Randy Carlson

Tech, alternative energy, growth
Randy Carlson
Tech, alternative energy, growth
Contributor since: 2012
Davewmart,
Doesn't the Tesla Powerwall also contain a 2-way DC-DC converter so the battery can match the DC link in a solar-inverter system?
Looking at the LG spec, their units don't appear to have this functionality
blangererer,
Starting with their first full year of Roadster sales (ending start of April 2009 - 304 units) thru the end of last year (50,580 units), Tesla's actual CAGR is >200%/yr. over 6.75 years...
ONLY DOUBLING every year underestimates Tesla's actual, demonstrated growth performance, just in cars, by a factor of two.
Tesla growth at ONLY 50%/year takes them to ~2.9 million units for year ending 2025...
JackBowers,
I don't think too many investors understand this advantage Musk and Tesla have over the competition. Google (and Apple, Uber...) operating an in-house fleet of test vehicles can never hope to have 20,000+ vehicles out there 'testing' their system. And because the whole 'ball game' is in the ability of the system to cope with the very infrequent, even the hard to imagine, corner cases, it will take huge amounts of testing to wring these systems out.
This isn't about trying to find 'failures' in the hardware / software. it's about 'discovering' what it is the software / hardware have to do. There is no really good alternative to just lots and lots of 'test miles', and Tesla has the competition completely out-gunned because they have a huge fleet with sensors / actuators that can drive the car, data links that report back and the ability to incrementally roll out incremental updates.
Google (and similar competitors) doesn't have their own cars in the hands of customers. Legacy carmakers lack the combination of technical resources in their cars (and the engineering flexibility - and balls - to do what Tesla is doing.) This means not only that Tesla is way ahead, it means that their competitors haven't a chance of catching up.
mswyman,
Most of the capital investment for Model X is already in place. The tooling is installed and working and most of the R&D is done.
Working capital requirements to ramp production will be modest (compared to conventional car makers) because Tesla manufacturers to order, not to inventory so increasing production rates will not 'pump up' inventory in the pipeline to the degree one might expect for a GM or Ford...
They will of course try to 'use up' all the slack they've got pursuing Model 3. But that has always been the way at Tesla as they pursue all the growth they can.
Short/Long Trader,
To reach 500,000 units in 2025 (what Tesla has stated as an objective) they need to sell WORLD WIDE:
~50,000 Model S (same as last year)
~50,000 Model X
~400,000 Model 3 (presumably a combination of sedan and CUVs on that platform)
You tallied up about 325,000 US sales for the competing cars (sedans) I listed. There are a few 'odds and ends' like Infinity, Acura, the small Cadillacs, etc., too.
Tesla's Model S sales were about 50% in the US last year, and if that holds in 2025 and Model 3 sedan / CUV split is 50:50, then they would need to take 100,000 Model 3 sedan sales out of a segment where you have identified 325,000 sales among just a subset of the competitors...
If you look at the data (Clean Technica link above) you will see that Model S took ~26% of sales in 'F' segment in the US last year against similar competition - and their sales grew in this segment by >40% at the same time. If Model 3 does as well as Model S against high-end competitors 'in segment', they will quite easily achieve their sales goals...
Bill Cunningham,
I believe Tesla books sales only upon delivery of the car to the end customer. They do not count orders as sales - at least they don't report sales on that basis.

y = 643.42 x^1.2227
Frank Greenhalgh,
Zero to sixty in 7 seconds may well be adequate performance for the segment of the market in which the Bolt is to compete. It my indeed be a sufficient acceleration performance to satisfy you. It would satisfy me. But then I am getting a bit older and my testosterone levels may have decided some while my awareness of how speeding tickets boost insurance rates has grown with time.
In the market segment where Tesla hopes to sell Model 3 - especially the higher-spec versions - 0-60 in 7 seconds would be laughable. This difference just exemplifies how Tesla has positioned their cars (Model S/X) as compared to how GM has positioned Bolt. High-end, high margin cars in 'D' segment don't take 7 seconds to reach 60, and the Bolt isn't going to be a competitor in that space - at least not on the basis of acceleration, and with falling fuel prices, not much of a contender ion the basis of its efficiency, either.
Model 3 on the other hand, judging by both analysis and Tesla's design history, will compete with these cars, and not nearly so much with the Bolt.
Illuminati Investments,
No. Try carefully reading what I said. "If 'A' then 'B'" does NOT also mean "if 'notA'' then 'notB'".
All the article tries to say is that when oil prices fall dramatically, Tesla's sales continue to grow. That is what the data very clearly shows.
Those investors who repeatedly say, and apparently believe that falling oil prices adversely affect Tesla sales are stating and believing in something that isn't supported by the data. To the degree such objectively incorrect beliefs contribute to their valuing of TSLA, they are undervaluing the stock.
