Musk endeavours

[odysseus2000]

Nice Elon interview stretching across very many subjects (32:29):

https://youtu.be/FPpPTp7FIHY?si=_P5CnJ2tVhtdcDVz

Regards,

[odysseus2000]

National Public Radio which is a US sort of equivalent of the BBC is losing viewers:

https://x.com/elonmusk/status/1777763434727186655

Yes, one can argue this is a post covid phenomena, but not all media are in decline like this.

Regards,

[88V8]

Nice Elon interview stretching across very many subjects (32:29):

He seemed more enthused about Mars than Tesla.

Surprised to see no comment on here about Tesla apparently abandoning their ambition to produce a cheap car.
As reported in The Times, Saturday (hardcopy).

Presumably that's just the reality of China's EV explosion.

V8

[odysseus2000]

Nice Elon interview stretching across very many subjects (32:29):

He seemed more enthused about Mars than Tesla.

Surprised to see no comment on here about Tesla apparently abandoning their ambition to produce a cheap car.
As reported in The Times, Saturday (hardcopy).

Presumably that's just the reality of China's EV explosion.

V8

The demise of the cheap car all comes from a Reuters article which was called a lie by Musk 4 days ago, but it is still being published & quoted as facts:

https://x.com/thesonofwalkley/status/17 ... DCpgdbFBxg

Project Redwood (name for new car) is still on going. Whether this will also be a robo taxi is not clear, but we will get a steer on 8 of the 8th, presumably this year.

Regarding Chinese competition, Tesla did better in % terms of sales compared to Q4 & Tesla margins are better than byd, so there is no obvious threat from byd or any other Chinese manufacturer to Tesla. The threats are towards legacy auto: VW, Ford, GM, et al. However, the mainstream media, which is losing sales, get a lot of advertising revenue from legacy auto & so dare not be critical. I still feel the biggest opportunity is to be long Tesla, but there is an argument that short option leaps on legacy auto is a potential high win lottery ticket that can be picked up at low cost.

Musk is enthused about all manner of stuff. How he manages to do it all is unclear, but the road map for Tesla is by far the best in the auto/AI industry with relentless profitable sales while most legacy & Rivian are losing thousands on each BEV they sell.

It is fascinating to read the mainstream media having studied the auto industry for a long time. The quality of the research that journalists should rely on is a little better, but most journalists can’t even be bothered to go beyond the head lines.

It is also interesting how legacy media are not looking at the business case for SpaceX. It is not clear to me how SpaceX can fund the move to Mars with their disclosed income streams as best I can tell from what is a private company, so no accounts. This suggests to me that SpaceX must either be getting very substantial sums from US DOD (there is a SpaceX military division) or there are other projects planned that can generate lots of cash. Or perhaps he feels that X & X-AI will become a massive cash cow that he can use his earnings from to support the move to Mars. He estimated the cost at about 1% of the global economy which is roughly $100 trillion, so if he is correct SpaceX will need $1 trillion. Musk is worth around $200 billion, so to fund Mars would need 5x his worth which is doable if lots of his projects work and/or he gets partnerships from other billionaires. It is a lot of dosh, but not impossibly large.

Regards,

[Adamski]

The likes of Ford and GM are struggling with EVs and going to Hybrid. Noticing Toyota doubling its hybrid sales. Pure EVs have plateaued and Tesla is no longer a growth company. It'll take time for this new reality to be reflected in the stock price.

The basic problem is the early adopters, the tech geeks and ceos/directors have them, but ordinary folks not interested.

[odysseus2000]

The likes of Ford and GM are struggling with EVs and going to Hybrid. Noticing Toyota doubling its hybrid sales. Pure EVs have plateaued and Tesla is no longer a growth company. It'll take time for this new reality to be reflected in the stock price.

The basic problem is the early adopters, the tech geeks and ceos/directors have them, but ordinary folks not interested.

And yet the Model Y is the best selling car (all cars not just electric) in the world.

