Musk endeavours

[BobbyD]

Looking at the 2019 sales and profitability figures, the Tesla story may go down in history as one of the best examples of how not to market cars.

Surely they missed a big opportunity to become a huge success story. If, as we are told, sales were constrained by production capacity, why oh why did Tesla not charge a little more for each car?

I'm not sure you are allowed to use logic when it comes to Tesla!

If Tesla tech was as good as we were constantly being told I think they missed a bigger boat. Faced with a company that knew the least about manufacturing and manufacturers who needed electric tech to avoid emissions fines I recall saying long before VW opened up the MEB platform to outsiders that Tesla should have sold or licensed their BEV tech to Big car.

They sell on their emissions credits anyway, so why insist on doing the things you aren't very good at, and you don't have a fraction of the same bandwidth as the rest of the industry for, at a time when you had a clear technological advantage instead of entrenching that advantage by making yourself the default go to and adding mountains of scale? Instead Tesla decided to use the time it took Big Car to take BEV's seriously learning about half of what Big Car already knew about car manufacturing while Big Car spent the time learning about 90% of what Tesla knew about BEV's. If you compare the research budgets of Tesla and everybody else it should be clear that Tesla's one significant advantage had a shelf life, and they've wasted most of it going from boutique manufacturer to very small manufacturer.

An unenthusiastic automotive industry looking to tick the compliance box without an expensive development process would have provided no shortage of customers for an out of the box BEV platform, Tesla would have had instant scale, monopolised supply chains, could have concentrated on BEV development rather than seat design and paintshops and door seals, significantly reduced the amount of competitor development, and had everything from little European run abouts to massive American trucks running around every continent on their platform without ever having to design or market a car. Lowering the ramp for Big Car to get on the BEV train would also have significantly advanced Musk's declared goal for Tesla, to advance the transition to sustainable transport. If they wanted to run Porsch-la on the side to keep Elon busy then fair enough I guess...

[odysseus2000]

Fascinating how selling a car like the Porsche at very high margin, or in layman terms very over priced, is seen as a great success story.

If the punters will continue to pony up then all will be well, but what happens if punters stop being so enthusiastic with their money?

With Porsche we have all the ingredients necessary for serious trouble: A massively over priced ice car that uses obsolete fuel & is being competed against by its own BEV stable mate at -ve margin.

Very like a tall stack of dominoes, any slight push such as higher carbon tax & the whole edifice comes crashing down & history tells us that such a decline is inevitable.

If I was an owner of VW stock I would sell & never come back.

Regards,

[BobbyD]

Fascinating how selling a car like the Porsche at very high margin, or in layman terms very over priced, is seen as a great success story.

If the punters will continue to pony up then all will be well, but what happens if punters stop being so enthusiastic with their money?

With Porsche we have all the ingredients necessary for serious trouble: A massively over priced ice car that uses obsolete fuel & is being competed against by its own BEV stable mate at -ve margin.

Very like a tall stack of dominoes, any slight push such as higher carbon tax & the whole edifice comes crashing down & history tells us that such a decline is inevitable.

If I was an owner of VW stock I would sell & never come back.

Regards,

Analysts at the Communist Bank of Ody today dropped their rating on Porsche from Sell to Sell now you crazy MF's, on the basis that Porsche's profit margin is far too high.The note read, "Making money by selling cars, whatever do they think they are doing?". Their rating on Tesla remained steady at 'put your house on it' citing the company's reassuring inability to break even for more than 5 minutes in any financial year which is clear evidence of their future world domination.

About half of serious interest in the Taycan has come from existing Porsche owners, the second highest source of interest was Tesla owners. Why is this a good thing? It validates the acceptance of the Taycan as a genuine Porsche, rather than atoy car with a Porsche badge on the bonnet, and Porsches as we have seen are much in demand and heavily profitable to produce. In other words the value in the Porsche name, history and brand doesn't seem overly threatened by electrification.

You couldn't hack being a VW shareholder Ody, the nice cheques they send you every year would drive you mad. Although this does possibly explain your previous comment that you were unable to make money investing, hence your predilection for trading.

