cogitator8 Posted October 11, 2018 Share Posted October 11, 2018 I don’t know where stock will go but I own a Model X and it certainly save me money and time and lots of headache dealing with sleazy car repair guys and dealership. I had some part break in due to accident ( someone hit the lining around the tire) it just cost me $67 including labor to get it fixed. Investment community do give him lot of grief but Eihnhorn never developed any products and try to change the world. Personally I don’t have vision to analyze Tesla stock but I am a big fan of the product. In fact I am getting ready to build a new house just so I can get Tesla roof and the battery, I already have the car, I can live off the grid for rest of my life. Link to comment Share on other sites More sharing options...
oddballstocks Posted October 11, 2018 Share Posted October 11, 2018 I don’t know where stock will go but I own a Model X and it certainly save me money and time and lots of headache dealing with sleazy car repair guys and dealership. I had some part break in due to accident ( someone hit the lining around the tire) it just cost me $67 including labor to get it fixed. Investment community do give him lot of grief but Eihnhorn never developed any products and try to change the world. Personally I don’t have vision to analyze Tesla stock but I am a big fan of the product. In fact I am getting ready to build a new house just so I can get Tesla roof and the battery, I already have the car, I can live off the grid for rest of my life. I've eaten at a lot of restaurants that had awesome atmospheres, great menus, and incredible food. The problem was they had a bad capital structure and I can't eat there anymore. Probably the easiest analogy I could make. Link to comment Share on other sites More sharing options...
cogitator8 Posted October 11, 2018 Share Posted October 11, 2018 Like I said, I don’t have that intellect to analyze this company, if it fails, it will be spectacular and sad, but I agree that things don’t look good at present. I was listening to Stan Druckenmiller and he went on to say that Tesla bankruptcy could be that one event which may trigger next US recession ! I still love my Model X and I hope Tesla survive. Link to comment Share on other sites More sharing options...
TwoCitiesCapital Posted October 11, 2018 Share Posted October 11, 2018 I don’t know where stock will go but I own a Model X and it certainly save me money and time and lots of headache dealing with sleazy car repair guys and dealership. I had some part break in due to accident ( someone hit the lining around the tire) it just cost me $67 including labor to get it fixed. Investment community do give him lot of grief but Eihnhorn never developed any products and try to change the world. Personally I don’t have vision to analyze Tesla stock but I am a big fan of the product. In fact I am getting ready to build a new house just so I can get Tesla roof and the battery, I already have the car, I can live off the grid for rest of my life. No one is giving Musk grief for trying to change the world. Or for trying to build excellent cars. People weren't even really giving Elon grief at all... until his erratic behavior called for it. No. The trouble a lot of investors have with this stock wasn't Elon - it was that markets were pretending Tesla's dominance over every other international car maker was a done deal even though Tesla was YEARS away from making that happen. Even though Tesla only makes a fraction of the cars and no demonstrated ability to successfully scale, or profit, from the scale of those cars. Even though Tesla's competitors were spending heavily in R&D to develop competing products. Even Elon was becoming more involved with related party transactions so each of his companies could keep other companies afloat. That was the problem that investors had with Tesla. Also, maybe just a smidge of their unsophisticated friends who bought the stock getting rich off of it and rubbing it in their faces asking "why didn't you own this, it's so obvious" ;) Link to comment Share on other sites More sharing options...
