TSLA - Tesla Motors

[CassiusKing1]

https://jalopnik.com/conan-obrien-reveals-teslas-newest-product-to-save-itse-1825781666

[Spekulatius]

I had a thought about production efficiency, and am curious if I'm off the rails -- comparing 10-Qs, Tesla's inventory $/cars sold compares quite badly to other car makers. I know the energy business skews this a little, but it looks like Tesla's at $51k in inventory per car shipped, where Ford is ~2.5x better there (~$12b in inventory, ~650k vehicles sold/quarter), and GM is 10x+ better (~$11b in inventories on ~2.5m sold/quarter).

 

Tesla needs to find someone else to manage his assembly line and pain shop. Car assembly lines and pain shops  has been designed and run before and this isn’t rocket science  ::)

[Investmentacct]

Would a few Longs tell me their long thesis on TSLA? 

Thanks.

 

Will sound ridiculous or who's smokin' argument; but see. If you drive Tesla car for 500 to 1000 miles; and then switch to any other car; will make you come back in time travel from year 2025 to back to today.  That's literal feeling after driving Tesla Model 3 for past 3 months.  Same thesis about product review, run through social media from people who are owning this car for sometime and who are in queue for delivery. Once, Tesla Model 3 does 5K a week, and crosses 20K a month, it will start matching volume of Honda Accord. And, at that point, should match margin of BMW. If, in a year, they get to 10K a week, that will make them do 40K a month. And that's none of existing car has done with in US at this point.  Tesla model 3 is already charting upward in per month sales of about 10K a month currently. In small/midsize luxury car sales , it has already crossed Mercedes C class sales, BMW 2,3,4 series sales , Audi A4 sales a month in USA.

[DTEJD1997]

Hey all:

 

If TSLA is not making money now, when are they going to?  Ford & GM are trading in mid single digit P/E's...TSLA has a market cap higher than Ford, but TSLA is not making money, they are losing money BIGLY and nobody has any idea when they are going to START making money?  Has the market lost it's MIND?

 

They will make money when production of the model 3 ramps up?  I've read MANY credible reports that TSLA can NEVER make money on the model 3....If you product has a NEGATIVE MARGIN...you just can't make money by jacking up sales volume!

 

They are going to have to spend BILLIONS in more capital expenditures for the model 3.

 

Then they want a semi & SUV?  probably have to build another factory & spend BILLIONS more on top of that.

 

Then they are going to start selling candy?

 

If I were an investor, I would be panicking.

 

I find it hard to see how TSLA does not become a "0" eventually.

[Investmentacct]

Hey all:

 

If TSLA is not making money now, when are they going to?  Ford & GM are trading in mid single digit P/E's...TSLA has a market cap higher than Ford, but TSLA is not making money, they are losing money BIGLY and nobody has any idea when they are going to START making money?  Has the market lost it's MIND?

 

They will make money when production of the model 3 ramps up?  I've read MANY credible reports that TSLA can NEVER make money on the model 3....If you product has a NEGATIVE MARGIN...you just can't make money by jacking up sales volume!

 

They are going to have to spend BILLIONS in more capital expenditures for the model 3.

 

Then they want a semi & SUV?  probably have to build another factory & spend BILLIONS more on top of that.

 

Then they are going to start selling candy?

 

If I were an investor, I would be panicking.

 

I find it hard to see how TSLA does not become a "0" eventually.

 

you just can't make money by jacking up sales volume!

 

>> Sure, unless, you are making sale of a software as part of every car, with no additional cost of capital.

[DTEJD1997]

Hey all:

 

If TSLA is not making money now, when are they going to?  Ford & GM are trading in mid single digit P/E's...TSLA has a market cap higher than Ford, but TSLA is not making money, they are losing money BIGLY and nobody has any idea when they are going to START making money?  Has the market lost it's MIND?

 

They will make money when production of the model 3 ramps up?  I've read MANY credible reports that TSLA can NEVER make money on the model 3....If you product has a NEGATIVE MARGIN...you just can't make money by jacking up sales volume!

 

They are going to have to spend BILLIONS in more capital expenditures for the model 3.

 

Then they want a semi & SUV?  probably have to build another factory & spend BILLIONS more on top of that.

 

Then they are going to start selling candy?

 

If I were an investor, I would be panicking.

 

I find it hard to see how TSLA does not become a "0" eventually.

 

you just can't make money by jacking up sales volume!

 

>> Sure, unless, you are making sale of a software as part of every car, with no additional cost of capital.

