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Bob Wallace

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Re: Tesla glory/failure
« Reply #2550 on: June 13, 2019, 03:11:05 AM »
Well if it isn't Bob Wallace himself!
While I disagree with your specific point (finished goods if sold would have made Q1 profitable), I am happy to see you posting again here after a long hiatus.

I did not say that if the money from in transit goods were received in Q1 that the quarter would have been profitable.  I said that the loss would have been around $133 million, about 20% of what is seen if one ignores increased goods in transit.

And I said if one takes that ($133) and averages it over the last three quarters Tesla is operating at a profit.

Why only the last three quarters?  Perhaps cherry picking?  No, something happened over Q1 and Q2 that played out starting in Q3 2018.  Total Tesla EV production jumped from around 25k per quarter to over 3x as much.

2017 Q1   2017 Q2   2017 Q3   2017 Q4   2018 Q1   2018 Q2   2018 Q3   2018 Q4   2019 Q1
 25,418     25,708   25,336     24,565      34,494    53,337     80,142    86,555     77,138

That was what was needed to move Tesla from a startup company losing money to a semi-mature company reaching profitability.  Let me define three stages.  First, startup with expenses greater than revenue on a consistant basis.  Second, the profitability threshold.  Overall small profits but not with monthly/quarterly consistency.  Third, maturity where profits are normal, not every single month/quarter, but loss periods are infrequent compared to profitable periods.

Tesla, in my opinion, has reached stage two in which the company is overall profitable.  But not overly so.  Movement to stage three will take an increase in product output which should come from the Shanghai Gigafactory and increased production in Fremont and Reno as battery cell production grows and the Model Y comes to production.

If S/X production/demand returns to ~25k per quarter and T3 production grows to ~9K per week that might be enough to shove Tesla into the ranks of profitable companies. 


crandles

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Re: Tesla glory/failure
« Reply #2551 on: June 13, 2019, 01:31:06 PM »
Well if it isn't Bob Wallace himself!
While I disagree with your specific point (finished goods if sold would have made Q1 profitable), I am happy to see you posting again here after a long hiatus.

I did not say that if the money from in transit goods were received in Q1 that the quarter would have been profitable.  I said that the loss would have been around $133 million, about 20% of what is seen if one ignores increased goods in transit.


I am also very happy to see you back posting here again.

However, on this point you are misguided.

If the goods in transit increased $569 million. That $569 million is in the balance sheet. At a 20% margin then on sale of these goods revenue of $711 goes to the P&l but the stock on balance sheet also gets moved to cost of sales on the P&L which gives a net $142 million gross profit to reduce the loss. So the $702 million loss get reduced to $560 million.

There is a big difference from a $133 million loss to a $560 million loss.

That $.7bn is not as easily reduced as you are suggesting. If they are guiding 90-100k deliveries then the above effect is included in the guided deliveries. So probably more relevant to look at this guidance for Q2. That is ~50% up on q1 and increasing vehicle gross profit by 50% does not wipe out the $.7bn loss but will significantly reduce it. Now if q3 can do higher volumes than q2 without new production lines maybe they can get to profitability but is significant increase likely now?  When china factory starts producing then further volume and reduced transport costs should be possible and I am sure capital costs will be much reduced from experience with other lines.

So there is a route to profitability through growth but neither quick nor easy. At other extreme, bankruptcy isn't imminent unless there is something really bad hidden from my view.

Ho hum: Neither one extreme nor the other: there is plenty of room in the middle but I guess that isn't particularly exciting.

magnamentis

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Re: Tesla glory/failure
« Reply #2552 on: June 13, 2019, 04:45:24 PM »

What I am trying to communicate is the need to understand the OpEx report in order to gain an accurate appreciation of Tesla's financial conditions.
.................. <Snipped>

thanks for the reply, perhaps i should have added a few smilies after that question to safe you the work, all true what you say, it's perhaps the conclusion taken form those facts where we interpret things in a different manner but nevertheless you got the facts right of course.

your statements for my taste simply sound too good while in fact it's still bad ( financial conditions of thesla as well as th outlook any term long, mid or short-term)
« Last Edit: June 13, 2019, 04:55:03 PM by magnamentis »

Sigmetnow

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Re: Tesla glory/failure
« Reply #2553 on: June 13, 2019, 05:04:56 PM »
Welcome back, Bob.  Missed you!



Speculation, on something everyone pretty much accepts as a given:
Tesla all but confirms it’s going to make own battery cells with new Maxwell tech
https://electrek.co/2019/06/12/tesla-battery-cell-production-maxwell-tech/

And facts.  Also no surprise:
Tesla Model 3 / Hyundai Kona Electric Help Canada Achieve 100K EVs
https://insideevs.com/news/354156/tesla-model-3-hyundai-kona-ev-canada-sales/

The EV invasion for Q2 hits Canada and Norway:
Quote
Sébastien Lachance (@archiecoder) 6/8/19, 9:09 PM
Since we can get 13k as [incentive] in Québec, Canada. The Tesla demand is over the top. Haha to the tesla haters and shorters. #tesla
https://twitter.com/archiecoder/status/1137527178546110465
< Tesla is now delivering tons of cars in Montreal Canada
Via & credit @TeslaHab, thanks
Quote
Quote
Christopher (@TeslaHab) 6/8/19, 12:51 PM
Don’t believe the $TSLAQ crowd. There is no demand issue. Picking up our 2nd Model 3 in Montreal. They are delivering A LOT of cars today...
https://twitter.com/teslahab/status/1137401763021983744
- Also a lot of people coming in to place orders $TSLA
Photos at the links.

