Musk endeavours

[Hallucigenia]

Charts from Reuters make the point, the purple patch of 2021-22 is over. Tesla is now just another premium carmaker with margins similar to other manufacturers, and barely growing sales. That $200 resistance line is surely going to be taken out now?

[Adamski]

Sales (automotive exc energy and service) q4 vs q3 +1% 1%!, lol. I predicted will eventually happen, despite hype sales have levelled off. Stock price in a declining pattern, just a question of how low it can go. (Long term, think Tesla will be winner in EVs though.)

[TUK020]

Sales (automotive exc energy and service) q4 vs q3 +1% 1%!, lol. I predicted will eventually happen, despite hype sales have levelled off. Stock price in a declining pattern, just a question of how low it can go. (Long term, think Tesla will be winner in EVs though.)

With an army of Chinese suppliers competing on cost? They might well be winners, but not on margins that justify a PE of over 60.
Wait for it....Ody2k will cite FSD as opening up a huge market for autonomously piloted aeronautical pigs

[Adamski]

With an army of Chinese suppliers competing on cost? They might well be winners, but not on margins that justify a PE of over 60.

Agree, however, The price earnings is 42.4 now, after falling 29% since Christmas!

Yes China is going to be a problem for Tesla The U.S. imposes a 25% levy on imported Chinese cars on top of a general 2.5% tariff, which blocks them from the US market. Think Tesla be likely winners in Europe and US, but not china/ RotW.

[88V8]

Sales (automotive exc energy and service) q4 vs q3 +1% 1%!, lol. I predicted will eventually happen, despite hype sales have levelled off. Stock price in a declining pattern, just a question of how low it can go. (Long term, think Tesla will be winner in EVs though.)

With an army of Chinese suppliers competing on cost?

It's not only cheap stuff that will come out of China. There's many mouths waiting to eat Tesla's lunch.

V8

[odysseus2000]

Fascinating to see the focus of attacks on Tesla following q4 earnings 2023.

Sure auto sales are only up 1%, but the whole business is up 3%. Tame by historical standards when Tesla was ultra small. As is there are about 100 million cars made per year, but Tesla sell about 2 million, so there is room for growth.

If one looks at sales growth 2015 to 2023:

https://x.com/icannot_enough/status/174 ... DCpgdbFBxg

It is clear that legacy auto is being murdered. We should not forget that the model y is the best selling car in the world by volume even though once popular cars from Toyota & Honda etc are much cheaper.

We should also not forget that Tesla has good margins, sure down on the last few years but still good excluding regulatory credits, even though Tesla is spending heavily on new products & it now has over $29b on its balance sheet, adding over 4 billion the last quarter, whereas most legacy auto has large debt.

We are still not in the ramp phase for both the semi & Cyber truck. Neither will be huge volume leaders, but they will contribute to future eps & sales.

FSD is in no analysts price since nearly everyone believes it won’t happen, although version 12.1.2 looks impressive so this is a wild card. Ditto for Optimus.

There have been some comparisons between BYD & Tesla equivalent models that show Tesla out perform byd in most technical aspects including safety & especially in FSD. Yes, Chines cars will sell & it’s likely that legacy will get hurt just as they did when Japan began to import cars into the US & Europe.

As of now the outlook for Tesla stock looks weak on a 12-18 month view & it will stay weak till new models (small car named redwood & Optimus) begin to come out & Cyber & Semi ramp. If competitors wanted an opportunity to catch Tesla that moment is now, but it seems more likely that they will fail to take advantage & Tesla will roll over them.

Regards,

[odysseus2000]

Table seats to be competitive in AI are several billion dollars at the moment:

https://x.com/smartertrader/status/1751 ... DCpgdbFBxg

Regards,

[Howard]

FSD versus a wheelie bin. (And invisible people). Tested four months ago.

https://www.youtube.com/watch?v=kfsRFTpaTwA

regards

Howard

[odysseus2000]

FSD versus a wheelie bin. (And invisible people). Tested four months ago.

https://www.youtube.com/watch?v=kfsRFTpaTwA

regards

Howard

Four months is a very long time in AI.

Regards,

[odysseus2000]

Model Y sold over 1.2 million units, best selling car in 2023:

https://x.com/sawyermerritt/status/1752 ... DCpgdbFBxg

Regards,

[odysseus2000]

Elon’s pay package deemed too much by judge:

https://www.theguardian.com/technology/ ... udge-rules

There will likely be an appeal, but the situation is now perilous for Tesla investors.

If Elon is forced to repay part of his compensation he may be forced to sell Tesla stock to generate the cash & he may decide that leaving Tesla & forming a new company not via the Delaware rules is in his interest. He has noted the excessive control that Zuckerberg has over Meta via the voting structure created, as I understand it, while meta (née Facebook) was private.

There are many options here, some dangerous to Tesla investors, that will be considered & it’s hard to have any faith in predictions as the alarm klaxon sounds.

Regards,

[bungeejumper]

So now Musk says Tesla's shareholders will vote on a move to switch the company's incorporation to Texas, because the pesky judge in Delaware said his $55 billion pay package would hollow out shareholder value. Seems to me that if it hollows out shareholder value in Delaware, then it hollows out shareholder value in Texas too.

As erratic geniuses go, Musk is up there with the best of them. Genius, absolutely. But oh dear, there are other things about the man that have troubled me for some time. Thank god he's not running for President!

BJ

[88V8]

As erratic geniuses go, Musk is up there with the best of them. Genius, absolutely. But oh dear, there are other things about the man that have troubled me for some time. Thank god he's not running for President!

He could launch a Presidential perfume brand, then he might get the female vote.