 

If they are selling a model 3 for $45k and it costs $52k in direct material costs....they could sell a TRILLION and would never make a penny in profit.

 

Sure, selling software is typically a high margin business...but TSLA is not even close to making money currently...and there is analysis showing that they might have broken business model in that they simply don't have the margins on the model 3.

 

Certainly TSLA makes some interesting products.  They also tend to have good customer perception.  They also seem to be leading and not following when it comes to electric propulsion.  Those are the good points.

 

The bad is that they aren't making money, they don't appear to be making anything in the near future.  They are losing money at a breathtaking rate.  They have production problems.  They are starting to have quality issues.  The CEO is under tremendous stress and is distracted (candy?).  They have capital expenditure issues.  They have supplier problems.  They have executive problems.  They have labor problems.  Management & R&D is probably spread too thin (batteries, solar panels, Semis, SUV, candy).

 

I could see that TSLA is a speculative play and might trade for $20/share or something, not $300/share.

 

Time will tell, but I still think that unless things change QUICKLY, TSLA is eventually a ZERO.

[Voodooking]

https://electrek.co/2018/05/07/elon-musk-buys-tesla-tsla-stock-short-squeeze/

[LongHaul]

Hey all:

 

If TSLA is not making money now, when are they going to?  Ford & GM are trading in mid single digit P/E's...TSLA has a market cap higher than Ford, but TSLA is not making money, they are losing money BIGLY and nobody has any idea when they are going to START making money?  Has the market lost it's MIND?

 

They will make money when production of the model 3 ramps up?  I've read MANY credible reports that TSLA can NEVER make money on the model 3....If you product has a NEGATIVE MARGIN...you just can't make money by jacking up sales volume!

 

They are going to have to spend BILLIONS in more capital expenditures for the model 3.

 

Then they want a semi & SUV?  probably have to build another factory & spend BILLIONS more on top of that.

 

Then they are going to start selling candy?

 

If I were an investor, I would be panicking.

 

I find it hard to see how TSLA does not become a "0" eventually.

 

I largely agree with you.  $50 billion market cap. 

Tesla has a good brand at this point but I don't get the long thesis.  Feel free to enlighten me if you are long.

 

Seems like they have a number of serious competitive disadvantages.

No economies of scale in:

Purchasing (perhaps the battery is an exception), engineering, manufacturing

Selling and Distribution, etc. 

What is proprietary that others cannot copy besides the brand?

 

Tesla's FCF was -$4b last year so I guess Tesla is trading at a -12.5x P/E

 

You have to make some big assumptions to even get close to $50b market cap.

If they do $20b in sales and $1b in Net Income it is still 50x.

 

Then if people do get worried about Bankruptcy, customers are going to get scared and not buy, put down deposits (unsecured loans with 0% interest), suppliers panic, and then it is over. 

 

I think there is a 70%+ chance of Bankruptcy over time and I think people have lost their minds with Tesla.

It is super high risk gambling for people that have gone mad for electric cars and have crushes on Elon Musk.  Perhaps a Green Ideology also.   

I prefer humility and rationality to genius. 

 

Let the vegetables fly!

 

 

 

 

 

[DTEJD1997]

Hey all:

 

If TSLA is not making money now, when are they going to?  Ford & GM are trading in mid single digit P/E's...TSLA has a market cap higher than Ford, but TSLA is not making money, they are losing money BIGLY and nobody has any idea when they are going to START making money?  Has the market lost it's MIND?

 

They will make money when production of the model 3 ramps up?  I've read MANY credible reports that TSLA can NEVER make money on the model 3....If you product has a NEGATIVE MARGIN...you just can't make money by jacking up sales volume!

 

They are going to have to spend BILLIONS in more capital expenditures for the model 3.

 

Then they want a semi & SUV?  probably have to build another factory & spend BILLIONS more on top of that.

 

Then they are going to start selling candy?

 

If I were an investor, I would be panicking.

 

I find it hard to see how TSLA does not become a "0" eventually.

 

I largely agree with you.  $50 billion market cap. 

Tesla has a good brand at this point but I don't get the long thesis.  Feel free to enlighten me if you are long.

 

Seems like they have a number of serious competitive disadvantages.

No economies of scale in:

Purchasing (perhaps the battery is an exception), engineering, manufacturing

Selling and Distribution, etc. 

What is proprietary that others cannot copy besides the brand?