Dalal.Holdings Posted October 13, 2018 Share Posted October 13, 2018 Meh. Tesla can easily survive if they issue a few billion $ worth of shares even at current valuations (wouldn't even be much dilution). Equity market there to take those new shares (at least for now). Musk swinging for the fences. Already accomplished more than Chanos, Einhorn, etc could even dream of accomplishing in a thousand lifetimes. If you need to go on CNBC/Bloomberg/etc to advertise your short thesis, it's probably desperation. Maybe these folks can learn from Elon on how to better spend their time for the good of society. He's built a brand with >>$10B value. If the market cap falls to ~$20B, could easily see a cash hoarding tech firm (Apple, Google, the usual suspects) take this whole thing out. Seems like a lot of folks out there are short this thing. That should tell you a lot about the risk-reward setup here. Tesla failure would be tragic for American innovation/leadership in an important area of future tech: sad to see so many rooting for it. Other auto companies give lip service (ie concept cars galore) to electric cars. Musk puts them in your driveways. Sure, Porsche/Jag/etc coming out with electric cars that actually look "ok"...only now after Musk showed them how. Bet they'll be as successful as the Microsoft Zune, the Palm Pre, and the Windows Phone... (I'm not a shareholder, but I'm rooting hard for Tesla and SpaceX from the sidelines)... Link to comment Share on other sites More sharing options...
rb Posted October 13, 2018 Share Posted October 13, 2018 Meh. Tesla can easily survive if they issue a few billion $ worth of shares even at current valuations (wouldn't even be much dilution). Equity market there to take those new shares (at least for now). Musk swinging for the fences. Already accomplished more than Chanos, Einhorn, etc could even dream of accomplishing in a thousand lifetimes. If you need to go on CNBC/Bloomberg/etc to advertise your short thesis, it's probably desperation. Maybe these folks can learn from Elon on how to better spend their time for the good of society. He's built a brand with >>$10B value. If the market cap falls to ~$20B, could easily see a cash hoarding tech firm (Apple, Google, the usual suspects) take this whole thing out. Seems like a lot of folks out there are short this thing. That should tell you a lot about the risk-reward setup here. Tesla failure would be tragic for American innovation/leadership in an important area of future tech: sad to see so many rooting for it. Other auto companies give lip service (ie concept cars galore) to electric cars. Musk puts them in your driveways. Sure, Porsche/Jag/etc coming out with electric cars that actually look "ok"...only now after Musk showed them how. Bet they'll be as successful as the Microsoft Zune, the Palm Pre, and the Windows Phone... (I'm not a shareholder, but I'm rooting hard for Tesla and SpaceX from the sidelines)... Man, give me a break on the save the world, good for society crap. The guy has an ego bigger than Donald Trump. That's why we were talking about pedo stuff. Because for once there was a dominating news story that he wasn't part of so he couldn't stand it and had to insert himself in it. That's right Elon Musk, the new Messiah, saving the world one luxury car sale at a time. Pfffft! Tesla has >$10B brand value? How do you figure the stock price? Please... Coca Cola has brand value. You know why? Because they can take something that costs 10 cents to make and sell it to you for a dollar. In huge volume! That's brand value. Tesla is loosing money on every unit it ships. Not exactly the same scenario. In the end I must say that it's pretty funny and presumptions to assume that companies that have been designing, producing, and delivering cars profitably for roughly 100 years or more or less as long as the automobile existed are the zune to Tesla's iPod. Link to comment Share on other sites More sharing options...
Grant Posted October 13, 2018 Share Posted October 13, 2018 Sure, Porsche/Jag/etc coming out with electric cars that actually look "ok"...only now after Musk showed them how. Bet they'll be as successful as the Microsoft Zune, the Palm Pre, and the Windows Phone... The car business isn't the MP3 streamer or phone business. There aren't huge network effects here. It's very competitive, and not a winner-take-all market. Car manufacturers successfully copy each other all the time. Link to comment Share on other sites More sharing options...