The economics of owning a car like the 3 that is around $39k before incentives are overwhelming. A similar spec gas or diesel car would cost a similar amount and have far higher running costs.

Sure every man and his dog believes, after extensive misinformation campaigns, that electric cars are way too expensive, the batteries don't last and we will forever drive gas, but the reality is so different and as the cost benefits begin to spread out from the early adopters the uptake of BEV will increase.

Electric cars are a revolution just as the PC was, the |Internet, the App, Smart phones. All faced intense consumer reluctance and then became consumer essentials and so it will be with electric cars.

Regards,

[odysseus2000]

Lots of commentary on this announcement that supervised FSD is now $99 per month:

https://x.com/elonmusk/status/177888136 ... DCpgdbFBxg

Having watched many hours of the full neural net FSD videos it is clear that the new system is far more capable than anything else. It is possible that all the YouTube video are hoax, but that seems unlikely as there are such a wide range & many who have been reviewing FSD for several years.

As I recall FSD was selling for $12k, so at $99, round new monthly to $100 for ease, that is $1.2k per year, requiring a $12k buyer to have it for 10 years to cost what a per month diver pays. Prior buyers are likely miffed.

The big question is what fraction of Tesla owners will buy the monthly FSD.

There have been about 5.2 million Tesla cars made, maybe 80% can take FSD & if we assume 50% are in the us where the FSD offer is available, then there are around 2 million potential buyers. If we assume 10% then revenue per year is
0.2 million x $1200 = $240 million

50% take up would be 5x240 = $1.2 billion.

Tesla 2023 revenue was $96 billion, so as a contribution to revenue even a 50% take up is small, but this is revenue with out much additional cost, I.e. sales of FSD go straight to the bottom line.

Tesla 2023 pre tax earnings were $10 billion.

So if there is a 50% take up then it would add about 10% to pre tax profits which is enough to excite Wall Street as if it happens Tesla have created 10% by magic out of thin air.

Is $1200 a lot? The average US salary in 2024 was $59k.

This suggests that many who can afford a Tesla would be able to spend $1200 with out hardship.

Interesting set up. Tesla next report is due 23-April. This will likely be a lower earnings than previous, but likely over shadowed by the FSD excitement. Cynics will argue that FSD is a smoke screen to cover the likely disappointing earnings. Bulls will argue this is the start of a re-rating of Tesla stock price.

In my humble opinion FSD, based on all the video I have watched (not personal experience) is now worth having & will be licensed by other auto. Whether it is good enough for robo taxi is not clear, but if the current rate of progress continues it will soon be so.

Regards,

[odysseus2000]

Elektrek say Tesla are cutting over 10% of its work force:

https://electrek.co/2024/04/15/tesla-la ... workforce/

Don’t know if it’s true, but would be consistent with how Musk runs his business as more & more AI is deployed.

Tesla stock down over 1% in the pre market.

Regards,

[88V8]

Elektrek say Tesla are cutting over 10% of its work force:

It's a great pity that buyers in the UK and Europe no longer seem to care where things are made, no longer support their local manufacturers - insofar as they still exist - and will buy Chinese or any other origin, so long as it's cheap.

By the time the UK and EU get round to tariff barriers, it will be too late.

V8

[ReformedCharacter]

It's a great pity that buyers in the UK and Europe no longer seem to care where things are made, no longer support their local manufacturers - insofar as they still exist - and will buy Chinese or any other origin, so long as it's cheap.

By the time the UK and EU get round to tariff barriers, it will be too late.
V8

Yes but, for example, the once mighty British car and motorcycle industries dug their own graves by producing poor quality, inferior products. I think people did care but at the end of the day chose better quality imported options.

RC

[odysseus2000]

The decline of the UK from being a major innovative manufacturer is tragic.