Tesla soars past 40k total registrations in Norway, Model 3 leads the charge
Quote
The total number of Tesla Model S, Model X, and Model 3 registrations in Norway crossed the 40,000 mark last week, according to Teslastats.no, a website tracking Tesla registrations in the country. ...
https://www.teslarati.com/tesla-passes-40k-total-registrations-in-norway
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Tor Bejnar

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Re: Tesla glory/failure
« Reply #2554 on: June 13, 2019, 06:26:45 PM »
Quote
Neither one extreme nor the other: there is plenty of room in the middle but I guess that isn't particularly exciting.
This middle ground is, actually, exciting.  Extremes that won't happen or are no-brainers (e.g., space colonization this century, economically viable fission this decade, the President is a cheat, EVs taking over this decade) are what is not exciting (except that I'm excited by what Tesla is leading ...).
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Sigmetnow

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Re: Tesla glory/failure
« Reply #2555 on: June 13, 2019, 09:24:44 PM »
Do you think “Logistics Hell” is over? It was a critical thing in the Q1 earnings call and subsequent internal emails, but there was no mention of logistics at the shareholder meeting.
H/t:  https://twitter.com/jjhanna2/status/1139227611840647168
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Bob Wallace

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Re: Tesla glory/failure
« Reply #2556 on: June 14, 2019, 12:50:12 AM »
Well if it isn't Bob Wallace himself!
While I disagree with your specific point (finished goods if sold would have made Q1 profitable), I am happy to see you posting again here after a long hiatus.

I did not say that if the money from in transit goods were received in Q1 that the quarter would have been profitable.  I said that the loss would have been around $133 million, about 20% of what is seen if one ignores increased goods in transit.


I am also very happy to see you back posting here again.

However, on this point you are misguided.

If the goods in transit increased $569 million. That $569 million is in the balance sheet. At a 20% margin then on sale of these goods revenue of $711 goes to the P&l but the stock on balance sheet also gets moved to cost of sales on the P&L which gives a net $142 million gross profit to reduce the loss. So the $702 million loss get reduced to $560 million....

OK, you lost me there.  Let's start with the balance sheet.  Profits and losses are not calculated on balance sheets.  A balance sheet is just a check to see if all assets and liabilities are included which needs to happen for the balance to end up as zero if one is subtracted from the other.

Now, here's a copy of Tesla's P/L page from their Q1 2019 10-Q report to the SEC.  You're saying that the inventory in transit is included in these numbers?

      
2019   Number in Millions
Revenues         
Automotive sales      $3,508,741
Automotive leasing         215,120
Total automotive revenues         3,723,861
Energy generation and storage         324,661
Services and other         492,942
Total revenues         4,541,464
Cost of revenues         
Automotive sales         2,856,209
Automotive leasing         117,092
Total automotive cost of revenues         2,973,301
Energy generation and storage         316,887
Services and other         685,533
Total cost of revenues         3,975,721
Gross profit         565,743
Operating expenses         
Research and development         340,174
Selling, general and administrative         703,929
Restructuring and other         43,471
Total operating expenses         1,087,574
Loss from operations         (521,831)
Interest income         8,762
Interest expense         (157,453)
Other income (expense), net         25,750
Loss before income taxes         (644,772)
Provision for income taxes         22,873
Net loss         (667,645)
"Net income (loss) attributable to noncontrolling interests and
redeemable noncontrolling interests in subsidiaries"         34,490
Net loss attributable to common stockholders      $(702,135)

The way I understand P/L reports (having filed them for several years, back when) is that you report revenue received and monies expended on the date the transaction occurs.  When Tesla delivers that $500-odd million inventory the money received will be entered onto the company's books on that date.  Which will be in Q2.

Remember, Tesla does not operate like other car manufactuers.  Traditional car manufacturers "sell" their cars as they roll out the factory door.  They get charged to dealers and the car company records the sale even before the car gets loaded on the transfer trailer.  Tesla does not record the sale, credit revenue to their ledger, until the product it accepted by the owner. 



Have I got it wrong?

Bob Wallace

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Re: Tesla glory/failure
« Reply #2557 on: June 14, 2019, 12:53:20 AM »


your statements for my taste simply sound too good while in fact it's still bad ( financial conditions of thesla as well as th outlook any term long, mid or short-term)

What objective numbers are you using to form your opinion that things are still bad for Tesla?

I'm totally open to finding out that I'm looking at things incorrectly.

Bob Wallace

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Re: Tesla glory/failure
« Reply #2558 on: June 14, 2019, 01:03:54 AM »
Do you think “Logistics Hell” is over? It was a critical thing in the Q1 earnings call and subsequent internal emails, but there was no mention of logistics at the shareholder meeting.
H/t:  https://twitter.com/jjhanna2/status/1139227611840647168

Is that question aimed at me?  If so, I think there's going to be some amount of logistic hell from now until Tesla has factories operating in Asia and Europe. 

Apparently one of Tesla's problems during Q1 was trying to secure enough ships for transport.  And the intake process in Europe and China (?) wasn't ready to have a large number of cars show up all at once.  Tesla is smart enough to spread deliveries going forward if that was a major problem.  The problem arose, I think, because Tesla did not get past "Production Hell" until into Q1 and that created a bunch of cars to ship to places they hadn't shipped in large numbers previously.  I think Tesla may have also wanted to make a "big splash" by delivering a bunch of T3s when they introduced it to other countries.

Now, all that is speculation on my part based on tidbits I've picked up here and there.  My bottom line is that a group of people who can land a rocket on a barge at sea can figure out how to smooth out car delivery problems.


oren

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Re: Tesla glory/failure
« Reply #2559 on: June 14, 2019, 02:28:51 AM »
OK, you lost me there.  Let's start with the balance sheet.  Profits and losses are not calculated on balance sheets.  A balance sheet is just a check to see if all assets and liabilities are included which needs to happen for the balance to end up as zero if one is subtracted from the other.

Now, here's a copy of Tesla's P/L page from their Q1 2019 10-Q report to the SEC.  You're saying that the inventory in transit is included in these numbers?

      
2019   Number in Millions
Revenues         
Automotive sales      $3,508,741
Automotive leasing         215,120
Total automotive revenues         3,723,861
Energy generation and storage         324,661
Services and other         492,942
Total revenues         4,541,464
Cost of revenues         
Automotive sales         2,856,209
Automotive leasing         117,092
Total automotive cost of revenues         2,973,301
Energy generation and storage         316,887
Services and other         685,533
Total cost of revenues         3,975,721
Gross profit         565,743

The way I understand P/L reports (having filed them for several years, back when) is that you report revenue received and monies expended on the date the transaction occurs.  When Tesla delivers that $500-odd million inventory the money received will be entered onto the company's books on that date.  Which will be in Q2.

Remember, Tesla does not operate like other car manufactuers.  Traditional car manufacturers "sell" their cars as they roll out the factory door.  They get charged to dealers and the car company records the sale even before the car gets loaded on the transfer trailer.  Tesla does not record the sale, credit revenue to their ledger, until the product it accepted by the owner. 

