Musk endeavours

[odysseus2000]

There is a general media frenzy over losses, but times of market volatility are times for huge profits. This is an example of what a short made on Tesla yesterday with puts:

https://twitter.com/smartertrader/statu ... 48000?s=20

Alas I did not do anywhere near as well as I am not a good shorter, certainly nothing remotely close to the ability of this guy and other good market shorters, but I am still very thankful to have gone to cash when I did and although I have re-bought a little Tesla I still have a lot of cash left from my sales.

Internally I am vexed that I have not made more of this golden life changing opportunity, but so it goes, while one lives, trades and invests one gains more experience and the trick is sensing when things are going in a particular direction & using memory of similar times that might be many years ago to guide ones market activity. It is far from easy & requires significant skill.

Regards,

[dealtn]

I am not sure what you don't follow here
...
where am I wrong, what am i saying that isn't correct?

The bit where it is a "market solution"

What you are proposing are "interventions" not "market solutions". You might be right. They might be desirable. Others might disagree, and have alternatives. But intervening in the market isn't a market solution.

[odysseus2000]

I am not sure what you don't follow here
...
where am I wrong, what am i saying that isn't correct?

The bit where it is a "market solution"

What you are proposing are "interventions" not "market solutions". You might be right. They might be desirable. Others might disagree, and have alternatives. But intervening in the market isn't a market solution.

Markets are all about intervening.

The idea that in the 21st century you have markets where the governments don't meddle is a fine bit of rhetoric for some wild politicians, but all markets are the product of capitalism and governments.

There are no such things as free markets that are allowed to do what they will. Even in historical times when there was much less government intervention excess market abuses were always corrected one way or the other. Markets are like sports games where the number of players is unlimited, but where there are still rules and a referee and folk who design the stadiums and the sports field and who police it all. Without all of these controls we would descend into chaos and extremes of wealth, poverty and violence.

What I am describing are market solutions within the framework of what politicians and the law allow.

Regards,

[Howard]

Wow! Tesla have 103 new Model 3 available immediately on their UK site. I haven't seen this level of new inventory since the model was launched. There are normally zero to around 5 Model 3s available.

https://www.tesla.com/en_GB/inventory/n ... p=&range=0

They may be getting their stock ready for the expected boom in BIK demand. Or they may just not be selling as fast as expected?

I have noticed that the typical leasing cost for a 3 has gone down just under 10% since last year so this may mean that prices are being reduced for leasing companies.

regards

Howard

[redsturgeon]

Legacy auto struggling?

https://uk.finance.yahoo.com/news/volks ... 19769.html

FRANKFURT (Reuters) - Volkswagen Group <VOWG_p.DE> said its full-year operating profit rose 22% to 16.9 billion euros (14.1 billion pounds) thanks to strong sales of higher-margin cars and lower diesel charges and forecast vehicle deliveries to stay in line with 2019 levels

John

[odysseus2000]

Legacy auto struggling?

https://uk.finance.yahoo.com/news/volks ... 19769.html

FRANKFURT (Reuters) - Volkswagen Group <VOWG_p.DE> said its full-year operating profit rose 22% to 16.9 billion euros (14.1 billion pounds) thanks to strong sales of higher-margin cars and lower diesel charges and forecast vehicle deliveries to stay in line with 2019 levels

John

Have a look at the earnings, page 28 and on, in:

https://www.volkswagenag.com/presence/i ... 2019_e.pdf

They are full of all manner of stuff like:

Items that will not be re-classified to P&L

&

Items that will may be re-classified to P&L

There are some big numbers in there and it is hard to work out what is going on with the accounts. This is usually what one does when things are difficult and you want to make the accounts incomprehensible to scrutiny.

Moreover at a time when they need to be spending money making battery factories they are giving money away in shareholder dividends.

The headline results make no mention of all of this and are imho all about putting lipstick on a pig.

Regards,

[Howard]

Substantial growth in EV sales by legacy manufacturers in the first month of January suggests that, if they keep this up, many may not be fined by the EU. As expected, the European manufacturers were keeping back sales of EVs so that they would qualify for reduction in emissions targets in 2020 onwards.

It may be one of the reasons why Tesla's market share in European markets in Jan and Feb has fallen away so rapidly. And why they appear to have so many new cars available from stock. We'll await their boat shipments in March to see if they can produce their usual third-month surge.

Whilst this article makes an interesting point, obviously the Coronavirus situation may change everything.

"January EV sales in Europe gives hope automakers will meet 2020 EU emission targets"

https://electrek.co/2020/02/28/january- ... n-targets/

regards

Howard

[odysseus2000]

Substantial growth in EV sales by legacy manufacturers in the first month of January suggests that, if they keep this up, many may not be fined by the EU. As expected, the European manufacturers were keeping back sales of EVs so that they would qualify for reduction in emissions targets in 2020 onwards.

It may be one of the reasons why Tesla's market share in European markets in Jan and Feb has fallen away so rapidly. And why they appear to have so many new cars available from stock. We'll await their boat shipments in March to see if they can produce their usual third-month surge.

