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Palantir

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We were in Burlington MA mall today. Tesla was demonstrating Model X in the mall and trying to sign up people for Model 3. Model X wing doors and curved front windshield look impressive - perhaps just a bias from knowing how much pain both created. There was a pretty lively crowd around the car with kids and dads climbing into driver's seat and taking selfies. Seems the salespeople were getting some traction signing people with "our coming $35K car" spiel.

 

Jurgis, my wife and I were at the Burlington mall on Saturday as well and saw the same thing.  We took a look at it, but couldn't get right up to it because of the people around it (although we didn't try very hard either).  That's funny, I wonder if we were there at the same time.

 

 

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This is the huge wildcard that the bears keep trying to ignore.  Understandable to ignore business decisions that haven't been announced but I look at the future opportunities of Tesla like the future investments of Buffet.  You don't exactly where he is going to go but he will find new areas to invest in.

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Lithuanians are funny:

 

 

Thanks for the sentiment.

 

I guess.

 

 

 

Edit: Background info: some Lithuanians started a dream mill to attract Tesla to build Gigafactory in Lithuania. There are some official discussions within the government, though they seem a bit far from real discussion with Tesla. Minecraft buildout and this video is a consequence.

 

Tesla's twitter reaction: http://www.delfi.lt/mokslas/technologijos/tesla-pagyre-lietuvius-jie-zino-kelia-i-musu-sirdi.d?id=73653646

 

And BTW:

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Lithuanians are funny:

 

 

Thanks for the sentiment.

 

I guess.

 

 

 

Edit: Background info: some Lithuanians started a dream mill to attract Tesla to build Gigafactory in Lithuania. There are some official discussions within the government, though they seem a bit far from real discussion with Tesla. Minecraft buildout and this video is a consequence.

 

Tesla's twitter reaction: http://www.delfi.lt/mokslas/technologijos/tesla-pagyre-lietuvius-jie-zino-kelia-i-musu-sirdi.d?id=73653646

 

And BTW:

 

Can you give a quick translated gist of the Twitter dealio?

 

http://www.baltic-course.com/eng/transport/?doc=104663

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Can you give a quick translated gist of the Twitter dealio?

 

Tesla's tweet was in English. The rest of the article did not say much interesting IMO: some students saw Internet chatter about attracting Tesla to Lithuania for Gigafactory 2 and decided to build Gigafactory in Minecraft. There was a lot of support for that, lots of people are excited, they expect million youtube views, blah blah. (Million youtube views is not a bad moolah though  8) )

 

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Can you give a quick translated gist of the Twitter dealio?

 

Tesla's tweet was in English. The rest of the article did not say much interesting IMO: some students saw Internet chatter about attracting Tesla to Lithuania for Gigafactory 2 and decided to build Gigafactory in Minecraft. There was a lot of support for that, lots of people are excited, they expect million youtube views, blah blah. (Million youtube views is not a bad moolah though  8) )

 

My bad, I clicked the link in the post instead of going straight to Twitter...

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  • 1 month later...

 

Good portrait of what is happening with the Model 3, thanks.

 

I'm still really interested in the car, and being in Canada, I'm expecting to be able of ordering somewhere in 2018, when the car major's bug will have been fixed, when the Dual Drive will be available if I choose to go with it. But I am really afraid that the car will be quite expansive here considering the Canadien $...and most of the options will push the car over 50$CAN. Anywa, I will wait until I can try it and see if it is really the car I want, but in one year from now, a lot of things should be clearer.

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I wonder how many things will be pushed into options and how much the options gonna cost. Heard rumors - maybe totally unsubstantiated - about $5K-10K just for Autopilot (sw enable?).

 

Gonna have to think about taking delivery or not when it's clearer about the actual price.

 

BTW, there's likely gonna be a mess with service. People are already bitching about slow Tesla service (though perhaps mostly about the 3rd party body shops). Magnify that x500k cars and no dealerships... Gonna be interesting if they can manage that well.

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I wonder how many things will be pushed into options and how much the options gonna cost. Heard rumors - maybe totally unsubstantiated - about $5K-10K just for Autopilot (sw enable?).

 

Gonna have to think about taking delivery or not when it's clearer about the actual price.

 

BTW, there's likely gonna be a mess with service. People are already bitching about slow Tesla service (though perhaps mostly about the 3rd party body shops). Magnify that x500k cars and no dealerships... Gonna be interesting if they can manage that well.

 

At least to enable the Autopilot, you can take the decision later, probably more costly, but at least you have the option to change your mind. I'm probably gonna do that to reduce cost upfront and see how the tech evolves if I purchase a 3.