[BobbyD]

Pause for thought:

More Teslas on the Road Meant Hours-Long Supercharger Lines Over Thanksgiving

The busiest travel weekend of the year was an interesting test for Tesla's fast-charging network.

I can understand why they might not want to, or be able to, expand every supercharger station to peak holiday capacity, but hows about some of these portable chargers we've been hearing about?

Good news:

Volkswagen to install free EV charging points at 600 Tesco stores

Volkswagen has announced plans to install 2,400 electric vehicle charging points at Tesco stores across the UK.

The car manufacturer said the rollout is already underway and EV drivers at 100 Tesco stores are now able to top up their battery for free while shopping.

All electricity used to charge cars at the Tesco sites comes from renewable sources.

According to research conducted by Volkswagen, the average Brit spends 50 minutes per week in a supermarket.

If electric car owners were to plug in their vehicles for these 50 minutes they could get around 22.5 miles of free charging.

Over a whole year, this works out as 1,170 miles, the equivalent of driving from London to Rome.

- https://airqualitynews.com/2019/12/05/v ... co-stores/

[Howard]

Fascinating how selling a car like the Porsche at very high margin, or in layman terms very over priced, is seen as a great success story.

If the punters will continue to pony up then all will be well, but what happens if punters stop being so enthusiastic with their money?

With Porsche we have all the ingredients necessary for serious trouble: A massively over priced ice car that uses obsolete fuel & is being competed against by its own BEV stable mate at -ve margin.

Very like a tall stack of dominoes, any slight push such as higher carbon tax & the whole edifice comes crashing down & history tells us that such a decline is inevitable.

If I was an owner of VW stock I would sell & never come back.

Regards,

Dear Ody

As usual your comments make this an entertaining forum - and congratulations for that!

Without resorting to fanciful predictions for the future and sticking to current facts, what is wrong with the financial performance of a company which has for 70 years made sustainable profits selling cars which have always been in demand? And in that time it has employed a loyal well-trained workforce who have turned out the highest quality products?

Yes, we can all agree that ICE cars are polluting and there is an urgent need to dramatically reduce pollution and all manufacturers must be forced by regulations to comply.

As investors the challenge is for us to back manufacturers who can demonstrate that they have the skills to meet this new challenge and sustainably produce low emission cars (or personal transport).

Looking at the track record of Porsche and their current owners VW and comparing with Tesla we have to make a judgement as to who might be more successful.

If you engineers are right, Tesla have had a wonderful technical advantage over the last three years. But throughout this time they have made huge mistakes.

In marketing terms, they have abysmally failed to exploit that advantage. Instead of profitably developing sales and building a reputation for excellence they have made losses by underpricing their cars and producing poor quality customer service.

Any fool knows that it’s easy to sell products for substantially below cost. If Tesla really are supply constrained, why didn’t they increase prices to balance supply and demand so that they had a huge amount of capital to invest in their next product range? Porsche are a brilliant historical example of how to do that.

None of us can forecast whether Tesla will become a better run company or whether VW and Porsche will continue to be hugely successful at making quality cars. We are all guessing, despite some of the fancy analysis quoted on this forum.

It’s ironic that Tesla’s future growth might be severely limited by the success of a company that committed the huge offence of dieselgate - and then was nimble enough to quickly learn how to recover!

regards

Howard

PS Declaring an interest and answering your final point, I did have a significant holding in VW and sold on the Monday after dieselgate was revealed. It was a profitable investment but indefensible after that news. Their stock now looks attractive again under the new(ish) management.

[odysseus2000]

Howard
Without resorting to fanciful predictions for the future and sticking to current facts, what is wrong with the financial performance of a company which has for 70 years made sustainable profits selling cars which have always been in demand? And in that time it has employed a loyal well-trained workforce who have turned out the highest quality products?

Nothing if there are no secular changes coming to the industry which is why I still like Apple, but everything if there are secular changes coming.

Any industry that is very profitable & then finds a new tech transforms their industry is in trouble. Investors are assuming that the good times will continue & at the same time they will transition to the new tech without trouble. This is a highly fanciful view which will get investors creamed. There is an opportunity for investors to leg it now, but it will close.