Whilst this article makes an interesting point, obviously the Coronavirus situation may change everything.

"January EV sales in Europe gives hope automakers will meet 2020 EU emission targets"

https://electrek.co/2020/02/28/january- ... n-targets/

regards

Howard

So one outfits says European makers won't meet emission targets, another says January sales are so good, emission targets may be met.

Candles blowing in the wind, especially given the well documented shortage of batteries, or will that too be negated by some new story?

Very difficult to make any sense of any of this, but by the summer solstice it should be a lot clearer.

Regards,

[PeterGray]

I am not sure what you don't follow here
...
where am I wrong, what am i saying that isn't correct?

The bit where it is a "market solution"

What you are proposing are "interventions" not "market solutions". You might be right. They might be desirable. Others might disagree, and have alternatives. But intervening in the market isn't a market solution.

There's no such thing as a pure "market solution". All economies regulate or intevene in the operation of markets to a greater or lesser degree. The term mixed economy used to be used. In practice pretty well all economies in the world are mixed!

[redsturgeon]

I must admit I am rethinking my EV strategy in light of the issues at the moment. It seems to me that Tesla have very much taken the view that their customers are the Beta testers of their cars and they are very lucky in that the average Tesla buyer seems to put up with issues that most normal car buyers would find unacceptable...me included.

The ID3 seems to be an ideal BEV for me but it seems likely that I could not get one before next year with the current issues. The software faults sound bad but has anyone any specifics. The cars have been available to journalist on fairly long test drives and not one of them that I have read has made any comment about any software issues during that time. Could it be they were sworn to secrecy as a condition of getting a pre-launch test drive?

My view is that, unlike Tesla, VW is not going to release its car until they are satisfied that no faults exist while Tesla seem happy to release software and wait for the faults to show themselves then try to fix them via firmware updates. Of course this is just conjecture on my part but does anyone know exactly what software faults are problematic at the moment?

Of course all of this may be further exacerbated by the COVID 19 virus in terms of supply chains etc.

John

[Howard]

Substantial growth in EV sales by legacy manufacturers in the first month of January suggests that, if they keep this up, many may not be fined by the EU. As expected, the European manufacturers were keeping back sales of EVs so that they would qualify for reduction in emissions targets in 2020 onwards.

It may be one of the reasons why Tesla's market share in European markets in Jan and Feb has fallen away so rapidly. And why they appear to have so many new cars available from stock. We'll await their boat shipments in March to see if they can produce their usual third-month surge.

Whilst this article makes an interesting point, obviously the Coronavirus situation may change everything.

"January EV sales in Europe gives hope automakers will meet 2020 EU emission targets"

https://electrek.co/2020/02/28/january- ... n-targets/

regards

Howard

So one outfits says European makers won't meet emission targets, another says January sales are so good, emission targets may be met.

Candles blowing in the wind, especially given the well documented shortage of batteries, or will that too be negated by some new story?

Very difficult to make any sense of any of this, but by the summer solstice it should be a lot clearer.

Regards,

It is a fact that Tesla sales in Europe and China are down overall for the first two months of the year. And massively down in two previously big markets, Norway and the Netherlands. Plus lower sales in the USA in January . This must mean that they are needing less batteries for their cars at the moment. So there is more availability for their competitors?

Obviously two months are not a long time but the very substantial gap in sales will take some catching up. Elon's February forecast of 500,000 sales for the year will take some achieving and if it is not met, his battery suppliers will have more availability for competitors?

Early days, but sales figures aren't fanciful forecasts, they are reality. As you say, we'll see in the summer. As dspp might say "do the maths".

regards

Howard

[dealtn]

Have a look at the earnings, page 28 and on, in:

https://www.volkswagenag.com/presence/i ... 2019_e.pdf

They are full of all manner of stuff like:

Items that will not be re-classified to P&L

&

Items that will may be re-classified to P&L

Which items don't you understand, and which don't you think belong there and should go through the p/l?

Most are hedges which are non-cash and could just as easily be +, not -, and could be in any future year. Would it be ok to put them through the p/l account if they were +?

[odysseus2000]

Have a look at the earnings, page 28 and on, in:

https://www.volkswagenag.com/presence/i ... 2019_e.pdf

They are full of all manner of stuff like:

Items that will not be re-classified to P&L

&

Items that will may be re-classified to P&L

Which items don't you understand, and which don't you think belong there and should go through the p/l?

Most are hedges which are non-cash and could just as easily be +, not -, and could be in any future year. Would it be ok to put them through the p/l account if they were +?

Call me hardened and suspicious of accounts that leave many things undefined.

Generally if the company finance officer wants me to understand the accounts I can, but when I see all manner of "mays" and "re-classified" I get nervous and suspicious. A long time ago I learned the difference between hedges and investments, they are identical apart from the sign: Investments = profits, Hedge = losses and when these are all mixed up and stirred by the finance officers pen the accounts lose their meaning to me.