In my humble opinion part of the decline can be laid at the business educational system that has created a set of people focused on getting themselves rich & not caring about their customers. As a recent example I bought some tyres from National Tyre with guarantees to replace an unrepairable tyre with a new one with a discount based on the amount of tread left on the unrepairable tyre. One tyre got a screw in it, close to the edge which was deemed not repairable, so I asked for a new one with a discount based on the warranty, but they refused as although they still trade as National, they are now owned by Halfords & refused to honor the National warranty. So I won’t buy anything else from them. By contrast I bought a tool from a Chinese seller, but they sent the wrong one & after sending pictures they agreed they had sent the wrong tool & have organised a full refund, without me needing to send the tool back.

I happen to own a Rover 25 built shortly before Rover went under. If I compare the quality to early UK cars this one has been built as cheaply as possible. I had the same experience with Mercedes which once made great cars, but the one I bought was made as cheap as possible: Ferrous brake & oil suspension pipes that corroded, massive corrosion indicative of a poor anti corrosion treatment & compared to the Volvo I own of the same era cheap & nasty. Even the injectors on the Merc were held in with m6 stretch bolts, tapped into the alloy head, several of which leaked & I ended up having to retap all the holes to m8 to secure the injectors. Then the front coil spring supports rusted into holes & can only be replaced by welding on a jig, whereas Volvo ones are relatively easy to swap with no welding.

Over & over when I deal with relatively recent European tech it is built to accountants specs not engineers. Yet at one time UK engineering was the finest in the world. The weapons made for the second war were well built & robust & in many cases world leading. The US Mustang fighter only reached its potential when it got a Rolls Royce Merlin engine.

The Chinese tech I have has been first class & at great prices, such that I either buy old machine tolls at car boots, more recently off eBay in Imperial units or Chinese. Japanese stuff was similarly well made, but far more expensive than Chinese.

When I talk to various folk in UK business it is obvious who the engineers are & who the management are as the latter are not interested in what they sell, just on making money. The local Baxi heating business was great till it was taken over & all the investment from the previous managing Director skipped as they sold the site for housing.

I have no idea what all the brass hats are on about, in terms of fighting a war with Russia. We can neither feed ourselves or make arms in the volumes needed should our Island be blockaded as happened in both world wars.

End of rant!

Regards,

[Adamski]

Down 5%, after redundancy announcement. Testing new lows now. Amazed that not crashed given the business now actually contracting. The elevated valuation supposed to be based on growing 50% every year. As long said ppl that want one have one, most people simply prefer their petrol car... unless they (evs) become much cheaper.

[Howard]

The Tesla news is interesting when compared with the progress of companies like VW and BMW whose margins are improving and both have increased their workforce over the last year to deal with demand for their BEV, Hybrid and ICE models.

Next week we will see how much Tesla has had to cut its margins to achieve volume.

regards

Howard

[Mike4]

The big problem with EV sales is actually range anxiety, I suggest.

Not amongst EV drivers, but in ICE drivers who want a charging network as numerous and reliable as the petrol/diesel network is now. Me included.

Once that happens, the mass acceptance Oddy mentioned earlier will finally happen.

[odysseus2000]

Down 5%, after redundancy announcement. Testing new lows now. Amazed that not crashed given the business now actually contracting. The elevated valuation supposed to be based on growing 50% every year. As long said ppl that want one have one, most people simply prefer their petrol car... unless they (evs) become much cheaper.

I have no idea where this analysis comes from, nor the reaction to the Tesla redundancies.

The US 10 year having fallen to around 4% is now back at 4.6%, creating a head wind for stocks as capital moves back to bonds & this has taken the whole market down: spx down 1.2%, nasdaq down 1.8% as Fed rate cuts have receded towards the end of the year if even then.

Meanwhile everyone is focused on Tesla & ignoring competitors. Ford has tried to make BEV & is struggling, down about 2.8% after a bit of post market support. GM, Toyota et al are all losing sales to electric cars. It is clear that folk don’t want internal combustion, the market is moving rapidly to BEV.

