Whitney Tilson’s email to investors discussing the bull case and his response; the question he almost asked at the Berkshire meeting; thread on Tesla Inc (NASDAQ:TSLA)’s capital raise; Today’s most interesting Tesla export calculations — thus far; Fiat Chrysler Automobiles NV (NYSE:FCAU) to spend 1.8bn Euros on CO2 credits from Tesla.
1) From one of my readers:
Alkeon expects data growth to surpass 5G’s capabilities by 2028 [Q4 Letter]
Alkeon Growth Partners wrote at length on tech stocks and why they are defensive in their recent letter to investors, which was reviewed by ValueWalk. The fund also highlighted 5G and other advanced technologies and the investment opportunities they offer. Q4 2020 hedge fund letters, conferences and more Artificial intelligence and machine learning The Alkeon Read More
With $2.7b raised and another $2b in free money do you sorta start to wonder if the short story is over? The biggest problem I saw was a company way over-stretched and with the funding and cost-cutting, that is resolved. I don’t see how shorts make money from here unless economy tanks. So I would predict your followers lose a *lot* of money.
My response: I never doubted that the company could raise capital in this environment of seemingly endless STOOOOOPID money. That’s why price target was (and still is) $100 not zero.
The company remains way over-stretched – but the cash buys them a few more quarters before they hit the wall.
My thesis has nothing to do with the economy tanking. Rather, it’s that Tesla cars were, are and will always be cool but niche products for coastal elites. As we saw in Q1, its attempts to go mainstream have failed and will continue to fail, even as the EV market expands dramatically, due to a tidal wave of competition (which Tesla, to its credit, helped create) from far better managed, capitalized and experienced car makers.
I believe Q1 is a very good indicator of what demand will be going forward for the company’s cars. (And, no, China, with its 487 local electric car companies (as of last July), won’t save the day – see: Turns Out China Has An Astounding 487 Electric Car Makers.)
Nor will solar roofs, Powerwalls, self-driving cars, a fleet of a million robotaxis or any other empty promise by a delusional and desperate CEO..
2) I’m so bummed! I was question 2 at microphone 11 at the Berkshire Hathaway annual meeting, but the meeting ended after they gave a long answer to the question from microphone 10 – ARRRRRHHHHH! This is the question I was going to ask to Buffett and Munger:
My question is about self-driving cars.
Last week Tesla announced that, within a year, its cars will have full Level 5 self driving capabilities – meaning a steering wheel would be superfluous.
It also announced that, pending regulatory approval, it will have a fleet of a million robotaxis by the end of next year.
This timeline is years more aggressive than that of any other car maker.
Do you have an opinion on how quickly any automaker will be able to offer truly autonomous driving, meaning you’ll be able to get in your car in Omaha and drive to LA or New York without touching the wheel even once?
And regardless of the timelime, what are your thoughts on how this will affect two major Berkshire holdings:
First, could self-driving trucks reduce the huge cost advantage railroads have over trucks?
And second, if autonomous cars get in far fewer accidents, could this hurt GEICO’s business?
3) Interesting thread: https://twitter.com/Trumpery45/status/1124811500680433664
How did Elon flog off the new share part of this raise? What dummies need to own so many hundred million more $tsla? Turns out, 50% of new shares were purchased by banks to deliver Teslas u-turn of a fat amount of the convert in an option hedge:(birdie sent me)
4) From a friend: Today's most interesting Tesla export calculations -- thus far:
Those small sales numbers while not actually having cars are not that interresting. May will be terrible untill next boats with cars are delivered starting end of May. What should be interresting, is that they only delivered 63.000 cars Q-19 with an additional 10.600 "in-transit" at 03/31. Which tells us real April sales are terrible.
Then again, to fill that promised 90-100.000 Q2-19 sales number they would (from Q1 global mix) have to ship at least 50% more cars towards Europe/China as they did in Q1. And sell them. As of May 1. they are apx. 72-82.000 deliveries away from that promise.
In Q1-19 16 boats left SF with Teslas. 8 for Europe/8 for China. As of today this quarter 4 have left(2/2). That means 20 MORE would have to ship within the next three weeks to make sure they would actually be able to deliver those cars to customers before Q2 ends.
Add to this apx. 50% increase in US sales. You actually need overall apx. 50% growth from Q1 sales to get in the projected sales estimate from Tesla themselves.
So. Let's see if those apx. 20 needed boats will dock, load and leave pier 80 in SF before May 24. That is exactly three weeks. For that, they will need another pier aswell. Or is your bet they will double in US from Q1-19, thus only needing 18 boats (14 more) filled by May 24. for global sales? I do not see anything in forums or anywhere else indicating there is anything NEAR the Q1 demand
Guy Whitehead, Contributor
@Diesel, Teslas seem to be exported from the Bay Area through Pier 80. All the ships that I have checked leaving Pier 80 are vehicle carriers. A web site that lists departures is buildingtesla.com.
Many of these ships carry cars to Europe and China (or are at least are going to Europe and China.
Ships carrying Teslas and arriving April 1 to June 15 which would be relevant to April May June sales are:
1) none definitely carrying Teslas according to their listing.
2) Grand Pave will arrive China May 14, unknown if Tesla cargo.
3) NOCC Oceanic arrive Europe May 11, unknown if Tesla cargo
4) Glovis Captain arrive Europe May 7, unknown if Tesla
5) Morning Cornelia arrive Zeebrugge May 11, unknown if Tesla
6) Asian King arrive China March 24 unknown if Tesla (late in month so it would probably show up in April Sales.
Conclusions: No ships according to the BuildingTesla.com website will be definitely carrying Teslas from Pier 80 to Europe or Asia during the quarter.
3 Ships will be going from Pier 80 to Europe during the quarter and might be carrying Teslas.
2 Ships will be going from Pier 80 to China during the quarter and might be carrying Teslas.
At this point, it does not look like a flood of exports to either Europe or Asia during Q2.
Possible sources of error on this are
a) Tesla may use other piers to export from (although Pier 80 seems to be the vehicle shipping pier for the Bay area).
b) other ships besides the ones listed may become available to carry cars to Europe and China during this quarter (although I would think these voyages are scheduled well in advance).
c) the vessels above which are not listed as definitely carrying Teslas may have all their carrying capacity devoted to Teslas. RORO car ships can carry 5000 or more cars, although in the past Tesla has typically shipped less than 2000 cars per ship. Tme will tell on this.
Fiat Chrysler to spend 1.8bn Euros on CO2 credits from Tesla
Re. the article below, a friend comments:
That was analyzed well this morning on twitter by @TeslaAgnostic. It includes all the money they already ARE getting from GHG & ZEV sales to FCAU, which last quarter was $200M and the company still lost $700M. Tesla Agnostic estimates the figure going forward will be around $165M/quarter (so declining from Q1). And I'll add that it was likely predicated on much higher Tesla sales than are taking place, and thus will wind up being less.
Fiat Chrysler to spend €1.8bn on CO2 credits from Tesla : Read the article here by FT.com