 

Tesla's FCF was -$4b last year so I guess Tesla is trading at a -12.5x P/E

 

You have to make some big assumptions to even get close to $50b market cap.

If they do $20b in sales and $1b in Net Income it is still 50x.

 

Then if people do get worried about Bankruptcy, customers are going to get scared and not buy, put down deposits (unsecured loans with 0% interest), suppliers panic, and then it is over. 

 

I think there is a 70%+ chance of Bankruptcy over time and I think people have lost their minds with Tesla.

It is super high risk gambling for people that have gone mad for electric cars and have crushes on Elon Musk.  Perhaps a Green Ideology also.   

I prefer humility and rationality to genius. 

 

Let the vegetables fly!

 

One very serious point that I forgot to mention, is the problem with Mr. Musk. 

 

Specifically, he has made projections TIME AND AGAIN that have not come to fruition.  Specifically about the model 3 and it's availability.  He has also made claims about profitability and the need for more capital.

 

He was wrong in the past, and he is likely to be wrong in the future.  I am saying he has little credibility when it comes to this.  It is not like he says "WE ARE GOING TO MAKE $100MM" and the company winds up making $75MM.  They are not making money, do not appear to be making money any time soon...AND ARE BURNING $$$$ at a furious pace.

 

If I were the BOD, I would tell Elon to keep his mouth shut.

[Voodooking]

So many people bring up the point that Tesla do not have any technology that other car companies could not just replicate and create a similar vehicle...

 

I think this is a valid concern, but it really perplexes me why none of the other car companies have done this.

 

As others say, I don't imagine it would be particularly difficult for BMW, Mercedes, VAG etc. to reverse-engineer and create a similar Model S, X, or 3 alternative, but I am absolutely astounded that none of them have done this.

 

Elon is an incredibly clever guy, and he puts forward a compelling argument that all land/ground based transport will eventually become electrically propelled. I believe this is so. His reasoning and explanation is such that when you are able to grasp it, it is then simply a foregone conclusion. I am not particularly intelligent, and I can see that all ICE vehicle sales will eventually cease.

 

Of the hundreds of thousands of people employed by the other major car manufacturers, I refuse to believe that no one else has twigged this in the same way that Elon and I have...

 

My question is, why haven't BMW just turned round and said "The next 3 Series will be completely electric. It will do 300 miles, the same as your ICE car, it will charge up overnight like your phone, you will never need to worry about petrol or diesel again. The End." ???

 

I think that the Germans could easily design and build such a car, even if they just copied Tesla (or BYD). I think there are deeper, more complicated reasons that they are collectively burying their heads in the sand. My guess is the following:

 

a). They know that they sell loads and loads of petrol and diesel cars every year, as they have done for decades before, and choose not to acknowledge that things will change in the future. They don't want to kill their 'cash cow' product lines with an uncertain new direction / strategy.

 

b). They realise that people have valid concerns about where and how to charge their new electric cars, and realise they don't have a solution, therefore choose to ignore the future. Tesla owners don't need to worry about this, because of the Tesla Supercharger network, home charging solutions, and loads of dedicated destination chargers. Other brands don't have a network.

 

 

Now, people can argue that Mercedes could bring out an electric C-Class tomorrow, or BMW could bring out an electric 3 Series next week... but these companies DON'T! If I was in charge of either of these ranges, my sole focus in life would be to electrify them. Build the next model from the ground up, yesterday. Tesla already has these competitor cars, and is about to start eating everyone else's lunch! Instead, they fart about with weird "Concept Electric Vision Cars" and other futuristic, strange looking rubbish. People just want a normal looking, normal to use car, that happens to be electric. That is what Tesla is building.

 

I don't think the incumbents will all die and be forgotten, but they are seriously underestimating Tesla's first-mover advantage and by burying their heads in the sand, similar to Kodak when the digital camera was invented, or newspapers when iPads and the internet were invented, they are seriously underestimating the risk that they will not be around in a few years.

[tng]

I don't think the incumbents will all die and be forgotten, but they are seriously underestimating Tesla's first-mover advantage and by burying their heads in the sand, similar to Kodak when the digital camera was invented, or newspapers when iPads and the internet were invented, they are seriously underestimating the risk that they will not be around in a few years.

 

The thing about Kodak and newspapers is that they just died. They were not replaced by other money making businesses. Kodak film was a great business, but memory cards are basically a zero margin business. Newspapers that died are replaced by ordinary people posting on social media who do it for fun and don't receive money for doing it. Basically, all the value from those innovations went to the consumers and society, not to capitalists.