Regards,

[Howard]

Howard
Without resorting to fanciful predictions for the future and sticking to current facts, what is wrong with the financial performance of a company which has for 70 years made sustainable profits selling cars which have always been in demand? And in that time it has employed a loyal well-trained workforce who have turned out the highest quality products?

Nothing if there are no secular changes coming to the industry which is why I still like Apple, but everything if there are secular changes coming.

Any industry that is very profitable & then finds a new tech transforms their industry is in trouble. Investors are assuming that the good times will continue & at the same time they will transition to the new tech without trouble. This is a highly fanciful view which will get investors creamed. There is an opportunity for investors to leg it now, but it will close.

Regards,

Sorry to be pedantic but you are making my point.

Secular change is a descriptive term used to refer to market activities that occur over the long term. (Investopedia definition).

So by your argument, established manufacturers have plenty of time to react to a long term trend. In this situation efficient, quality producers with good marketing skills will always win over less skilful competitors. Tesla are wasting time and capital. They had an opportunity to build a profitable company like Apple, but they are in danger of frittering away their advantages by indulging in vapourware which is unlikely to get built rather than making each model very profitable and enhancing their quality reputation.

Apple's main success was due to a very short term trend towards smartphones. It only took about three years for the iphone to become successful. So not a slow secular trend like BEV adoption.

regards

Howard

[odysseus2000]

Howard
Sorry to be pedantic but you are making my point.

Secular change is a descriptive term used to refer to market activities that occur over the long term. (Investopedia definition).

So by your argument, established manufacturers have plenty of time to react to a long term trend. In this situation efficient, quality producers with good marketing skills will always win over less skilful competitors. Tesla are wasting time and capital. They had an opportunity to build a profitable company like Apple, but they are in danger of frittering away their advantages by indulging in vapourware which is unlikely to get built rather than making each model very profitable and enhancing their quality reputation.

Apple's main success was due to a very short term trend towards smartphones. It only took about three years for the iphone to become successful. So not a slow secular trend like BEV adoption.

regards

Howard

Yes, secular change with a product that is 50x more expensive than another will have a different time line.

Additionally the whole idea that a new company that is growing fast, but isn't producing as many cars as legacy indicates that the whole business is wrong has no historical strength.

Legacy auto wanted to transition to BEV or hybrids over decades and invested accordingly, but instead they are having to say they are doing it now while at the same time not doing it and continuing to reap in profits from legacy cars. Investors are applauding this and this makes changing to BEV much more of a board room issue as the legacy bulls will argue no change is needed and swamp out the legacy bears who argue change is urgent. Meanwhile many of the buying punters are very conservative and are frightened to change from something they have known all their lives to something that is new and to them frightening. Talking to people who have legacy cars it is interesting how little they know about BEV and what they do have in their minds is hopelessly wrong. One guy the other day was telling me that there wasn't enough electricity to power all the BEV cars. Human mind sets are fascinating things, resisting change until suddenly changing which is a wave that is slowly building for BEV and when it does come will cause legacy serious trouble.

imho there are two factors that will trigger this wave, the first is that politicians will push through carbon taxes, but this looks increasing unlikely. The second is that punters will wake up to the fact that BEV are far better and that wake up is taking a long time but will happen.

Regards,

[dealtn]

The second is that punters will wake up to the fact that BEV are far better and that wake up is taking a long time but will happen.

Have you considered the possibility that, as yet, BEV isn't "far better", hence the "long time". It might become "far better", of course, in which case it would be reasonable for that "long time" to shorten.

Every thing I read from you seems to suggest you are too "married" to what you believe to be true, or want to be true, rather than what actually is true. Like you say Human Nature is a wonderful thing to observe in practice.

[ReformedCharacter]

EV drivers can charge for free at Tesco:

https://www.fleetnews.co.uk/news/enviro ... e-at-tesco

Every little helps

RC

[odysseus2000]

The second is that punters will wake up to the fact that BEV are far better and that wake up is taking a long time but will happen.

Have you considered the possibility that, as yet, BEV isn't "far better", hence the "long time". It might become "far better", of course, in which case it would be reasonable for that "long time" to shorten.

Every thing I read from you seems to suggest you are too "married" to what you believe to be true, or want to be true, rather than what actually is true. Like you say Human Nature is a wonderful thing to observe in practice.