Illuminati Investments,
Actually, the upwardly curved trend line for Tesla sales shown on the chart is a 'mathematically best fit' to the data...
Once again the idea that Model 3 is 'a car for the masses' gets raised. It is not, and never was intended to be a Toyota Corolla competitor. Get over it.
At $35k base ~$50k ASP, Model 3 will attract many more buyers than Model S/X. Tesla's goal for this car is ~400,000 to 500,000 units a year and Model 3 will be targeted against cars like the BMW 3 Series, Mercedes C-Class, Lexus 330, Audi A3/4. These are not cars that are sold as economy cars. They are sold as aspirational cars. If a Model 3 fuel economy advantage is intended to be THE selling point for Tesla's coming smaller car, then it is doomed. Model 3 will have to compete in terms of appearance, performance, 'cool factor' and such against its target competitors, just as Model S competes successfully against larger, more expensive performance luxury sedans.
And, Model S - by applying this strategy - has become THE BEST SELLING LUXURY CAR in America, bar none.
http://bit.ly/1Zu4OJU
Juan Carlos Zuleta,
You are correct. I should have just said that when oil prices go down, Tesla sales go the other way...
Bill Cunningham,
Good point.
Davewmart,
Exponential growth - e.g. the 'knee' of a generic disruption market penetration curve - is not a straight line. but an exponential. I agree, straight line projections of Tesla's growth over the next several years are absurd. they are way, way to low.
Davewmart,
The analysis I did a while back of likely Model 3 characteristics specifically looked at how eliminating battery cells in the passenger footwells would allow lower seating position, and also overall height. Height is the critical dimension when scaling down Model S and trying to maintain the proportions - it's hard to shrink the height unless you can lower the seating position or shrink the people, the latter being the more challenging than the former.
Incidentally, this approach predicts an overall height for Model 3 of 52 inches. This is 4 inches less than Model S and EXACTLY the height of the Porsche Mission E...
cpryds,
I would take issue that this news is not important.
There is enormous potential synergy between Tesla's SuperCharger network and utility grids to which these facilities are connected.
SuperCharger stations inherently operate at very low 'duty cycle'. This is necessarily true because a) charging time is longer than gas station fill up time, and b) as utilization approaches 'capacity' under rush-hour conditions a 'line' of cars waiting to charge quickly forms and results in unacceptable user experience. For this reason, these stations need to be 'sized' to handle the peak traffic condition and are greatly under utilized most of the time. A statistical analysis is here :
http://bit.ly/10koC6c
Having a very high power grid connection adequate to run all of the chargers at a large SuperCharger station represents a large capital investment and putting a large grid-connected battery system at large stations to handle the relatively rare 'peak use' condition, then supplying the station with a robust but smaller grid connection has lower overall cost.
If a network of SuperCharger stations, each with a substantial grid-connected energy storage system is made available to the utility (either through an appropriate rate system or utility partnership) and controlled by the system operator, the combined assets of the station grid connection and the station grid-connected storage system can be used to stabilize the grid and significantly lower the investments in grid storage that would otherwise need to be made.
Putting in place a mechanism whereby the utility can benefit from the grid storage and grid connection assets associated with each SuperCharger station, if fairly priced, will greatly reduce Tesla's cost, and in the end the cost of energy for charging Tesla cars.
Further, the fact that this 'deal' includes free charging for Tesla owners at home implies that Tesla will implement fleet-wide charging rate modulation and pass control of that functionality to the utility, again saving the utility capital and investment costs. This is an example of the 'information content' value of Tesla's vertically integrated cars + computers + charging infrastructure provides. Tesla's computer networked cars with the ability to assess, for each car, its state of charge, physical location on the grid, and (with appropriate owner input) desired minimum charge state and desired 'availability time', in combination with onboard chargers that can vary the rate at which they draw energy, can become a very sophisticated variable load resource for managing the grid with almost NO ADDITIONAL COST. And, the value of this load management capability to the utility can easily be as much or more than the value of the energy being used to charge these cars. This is something Tesla has been working on all along and this deal gives investors an example of how Tesla is likely to 'monetize' this capability - by making the energy to run your Tesla, no matter where you charge, free.
http://bit.ly/1W7s4fW
(see slide #11)
The implications for competing charge-for-charge road trip charging businesses AND for any BEV makers that don't either join the SuperCharger network or duplicate all aspects of what Tesla is doing, is dire...
This is an example of how Tesla is better positioned to take advantage of (and make their shareholders rich from) the coming disruption in energy and transportation.
http://bit.ly/1lrSAF1
Davewmart,
50kW charging rate is less than 1C for a 60kWh pack in the Bolt. Assuming that this pack is capable of being charged at a rate faster than GM has said that it is, is well, assuming.
And, 50kW charging is insufficient to achieve ICE comparable road trip travel times.
http://seekingalpha.co...
