesla as a "possible" Toshiba (just to pick a big battery manufacturer out of the hat, could easily say Samsung) competitor is well established now too.

The predominant narrative was still Amazon was revolutionizing the book industry.

I've called Tesla entries both long and short in this thread.

Some predictions:

Certain to hit $150 again within two years.
Buyouts make bankruptcy predictions tricky, but I'd say 80% chance of below a valuation of $10 billion within six years.

We're about to enter a period of stagnation over the next year. Model S demand seems very much down - look at their delivery numbers, inventory build, Norway sales, and the fact that they cut prices by $10K while keeping in a more expensive battery pack. Model 3 is a long way off, is certain to miss Musk's absurd production target, and will run into problems.

Model X is a wildcard. Gigafactory/"Tesla energy" is a total flop - it's a commodity product. But I'm sure there'll be hype around the gigafactory later this month.

Then what? They keep burning cash, missing targets, doing secondaries, and are going to have to spend a fortune to tool up for Model 3/keep SCTY afloat, which is a hungrier cash furnace than Tesla.

I don't think you can draw this conclusion from the numbers. Tesla sell every car they produce and they have produced 20% more cars. That most of the cars were produced in the end of the quarter(leading to more cars in delivery) seems to indicate that demand has not died down, if that was the case I assume we would see more cars produced early in the quarter and fewer in the end of it.

You're absolutely right:



I think it's unreasonable to draw the conclusion that demand for the Model S is down by looking at that graph.
It looks like desperation to me. You are aware they cut the price by $7,000 a month ago, while keeping the same production specs, which is basically a further $7K loss per car? Any car company dropping the price 10% is going to get a flurry of new orders.

Why would a company that's "supply limited" with "plenty of demand" cut the price?

As you increase production you also need to do things to increase demand?

Isn't that the point? TS is saying they aren't supply limited.

I understand that you are sarcastic but my logic still holds? They produced more cars and each car is a sold car. Deliveries depend on transportation which can make the number lag between quarters which seems to have happened illustrated in that graph.

Unless you have improved cost of components which seems reasonable given how the price of batteries seems to be falling, economies of scale and R&D costs spread over more vehicles.

So you are saying that demand is higher?

Maybe they were demand constrained at the higher price but not at the lower? Maybe they felt that customer would be more happy at that price and the overall gain would be positive. Maybe some other reason.

It blows my mind talking with you guys.

Anyway, interesting video on the autopilot crash:



This is multiple system failure. The car simply didn't stop even after the crash and kept going for 300 yards until a power pole took it out. The software/hardware is so ****ing stupid/buggy/underdeveloped that it didn't even realize it was no longer on a road. This is why I've called you guys utter clowns when you claim Tesla are ahead of others in autonomous driving.

Imagine this had happened somewhere there were people around and it plowed through them, not applying the braking system (it's terrible at picking up pedestrians). Tesla as a company would be finished. It's pure luck that irresponsible Musk didn't cause you all to lose 50+% of your stock value overnight (not to mention the death of many people).

I think Elon's position from past earning calls was that they are in a state of being supply limited because they are producing cars and ramping production as fast as they reasonably can and have a backlog and are not yet pulling many "demand levers" that they will pull in the future as production increases to maintain the demand levels that match their maximum production ability. And i believe tesla views model s/x demand leveling off at around 100k/units a year.

so i agree that the deal is pretty absurd, and also not great from a corp gov perspective - but imo it's not quite as bad (from corp gov) as you are making it out since a majority of disinterested TSLA shareholders have to approve the deal. this article is a good summary:

http://www.nytimes.com/2016/06/23/bu...laws.html?_r=0

i guess put another way, the structures in place for shareholder protection (the corp gov aspect) are near adequate (in this situation), and rather this is a management blunder with a twist of management disloyalty added in.

all this being said: do people believe the deal is actually going to go through? based on market reaction (and common sense), it seems unlikely imo. otoh, scty hasnt retreated much off its recent post announcement highs.

It's a relevant question. Maybe we should make a prediction market of it? Can you specify the question, some dates(event happen before, betting ending etc) and some source and I might be able to make it happen

I'll play devils advocate. Actually, I believe what follows.

I think the deal will go through. I think it is smart from a vertical integration perspective. Elon is very smart. But I have not looked at the numbers, and for my purposes, could car less what they are.