Dalal.Holdings Posted October 13, 2018 Share Posted October 13, 2018 In the end I must say that it's pretty funny and presumptions to assume that companies that have been designing, producing, and delivering cars profitably for roughly 100 years or more or less as long as the automobile existed are the zune to Tesla's iPod. Pretty funny also that a company started from scratch can compete with the likes of major defense contractors Boeing and Lockheed Martin with tens of billions $ in R&D and a long history of advanced tech such as stealth, jet engines, etc when it comes to developing rockets, but SpaceX did just that. Those bloated defense contractors were lacking in vision and misallocating their massive amounts of capital...just look at some of their programs like the F-35: hundreds of billions of dollars over budget--total budget now over $1 Trillion--with nothing to show for it thus far. Where's all that money going?? Where's all the hundreds of billions in capex the automakers all spend every year really going? To believe that car manufacturers will succeed just because they've been doing it for 100 years...laughable. Guess you must be a loyal GE and IBM investor as well. Those two 100+ year old companies seem to be doing great in the face of disruption... And let's not forget where the 3 U.S. automakers were just 10 years ago: 2/3 bankrupt, and the other teetering...and they haven't done that great even in recent years with a booming auto market. They somehow just find new ways of shooting themselves in the foot (oh, and all they really are and have been for decades: glorified full sized pickup truck manufacturers). A brand like Tesla has pretty much come out on top of luxury brands like BMW, Audi, etc in a short span of time despite those brands having spent lots of capital on marketing over decades (Tesla spends pretty much nothing on marketing, is a lot younger as a company, and a lot more successful with Gen X/Y/Z). And there are objective measures of Tesla's superiority in engineering: just look at the NHTSA ratings for their products. If those old auto companies are so talented with 100 years of experience, how'd this scrappy upstart engineer its cars to be so much safer? Link to comment Share on other sites More sharing options...
Dalal.Holdings Posted October 13, 2018 Share Posted October 13, 2018 Sure, Porsche/Jag/etc coming out with electric cars that actually look "ok"...only now after Musk showed them how. Bet they'll be as successful as the Microsoft Zune, the Palm Pre, and the Windows Phone... The car business isn't the MP3 streamer or phone business. There aren't huge network effects here. It's very competitive, and not a winner-take-all market. Car manufacturers successfully copy each other all the time. People said that about the cell phone business too. It too used to be very competitive, fragmented, and not a winner-take-all market. There aren't really any networks effects in cell phones either. Yeah, car companies copy themselves all the time--and that's the problem with the entire industry (ie. F-150 vs Silverado vs Ram, etc etc) and why there's a good chance Tesla will be the winner-take-all. It's the truly unique challenger. No one has successfully "copied" Tesla in over 10 years now, but they seem to have been trying for a long time. I'd know: I own GM: the Cadillac ELR, the Volt, the Bolt (and it goes on...)...they just can't compete with the Tesla brand and products because their products are half-assed attempts to check the "EV" box. Link to comment Share on other sites More sharing options...
Grant Posted October 13, 2018 Share Posted October 13, 2018 People said that about the cell phone business too. It too used to be very competitive, fragmented, and not a winner-take-all market. There aren't really any networks effects in cell phones either. Modern (smart) phones have huge network effects in the form of app ecosystems. Teslas (and cars in general) do not. Operating systems have always been winner-take-all. Tesla does not have an SDK, unlike platforms like Android Auto. Just look at what's going on in China, where BEV incentives are greater. The market is getting extremely fragmented. BYD's growth has slowed enormously. BEVs have less economies of scale than ICEVs. They're easier to design, manufacture, and the software controlling their powertrains is far simpler. All other things equal, this leads to more competition. What automakers will have trouble copying from Teslas are the over-the-air updates. They raise safety and security concerns, and in many cases their dealer contracts prohibit manufacturers from directly issuing an update which affects the powertrain. Link to comment Share on other sites More sharing options...