 

The other automakers can easily imitate Tesla and sell cars at a loss, but that would probably speed up their demise. In the long run, I think electric vehicles are inherently more simple (and therefore easier to imitate) than cars running on gasoline. The engines have so many more moving parts that are difficult to manufacture precisely and in large scale, whereas some people have jokingly called EVs as wheels attached to a battery. It's like a mechanical watch vs a digital watch - once people got good at making electronics, making a digital watch is a joke, but it's still difficult to make a good mechanical watch. As a consumer, I absolutely love what Tesla is doing. But I would be sweating if I were a shareholder in the auto industry. We might reach a point where there are a small handful of automakers, they are all made at the lowest cost facilities (i.e. made in China), and they are sold at close to zero margin.

 

If Elon Musk succeeds, cars would be cheap, high tech, and safer. The environment will be cleaner. But I am not sure if that means that the profits in the auto industry (or to Tesla) will go up. Tech often has a way of just moving all the value to the consumers instead of the investors.

[rkbabang]

I don't think the incumbents will all die and be forgotten, but they are seriously underestimating Tesla's first-mover advantage and by burying their heads in the sand, similar to Kodak when the digital camera was invented, or newspapers when iPads and the internet were invented, they are seriously underestimating the risk that they will not be around in a few years.

 

The thing about Kodak and newspapers is that they just died. They were not replaced by other money making businesses. Kodak film was a great business, but memory cards are basically a zero margin business. Newspapers that died are replaced by ordinary people posting on social media who do it for fun and don't receive money for doing it. Basically, all the value from those innovations went to the consumers and society, not to capitalists.

 

The other automakers can easily imitate Tesla and sell cars at a loss, but that would probably speed up their demise. In the long run, I think electric vehicles are inherently more simple (and therefore easier to imitate) than cars running on gasoline. The engines have so many more moving parts that are difficult to manufacture precisely and in large scale, whereas some people have jokingly called EVs as wheels attached to a battery. It's like a mechanical watch vs a digital watch - once people got good at making electronics, making a digital watch is a joke, but it's still difficult to make a good mechanical watch. As a consumer, I absolutely love what Tesla is doing. But I would be sweating if I were a shareholder in the auto industry. We might reach a point where there are a small handful of automakers, they are all made at the lowest cost facilities (i.e. made in China), and they are sold at close to zero margin.

 

If Elon Musk succeeds, cars would be cheap, high tech, and safer. The environment will be cleaner. But I am not sure if that means that the profits in the auto industry (or to Tesla) will go up. Tech often has a way of just moving all the value to the consumers instead of the investors.

 

You could make the argument that all of the film/camera/video camera, newspaper, telephone, portable music players, etc, profits are now all going to Apple.  Transportation profits will go somewhere. It could be Tesla, but it might be something like a future autonomous Uber network running flying drones rather than Tesla.  I don't know.

 

[KJP]

I don't think the incumbents will all die and be forgotten, but they are seriously underestimating Tesla's first-mover advantage and by burying their heads in the sand, similar to Kodak when the digital camera was invented, or newspapers when iPads and the internet were invented, they are seriously underestimating the risk that they will not be around in a few years.

 

The thing about Kodak and newspapers is that they just died. They were not replaced by other money making businesses.

 

...

 

If Elon Musk succeeds, cars would be cheap, high tech, and safer. The environment will be cleaner. But I am not sure if that means that the profits in the auto industry (or to Tesla) will go up. Tech often has a way of just moving all the value to the consumers instead of the investors.

 

I'm not sure this is right.  Newspapers' business was advertising; everything in the paper, from front page news to the sports section to the comics, was there to get people's eyeballs on the advertising.  Tech hasn't eliminated that advertising business, but rather shifted it largely to Facebook and Google.

 

Similarly, computers became largely commoditized boxes, yet there were huge profits in the dominant operating system (Windows) and processor (Intel).

 

With cars, it's harder to see what profit center there may be and who might own it, but perhaps one will develop, such as around a far superior charging network (though it's hard to see how this couldn't be replicated) or a superior self-driving system, or some component of such a system, such as mapping.

[Grant]

My question is, why haven't BMW just turned round and said "The next 3 Series will be completely electric. It will do 300 miles, the same as your ICE car, it will charge up overnight like your phone, you will never need to worry about petrol or diesel again. The End." ???