Full disclosure, I have a butter fly on TSLA around 200. So I am not saying its bullish for the stock price in the next quarter or something. But I think Elon cares less about the next quarter more about the next century.

that's a cool idea. i think as far as a question for a betting market, something along the lines of: tsla and scty shareholders vote to approve acquisition before [end date] (y/n). i dont really think there need to be more conditions attached, although if you wanted to make the question inclusive of another bidder, it would be: scty is acquired before [end date] (y/n), with a similar end date. i dont really envision this turning into an auction though...

as far as the date, end of year seems reasonable. its friendly, doesnt really need antitrust review, and i cant imagine diligence taking forever with musk behind it, so it should be pushed along rather quickly i would think. TSLA had its annual meeting end of may and scty had theirs in june, so they arent gonna wait for those. catalyst for delay might be rounding up extra votes.

what did you have in mind wrt sources?


related: http://www.valuewalk.com/2016/06/tes...mands-changes/

"An investor group called on Tesla Motors Inc (NASDAQ:TSLA) on Tuesday to add two independent directors to its board. CtW Investment Group asked the automaker to separate the roles of chief executive and chairman as it underlined the dominance of Tesla CEO and founder Elon Musk in the wake of the proposed bid for SolarCity. Musk is also the largest shareholder and chairman of SolarCity."

they also asked for independent committee review on tsla's side, so maybe some corp gov shakeups delay/impede this a bit.


and also: http://www.valuewalk.com/2016/06/tes...tsla-non-gaap/

a good quick write up of a short thesis with sources that talk about cost structure and capital needs, and touch on why scty deal doesnt make sense

We'll see if this one goes through:
https://bitbet.us/propositions/

Can you expand on this? Especially the same specs part? You know you are full of ****, right? The source you provided doesn't support your same specs comment either.

Explanation to provide content and not just lies:
Model S now sells for $66k for the 60 kwh base version. Upgrade costs $9k to 75kwh version, can be done over the air. The regular 75kwh version costs $7.5k more.

"Production specs": the company are creating the exact same car as a model that's $7.5K more expensive.

In other words, you can have a Model S for $7K cheaper (with a slightly worse battery/range), yet it's built using exactly the same production specs/cost as the more expensive version. Thus the company is simply losing (yet more) money by selling it cheaper.

You don't do this unless demand is well below production rates.

No, the company sells the car with the option to upgrade because they assume people will do so. They are changing it to an as-a-service offering. I assume they'll let people upgrade when they need it and then grade back down.

Compared to the really same product from a bit more than a year ago, it's only slightly cheaper. The price is roughly in line with the decline of battery prices. I'm currently travelling and wasn't able to find the comparison. But I saw one recently that exactly aligned them next to each other.

Edit: found the link here: http://www.bloomberg.com/news/articl...r-price-points

TS, I think you contribute a lot to this thread, but I think you should scale back the rhetoric and learn to admit when you're wrong or made a mistake. It seems to me from Spurious's post that your contention that Tesla lowered the price $7k on a car with the exact same specs as before is wrong. Fifteen kwh is a significant difference in specs. Two trucks that are identical except for one having a 4.6L engine and one having a 5.7L engine do not have the same specs, and one will cost thousands more than the other.

I know you don't want to give an inch because it'll look like you "lost" to whoever challenged whatever you said, but correcting a mistake looks much better than hunkering down in some untenable position.

somigosaden,
I'll gladly admit when I'm wrong. I think you don't understand what's being said. Let me highlight my posts:
They are producing the same car for the same cost. What the end user gets for the cheaper version is less (limited by software), and they pay $7K less, but it costs exactly the same to build since it's just software limited.

The point being that this is money straight out of Tesla's pocket, and for what? If they are production limited, all they're doing by dropping the price 10% is increasing wait times while burning through more cash. This is good for precisely no one.

Musk has repeatedly said that Tesla are production limited. You do not drop the price 10% if you are production limited. They are clearly demand limited, even at the tiny level of current Model S sales, which is why they dropped the price.

The fact that people are arguing with me on this point is just incredible.

It is possible that with the new 3 that looks more like an Aston Martin, that people are deciding to cancel S orders. Musk also said he can triple production of batteries in the gigafactory due to better manufacturing techniques. He may be dropping the S price for many reasons, including demand for the X. If I was buying an S, I would try to cancel to get X or 3.

One interesting aspect of it is that in some countries the tax and insurance costs will be different between the 60kWh with 15kWh upgrade and the 75kWh.

It should also be noted that Tesla charges $8500 before delivery and $9000 after delivery for the upgrade so if they bet that >85/90 of the cars will do the upgrade it is actually +EV for them. They should also be able to sell CPO cars for slightly higher price right?!

TS is right with the facts but the idea that Tesla is demand limited despite Tesla's waiting lists/time getting longer and longer is just silly.

Demand growth is outpacing supply growth (and supply is growing at ~100%/year) at Tesla. That alone will keep the firm afloat for quite a while.

TS is not correct on the facts and he is missing a completely obvious business decision. Tesla wants to offer range as a service in the future and is starting to implement it.

Specs for specs the car is a bit cheaper but well in line with the savings on battery. The 75 kwh option is just not reduced in the same way, the customer is not getting the same savings.

The same optionality was offered before on the supercharging as well as the autopilot. They are experimenting and that's one of the flavors. I'm flabbergasted by the fact that this is seen as a price reduction and not an obvious feature. It's like saying Amazon prime was offered as a coupon book instead of an incentive to buy more than you'd normally do.