Or, you know, Musk's exponent is far too high, as it always has been for everything he's ever promised. Besides, it's not an exponential fit. Linear might even be a better line of fit in matching the final result, given the huge delays that Musk has. I'd like to see you plot Model S or X on an exponential from first promises to delivery.
You say this an out when Musk fails spectacularly time and time again, yet you never seem to incorporate it into your models, as in "ok, so Musk is committing stock fraud like usual to push workers and suppliers; I have to add at least a month to my projections, therefore there's no possible way they delivery 400K cars in 2018".

Curiously, all the bull models take Musk's claim as given and even beyond.

As I have said before, I have not posted my models. But yeah, I do take that into account.

But it should also be noted that 10k cars/week 2018 was originally for 2020. His goal was pushed forward, if he fails and "only" achieves this by said 2019 you will probably say that he failed spectacularly. As a shareholder I would still be very happy if it happened in 2019.

It is always like this. Tesla delivers 2k cars, say he will deliver 20k cars next year, bears say he wont do that. He delivers 18k cars, bears says he always lies. He says he will deliver 50k cars next year, bears says he wont do that. He delivers 40k cars, bears says he always lies. He says he will deliver 100k cars next year, he delivers 90k, bears says he always lies. He says he will deliver 250k cars per year this year, he delivers 250k cars per year a few months later, bears says he always lies.

I see a process of growth, that is what I care about. At some point those thousands of cars should have ended the fraud argument, I wonder when if it ever will? At 1M cars? 10M? 100M? When does he stop being a fraud?

I can't speak for all the models, and I doubt that you can, but mine doesn't.

1. When his production and profit outcomes fall either side of his projections, as honest projections would, and not entirely on "pump up the stock price" side. All his projection ultimately end up up month or years, and billions of dollars, behind. He always falls on the wrong side of every projection. That isn't possible unless you're stupid or fraudulent, and Musk isn't stupid. He has a legal and moral obligation to give honest projections.

2. When he stops making promises to consumers that are impossible to meet (AP1 equivalent by December 2016), that he knows are impossible to meet, yet he promises them anyway, engaging in direct and blatant and deliberate fraud.

3. When his companies ceases engaging in fraud and dishonest practices to get government money. The battery swap, for example, was needed to get major government credits, but he never had any intention of ever making it available for the end user. SolarCity was sued for claims fraud by the government and settled, showing a pattern of this behavior. The SolarCity deal was bailing out a failing company, for his own enrichment and those of his friends, rather than for shareholder benefit.

4. When he brings meaningful external oversight to his public companies, rather than cronies, family, and people he controls.

5. When he uses industry-standard accounting for things like gross margin and COGs, rather than the one that extremely dishonestly makes Tesla look like it has a competitive edge on costs/margin.

6. When he honestly discloses negative information and events to both consumers and stock holders, rather than spinning, hedging, going silent, lying, hiding, and obfuscating.

It's not much to ask. In fact, it's both legally and morally required of a company director. When he does the above, he stops being a fraud. Easy question, easy answer. These would be obvious to you also if you weren't caught in a cult-love for Musk.

This is what Elon specifically told investors about the model 3 ramp two months ago:

Elon Reeve Musk - Tesla, Inc.

What we have ahead of us, of course, is an incredibly difficult production ramp. Nonetheless, I think we've got a great team, and I'm very confident that we will be able to reach a production rate of 10,000 vehicles per week towards the end of next year. And we remain – we believe on track to achieve a 5,000 unit week by the end of this year.

So, I would simply urge people to not get too caught up in what exactly falls within the exact calendar boundaries of a quarter, one quarter or the next, because when you have an exponentially growing production ramp, slight changes of a few weeks here or there can appear to have dramatic changes, but that is simply because of the arbitrary nature of when a quarter ends.

But what people should absolutely have zero concern about is that Tesla will achieve a 10,000 unit production week by the end of next year.