I make it an habit to ask anyone I see with an electric motors as to whether they like it better than ICE motors and so far everyone who has got a BEV has replied that they prefer BEV over previous ICE. Their reason include: quieter, smoother, faster, no more petrol station visits...

I am sure some folk with a BEV hate BEV, but so far I have not met one.

As I have mentioned several times I am long Tesla so my evangelising for BEV is not without self interest but I drive a Volvo Diesel which is hypocritical but it cost me very little and I am forever focused on miles per £ invested.

I would be most interested in any arguments that anyone wants to put up as to why ICE cars are better than BEV and why BEV will fade away. I have so far read many of these and all have imho been fundamentally flawed, but I always like alternative views which is why this board is so useful.

As things now are there is enough Tesla hostility here to make me positive for the investment potential, so many folk who can in the by and by become Tesla bulls. If we get to a state where there are no Tesla bears I will get worried.

Regards,

[odysseus2000]

Tesla made Chinese cars eligible for Chinese subsidy:

https://seekingalpha.com/news/3524287-c ... email_link

Regards,

[dealtn]

I make it an habit to ask anyone I see with an electric motors as to whether they like it better than ICE motors and so far everyone who has got a BEV has replied that they prefer BEV over previous ICE. Their reason include: quieter, smoother, faster, no more petrol station visits...

So you are asking people who have a BEV about their BEV purchase decision, and basing your "knowledge" on that in making your arguments about the BEV being "far better".

Have you ever heard of Confirmation Bias!

[TUK020]

Analysts at the Communist Bank of Ody today dropped their rating on Porsche from Sell to Sell now you crazy MF's, on the basis that Porsche's profit margin is far too high.The note read, "Making money by selling cars, whatever do they think they are doing?". Their rating on Tesla remained steady at 'put your house on it' citing the company's reassuring inability to break even for more than 5 minutes in any financial year which is clear evidence of their future world domination.

Goodness gracious, a change in tack!
I have long been amazed by the perserverance of BobbyD, Howard, et alia.
You folks seem to think that reason and evidence will in the day in the 1001st post, despite it having failed for the first 1000.
tuk020

P.S. I love the "Sell now you crazy MFs" rating

[odysseus2000]

I make it an habit to ask anyone I see with an electric motors as to whether they like it better than ICE motors and so far everyone who has got a BEV has replied that they prefer BEV over previous ICE. Their reason include: quieter, smoother, faster, no more petrol station visits...

So you are asking people who have a BEV about their BEV purchase decision, and basing your "knowledge" on that in making your arguments about the BEV being "far better".

Have you ever heard of Confirmation Bias!

If someone has bought a poor quality or poor performance widget they love to share their misery.

Find someone who bought a iPhone that bent in their pocket & mostly they loathe Apple, someone who spilt water on their MacBook & they loathe the fact that it cost thousands to fix & will share their misery with anyone who will listen. The guy who bought a new Mercedes & its spring shattered on his drive was not backwards about telling me how rubbish Mercedes are.

All over the internet there are stories of folk who loathe their Tesla for its long time in the repair shop or what ever. I have seen many video, but in person I have met no one so far who does not like, usually love, their BEV.

Regards,

[dealtn]

I make it an habit to ask anyone I see with an electric motors as to whether they like it better than ICE motors and so far everyone who has got a BEV has replied that they prefer BEV over previous ICE. Their reason include: quieter, smoother, faster, no more petrol station visits...

So you are asking people who have a BEV about their BEV purchase decision, and basing your "knowledge" on that in making your arguments about the BEV being "far better".

Have you ever heard of Confirmation Bias!

If someone has bought a poor quality or poor performance widget they love to share their misery.

Find someone who bought a iPhone that bent in their pocket & mostly they loathe Apple, someone who spilt water on their MacBook & they loathe the fact that it cost thousands to fix & will share their misery with anyone who will listen. The guy who bought a new Mercedes & its spring shattered on his drive was not backwards about telling me how rubbish Mercedes are.

All over the internet there are stories of folk who loathe their Tesla for its long time in the repair shop or what ever. I have seen many video, but in person I have met no one so far who does not like, usually love, their BEV.