The cynic in me feels that VW management are in "lets pull the wool over investors eyes" mode. The whole report is too upbeat and positive compared to the real situation as I see it and that makes me even more nervous, especially as its from the company that lied on emissions and had their engineers build in cheat routines to fix inspections.

If I was doing these accounts i would be in "lets start kitchen sinking problems" "Lets start indicating how much the transition to BEV is costing us" "Lets make it ugly and frighten the politicians."

As things are the accounts to me say that VW are doing great and are not being troubled by anything, an open invitation for the politicians to ramp up emission controls and accelerate the move to BEV.

Regards,

[Howard]

Is Tesla's battery "moat" shrinking?

It has been argued that Tesla's battery production gives it a strong moat. However, huge investments are being made by battery producers, including CATL, now said to be the world's largest producer. According to Elektrek "China’s CATL ..... is the industry leader with a global share of 28%". It plans to quadruple output.

https://electrek.co/2020/02/28/with-tes ... le-output/

If Tesla is going through a period of slower growth, this will allow other manufacturers to source more batteries.

As I have posted previously, as well as China, the auto market to watch is Germany. CATL expect to be producing batteries there in 2022 in their first overseas plant and they are already supplying some of the big German brands from China. For example a lot of their batteries have gone into the more than 500,000 PHEV and BEV BMWs already sold (BMW started purchasing batteries from CATL in 2018 with an initial contract worth Euro 4 billion and have recently increased this to Euro 7.3 bn).

https://www.autonews.com/china/bmw-boos ... order-catl

Where Tesla obviously have a lead is in the software control of auto batteries (and this is pretty obvious at the moment from the discussion about VW's software issues). Will this lead shrink? Or will their competitors catch up fairly quickly? The German market is one to watch. Tesla will need to sell more than a few hundred cars a month in Germany to give us an indication that they have an advantage which is recognised by canny EV car buyers.

regards

Howard

[odysseus2000]

Is Tesla's battery "moat" shrinking?

It has been argued that Tesla's battery production gives it a strong moat. However, huge investments are being made by battery producers, including CATL, now said to be the world's largest producer. According to Elektrek "China’s CATL ..... is the industry leader with a global share of 28%". It plans to quadruple output.

https://electrek.co/2020/02/28/with-tes ... le-output/

If Tesla is going through a period of slower growth, this will allow other manufacturers to source more batteries.

As I have posted previously, as well as China, the auto market to watch is Germany. CATL expect to be producing batteries there in 2022 in their first overseas plant and they are already supplying some of the big German brands from China. For example a lot of their batteries have gone into the more than 500,000 PHEV and BEV BMWs already sold (BMW started purchasing batteries from CATL in 2018 with an initial contract worth Euro 4 billion and have recently increased this to Euro 7.3 bn).

https://www.autonews.com/china/bmw-boos ... order-catl

Where Tesla obviously have a lead is in the software control of auto batteries (and this is pretty obvious at the moment from the discussion about VW's software issues). Will this lead shrink? Or will their competitors catch up fairly quickly? The German market is one to watch. Tesla will need to sell more than a few hundred cars a month in Germany to give us an indication that they have an advantage which is recognised by canny EV car buyers.

regards

Howard

Battery day at Tesla ought to give us a good steer on Tesla's batteries and how they compare to competitors. As things are most legacy auto are only using relatively small amounts of batteries and if they are buying from a maker they will have to pay the makers margins, which Tesla might skip if they are bringing battery production in house.

Regards,

[Howard]

If BMW deliver this car in 2021 it will be worth waiting for!

It has the look of luxury and will appeal to the cognoscenti if it drives as well as their current models. Time will tell!

And, sticking my neck out, they will sell it at a profit.

regards

Howard

https://www.theverge.com/2020/3/3/21162 ... -show-2020

[odysseus2000]

If BMW deliver this car in 2021 it will be worth waiting for!

It has the look of luxury and will appeal to the cognoscenti if it drives as well as their current models. Time will tell!

And, sticking my neck out, they will sell it at a profit.

regards

Howard

https://www.theverge.com/2020/3/3/21162 ... -show-2020[/qu

Far too few details.

Looks are one thing, building and making it competitively priced are a whole more difficult endeavour.

Regards,

[odysseus2000]

Toyota believe in the future and have been re-buying their stock:

https://www.investegate.co.uk/toyota-mo ... 00019231E/

Regards,

[Howard]

Toyota believe in the future and have been re-buying their stock:

https://www.investegate.co.uk/toyota-mo ... 00019231E/

Regards,

So, Ody, when can we expect Tesla to believe in their future and buy back their stock?

Regards

Howard

[odysseus2000]

Toyota believe in the future and have been re-buying their stock:

https://www.investegate.co.uk/toyota-mo ... 00019231E/

Regards,

So, Ody, when can we expect Tesla to believe in their future and buy back their stock?

Regards

Howard

Ha Ha, We are comparing an established manufacturer with a new and rapidly growing manufacturer.

It is not time for Tesla to be re-buying stock, but in the by and by they may do so, emualting the great Warren Buffett

Regards,