So, if you can sort of see where we came from, the Roadster – we were making only 600 units a week where the non-powertrain portion of the car was made by Lotus. And we did the powertrain and final assembly of the car, and then we went from that to 20,000 units a year of the Model S, a far more complex car, where we did the whole thing. And then with Model 3, we are more vertically integrated. I think people should really not have any concerns that we will reach that outcome from a production rate.
...
It should also be noted that one of our big concerns was that Model S, particularly, and Model X demand would suffer with the introduction of the Model 3. In fact, this has turned out to be the opposite situation. Model S and Model X demand increased with the release of Model 3.
...
Certainly. I mean, I do want to emphasize like but a lot of us is actually very hard for us to know. When we make mistakes is because we're stupid, not because we're trying to mislead anyone. I just want to emphasize – I – we aspire to be less dumb over time. So if I knew it, I would tell you. It's sort of like I've got this, like secret hand of cards that I'm holding close to my vest and I'm not telling you. It's just fundamentally impossible to predict the exponential part of the manufacturing S-curve. It's crazy hard. And S-curve is a simplification because it's really running through a series of constraints that, if you – it's like a really jagged sort of upward growth and it'll plateau and then it'll grow rapidly, and it'll plateau again. And then sometimes it'll go backwards because something broke.

Here is a list of his Tesla promises and status. I highlighted two that fell on the right side of projections.
Here are some upcoming statements if you wanna keep track:

I have no idea how tesla rips on this news. In not an everyday trader but I follow this stock, seems like such terrible news given public information, skipping beta testing, production issues, etc

So here is another take on the news:

Record deliveries, S+X demand not being cannibalized by TM3, Chinese demand looking strong, no fundamental issues with TM3 production, confident they can fix bottlenecks:
And a picture of the semi.

Tesla has been getting slaughtered in a market ripping through all time highs over the past couple of weeks. Ever since the SCTY fraud news came through, then continued total silence on the Model 3 from Musk, who's normally throwing out good news like a clown with toys at a birthday birthday.

Tesla (and other high betas) generally rip hard off lows at open in an upticking market. The algos are truly in charge at open these days. I've actually changed my trading style to accommodate this over the past year. Even when the news is truly terrible, it will rip off lows if the market is upticking; rather than taking a put position at open, if the news is truly bad that a selloff is inevitable, I wait 5-10 minutes for it to rip above breakeven now. And I don't take shorts in upticking markets unless the news is very bad.

M3 news is bad of course. But market all time highs + not-terrible Model S/X sales + the absurd upgrade above + weeks of selling is enough to bump it a little. I didn't take any of this one short, the news wasn't' bad enough, the market was too strong, there was a nutty upgrade, and it had sold down a lot already.

Good post, makes sense, I didn't pick up any short positions on this news or even right before it, just seems like the entire bull case rests on TM3 and it's pretty clear there are issues. I did probably discount how much that had already been digested over the last month

lol solarcity fraud news. I guess he is referring to the no fault $30 million settlement that amounted to arguing with the government over a few percentage points in estimated project valuations on well over a billion dollars worth of projects spread out over a number of years.

huge lol at the notion that there wouldn't be people chomping at the bit to go halfway across the world in 30 minutes for $5k. what are you smoking spurious?

Maybe you want to make an actual argument. There are people who will be willing to pay that. There are not that many at the same time, that is my argument. It will be an absolute niche. What is so difficult to understand that the entire infrastructure makes no sense if 120 people use it a day?

Take NYC - London. There's over 30 flights per day. It only takes 20 first/biz class passengers per flight to get to 600/day. Assuming the rocket doesn't fly every day and throw in some novelty passengers and you can easily fill 600 seats.

I kinda agree with tooth that this whole thing is a joke but it's not because the demand wouldn't be there.