Dalal.Holdings Posted October 13, 2018 Share Posted October 13, 2018 People said that about the cell phone business too. It too used to be very competitive, fragmented, and not a winner-take-all market. There aren't really any networks effects in cell phones either. Modern (smart) phones have huge network effects in the form of app ecosystems. Teslas (and cars in general) do not. Operating systems have always been winner-take-all. Tesla does not have an SDK, unlike platforms like Android Auto. Just look at what's going on in China, where BEV incentives are greater. The market is getting extremely fragmented. BYD's growth rates has slow enormously. BEVs have less economies of scale than ICEVs. They're easier to design, manufacture, and the software controlling their powertrains is far simpler. All other things equal, this leads to more competition. What automakers will have trouble copying from Teslas are the over-the-air updates. They raise safety and security concerns, and in many cases their dealer contracts prohibit manufacturers from directly issuing an update which affects the powertrain. The app ecosystem did not exist until Apple created it and then Android copied the model. That's how it became an effective duopoly between the two (up until then, phones were highly fragmented). Right now no such system/advantage exists among automakers because those companies aren't very good at creating moats. In fact, outside of the internal combustion engine, none of the traditional automakers is very good at innovating in general. Just look at how long it took them to get even decent software/hardware UI in their cars while companies like AAPL have been putting out products like the iPhone/iPad for over 10 years now. (In fact, you're much better off using Apple CarPlay than the automaker's proprietary UI/software). Tesla has a major software/hardware advantage and has a lot more talent in this area vs any other automaker (when looking at its UI and hardware: ie aspects such as the responsibility of its touchscreens--has been well ahead of competitors--even so-called high end luxury players). Another major advantage is self driving capability which adds to the moat and fights off commoditization. This is more than just an electric car company and lumping it in with some rando Chinese EV companies does not really work... Aside from that, there's an additional layer to the moat in that Tesla does not have to sell through dealerships. The dealership experience is terrible for buyers and Gen X/Y/Z will not tolerate it. Control over the retail experience similar to Apple gives it another major advantage. Link to comment Share on other sites More sharing options...
Grant Posted October 13, 2018 Share Posted October 13, 2018 What advantages does Tesla's UI have over Android Auto or CarPlay? Tesla has on SDK, so there is no app ecosystem. You can't develop third-party apps for it. Android Auto obviously does have an app ecosystem; meanwhile you can't even stream Pandora from a Tesla. I agree autopilot is a sales advantage, but I wouldn't call it a moat. Other manufacturers have the technology, they are just much more risk averse when it comes to deploying it (see the extensive testing and restrictions on GM's Super Cruise). Tesla does have a big innovation advantage because it can take far larger risks than shareholders of older manufacturers would allow. Aside from that, there's an additional layer to the moat in that Tesla does not have to sell through dealerships. The dealership experience is terrible for buyers and Gen X/Y/Z will not tolerate it. Control over the retail experience similar to Apple gives it another major advantage. In countries where the dealership model isn't protected by legislation, which model prevails? Direct sale with factory service centers, or franchises? In the last year, Tesla has added six service centers in the U.S. (from 69 to 75). In that time the size of their fleet has increased by 65%. Link to comment Share on other sites More sharing options...
bizaro86 Posted October 13, 2018 Share Posted October 13, 2018 Buying and servicing cars at a dealership is terrible. I hate everything about it. If they get that model changed I'll be eternally grateful to Musk no matter what happens to Tesla. A wide majority of my peers feel the same way. I think the dealership model largely ends within one generation, either replaced with some sort of transportation as a service (car2go/zip car type idea) or direct sales, or both. Link to comment Share on other sites More sharing options...
Grant Posted October 13, 2018 Share Posted October 13, 2018 Buying and servicing cars at a dealership is terrible. I hate everything about it. If they get that model changed I'll be eternally grateful to Musk no matter what happens to Tesla. I hear you, but the anecdotes we're hearing from Tesla stores and service centers aren't exactly great. The capital to build a sales and service infrastructure must be immense, and capital is not something Tesla has much of these days. I would rather look to countries where the two models have competed on fair grounds than simply assume one is better than the other. Link to comment Share on other sites More sharing options...