I'm no fan of bloated exec salaries, but it seems beyond ridiculous that a shareholder with nine shares can persuade a court to interfere with someone's pay award five years after the event. What with that and the sink that is Twitter he might as well run for pres.

V8

[scotview]

I'm no fan of bloated exec salaries, but it seems beyond ridiculous that a shareholder with nine shares can persuade a court to interfere with someone's pay award
V8

Maybe, as a first step, the judge should try and build a company(s) as huge and innovative as Musk's before he passes any judgement.

[bungeejumper]

Maybe, as a first step, the judge should try and build a company(s) as huge and innovative as Musk's before he passes any judgement.

A fair comment, but our human competences differ. Some people move fast and break things, and others are there to make sure people don't get hurt.

We've already had enough evidence from the SEC that Musk doesn't spend too much time worrying about how his pronouncements might skew the markets. (Overstating market caps on Twitter, and the like.) And maybe we shouldn't forget that Musk's $56 billion pay packet would be around half of global 2023 earnings? ($71.6 billion in the first three quarters.) That's quite a lot for a 22% equity holder.

But the more real worry, right now, is surely that large institutional investors might start to worry about whether Captain Marvel can be relied upon to protect their own interests from being undermined? Once that dam of confidence starts to crack, the consequences might arrive soon enough to cause a real problem.

BJ

[Hallucigenia]

A cynic might compare Tesla with BMW. BMW is a bigger company in almost every respect - more cars, higher revenue, growing faster, almost double the R&D.

And yet BMW has a market cap of only $65bn. So that cynic might argue that Tesla shareholders should reward the man who has hyped a smaller company than BMW into a market cap of 10x BMW, even if that reward takes the form of a payout so large he could almost buy the bigger company with it.

I guess that also brings us back to the R&D thing, if you ignore the hype and look at how much Tesla spend on R&D, it's not very much compared to their peers. 4% of sales hardly backs up the "tech company" image, and it's one reason I'm a bit sceptical of future growth. I get it, they spend a lot of their R&D budget in China, and it's easier when you only have a few models that you replace less frequently than competitors, but even so it feels like there's not enough substance there to back up the hype.

[Tedx]

I guess one aspect might be that R&D on fossil fuel engines is expensive where as electric motors are pretty straightforward?

[ursaminortaur]

I guess one aspect might be that R&D on fossil fuel engines is expensive where as electric motors are pretty straightforward?

I'd have thought the opposite was the case. We have been honing the internal combustion engine for over a hundred years whereas practical electric engines with suitable battery technology is relatively new. R&D on internal combustion engines nowadays is surely just making minor tweaks with little chance of major performance boosts whereas R&D on electric engines and batteries might still find ways of boosting range and performance.

[odysseus2000]

There are several points about the judgement that has cancelled Elon Musk’s pay package.

In this interview the lawyers against Musk says that the reason for the cancelling of the judgement was that the shareholders were not properly informed about what the salary package meant & he hints there was deception on the part of the folk who supported it such that the share holders voted under false information & as such the award was not lawful:

https://youtu.be/KYNSxz3bumI?si=GW-1WAo4_qleGUg7

Also it transpires that the judge is a friend of president Biden:

https://x.com/elonmusk/status/175297631 ... DCpgdbFBxg

It seems a long stretch to argue that the board & who ever conspired to hide details from shareholders given that the board is made up of sophisticated investors who would not likely do things that would hurt their own share holdings & open the company to claims of illegal behaviour.

The action was launched by an investor with 9 shares who has seen the value of those 9 shares increase substantially as have all other share holders after Tesla produced exceptional results in the 6 years since the award.

Every share holder has to made up his or her mind, but I find it difficult to reconcile board independence with the judges ruling especially as share holders did very well.

Regards,

[odysseus2000]

I guess one aspect might be that R&D on fossil fuel engines is expensive where as electric motors are pretty straightforward?

I'd have thought the opposite was the case. We have been honing the internal combustion engine for over a hundred years whereas practical electric engines with suitable battery technology is relatively new. R&D on internal combustion engines nowadays is surely just making minor tweaks with little chance of major performance boosts whereas R&D on electric engines and batteries might still find ways of boosting range and performance.

Legacy auto has two big research programs go8ngnon simultaneously:

1 Find away to make attractive electric vehicles that sell at a good positive margin. This proving a terrible struggle for all of them.

2 Develop alternatives to diesel & petrol, so called efuels & hydrogen, that are cost competitive with existing technology & renewable.

Meanwhile they are refining existing motors to be cleaner using various technologies such as direct injection, stop start, lighter materials, … a long list of stuff that has been relentlessly refined since Henry Ford.

By contrast there are two areas of development for electric cars: Batteries & motors with associated control electronics. There are several business focused entirely on batteries so Tesla’s spend is geared by all these other folk. On the motors & associated electronics there are still many things including the move to 48 volt systems, the hvac (heating, ventilation, air conditioning) etc.

Additionally most legacy makers have many cars all of which need r&d such that to invest at the same level that Tesla does requires more expenditure over the whole range.

It is hard to argue that Tesla have not done a great job in defining market sectors to go after & doing so with precision. If Tesla were stagnating one could argue that their r&d is too low, but they are branching out into Semi, Cyber, small car, project Redwood, new battery lines etc & building a new factory in Mexico.

Incidentally legacy auto are all handicapped by long term debt. BMW have over $57b whereas Tesla have over $29b in cash. The idea that BMW are a growing business & safe is a challenged narrative.

As of now there are around 100 million cars produced per year, Tesla make over 2 million & other makers such as byd make a few more, but around 90% of new cars are internal combustion.

Regards,