Have I got it wrong?
Tesla like (almost?) any corporation does not report its P/L on a cash basis, but on an accumulating basis. The cars in transit would not appear in automotive revenue, but neither would they appear in cost of automotive revenue, as they were not sold.
Instead they would appear in the cash flow report as cost of inventory. And they would appear on the balance sheet as inventory. So they did not affect the profit or loss. But they did reduce Tesla's cash position by $570M.

When they were sold in Q2, a revenue of $710M was recorded, a cost of revenue of $570M was recorded, and thus a profit of $140M was recorded. Cash position increased by $710M.

Sigmetnow

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Re: Tesla glory/failure
« Reply #2560 on: June 14, 2019, 02:50:37 AM »
Do you think “Logistics Hell” is over? It was a critical thing in the Q1 earnings call and subsequent internal emails, but there was no mention of logistics at the shareholder meeting.
H/t:  https://twitter.com/jjhanna2/status/1139227611840647168

Is that question aimed at me?  If so, I think there's going to be some amount of logistic hell from now until Tesla has factories operating in Asia and Europe. 

Apparently one of Tesla's problems during Q1 was trying to secure enough ships for transport.  And the intake process in Europe and China (?) wasn't ready to have a large number of cars show up all at once.  Tesla is smart enough to spread deliveries going forward if that was a major problem.  The problem arose, I think, because Tesla did not get past "Production Hell" until into Q1 and that created a bunch of cars to ship to places they hadn't shipped in large numbers previously.  I think Tesla may have also wanted to make a "big splash" by delivering a bunch of T3s when they introduced it to other countries.

Now, all that is speculation on my part based on tidbits I've picked up here and there.  My bottom line is that a group of people who can land a rocket on a barge at sea can figure out how to smooth out car delivery problems.

For anyone.  :)  Just offered as an alternative to the endless Numbers Good / Numbers Bad arguments.  ;)

Eight car-carrier ships have arrived in Europe, China, and Japan so far this quarter, and four more are enroute.  I imagine radically changing scheduled ship payloads is not something that can be done overnight, which is why Musk said they would be “winding down” the usual quarter-end wave, not suddenly ending it. 

But Norway has already registered over 1,000 Teslas so far in June alone, and folks in Canada and the northwest (US/Canada) are reporting that Tesla Delivery centers are crowded with people taking deliveries — and placing new orders!  (Incentives opened up in Canada; the US tax credit halves again the end of June.)  So it seems the international ramp is getting under control (the company that failed to handle huge shipments arriving at Zeebrugge was fired in Q1) and North American deliveries are proceeding apace.  Standard Range Plus (SR+) in Europe signals the start of the next delivery ramp: European SR+ customers are reporting deliveries scheduled before the end of the month.  So far, I’ve seen no sign of problems such as the ones encountered in Q1.

https://twitter.com/mortenlund89/status/1139179037224570881
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Sigmetnow

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Re: Tesla glory/failure
« Reply #2561 on: June 14, 2019, 02:54:24 AM »
One more thing ;) : Elon and Drew confirmed that Version 3 of the solar roof is predicted to be equal to the cost of a shingle roof plus a utility bill.  That is their goal, and they are focused on achieving it.  “It can be done!”

That would be huge.

Update:
Quote
Elon Musk (@elonmusk) 6/13/19, 6:28 PM
Tesla Solar Toof Tile V3.0 starting early trials electrek.co/2019/06/13/tes…
https://twitter.com/elonmusk/status/1139298574489907200

First look at Tesla’s solar roof tile technology with custom fittings
https://electrek.co/2019/06/13/tesla-solar-roof-tile-techonology-custom-fittings/
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GoSouthYoungins

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Re: Tesla glory/failure
« Reply #2562 on: June 14, 2019, 07:31:32 AM »
OK, what did I miss?  What step absolutely requires fossil fuel?

If you think mining can be done with solar, then nothing. I take it you have never worked in serious industry.

Your list of things that can theoretically be done without fossil fuels is similar to list of what is necessary to live on Mars. Creating the check list isn't too tough. Doing it is nearly impossible, and totally impossible in the time frame necessary to avert disaster.
big time oops

Bob Wallace

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Re: Tesla glory/failure
« Reply #2563 on: June 14, 2019, 08:55:32 AM »
OK, what did I miss?  What step absolutely requires fossil fuel?

If you think mining can be done with solar, then nothing. I take it you have never worked in serious industry.

Your list of things that can theoretically be done without fossil fuels is similar to list of what is necessary to live on Mars. Creating the check list isn't too tough. Doing it is nearly impossible, and totally impossible in the time frame necessary to avert disaster.

Let's start by recognizing that I did not say that mining could be done with solar.  I said that mining can be done, and is being done with electricity. 

Now, let's move past that and I'll claim, without hesitation, that mining could be done using only solar energy.  We'd just need enough storage to allow mining to continue even when the Sun is not shining.  Obviously solar-only is not the lowest cost way to power a renewable grid.  It makes much more sense to add in a large percentage of wind along with whatever hydro, geothermal and other renewable sources we can put together. 

"Doing it is nearly impossible"

You're not clear on what your "it" is.  Running a large piece of equipment using electricity?  Here's an entire gold mine that is run on electricity - no fossil fuel equipment used.

https://www.reuters.com/article/us-mining-electric-goldcorp/first-new-all-electric-mine-dumps-diesel-cuts-costs-pollution-idUSKBN1JH2FI

Running electric grids on 100% renewable energy?  There are tons of research papers showing it can be done and around the world we see RE replacing fossil fuels.

"totally impossible in the time frame necessary to avert disaster"

I'm not sure how you define "disaster".  If you mean avoiding damage caused by climate change we're already too late.  We're already suffering disasters such as droughts, floods, heat waves, and wildfires.  If you mean extreme climate change that would make it very difficult for humans to survive on planet Earth, we should be able to avoid that.

If we would simply put leaders in office who put a priority on fighting climate change we could be largely off fossil fuels in about 20 years. 

Take the US grid.  In 2016 we generated 65% of our electricity with fossil fuels.  That fell to 63% in 2017.  Electricity generated from renewable sources rose from 15% to 17%.  We made a 2% market share transition in one year.