The Concorde - far simpler and safer technology than a rocket that can use existing airports/infrastructure and not terribly slower when you include nuisance time at each end - went out of business charging $5000/ticket. They blamed maintenance costs and low passenger numbers. This in an era as air travel exploded and high end wealth increased.

Perhaps there's a case to be made for longer than Concorde flights - halfway around the world, like Australia to Europe, or NY to China - but I think it's a very very thin market. East coast to Europe on a rocket seems like fantasy to me, if the Concorde couldn't cut it.

I think a lot of people don't understand economies of scale and what they mean and how very hard it is to compete with them when you're up against a trillion+ in deployed, time tested, bugs-worked-out capital.

This exactly.

Spurious, just curious, how many people do you think fly trans-Atlantic/Pacific a day/year?

grizy,
Why did commercial supersonic flights die out, in an era of exploding flight travel and wealth? They cut the time from 8 hours to 3.5, which is almost as much time saved as a rocket.

What make you think the nuisance time on each end would be so much worse than an airport? Or are you mostly referring to the nuisance time as a % of total travel time relative to a normal flight?

All this talk about first-class passengers willing to pay for rocket flights. A non-small portion of these seats are filled by upgraded frequent flyers. Unless we can use our United miles we aren't getting on board.

Most important factors are:
Supersonic booms limiting number of routes
Safety and environmental concerns
Oil shock

I think it's fair to say Concorde failed due to a combination of bad luck (timing of the introduction, unexpected issues inherent with supersonic flight, a competitor's model going up in flames) and immature technology (Concorde had serious maintenance issues... Russian counterpart crashing before product launch didn't help, neither did a Concorde going up in flames on camera in 2000).

I'm assuming it'll be the same as an airport.

Concorde flight:

0.5 hours for the get ready/trip to the airport
1.5 hours early for check in/customs/plane loading
3.5 hours for the flight
1 hour for unloading, international customs, arrive at destination

End to end = 6.5 hours

Rocket flight:

0.5 hours for the get ready/trip to the airport
1.5 hours early for check in/customs/plane loading
0.5 hours for the flight (optimistic)
1 hour for unloading, international customs, arrive at destination

End to end = 3.5 hours

Claimed flight time drop - 10x (30 minutes vs 5 hours)
Actual flight time drop 2x (3.5 hours vs 6.5 hours)

It's just not an attractive value proposition, especially given the very high risk of death (rockets are hard for a reason - they operate at parameters that make planes look like toys, and tend to go splodey as a result).

Don't forget, at the beginning at least, Rocket/Spaceports will more likely be farther away from city centers, adding additional time.

Approvals will also be extremely problematic. We're basically flying ICBMs over major cities, which is a lot more threatening than the sonic/boom noise pollution of the Concorde, which was a major reason for the Concorde's failure.

All of this is precisely what tends to happen with niche products. Complex stuff has bugs that takes hundreds of thousands of trials - scale and decades - to work out properly. Maintenance costs a ****load more. When something goes wrong that involves a fireball and barbecue humans, people avoid the niche product.

And the idea that there is high demand but they couldn't fill seats in a growing industry, running the most profitable, desirable routes is not believable. They're essentially offering a rocket-level speed advantage over regular flight NY to Paris, say. And they couldn't fill seats.

"Take NYC - London"
That's the most flown route in the world I think. Of course you will have demand for 1-2 flights per day at $5k. NYC, Singapore, London, HK, Shanghai, Beijing, LA, SF, potentially Frankfurt and Sydney. Even if you have 2 services each day for each leg, that's 360 flights if I didn't mess up the calculations. Do you think the technology will survive when you need to build the infrastructure at 10 different places to only support a few flights from each per day.

No idea to be honest, doesn't matter. Do you know how many routes are covered in this? My entire point is that you cannot convert it and then say people will pay 2.5x as much for the flight. The Concorde argument is spot on.

How many g's do these rocket planes pull? Its going to have to accelerate super gently if we're just letting regular slobs fly on it.