Regards,

So you extrapolate the experience of a single person who hasn't encountered anyone with a bad word to say, to make a claim that "BEV are far better..." etc.

You really are priceless in your scientific integrity, no wonder a few question your arguments!

[redsturgeon]

I make it an habit to ask anyone I see with an electric motors as to whether they like it better than ICE motors and so far everyone who has got a BEV has replied that they prefer BEV over previous ICE. Their reason include: quieter, smoother, faster, no more petrol station visits...

So you are asking people who have a BEV about their BEV purchase decision, and basing your "knowledge" on that in making your arguments about the BEV being "far better".

Have you ever heard of Confirmation Bias!

If someone has bought a poor quality or poor performance widget they love to share their misery.

Find someone who bought a iPhone that bent in their pocket & mostly they loathe Apple, someone who spilt water on their MacBook & they loathe the fact that it cost thousands to fix & will share their misery with anyone who will listen. The guy who bought a new Mercedes & its spring shattered on his drive was not backwards about telling me how rubbish Mercedes are.

All over the internet there are stories of folk who loathe their Tesla for its long time in the repair shop or what ever. I have seen many video, but in person I have met no one so far who does not like, usually love, their BEV.

Regards,

My experience of Apple fan boys is completely the opposite. All my family have iPhones, Mrs RS has had every model since the start. All of their iPhone 6s had the battery issue and also the iPhone sevens. They have all been through the cracked screens and the ridiculous cost of repair while I have had cheaper smartphones that always seem to perform better. They all still insist iPhones are the best!

I see a similar story with some friends with BMWs.

John

[odysseus2000]

So you extrapolate the experience of a single person who hasn't encountered anyone with a bad word to say, to make a claim that "BEV are far better..." etc.

You really are priceless in your scientific integrity, no wonder a few question your arguments!

How many folk do you need to talk to get an impression on quality and performance?

There were many polls of voter intention before Brexit and before Trump's win and many were wrong, some gambling organisations even paid out to those who bet on Hiliary.

Everything here is just my views and experiences which have been very good to my p&l whereas the Tesla bears have had many victories if folk traded Tesla but defeats if folk stayed short over the long term expecting a windfall when Tesla collapsed.

In the end none of us know the future, it is all about probability.

Regards,

[odysseus2000]

My experience of Apple fan boys is completely the opposite. All my family have iPhones, Mrs RS has had every model since the start. All of their iPhone 6s had the battery issue and also the iPhone sevens. They have all been through the cracked screens and the ridiculous cost of repair while I have had cheaper smartphones that always seem to perform better. They all still insist iPhones are the best!

I see a similar story with some friends with BMWs.

John

How interesting. The feedback I have had is that folk hated their iPhone 6 and 7 but so liked the Apple eco system that they were prepared to forgive the poor hardware so long as they got something better in the by and by and I am hearing less moans about the later iPhones and breakages, water damage etc.

The BMW story seems to be car age dependent. The folk who have a BMW on lease, laugh at the troubles as they don't have to foot the bill, whereas folk who buy older models expecting them to age gracefully now bitch about them as money pits and get shut of them. Similar experience to my Mercedes adventure.

Still super encouraging information for my Apple shares now near all time highs.

Regards,

[dealtn]

How many folk do you need to talk to get an impression on quality and performance?

...

In the end none of us know the future, it is all about probability.

Regards,

More than one that's for sure! I know precisely 2 people with an electric car. One is ambivalent, happy with the purchase but none more so than previous car purchases. The other underwhelmed, doesn't like the lack of noise, and hates the lack of charging points relative to the numerous petrol stations. Let's be generous and call that a 1-1 draw. Now if I went about making claims that 50% of electric car adopters hate electric cars I would rightly be laughed at for making a ridiculous extrapolation.

I have no axe to grind in this fight, I am not long or short any car companies as an investment, "new" or "old", but frankly the level of argument consistently made on this thread is far below the level of serious and hardly above childish at times.

You in particular will make claims about "probability" yet argue like it's binary! All of which is a shame as this thread should, for me, be about learning new things, which sadly is more difficult than it needs to be.