To get from 63% to 0% in 20 years we would need to annually flip 3.2% of our fossil fuel generation to renewable generation.  We've already demonstrated that we can do 2% per year.  And we did that without breaking a sweat.  We wouldn't even need to double our generation efforts to achieve a 100% RE electricity supply by 2020. Bad error.  Should have been 2040.

Now vehicles.  We already have EVs on our roads which are perfect replacements for ICEVs.  They have the range, fast enough charging, and they are cheaper to power.  What we would need to do is to build a lot of battery factories and open a bunch of lithium mines in a hurry but in less than ten years we could be manufacturing enough EVs to replace all ICEV manufacturing.  And in another ten years or so most of the ICEVs that were manufactured earlier would be wearing out and disappearing.

These are things that we can do with the technology we have in hand right at this moment in time.  We don't need to invent anything other than will to move us off fossil fuels in a couple of decades.

BTW, before you tell us that EVs are too expensive do you realize that if you bought a Tesla Model 3  or a Toyota Camry V6 that your monthly out of pocket expenses would be just about the same during a five year loan payoff?  Long range luxury EVs are already price competitive with <luxury sedans.

« Last Edit: June 17, 2019, 08:51:31 AM by Bob Wallace »

crandles

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Re: Tesla glory/failure
« Reply #2564 on: June 14, 2019, 12:05:15 PM »

OK, you lost me there.  Let's start with the balance sheet.  Profits and losses are not calculated on balance sheets.  A balance sheet is just a check to see if all assets and liabilities are included which needs to happen for the balance to end up as zero if one is subtracted from the other.

Now, here's a copy of Tesla's P/L page from their Q1 2019 10-Q report to the SEC.  You're saying that the inventory in transit is included in these numbers?

If you are lost, then just accept you are wrong.

I indicated the inventory is in the balance sheet at end of q1 not in the P&L. When you sell the cars for $711 million, you recognising this in the P&L as income in Q2. However, you also have to recognise the cost the $569 million which is money spent in Q1 but this went to the balance sheet as an asset not yet as an expense in q1. In q2 the inventory asset has disappeared ie it gets transferred to the P&L in Q2 as a cost of the sale.

Recognising the sales early necessarily means you should also recognise the cost of sale early as well. Neither sales nor cost of sales have been recognised in P&L by end of Q1. You can only do a pseudo adjustment that recognises both the sales and the cost of sales, else it is a complete fairytale adjustment.

This is basic accounting, and I am a chartered accountant and am not the only one telling you this. You are not going to win this argument.

Tor Bejnar

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Re: Tesla glory/failure
« Reply #2565 on: June 14, 2019, 03:05:43 PM »
Although without any formal accounting/bookkeeping training, I was the financial manager of a (non-profit) homeless shelter & crisis counseling center for several years (and have done other paid and volunteer bookkeeping).  What Crandles and others are saying makes perfect sense to me.  All formal accounting is done on an accrual basis, and that's how it works.

From the internet:
Quote
• Cash basis. Revenue is recorded when cash is received from customers, and expenses are recorded when cash is paid to suppliers and employees.
• Accrual basis. Revenue is recorded when earned and expenses are recorded when consumed.
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magnamentis

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Re: Tesla glory/failure
« Reply #2566 on: June 14, 2019, 04:24:59 PM »
Although without any formal accounting/bookkeeping training, I was the financial manager of a (non-profit) homeless shelter & crisis counseling center for several years (and have done other paid and volunteer bookkeeping).  What Crandles and others are saying makes perfect sense to me.  All formal accounting is done on an accrual basis, and that's how it works.

From the internet:
Quote
• Cash basis. Revenue is recorded when cash is received from customers, and expenses are recorded when cash is paid to suppliers and employees.
• Accrual basis. Revenue is recorded when earned and expenses are recorded when consumed.

absolutely 100% correct what crandles says. can't even understand what's there to discuss, those are really matters of fact.

even though i have never worked as an accountant, (not patient and precise enough LOL) i still did accounting in the swiss army because i hate weapons and i learned accounting at business school way over 40 years back but not much has changed, hence none of what crandles wrote is in the slightest way questionable.

BTW shifting numbers in ones mind, based on wishful thinking, has brought millions behind bars
and caused as many bankruptcies for small and medium sized businesses in the past. it can perhaps make some guys feel better fora short time and it can even look like working for a limited time but it's:

a) illegal

b) provided there are no extraordinary profits or lottery wins ahead, collapse is imminent

c) it's kind of ponzi kind of thinking, means the same kind of thinking makes people fall for ponzi schemes, not saying it is a PS of course, just the mind-set is related.
« Last Edit: June 14, 2019, 04:30:56 PM by magnamentis »

Bob Wallace

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Re: Tesla glory/failure
« Reply #2567 on: June 14, 2019, 05:17:31 PM »
 
Quote
You are not going to win this argument.

I am not arguing.  I am waiting to see how this plays out between people with a better understanding of accounting practices than I have. 

I think there's agreement that Tesla had product worth over $500 million in transit at the end of Q1. 

I made the assumption that the money spent to manufacture those cars that was spent during Q1 would be included in Q1 expenses.  Perhaps this is not the case.*

If both the revenue and expense of non-delivered products at the end of Q1 are pushed into Q2 and Tesla has at least a 20% CF on products then something over $100 million of what would be Q1 profits was not received due to transit times as opposed to the $500+ million I thought.
---

* And on further thought, there's a good chance that the materials and supplies used to manufacture the products in transit had been billed to the company but not yet due by March 31, therefore not paid.  Not a Q1 expense.

crandles

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Re: Tesla glory/failure
« Reply #2568 on: June 14, 2019, 05:46:35 PM »

BTW shifting numbers in ones mind, based on wishful thinking, has brought millions behind bars

Shifting numbers in ones mind gets done a lot and little wrong with that. If based on wishful thinking you may well be deluding yourself but if the reasoning for doing the adjustment in your mind is reasonable then I have no real problem with thinking 'what if'.

OTOH If you start shifting numbers in official sets of figures that shouldn't be so adjusted.... then you are asking for trouble with the most minor form of this trouble is that it likely comes back to bite you probably when you are much less able to deal/cope with it.