 

Firstly, there are dozens of all-electric vehicles on the horizon. Mary Barra for example has said GM sees an all-electric future. See the slideshows here: https://seekingalpha.com/article/4170654-tesla-still-zero

 

Secondly, these manufacturers probably didn't think there was money to be made building electric cars until battery prices came down. Seems like they were right.

 

Thirdly, remember their development cycle for a completely new platform is 3 to 5 years. This is longer than Tesla's, but quality and manufacturing output are higher. Most car buyers aren't enthusiasts like Tesla buyers, and will not put up with quality and safety issues like Tesla owners do. Traditional car manufacturers are much more risk averse than Tesla, which is why they often don't have features like OTA updates and autopilot.

 

Fourthly, they don't have charging networks and probably don't want to support proprietary ones themselves. This will change as Electrify Amreica and other initiatives get started, seemingly with the rollout of long-range non-Tesla BEVs in 2019+.

 

 

There has never been an argument for an ICE in the face of really good batteries, and I doubt you'll find an engineer who will tell you otherwise. The bottleneck has always been the battery. To doubt electric cars is to doubt batteries (their cost, weight, capacity, etc.). What Elon did is make electric cars sexy, and show Li-ion batteries are good enough.

 

I somewhat agree with tng. BEVs will reduce the economy of scale in car manufacturing, increasing competition and decreasing profits. However cars are much more than just drivetrains; their complexity in always increasing in other ways (safety, entertainment, comfort, automation, etc.). It's entirely possibly other complexities will offset the reduction in scale caused by simpler drivetrains with commodity batteries.

[Cardboard]

"Will sound ridiculous or who's smokin' argument; but see. If you drive Tesla car for 500 to 1000 miles; and then switch to any other car; will make you come back in time travel from year 2025 to back to today.  That's literal feeling after driving Tesla Model 3 for past 3 months."

 

LOL!

 

People don't want sedans. They want large vehicles. The Model 3 is different powertrain but, not what people are after anyway:

 

http://www.wsj.com/mdc/public/page/2_3022-autosales.html

 

Ford is shutting down most models, GM also cutting.

 

https://www.reuters.com/article/us-ford-motor-results/ford-accelerates-cost-cutting-plan-will-drop-most-u-s-sedans-idUSKBN1HW2UH

 

After the oil crash of 2014, gasoline prices came down significantly and Obama's introduced guidelines on ICE efficiency really dropped per car consumption worldwide (easy 30% and it continues).

 

So now, people are taking the savings from lower gasoline, better fuel consumption and higher wages from a better economy to buy what they truly want.

 

This is more visible in the U.S., but a global phenomenon by the way especially in China. If people can get more for the same price, their choice is obvious.

 

https://www.nytimes.com/2018/03/03/climate/suv-sales-global-climate.html

 

And regarding the Model 3 being some kind of great car, most reviews indicate otherwise. So either you never tried other cars of similar price, never been into a Tesla S or maybe yes you smoked something:

 

https://www.caranddriver.com/reviews/2018-tesla-model-3-test-review

 

Cardboard

[Investmentacct]

My question is, why haven't BMW just turned round and said "The next 3 Series will be completely electric. It will do 300 miles, the same as your ICE car, it will charge up overnight like your phone, you will never need to worry about petrol or diesel again. The End." ???

 

Firstly, there are dozens of all-electric vehicles on the horizon. Mary Barra for example has said GM sees an all-electric future. See the slideshows here: https://seekingalpha.com/article/4170654-tesla-still-zero

 

Secondly, these manufacturers probably didn't think there was money to be made building electric cars until battery prices came down. Seems like they were right.

 

Thirdly, remember their development cycle for a completely new platform is 3 to 5 years. This is longer than Tesla's, but quality and manufacturing output are higher. Most car buyers aren't enthusiasts like Tesla buyers, and will not put up with quality and safety issues like Tesla owners do. Traditional car manufacturers are much more risk averse than Tesla, which is why they often don't have features like OTA updates and autopilot.

 

Fourthly, they don't have charging networks and probably don't want to support proprietary ones themselves. This will change as Electrify Amreica and other initiatives get started, seemingly with the rollout of long-range non-Tesla BEVs in 2019+.

 

 

There has never been an argument for an ICE in the face of really good batteries, and I doubt you'll find an engineer who will tell you otherwise. The bottleneck has always been the battery. To doubt electric cars is to doubt batteries (their cost, weight, capacity, etc.). What Elon did is make electric cars sexy, and show Li-ion batteries are good enough.