Tesla have cut staff by at least 10% which is bad for those fired but for the business it is good & Musk has repeatedly cut when ever possible in all his business which is a sign of management focused where they should be, on the bottom line.

Legacy press is relentless focused on rubbishing Tesla because legacy auto advertises with them & Tesla advertise on X which is taking eyeballs off legacy media.

Sure Tesla’s last results were not great, but there is no focus on the poor results from legacy auto. Meanwhile Tesla has new income streams from Optimus, storage, charging, FSD & new & upgraded models.

The next Tesla report on the 23rd will be interesting.

Regards,

[odysseus2000]

Elektrek repeat claims that the model 2 has been suspended:

https://electrek.co/2024/04/15/tesla-pu ... 20vehicles.

Who is lying here? No idea, but it makes the next earnings report more interesting!

Regards,

[88V8]

It's a great pity that buyers in the UK and Europe no longer seem to care where things are made, no longer support their local manufacturers - insofar as they still exist - and will buy Chinese or any other origin, so long as it's cheap.

Yes but, for example, the once mighty British car and motorcycle industries dug their own graves by producing poor quality, inferior products.

Yes, but, iirc the unions also had a lot to do with it.

Seems that Musk is not enamoured of Unions which is a point in his favour.

Musk said: “I disagree with the idea of unions … I just don’t like anything which creates a lords and peasants sort of thing.”

V8

[Tedx]

Yes but, for example, the once mighty British car and motorcycle industries dug their own graves by producing poor quality, inferior products.

Yes, but, iirc the unions also had a lot to do with it.

Seems that Musk is not enamoured of Unions which is a point in his favour.

Musk said: “I disagree with the idea of unions … I just don’t like anything which creates a lords and peasants sort of thing.”

V8

<Choke>

https://www.theverge.com/2023/8/16/2383 ... the-giants

[ReformedCharacter]

Yes but, for example, the once mighty British car and motorcycle industries dug their own graves by producing poor quality, inferior products.

Yes, but, iirc the unions also had a lot to do with it.
V8

Can't disagree with that, but not only the car manufacturer's unions but also their suppliers, such as the manufacturers of Triplex glass (Pilkingtons). My father was - probably correctly - of the the view that post-war the car manufacturers were under capitalised and using old fashioned equipment:

The challenge was enormous. Brown’s Lane was a sweatshop of old buildings for low-paid, occasionally hard-working people slowly shedding the benign philosophy of William Lyons, the former owner: ‘If a bucket has a hole, I’ll repair it. I won’t buy a new one.’ Old-fashioned machines and production methods had not been discarded. Improvisation was the gospel. The Jaguar’s metal panels were stitched together rather than pre-assembled on big frames; the electrical parts supplied by Smith’s and Lucas were faulty; the chassis, manufactured in Castle Bromwich, had rusted by the time the bare metal was delivered on open trucks to Brown’s Lane; and customers regularly found their new car’s paintwork on their fingertips.

https://www.aronline.co.uk/cars/jaguar/xj6-xj12/the-cars-jaguar-xj6xj12/

RC

[Howard]

Meanwhile everyone is focused on Tesla & ignoring competitors. Ford has tried to make BEV & is struggling, down about 2.8% after a bit of post market support. GM, Toyota et al are all losing sales to electric cars. It is clear that folk don’t want internal combustion, the market is moving rapidly to BEV.

Regards,

TOKYO, Feb 6 (Reuters) - Japan's Toyota Motor (7203.T), raised its full-year operating profit forecast by nearly 9% on Tuesday, after its third-quarter earnings raced past analysts' estimates thanks to a weaker yen and strong sales of high-margin cars and hybrid vehicles.

Toyota's profits are looking good. They are selling huge numbers of premium cars like Lexus and profitable hybrids. 2024 has been good for them so far and they have been increasing their workforce gradually over the last ten years with a brief drop during Covid.

regards

Howard