Is the narrative of delays in deliveries due to first time shipments to various countries that can be expected not to occur again believable? I would lean towards yes, but with a but: If deliveries are guided to increasing by 50% in q2 over q1, is it believable that stock will go down? Anyway the effect of this increased deliveries seems to be a much bigger and more important adjustment that should be done for what we should expect of q2 numbers, and it just so happens to include the effect of the one off delays to inventory delivery. It still doesn't wipe out the loss but does make a good dent in it.

I am also trying to say: better to think of future: i.e. better to think what will q2 be like rather than considering what would q1 have looked like if those delays hadn't happened. The delays did happen, so move on to what is sustainable going forward.

crandles

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Re: Tesla glory/failure
« Reply #2569 on: June 14, 2019, 07:28:50 PM »
Quote
Automotive sales $(000s) 3,508,741
Cost of revenues
Automotive sales $(000s) 2,856,209

Therefore gross profit on auto sales $652,532,000

Looks like an 18.6% margin (despite reporting
Quote
Automotive gross margin – GAAP 20.2 %
which includes leasing) note margin is on sales so it isn't 100 on 500, more like gross profit of (569/.814 -569) = $130 million (rather than the $142 million I suggested earlier using 20% margin).

Increasing deliveries 50% which falls in the 90-100k guidance makes $326 million difference or a little less than half of the $702 million loss. Maybe the remaining $376 million loss isn't sustainable because this includes those deliveries after delays but maybe production can be cranked up a little further without China factory, and or further cost savings ...

.

Re Bobs *
Unlikely: much more likely invoiced daily or billed by end of month at the latest. Possible or even likely not paid for so the cash has not yet gone out of Tesla Bank account.

Anyway the transaction is, if billed the effect (more than one way of getting here) is
Dr Stock (balance Sheet asset) Cr Creditors (bal sheet) and it doesn't hit P&L at end of q1.
If for some reason not billed at end of month then it is
Dr Stock (balance Sheet asset) Cr Accruals (bal sheet) and again it doesn't hit P&L at end of q1.

When the cash goes out it is Dr Creditors Cr Cash; both Balance sheet items so again no effect on P&L account.

It is when the sale occurs that the income and cost of sales hit the P&L.

(Dr are debits which are assets (bal sheet) or expenses (P&L). Cr are credits which are liabilities(BalS) or income(P&L). Bank statements are from banks point of view so this may not be what you are expecting if you are used to seeing dr and cr on bank statements.)
« Last Edit: June 14, 2019, 07:56:35 PM by crandles »

Sigmetnow

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Re: Tesla glory/failure
« Reply #2570 on: June 15, 2019, 04:39:14 PM »
Bloomberg has scrapped its Model 3 “production tracker,” now that its method no longer works.

Tesla Tracker: We Predicted Model 3 Rollout. Now Help Us Analyze Demand
Quote
While we’ll no longer be modeling overall production, we’ll continue to update the two datasets that Tesla watchers have grown to rely on: Vehicle Identification Numbers (VINs) that Tesla registers with safety regulators prior to production and VINs that new owners submit to Bloomberg.
https://www.bloomberg.com/graphics/tesla-model-3-vin-tracker/
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Archimid

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Re: Tesla glory/failure
« Reply #2571 on: June 15, 2019, 04:45:59 PM »
I think Bloomberg did a great job with the tracker. It was extremely interesting to see the model change over time.
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Sigmetnow

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Re: Tesla glory/failure
« Reply #2572 on: June 15, 2019, 06:53:19 PM »
The iPhone wasn't just a phone, it was a tiny handheld computer.
Teslas aren't just cars, they are computers on the road.
And nobody else is building computers for the road just yet.

Quote
Jason Rabinowitz (@AirlineFlyer) 6/14/19, 8:58 PM
No, it doesn't work
https://twitter.com/airlineflyer/status/1139698612890300416
MTA Subway, East Broadway, NYC
Photo below. ;)
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Sigmetnow

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Re: Tesla glory/failure
« Reply #2573 on: June 15, 2019, 07:07:02 PM »
GM’s Bob Lutz Talks Panel Gaps, Tesla, and Why Every Detail Matters
Quote
Tesla Model 3s are a rare sight in Michigan, since our laws don't permit factory-owned dealers. But the strongly motivated Tesla fan can procure the car in neighboring states. When I spied a metallic-red Model 3 in an Ann Arbor parking lot, I felt compelled to check it out. I was eager to see the oft-reported sloppy assembly work, the poor-fitting doors, blotchy paint, and other manifestations of Tesla CEO Elon Musk's "production hell" with my own eyes.

But, when next to the car, I was stunned. Not only was the paint without any discernible flaw, but the various panels formed a body of precision that was beyond reproach. Gaps from hood to fenders, doors to frame, and all the others appeared to be perfectly even, equal side-to-side, and completely parallel. Gaps of 3.5 to 4.5mm are considered word-class. This Model 3 measured up. ...
https://www.roadandtrack.com/new-cars/amp28008116/tesla-model-3-build-quality-bob-lutz/

—-
Clip from a 2014 interview, a year when Tesla delivered 31,000 cars:  Musk says his goal is 500k cars a year by 2020. 
https://twitter.com/flcnhvy/status/1139741677147578369

—-
Quote
James Stephenson (@ICannot_Enough) 6/15/19, 9:07 AM
Let's check in on how the "Tesla Killers" (Jaguar i-Pace, Audi Etron, and Porsche Taycan) are doing.
https://twitter.com/icannot_enough/status/1139882026432159744
Quote
- You may not be able to make out the "Tesla Killers"... so let me zoom in by reducing the y-axis, by... I don't know... an order of magnitude. Is this better?
Graphs below.
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Sigmetnow

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Re: Tesla glory/failure
« Reply #2574 on: June 15, 2019, 07:12:20 PM »
Model 3 have arrived in the UK.
Quote
R Symons LTD (@RSymonsLTD) 6/15/19, 4:10 AM
Trucks now heading from Dover to London with the first RHD’s for delivery next week.
Seemless and efficient logistics operation so far by the look of it.
https://twitter.com/rsymonsltd/status/1139807406802780163

—-
Canada deliveries will surprise in Q2:
Quote
Brock Nanson (@BrockNanson) 6/14/19, 8:43 PM
Another friend is taking delivery in Vancouver tomorrow. When I asked the insurance agent (when we were picking up on Monday) what Saturday would be like, he just rolled his eyes and laughed...
"That's what I thought", I said... LOL
https://twitter.com/brocknanson/status/1139694940458348546