 

I somewhat agree with tng. BEVs will reduce the economy of scale in car manufacturing, increasing competition and decreasing profits. However cars are much more than just drivetrains; their complexity in always increasing in other ways (safety, entertainment, comfort, automation, etc.). It's entirely possibly other complexities will offset the reduction in scale caused by simpler drivetrains with commodity batteries.

 

Thirdly, remember their development cycle for a completely new platform is 3 to 5 years. This is longer than Tesla's, but quality and manufacturing output are higher. Most car buyers aren't enthusiasts like Tesla buyers, and will not put up with quality and safety issues like Tesla owners do. Traditional car manufacturers are much more risk averse than Tesla, which is why they often don't have features like OTA updates and autopilot.

 

>> This line of thinking is similar to, flat earth society.

[Investmentacct]

"Will sound ridiculous or who's smokin' argument; but see. If you drive Tesla car for 500 to 1000 miles; and then switch to any other car; will make you come back in time travel from year 2025 to back to today.  That's literal feeling after driving Tesla Model 3 for past 3 months."

 

LOL!

 

People don't want sedans. They want large vehicles. The Model 3 is different powertrain but, not what people are after anyway:

 

http://www.wsj.com/mdc/public/page/2_3022-autosales.html

 

Ford is shutting down most models, GM also cutting.

 

https://www.reuters.com/article/us-ford-motor-results/ford-accelerates-cost-cutting-plan-will-drop-most-u-s-sedans-idUSKBN1HW2UH

 

After the oil crash of 2014, gasoline prices came down significantly and Obama's introduced guidelines on ICE efficiency really dropped per car consumption worldwide (easy 30% and it continues).

 

So now, people are taking the savings from lower gasoline, better fuel consumption and higher wages from a better economy to buy what they truly want.

 

This is more visible in the U.S., but a global phenomenon by the way especially in China. If people can get more for the same price, their choice is obvious.

 

https://www.nytimes.com/2018/03/03/climate/suv-sales-global-climate.html

 

And regarding the Model 3 being some kind of great car, most reviews indicate otherwise. So either you never tried other cars of similar price, never been into a Tesla S or maybe yes you smoked something:

 

https://www.caranddriver.com/reviews/2018-tesla-model-3-test-review

 

Cardboard

 

And regarding the Model 3 being some kind of great car, most reviews indicate otherwise. So either you never tried other cars of similar price, never been into a Tesla S or maybe yes you smoked something:

 

>> Model 3 has amazing review from newer generation who will be using technology going forward.  Other than model 3, we transitioned last year to Model X, which fits to your SUV sales thinking. However, Tesla Model X is the only available SUV BEV option available in market for past 3 years.

 

Overall, good thinking Cardboard. Thanks.

 

 

[Cardboard]

So you own both model X and 3? If not that would be a lie:

 

"That's literal feeling after driving Tesla Model 3 for past 3 months."

 

"Other than model 3, we transitioned last year to Model X, which fits to your SUV sales thinking."

 

Based on this, I think that would disqualify you as an unbiased opinion on Tesla as an investment or otherwise. You are way too deep in the religion.

 

Cardboard

[Investmentacct]

So you own both model X and 3? If not that would be a lie:

 

"That's literal feeling after driving Tesla Model 3 for past 3 months."

 

"Other than model 3, we transitioned last year to Model X, which fits to your SUV sales thinking."

 

Based on this, I think that would disqualify you as an unbiased opinion on Tesla as an investment or otherwise. You are way too deep in the religion.

 

Cardboard

 

That's correct. Please Outcast me/my opinions as biased. Can tell in California ,  religion  is spreading quickly enough.

[black-dog]

I'll agree that I've long thought that if BMW could produce a 3-series all-electric it'd be over, and I've also wondered why they didn't just do it -- while they might be behind on software, they're certainly way ahead on manufacturing and have the same kind of brand equity.

 

I think it's a combination of thing -- obviously, there's inertia: BMW's a world-wide company with 130,000 employees, and they make ~2.7m vehicles a year. Last year's Tesla output in total is maybe a third of what they sell in Minis. Rarely do incumbent companies see a potential disruption for what it is and react effectively.

 

Second, the economics: all car makers have smart people in rooms shooting the shit about what they might do for new models, and I have to imagine if it doesn't pencil out as remotely profitable (which Tesla's been proving for them) you have to have a prestige or other case for why you should build them -- for instance, if you can get a car close and helps meet fleet efficiency standards so you can sell the new Ford Extinction, well...