Bill Cunningham,
Capital raises by Tesla in the past have tended to increase the share price - contrary to what the dilution implied would suggest. To the extent that shorts hastening to cover upon the approach of Tesla going to market for additional capital has tended to drive up both the stock price and appetite for the new shares being issued, in part because shorts have been eager to buy so as to close out their positions as the share price goes up.
If shorts really 'pile on' next week, an enlarged short interest could supply a pool of ready buyers for additional Tesla shares if the price bounces substantially on the earnings announcement. The announcement of course might go either way, but it will be interesting to see just how big the short interest has turned out to be ahead of that event.
For the oil business the elephant in the room is the electrification of transport. If one looks analytically at the cost declines and increases in utilization of solar PV and batteries (Tony Seba's analysis, for instance) oil is going to be roadkill within the next decade or two.
While that seems like a long time, it is comparable to the planning horizon of the oil business. This industry is accustomed to looking 10 - 20 years out. And if you are in the oil business, the view that far out is highly uncertain at best and Armageddon more likely...
No wonder the Saudi's are thinking about privatizing (selling off) Armco. They can monetize those oil reserves only so fast by pumping... And, selling off the reserves to some sucker may not only be quicker, they may get a better price.
Does it have to be painted?
And, if so, does the paint have to be dry?
Silly, silly, silly.
13030082,
I absolutely agree.
It will be interesting to see what the short interest looks like in the next few weeks. Historically, Tesla shorts have ended up providing a lot of the capital sought by Tesla. And, there is no question but that Tesla will need a good chunk of capital to bring Model 3 to market quickly...
Next week will be interesting.
It really boils down to what you mean by "can".
Large legacy carmakers 'can' technically make compelling electric cars IF they want to do that. That is they are technically capable of duplicating what Tesla has done (or maybe even better).
But there are other constraints than just the technical ones. A legacy manufacturer who introduces a BEV with performance, range and other characteristics that make it as compelling (or more compelling) than Model S will NECESSARILY be targeting cars like the BMW 6/7, Audi A7/8, Mercedes S Class, Lexus LS, Jaguar XJ, Panamera, Cadillac, etc. This strategy works well if the legacy company is NOT BMW, VAG, Daimler, Toyota, Tata, Porsche, or GM. That leaves FCA, the head of which has expressed utter distain for electric vehicles.
One need only look at BEV products shown by legacy carmakers to see that these products under-perform not only Tesla offerings, but also the corresponding ICE offerings of the legacy carmaker.
The biggest reason legacy carmakers cannot make BEVs competitive with Tesla is that they don't want to. And, they have very powerful, very durable reasons to not want to...
solucky,
Tesla has DEMONSTRATED the ability to grow sales at high rates even in the presence of crashing oil prices that have set back sales of other BEVs.
Are Tesla's future sales assured in the case of every imaginable calamity? Probably not, but there doesn't seem to be much data suggesting that has happened in the past.
Other than the obvious observation that the future is by nature uncertain, what's your point?
c.
Charging time is poor. Charging rate and peak discharge rate for acceleration are related.
Cells from the GigaFactory will be cylindrical, and 10% larger dimensionally (33% larger volume) than the 18650 cells Tesla is currently using. The yield economics of the small, cylindrical format beats prismatic, especially when using high energy density chemistry and seeking highest specific energy by making layers thinner.
The Bolt battery is compromised in power density (e.g. thicker layers) and energy density (lower energy, more temperature tolerant chemistry) compared to Tesla practice. The result is seen in the relatively poor acceleration performance; in the longer charging times and the fact that a 60kWh battery is required for 200 miles in a smaller vehicle...
The initial GF is sized for 100,000 units of Model 3 per year based on a chemistry with ~40% higher energy density than Tesla's current cell. Assurance that the 40% improvement will be available (validated) is why the initial factory module was down-sized (because fewer cells are needed.) A Model 3 run rate of 100,000 units is consistent with a new line at Fremont running similar tac-times to the existing Model S/X line. replicating the Model 3 line in China and/or Europe and building out the rest of the GigaFactory by 2020 brings Tesla to ~400k Model 3s a year.
Note that the GigaFactory is intended to produce 35GWh of cells when complete. 20% of this is 7GWh, or ~70kWh in each of 100,000 Model 3s. This would conform to the intention to make predominantly the long range (~300 mi) version of Model 3 in the first year or so of production.
http://seekingalpha.co...
c. & MS,
As you clearly point out, sales of Model S appear to be unaffected by oil prices whether high or low.
Model 3 is to be targeted against BMW 3 Series cars. That being the case, one might ask to what degree high or low oil prices are or have impacted the sales of the BMW 3 Series...??