Quote
Trapper V (@TravisVallance) 6/15/19, 10:04 AM
There’s not even a Tesla Supercharger in Winnipeg and people still own them here. Plus cost per kWh is $.095, which is like $.07 USD. I just charge in my garage. Lots of commuters will be buying them once Superchargers are built.
https://twitter.com/travisvallance/status/1139896446243786752
- There’s a million people who live in sleeper towns close to capital cities through the prairies who travel 25,000+ miles per year. With gas now at almost $5 per gallon a SR+ would be half paid for in 5 years just from gas savings.
- I have a theory that the highest EV density in the next few years will be sleeper towns. Not one equals much but all of them will. The cost savings in Canada is on steroids compared to US. I bought without incentive. Need Superchargers to seal deal.
< I live in one of those sleeper towns and the savings in Canada is significant. To buy a gas car is financially irresponsible
- My most common experience talking to people is that they can’t afford “that much”. I always tell them you already do, it’s just broken up as a payment plus gas.
<< We pick up our second Model 3 on Monday in Toronto.
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Bob Wallace

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Re: Tesla glory/failure
« Reply #2575 on: June 16, 2019, 08:01:51 AM »
Quote
But, when next to the car, I was stunned. Not only was the paint without any discernible flaw, but the various panels formed a body of precision that was beyond reproach. Gaps from hood to fenders, doors to frame, and all the others appeared to be perfectly even, equal side-to-side, and completely parallel. Gaps of 3.5 to 4.5mm are considered word-class. This Model 3 measured up. ...

I'm glad to see this article.  Perhaps we'll now see people grabbing a taper gap gauge and sending in some numbers for new Teslas. 

But before that happens I expect to see the shorts claim that the particular T3 that Lutz inspected had been carefully realigned and put there for him to stumble over.

Bob Wallace

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Re: Tesla glory/failure
« Reply #2576 on: June 16, 2019, 08:11:22 AM »
I posted earlier -

Quote
* And on further thought, there's a good chance that the materials and supplies used to manufacture the products in transit had been billed to the company but not yet due by March 31, therefore not paid.  Not a Q1 expense.

Crandles replied -

Quote
Unlikely: much more likely invoiced daily or billed by end of month at the latest. Possible or even likely not paid for so the cash has not yet gone out of Tesla Bank account.

IIRC, one of the cost savings measures that Tesla has used is to get invoicing that allows the parts received to be installed and out the door before the bill is due.   A hangup in shipping could  make some of those bills come due before Tesla has sold (delivered) the car.

oren

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Re: Tesla glory/failure
« Reply #2577 on: June 16, 2019, 08:18:38 AM »
IIRC they pay suppliers within 60 days. But all this only has impact on cash flow, and does not affect profit/loss in any way.

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Re: Tesla glory/failure
« Reply #2578 on: June 16, 2019, 08:28:54 AM »
Crandles -

Quote
Increasing deliveries 50% which falls in the 90-100k guidance makes $326 million difference or a little less than half of the $702 million loss. Maybe the remaining $376 million loss isn't sustainable because this includes those deliveries after delays but maybe production can be cranked up a little further without China factory, and or further cost savings ...

Cars hung up in transit was one problem  The other problem was that S/X production fell considerably in Q1 2019.

2017 Q1   2017 Q2   2017 Q3   2017 Q4   2018 Q1   2018 Q2   2018 Q3   2018 Q4   2019 Q1
25,418       25,708      25,076     22,140     24,728      24,761     26,903     25,161    14,163

Tesla stated that some of the demand drop was due to pull-forward purchasing into 2018 by buyers who wanted to receive the full $7,500 federal tax credit.  After 12/31/2018 the credit dropped by 50% to $3,750.   

Another reason given was that there were some changes to pricing and to the models S/X themselves during the quarter.  Some buyers may have held off in order to get the newer hardware that was widely rumored to be coming.  And there were some price changes during the quarter along with the lowest range model dropped.  Tesla said that demand exceeded ability to produce later in the quarter.  If so, we should expect a rebound in S/X production back to the ~25k per quarter level.

T3 production levels do seem to be higher in recent weeks.  In Q4 2018 Tesla averaged 4,884 T3s per week.  Production seems to be over 7,000 per week now with rumors of some 10,000 weeks.  We'll have to wait a little while longer to determine the accuracy of those rumors.


Bob Wallace

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Re: Tesla glory/failure
« Reply #2579 on: June 16, 2019, 08:33:19 AM »
IIRC they pay suppliers within 60 days. But all this only has impact on cash flow, and does not affect profit/loss in any way.

Selling the parts as finished cars before having to pay for the parts decreases debt interest.  Minor in these days of low interest rates, but it is part of Tesla's cost savings strategy. 

That's assuming Tesla would need to carry debt if parts were received on a cash on delivery basis.

crandles

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Re: Tesla glory/failure
« Reply #2580 on: June 16, 2019, 11:20:00 AM »
Selling the parts as finished cars before having to pay for the parts decreases debt interest.  Minor in these days of low interest rates, but it is part of Tesla's cost savings strategy. 

That's assuming Tesla would need to carry debt if parts were received on a cash on delivery basis.

Yes, but absolutely normal for a car manufacturer. Tesla not doing anything different/special here.

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Re: Tesla glory/failure
« Reply #2581 on: June 16, 2019, 06:28:48 PM »
Selling the parts as finished cars before having to pay for the parts decreases debt interest.  Minor in these days of low interest rates, but it is part of Tesla's cost savings strategy. 

That's assuming Tesla would need to carry debt if parts were received on a cash on delivery basis.

Yes, but absolutely normal for a car manufacturer. Tesla not doing anything different/special here.

There was no claim that Tesla was doing something different than other manufacturers.  Read the context.

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Re: Tesla glory/failure
« Reply #2582 on: June 17, 2019, 07:57:09 AM »
We wouldn't even need to double our generation efforts to achieve a 100% RE electricity supply by 2020.