 

And yeah, BMW created a whole sub-brand to go after electrics, starting with the i3, which has a hybrid. It's... a weird looking car. But they've shipped like 100k of them since 2013. And price-wise, it's actually Model 3-competitive for your all-electric needs.

 

Then more directly as Tesla-ish competion, the i8 is a plug-in hybrid that looks great... and they're not selling many at allllllll. The new Roadster looks pretty slick. But the MSRP on those things is $insane.

 

Anyway, the point is they're getting there --  go to the home page of BMW USA right now -- I, at least, get a pitch for the line

 

https://www.bmwusa.com/vehicles/bmwi.html

 

I'm fascinated to see how the Jaguar does, as a possible omen for the entrants of luxury and sports car companies with manufacturing chops.

[rb]

So many people bring up the point that Tesla do not have any technology that other car companies could not just replicate and create a similar vehicle...

 

I think this is a valid concern, but it really perplexes me why none of the other car companies have done this.

 

As others say, I don't imagine it would be particularly difficult for BMW, Mercedes, VAG etc. to reverse-engineer and create a similar Model S, X, or 3 alternative, but I am absolutely astounded that none of them have done this.

 

Elon is an incredibly clever guy, and he puts forward a compelling argument that all land/ground based transport will eventually become electrically propelled. I believe this is so. His reasoning and explanation is such that when you are able to grasp it, it is then simply a foregone conclusion. I am not particularly intelligent, and I can see that all ICE vehicle sales will eventually cease.

 

Of the hundreds of thousands of people employed by the other major car manufacturers, I refuse to believe that no one else has twigged this in the same way that Elon and I have...

 

My question is, why haven't BMW just turned round and said "The next 3 Series will be completely electric. It will do 300 miles, the same as your ICE car, it will charge up overnight like your phone, you will never need to worry about petrol or diesel again. The End." ???

 

I think that the Germans could easily design and build such a car, even if they just copied Tesla (or BYD). I think there are deeper, more complicated reasons that they are collectively burying their heads in the sand. My guess is the following:

 

a). They know that they sell loads and loads of petrol and diesel cars every year, as they have done for decades before, and choose not to acknowledge that things will change in the future. They don't want to kill their 'cash cow' product lines with an uncertain new direction / strategy.

 

b). They realise that people have valid concerns about where and how to charge their new electric cars, and realise they don't have a solution, therefore choose to ignore the future. Tesla owners don't need to worry about this, because of the Tesla Supercharger network, home charging solutions, and loads of dedicated destination chargers. Other brands don't have a network.

 

 

Now, people can argue that Mercedes could bring out an electric C-Class tomorrow, or BMW could bring out an electric 3 Series next week... but these companies DON'T! If I was in charge of either of these ranges, my sole focus in life would be to electrify them. Build the next model from the ground up, yesterday. Tesla already has these competitor cars, and is about to start eating everyone else's lunch! Instead, they fart about with weird "Concept Electric Vision Cars" and other futuristic, strange looking rubbish. People just want a normal looking, normal to use car, that happens to be electric. That is what Tesla is building.

The thing these other manufacturers are doing just what you think they should do. I don't think they're ignoring the electric side of things and keeping their heads in the sand.

 

Remember a few years ago Daimler owned a bunch of Tesla and had a technology sharing agreement with them? Well going forward Daimler is launching a new electric line (EQ) and plans to introduce one model per year over the next 8 or 9 years.

 

BMW has been active here too. The already have an electric line (i). They put out the i3 - it sucks and the i8 - it rocks. Hiding in plain sight you have the 330e and the 530e. Yes they're not really EVs, they're plug in hybrids and they have really small batteries - you can only do about 14 miles in full electric. But they're there. In the next couple of years they'll come to market with a fully electric version of the X3 (the iX3), iNext which is supposed to be something about the size of the X5, and the i4 which is going to be a sedan with 340-425 miles range and has all the autonomous driving bells and whistles. By 2025 BMW wants to have 25 electrified models with half of those fully electric.

 

Then there's Audi e-tron, etc, etc. It doesn't seem to me like these guys have their heads in the sand. It seems to me like there's a lot of serious competition coming to market.

 

As to why these guys moved slower? We could only speculate. I think firstly they have real shareholders while Musk has fanboys. The shareholders of BMW and Daimler will not just let their managements to take a giant pile of money and set it on fire. Then the market for these cars just wasn't there in the past. I'm not sure the market is there now but it's larger than it has been in the past. Also in recent years batteries have come down in price a lot which makes these vehicles more feasible. So it makes more sense to move into the space now then it would have in the past.