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Well Tesla's valuation now is higher than GM and Ford and just slightly under BMW. We all know they don't make money but supposedly they will make money at some point in the future though I'm still waiting for Amazon's promised earnings to roll in.

 

Now when they finally do make money is there a reason to believe that their margin per vehicle will be larger/much larger than GM, Ford, or BMW? Or is the idea that they will move more volume than GM/Ford/BMW? If neither of the two is true then it's just an overvalued stock.

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Well Tesla's valuation now is higher than GM and Ford and just slightly under BMW. We all know they don't make money but supposedly they will make money at some point in the future though I'm still waiting for Amazon's promised earnings to roll in.

 

Now when they finally do make money is there a reason to believe that their margin per vehicle will be larger/much larger than GM, Ford, or BMW? Or is the idea that they will move more volume than GM/Ford/BMW? If neither of the two is true then it's just an overvalued stock.

RB:

 

Tesla is going to sell cars over the interwebs! 

 

Imagine this...what if they teamed up with AMZN?  What if they perfect the self driving car?

 

You could order your Tesla car on Amazon, and then it drives itself to your house from the factory!

 

TSLA is soon going to be worth MOAR than GM, F & FCAU combined...

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As I've mentioned before I bought 100 shares awhile back just to support Musk and thinking I'd hold forever.  I'm still holding, but today was the first day I had to really stop myself from selling.

 

This post reminds me of a quote from the famous financial philosopher Michael Gerard Tyson:

 

"Everybody thinks they'll hold forever until they get punched in the face."

 

Thought I'd share

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As I've mentioned before I bought 100 shares awhile back just to support Musk and thinking I'd hold forever.  I'm still holding, but today was the first day I had to really stop myself from selling.

 

This post reminds me of a quote from the famous financial philosopher Michael Gerard Tyson:

 

"Everybody thinks they'll hold forever until they get punched in the face."

 

Thought I'd share

 

In this case wouldn't a more appropriate quote be:

 

"Everybody thinks they'll hold forever until the already expensive shares double in less than a year"

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Dyson said its pretax profits rose 41 percent last year to 631 million pounds, or $785 million, while revenue rose 45 percent to £2.5 billion, or $3.1 billion, partly because of the weakened British pound. Mr. Dyson, 69, who founded the company in 1992, is worth about £5 billion, or $6.2 billion.

 

https://www.nytimes.com/2017/04/02/technology/dyson-british-consumer-electronics-company.html?_r=0

 

Dyson's pretax proft margin is ~25%.  Dyson manufactures appliances, Tesla manufactures cars.  Is it so unbelievable that Tesla can't get similar margins?  To put the numbers in perspective if they can do their 500k cars the revenue would be $30-35B.  If they could get 20% profit margins that would be ~$6-7B pre-tax profits relative to a $50B market cap.  You can see why the market cap is at least plausible.

 

We start 2017 well positioned to scale our business significantly. Model S and X net order growth remains strong, as we are continually

evolving our products by elevating performance, convenience, and safety. Our Model 3 program is on track to start limited vehicle

production in July and to steadily ramp production to exceed 5,000 vehicles per week at some point in the fourth quarter and 10,000

vehicles per week at some point in 2018. To support accelerating vehicle deliveries and maintain our industry-leading customer

satisfaction, we are expanding our retail, Supercharger, and service functions.

 

http://ir.tesla.com/events.cfm, click on Q4 Update Letter.

 

It is just a question of whether Musk is being honest with his production forecast and what the margins will be if they do hit the numbers.  There is also upside with the solar roof project and the giga factory.

 

 

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So now we're using a lucky comp from another industry and saying hey, if we get as lucky as them and everything goes according to my wet dreams the valuation may be sorta warranted.

 

Btw, a big difference between Tesla and Dyson is that Dyson sells products in the $300-$500 range. Dyson's margin is made by people saying ok, I'll spend and extra $50 or $100 for a really good vacuum cleaner. It's like going for an Iphone instead of an android. Yea it's more expensive but at the same time it's affordable and the difference isn't that big. In Tesla's case that difference in margin comes down to about $10,000 per car. Now that's a noticeable chunk of change.

 

You're really talking about selling luxury cars and a lot of luxury cars at that. Implying that they're going to take some serious market share (20-30%) from the likes of Daimler and BMW while those guys are just gonna sit back and tweedle their thumbs. And they're gonna do this with an electric car in a age of low oil prices.

 

Also i don't see how you get to $35B revenue on 500k cars. That would imply $70k per car. Model 3 starts at 35K.

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