I'm super curious what year you are currently living in.
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Re: Tesla glory/failure
« Reply #2583 on: June 17, 2019, 08:01:54 AM »
BTW, before you tell us that EVs are too expensive do you realize that if you bought a Tesla Model 3  or a Toyota Camry V6 that your monthly out of pocket expenses would be just about the same during a five year loan payoff?  Long range luxury EVs are already price competitive with <luxury sedans.

lol. The Camry will last 200k miles. The Tesla would last half that, at best. Computer on wheels! Risk of burning to death is also much less in a Camry. But it isn't as trendy. Trade-offs.
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b_lumenkraft

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Re: Tesla glory/failure
« Reply #2584 on: June 17, 2019, 08:17:49 AM »
GSY, can you cite a source for any of your statements?

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Re: Tesla glory/failure
« Reply #2585 on: June 17, 2019, 08:55:37 AM »
We wouldn't even need to double our generation efforts to achieve a 100% RE electricity supply by 2020.

I'm super curious what year you are currently living in.

I'm sorry, I made an error.  In the paragraph, which you read, I talked about our ability to eliminate fossil fuels in 20 years by roughly doubling the progress we've made in previous years.  At the end I should have typed 2040 but messed up and typed 2020.

I'm sure you recognized my mistake for what it was.

Bob Wallace

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Re: Tesla glory/failure
« Reply #2586 on: June 17, 2019, 09:10:12 AM »
BTW, before you tell us that EVs are too expensive do you realize that if you bought a Tesla Model 3  or a Toyota Camry V6 that your monthly out of pocket expenses would be just about the same during a five year loan payoff?  Long range luxury EVs are already price competitive with <luxury sedans.

lol. The Camry will last 200k miles. The Tesla would last half that, at best. Computer on wheels! Risk of burning to death is also much less in a Camry. But it isn't as trendy. Trade-offs.

Well, there's data that shows you wrong.  Multiple Teslas have now passed the 200,000 mile point and are going strong.  The record posted last August was 420,000 mile for a Tesla S.  More than double 200k.

Here are the mileages for the other reported Tesla S/X that had accumulated over 200k by last August.
410,000
330,000
315,000
250,000
230,000
206,000

I don't know the deaths from fire record for Camrys but for ICEVs overall it's much higher than for Teslas.  The few battery fires in Tesla have been slow to start.  They tend to smolder for some time, giving drivers and passengers ample time to exit the car unlike gasoline fires which build very rapidly. 

Sigmetnow

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Re: Tesla glory/failure
« Reply #2587 on: June 17, 2019, 10:02:30 PM »
On a miles-driven basis, Teslas are approximately ~98% *LESS LIKELY* to catch fire vs. ICE vehicles.

Notes: Fire incidence on a per-mile driven basis, per National Fire Prevention Association (NFPA) data on ICE vehicle fires from 2003-07 vs. reported Tesla fires vs. cumulative miles driven to date.
From: https://twitter.com/anonyx10/status/1123085999922454528

- Per news reports, there have been ~20 Tesla fires, w/ 10B+ miles driven, or 2 fires/Bn miles.
From 2003-07, ICE vehicles drove 2,980B miles/year & there were 287K fires/year, or 96 fires/Bn miles. --> 48X more likely to have a fire in an ICE car vs. a Tesla.

- NFPA source data here: https://t.co/f6l4uv6RdI
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b_lumenkraft

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Re: Tesla glory/failure
« Reply #2588 on: June 17, 2019, 10:13:43 PM »
Due to teslaq people, one feels compelled to provide evidence for the fact that the stuff that makes combustions inside of an engine can also do this combustions thing outside of the engine.

This is why we can't have nice things.

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Re: Tesla glory/failure
« Reply #2589 on: June 17, 2019, 10:27:01 PM »
Due to teslaq people, one feels compelled to provide evidence for the fact that the stuff that makes combustions inside of an engine can also do this combustions thing outside of the engine.

This is why we can't have nice things.

Also to provide evidence that cars other than Tesla offer humans ample opportunity to be stupid.

Bottle of water on steering wheel!
AUDI Lane ASSIST Hack (Self driving car) - YouTube
#https://www.youtube.com/watch?v=YauE0R7JNnI

VW Tiguan Self driving car / life hack active lane assist - YouTube
#https://www.youtube.com/watch?v=hI9wrMpxmP0
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Bob Wallace

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Re: Tesla glory/failure
« Reply #2590 on: June 17, 2019, 10:30:12 PM »
 
Quote
Per news reports, there have been ~20 Tesla fires

Two of those fires were in the very early days when Tesla Ss ran over large metal objects in the road and punctured their battery packs.  After those two events Tesla added a shield under the packs and I haven't heard of another fire starting that way. 


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Re: Tesla glory/failure
« Reply #2591 on: June 17, 2019, 10:32:52 PM »
The Maxwell acquisition may be all about increasing Tesla’s battery supply.
Tesla / Maxwell: It Seems Mainstream News Coverage Has Missed The Mark
It may not be about battery tech, but instead, an increased rate of production and capital savings.
https://insideevs.com/news/355152/tesla-maxwell-beyond-battery-tech/amp/

Shared patents aside: Nobody else has the Tesla tech.
Tesla Is a Monopoly, We Just Don’t Know It Yet
Inside industrial warfare at its finest
https://medium.com/swlh/tesla-is-a-monopoly-we-just-dont-know-it-yet-157131037ef8

< What a refreshing article. Among many great quotes: “Tesla might have its problems, but building dream machines isn't one of them.”
It's been 100 years since we've seen anybody like Elon Musk — here's why that's so disorienting
https://www.businessinsider.com/why-tesla-ceo-elon-musk-is-like-this-an-explainer-2019-6#3-musks-biggest-job-is-as-teslas-marketer-in-chief-3

Alex Roy is a big car guy and a very opinionated towards Tesla, pro and con.  But when it came time to buy a new car:
How I Learned To Stop Worrying And Buy A Tesla
A seemingly crazy choice becomes the only choice.
https://www.thedrive.com/opinion/27490/how-i-learned-to-stop-worrying-and-buy-a-tesla

ICE gearheads are not laughing any more.
Quote
Chad Mortensen (@mortchad) 6/15/19, 6:59 PM
I literally walked over & asked “who’s got the fastest car?”
They said the gtr & I said “I’d love to put it against my car!”
I was asked, “what do you have?” “@Tesla #Model3Performance”
TRUE STORY - no takers. “Well it would depend who has best reaction off the line” Ok buddy
https://twitter.com/mortchad/status/1140031089257222145
At the link: Photos of ICE car meet-up: Porsche, Lotus, etc
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b_lumenkraft

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Re: Tesla glory/failure
« Reply #2592 on: June 17, 2019, 10:32:57 PM »
Due to teslaq people, one feels compelled to provide evidence for the fact that the stuff that makes combustions inside of an engine can also do this combustions thing outside of the engine.