[rb]

That's correct. Please Outcast me/my opinions as biased. Can tell in California ,  religion  is spreading quickly enough.

You do know that California is not the world right?

[NBL0303]

 

Specifically, he has made projections TIME AND AGAIN that have not come to fruition.  Specifically about the model 3 and it's availability.  He has also made claims about profitability and the need for more capital.

 

 

In addition to the continually missed projection issues that you mentioned, another thing that I would find a little alarming about Elon is not just the missed projections/etc. but the fact that he seems to continually be trying to distract the public with sort of token gestures.  Launching products to much fanfare despite the fact that they know they are not going to produce those products in any business-significant volume.  There have seemingly been one misleading sort of stunt after another.  And I realize part of Elon's specialty is making the public believe in the magic of Tesla, and that is important if Tesla is going to successful, but it is as if he is trying so hard for years to take the focus off of what is actually going on with their core operations.  For years, almost like clockwork, when Tesla has negative news or a setback, they announce something flashy and distracting and most of the time those things are sort of made up or are not really pertinent to the company's operations.  Another aspect of these token gestures is the numbers games he has played; was it last year or the year before when he shifted around their expenses significantly just so they could show a profitable quarter (I think so they could garner further support for their SolarCity acquisition).  Or just take his purchase of $10 million of shares today - it seems like a PR move and a token gesture to create a headline.  That is okay I guess, but when there is one token gesture after another it is an alarming sign.

 

 

If I were the BOD, I would tell Elon to keep his mouth shut.

 

 

While I would communicate differently if I were Elon, I think Elon is a bit like Trump in the following way: many people on the Right in American politics say something to the effect of: "I like what Trump is doing, I just wish he'd Tweet less."  Or, "I think Trump is doing the right things, but he just communicates so crassly."  I understand what they are saying, and I personally find much or all of the Tweeting distasteful and I would personally behave very differently, but part of the whole political package of Trump is his Tweeting and his continually dominating the media coverage of the day and if he stopped Tweeting it in reality wouldn't make anyone come around to him - and he wouldn't be able to divert the media's attention as much and if he stopped communicating in the way he does - it would just be the media continually taking shots at him (as they do know) and Trump's silence would mean he wouldn't be firing up his core supporters as much/etc.  This is not from the vantage point of a Trump supporter, by the way, it just seems to me that part of Trump's whole package is him as the Tweeter, crass communicator - and if he stopped doing that, he probably wouldn't get much benefit and he would lose some of what has garnered him whatever level of political support he has.

 

I feel similarly about Elon.  If I were Elon I wouldn't communicate like he does at all; I wouldn't be making outlandish projections; selling flamethrowers and challenging Wall Street analysts and Warren Buffett/etc.  And some of those tactics probably do more harm than good, but it is all part of the package of Elon and for better for worse if Tesla is going to succeed they are going to do so in large part because of the belief in him and the company that he evokes from Tesla's core supporters.  In a certain sense, they need Elon out there stirring up belief in the company and giving the company the room to take these big swings - especially when they are missing deadlines, are unprofitable, etc.  In some sense, all they have is the runway that Elon can give them with the bravado and consequent belief in him that he engenders in much of the public.

[Spekulatius]

I think existing car makers would have trouble to acquire as many resources than Elon Musk didnwith Tesla. We are talking about 10‘s Billion of Dollars here. Had an old fashioned car company done just thwt and got to a similar where Tesla is now, with the same amount of resources spent, the capital markets would have punished the car company and activist would be crawling all over them.

 

Or to puthe it in ScottHalls words, Elon had thr better story and could sell it. Think about thr genius of calling his company Tesla, which has a mystique to it. Early on, he was able draw on the rich engineering resources from electric car enthusiast in CA that were willing to do or from him withoutnElon paying through thr nose. He was able to raise billions of dollars simply on price missed (most of which he cannot hold , at least not in a timely manner)l his for rays into SpaceX, Hyperloop, Flamethrowers, Mars exploration. All of her dreams and Elon can sell them better than anyone else and much better than car executives in suits from sure.

[Investmentacct]

That's correct. Please Outcast me/my opinions as biased. Can tell in California ,  religion  is spreading quickly enough.

You do know that California is not the world right?

  Saying goes: The way California goes, so goes the nation. In last 30 years, more or less the world.