Spekulatius Posted October 13, 2018 Share Posted October 13, 2018 Buying and servicing cars at a dealership is terrible. I hate everything about it. If they get that model changed I'll be eternally grateful to Musk no matter what happens to Tesla. A wide majority of my peers feel the same way. I think the dealership model largely ends within one generation, either replaced with some sort of transportation as a service (car2go/zip car type idea) or direct sales, or both. I agree on the dealership experience, it’s often terrible, the various points, the car makers tried to take control back, but I think it has always failed on the massive capital required and the ability to get the reach. The issue that Tesla has, is that they either will have to spent massive amounts of capital to get the distribution, or is he will have trouble servicing their customers , as seems to be the case right now. Link to comment Share on other sites More sharing options...
Dalal.Holdings Posted October 13, 2018 Share Posted October 13, 2018 Buying and servicing cars at a dealership is terrible. I hate everything about it. If they get that model changed I'll be eternally grateful to Musk no matter what happens to Tesla. A wide majority of my peers feel the same way. I think the dealership model largely ends within one generation, either replaced with some sort of transportation as a service (car2go/zip car type idea) or direct sales, or both. I agree on the dealership experience, it’s often terrible, the various points, the car makers tried to take control back, but I think it has always failed on the massive capital required and the ability to get the reach. The issue that Tesla has, is that they either will have to spent massive amounts of capital to get the distribution, or is he will have trouble servicing their customers , as seems to be the case right now. Pure electric cars have vastly fewer moving parts than internal combustion engine (ICE) based cars and hence much fewer potential points of failure. Tesla will likely require much fewer "service centers" than to support typical fleet of ICE vehicles. The servicing is also where ICE dealers make the most money, hence those same dealerships are less likely to want to sell electric cars to buyers and instead attempt to steer them away from such purchases (this has been observed with the Chevy Bolt/Volt). Distribution should not be an issue at all. Amazon shows how distributing products to individuals can work well (and cheaply) without much of a brick and mortar presence. The reason car companies "taking control back from dealers" has failed has nothing to do with distribution. It has everything to do with antiquated state laws that protect dealers and their lobbyists and connections to local gov't. The same dealers who continue to try to prevent Tesla from selling directly to consumer in many many states. If a company like GM even thought about switching away from dealers, its existing dealership body would revolt and create all sorts of headaches for the firm--that's why they can't even dream of bypassing dealers. So dealers have significant control over old auto companies very similar to the unions: if they feel threatened, they can hurt the company tremendously in the short run. Tesla has no such constraints. Link to comment Share on other sites More sharing options...
Grant Posted October 13, 2018 Share Posted October 13, 2018 Yes everyone knows BEVs are far simpler and potentially much more reliable than ICEVs. However the BEV manufacturer in this case is Tesla, who's cars typically come in at the bottom of reliability studies. Toyota hybrid powertrains are vastly more complex and reliable than Tesla BEV powertrains. I suppose the franchise vs. factory store debate is moot unless Tesla gets its hands on the capital to adequately support their cars. However I'd still like to see data from countries where each model competes on equal terms. If factory stores are so superior the results should be clear. Link to comment Share on other sites More sharing options...
Dalal.Holdings Posted October 14, 2018 Share Posted October 14, 2018 However the BEV manufacturer in this case is Tesla, who's cars typically come in at the bottom of reliability studies. [citation needed] Surely hope you're not referencing this study (a survey of a whopping 28 Tesla owners): https://www.motoringresearch.com/car-news/tesla-reliability-survey-meaningless/ Everyone seems to "know" that Tesla's cars seem to have a lot of problems based on what they read on the internets. But perhaps those people who fixate on Tesla's problems are merely succumbing to the Availability Heuristic. After all, the company we're discussing in this case is Tesla, where just about every single accident or problem involving their vehicles is pushed into the top of news headlines/Twitter feeds because discussing the company generates clicks/retweets so effectively. Link to comment Share on other sites More sharing options...