This is why we can't have nice things.

Also to provide evidence that cars other than Tesla offer humans ample opportunity to be stupid.

Bottle of water on steering wheel!
AUDI Lane ASSIST Hack (Self driving car) - YouTube
#https://www.youtube.com/watch?v=YauE0R7JNnI

VW Tiguan Self driving car / life hack active lane assist - YouTube
#https://www.youtube.com/watch?v=hI9wrMpxmP0

Ouch, that hurts.  ::)

Bob Wallace

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Re: Tesla glory/failure
« Reply #2593 on: June 17, 2019, 11:01:54 PM »
Quote
The Maxwell acquisition may be all about increasing Tesla’s battery supply.

There are strong rumors that Tesla may be going into the battery manufacturing business.  Maxwell's dry roll process apparently gives Tesla the patents it needs to start rolling their own.  They are already getting Panasonic to manufacture cells for them with a chemistry that Tesla developed.  And Musk has stated that Tesla might get into mining a bit.  There's a lithium brine site not far from the Reno Gigafactory.

Tesla is all about vertical integration and batteries are likely to be very, very large market going forward.

The Maxwell patents should mean a large increase in battery capacity and a nice cost drop.  Getting solvents out of the cells would be very beneficial.  And dry roll cells can be produced with much less floor space.  There's no need for a drying room.  That could open up space at Reno for some vehicle manufacturing.


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Re: Tesla glory/failure
« Reply #2594 on: June 18, 2019, 03:43:21 AM »
There's no need for a drying room.  That could open up space at Reno for some vehicle manufacturing.

Bro, most of the Giga is totally empty. It is, at most, 1/3 used. But I do see awesome it will be to eliminate the drying room. Drying is difficult in Nevada. Not enough space. Too much moisture. #NevadaProblems
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GoSouthYoungins

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Re: Tesla glory/failure
« Reply #2595 on: June 18, 2019, 03:45:29 AM »
Quote
Per news reports, there have been ~20 Tesla fires

Two of those fires were in the very early days when Tesla Ss ran over large metal objects in the road and punctured their battery packs.  After those two events Tesla added a shield under the packs and I haven't heard of another fire starting that way.

The other 90%, irrelevant!
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Re: Tesla glory/failure
« Reply #2596 on: June 18, 2019, 03:53:04 AM »
GSY, can you cite a source for any of your statements?

Can you cite a source for this question? Or the premise on which it is based? Or how about telling me what you are referring to, rather than just a nonsensical blanket question! Ah, but then I could just answer, and you'd look stupid for asking.


Here is a statement:

1+1=2 ,  and Tesla is totally going BK.  (both unsourced)
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GoSouthYoungins

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Re: Tesla glory/failure
« Reply #2597 on: June 18, 2019, 04:03:17 AM »
I talked about our ability to eliminate fossil fuels in 20 years by roughly doubling the progress we've made in previous years.  At the end I should have typed 2040 but messed up and typed 2020.

I'm sure you recognized my mistake for what it was.

Fair enough. I did.

Too tempting to point out how optimistic your error was (considering I find all your other comments to be in the same vein).

Alas, you seem a good fellow, who simply seems to see things differently than me, while not being totally deranged by Cultist Hopium, so I'll try to avoid disparaging comments in the future...


So, I am totally committed and on board for changing the world to be 90% plus off of fossil fuels in the next 2 decades...BUT I don't think it is possible with the same sort of lifestyle the 1st world currently lives. You seem to disagree and believe there are like-for-like substitutes which can make (for example: CARS) effectively "green". I do not hold this belief.  I would love to, in good faith, discuss this.

To establish a mutual level of understanding: what is your personal familiarity with manufacturing, mining, transportation, fluid transportation, industry at large, etc?


(for those who claim this is off topic: tesla's "glory" (at least on ASIF) is about its ability to aid humanity in removing itself for activities which increase GHG levels. thus, if you don't understand how this is germane, shut up and let the adults converse)
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Archimid

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Re: Tesla glory/failure
« Reply #2598 on: June 18, 2019, 04:13:56 AM »
Considering that Model S and X still use 18650 batteries made in japan by Panasonic, and the ample space remaining in Giga1, I can see how Tesla could set up their own battery factory while still buying every 18650 and 2170 Panasonic can make.

But the rumors I've heard about the Maxwell acquisition have very little substance to them. I'm really not sure how it all fits in.

The bull in me says they are fusing Maxwell's technology and fusing it with their own expertise. They start fabricating the next generation battery that is cheaper, lighter and more energy dense. I would be surprised if they don't implement super capacitors into their technology to increase battery life and charge and discharge rates.

The bear in me says they will integrate Maxwell technology into Panasonic's line making it faster, thus making the batteries cheaper, with a likely increase in durability.
I am an energy reservoir seemingly intent on lowering entropy for self preservation.

GoSouthYoungins

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Re: Tesla glory/failure
« Reply #2599 on: June 18, 2019, 05:57:22 AM »
Considering that Model S and X still use 18650 batteries made in japan by Panasonic, and the ample space remaining in Giga1, I can see how Tesla could set up their own battery factory while still buying every 18650 and 2170 Panasonic can make.

Except that Panasonic has recently pulled back plans to expand operations due to Tesla's current inability to buy enough due to lack of demand (or if you believe bulls...I dunno, transportation hell or something).

The bear in me says they will integrate Maxwell technology into Panasonic's line making it faster, thus making the batteries cheaper, with a likely increase in durability.

Ask a bear for the bear take. You can't muster a genuine bear thought. I promise.

Tesla bought Maxwell because Maxwell was going BK and would agree to almost any terms. Tesla wanted their cash on hand and the narrative that maybe there is some amazing tech. This staves off Tesla BK and helps keep Musk from his margin-call. Tesla only had pay with (soon to be worthless) stock. That's a bear take.
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