There are no doubt some folks who, when fuel prices were high, chose to buy a Prius rather than a 320i because of fuel costs. A buyer who aspires to a BMW 3 Series but buys a Prius instead because of high fuel costs (or concern for the environment, or to impress their neighbors with their 'greenness') are folks who have deliberately settled for a car 'second best' with respect to their aspiration for the BMW.
Now that Prius buyer who settled for the high efficiency / lower performance car may come back to BMW with their next car because fuel prices are low. I understand that.
I would however argue that there are / will be few buyers choosing a similarly priced Tesla against a BMW 3 Series because the Tesla is their second choice, but saves fuel. Those folks who choose a Tesla are going to do so because they want a Tesla, because the Tesla is their first, aspirational choice.
Tesla is a new manufacturer, Model 3 will be a 'new' car. Electric cars have limitations in range, refueling time, availability of charging stations, etc., though Tesla perhaps less so than some others. If Model S were not, on balance a 'better car' in the eyes of buyers, it is hard to see how they would sell many at all.
Tesla electric cars have (historically) had advantages over ICE cars against which they compete - smoother , quieter operation, better acceleration, over the air updates, big touch screen controls... The success of Model S in 'F' segment shows us that buyers are willing to accept the drawbacks in order to achieve the advantages.
While it may be to some extent the case that greater efficiency / lower fuel cost is an advantage that matters more in 'D' segment than in 'F' segment, Tesla's competitive success in 'F' segment shows that the balance of advantages to drawbacks earns Tesla a large market share, even in a segment where relative efficiency doesn't appear to matter at all. In 'D' segment, fuel cost may well be more strongly considered, however one can recognize that even with lower fuel prices, this advantage still falls decidedly in Tesla's favor, though the magnitude of savings is reduced with low gasoline prices.
Assuming Model 3 will offer a similar balance of advantages to drawbacks as Model S, the increased importance of fuel cost / efficiency in 'D' segment will only tip the competitive balance even more in favor of Model 3 than it is already tipped in favor of Model S in 'F' segment.
When you make the argument that Model 3 sales will suffer due to low fuel prices, you are saying that the fuel cost advantage of Tesla - which appears to be totally unimportant in 'F' segment - will make Tesla's in 'D' segment uncompetitive simply because Tesla's advantage on this one feature, while still significant, is less important now due to lower fuel costs.
The data on Model S shows that Tesla cars are highly competitive against ICE cars in 'F' segment where fuel cost is not a consideration. It follows that we should expect Model 3 to be similarly competitive in 'D' segment, even if fuel is very cheap.
tschmidt_de,
Tesla's growth rate is 50%/year or so. If Tesla continues this rate of growth - as they have successfully done with oil prices high and with oil prices low, they will be selling several million cars in 2025. That's more than good enough to justify a current price well north of $200.
The fact appears to be however that investors are 'spooked' by falling oil prices and - as many commenters her demonstrate - assume that Tesla sales have been and will be crushed because oil is cheap.
The data over the entire life of Model S production clearly shows that Tesla sales have nothing to do with the price of oil. If and to the extent that investors are making their decisions about TSLA on the incorrect basis that Tesla sales are tied to oil prices, the stock is likely to be undervalued.
Juan Carlos Zuleta,
A negative correlation coefficient, particularly one beyond -.75, denotes a pronounced lack of correlation. If that isn't "uncorrelated", I don't know what is...
Davewmart,
That Woonerf system reminds me of the right of way rules for boating. Sailboats have right of way over power boats. There is, as I understand it, a special exception for power boats that are large, grey and have airplanes on deck...
Hanse,
The simple fact is that low oil prices in the US are NOT having any measurable effect of Tesla sales. Period.
User 19236151,
The ONLY case where low oil prices will adversely affect Model 3 sales is one in which Model 3 carries a price premium compared to ICE vehicles of similar size and performance. If Model 3 doesn't carry a price premium, then low fuel prices will not drive customers away...
If Model 3 is directly price competitive with BMW 3 Series, Mercedes C Class, Audi A3/A4, Lexus IS 250/350 cars and offers comparable or better performance, we will see the same thing we now see with Model S in 'F' segment. There are plenty of ICE car sales that Model 3 can cannibalize in 'D' segment with $35k base / $50k ASP pricing to give Tesla 400,000 Model 3 sales, which combined with 50,000 Model S and 50,000 Model X brings them to their sales target for 2020.
One way to 'get the law changed' is to go through the courts. If the dealer franchise laws conflict with other laws (say those relating to restraint of trade) then a court can decide which law, in a particular circumstance, applies.
In the case of Tesla and existing franchise laws there are a range of opinions - just look at these posts. The more important question may be whether there are also a variety of laws that apply, including those that require auto dealer franchises and those which prohibit restraint of trade, etc.
In the mean time, Tesla's owner incentives program is in effect giving Tesla an 'Amway' business model rather than company owned stores in places like Michigan and Texas.