Grant Posted October 14, 2018 Share Posted October 14, 2018 This is an investment site. I would hope no one here is swayed much by anecdotes. https://www.truedelta.com/Tesla/brand-reliability-Tesla JD Powers doesn't have good things to say about Tesla reliability either, though I don't have access to their report on it: https://www.forbes.com/sites/jimgorzelany/2017/03/23/quality-issues-are-fake-news-to-tesla-owners/#296d48d677c0 Link to comment Share on other sites More sharing options...
fareastwarriors Posted October 14, 2018 Share Posted October 14, 2018 I'll share my anecdote. My bro owns a Tesla 3. We live together. While it's his car, I drive it more than him since he drives a work truck Mon-Sat. I've driven nearly 1000 mile and I loved every moment of it. My bro loves it even more than me. Only 4 months of ownership and no issues thus far. I can't tell you more about the company or stock. We also can't tell you about the tech/engineering/etc of the car. We are just average people and we love the product. Carry on the pro/con discussion on the stock! Link to comment Share on other sites More sharing options...
Investmentacct Posted October 14, 2018 Share Posted October 14, 2018 Agree. We own two Model X and 3. Complete fun to drive. Between two cars we have driven 33K miles. No issue to be reported. People who have Tesla; Tend to drive more as it is effectively free to drive. If you live in Cali, essentially driving on sun’s free energy is reality. And, Tesla’s vast Supercharger network makes road trips frequent. Let’s not discuss, v9 software updates ( no other car offer OTA updates). Best people arguing about product can do is to take a test ride themselves. Otherwise; It’s been true since old days : “Ships will sail around the world; flat earth society will flourish.” I'll share my anecdote. My bro owns a Tesla 3. We live together. While it's his car, I drive it more than him since he drives a work truck Mon-Sat. I've driven nearly 1000 mile and I loved every moment of it. My bro loves it even more than me. Only 4 months of ownership and no issues thus far. I can't tell you more about the company or stock. We also can't tell you about the tech/engineering/etc of the car. We are just average people and we love the product. Carry on the pro/con discussion on the stock! Link to comment Share on other sites More sharing options...
ERICOPOLY Posted October 14, 2018 Share Posted October 14, 2018 Statistics show above average number of items that need to be fixed. Overlooked is whether the owners are overall very impressed with the car despite the issues. Given the massive amounts of Teslas on the road in the Bay Area, one would think the "secret" would be out by now. Surely the place must be crawling with upset owners, right? I don't think so. Link to comment Share on other sites More sharing options...
ERICOPOLY Posted October 14, 2018 Share Posted October 14, 2018 Regarding the dealership model, Porsche has announced that the electric Taycan will be sold through dealerships. However, Audi has announced that it's E-Tron SUV will not be sold through dealerships.. https://electrek.co/2018/09/24/audi-electric-e-tron-suv-dealerships-inventory/ Is Porsche making a mistake? Why will it's dealers push the electric Taycan when the recurring servicing business is in the gas-powered vehicles to be pushed off the lot instead? I've heard that GM dealers have not been pushing the Bolt for this reason (lack of recurring servicing revenue), but I don't know if that is true. Link to comment Share on other sites More sharing options...
fareastwarriors Posted October 14, 2018 Share Posted October 14, 2018 I'm in the San Francisco Bay Area. Increasingly it feels like a Tesla is as common as a Honda or Toyota. We got too much money out there. ;) Link to comment Share on other sites More sharing options...
Grant Posted October 14, 2018 Share Posted October 14, 2018 Yes, the question isn't so much how Tesla quality affects demand as much as their service infrastructure. They don't sell parts or even service manuals to third-party shops, and as I pointed out earlier they haven't expanded their service centers much. Given the Model 3 is a mass-market car, there is a chance owners won't put up with quality issues. However I don't think that's a safe assumption in any short thesis. Link to comment Share on other sites More sharing options...
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