- Jeep and Tesla had similar worldwide unit growth sales rates in 2014, 39% and 42%.
- Adjusting for price per car, and discussing future growth rates and profitability, Jeep could be worth anywhere from $20 billion to $200 billion.
- FCA, which owns Jeep, could spin off Jeep for a massive increase in shareholder value. Where is Carl Icahn when we need him?
- I tested the all-new Jeep Renegade for a day and was very impressed. Perhaps it could sell 200,000 units worldwide in 2015.
- If Jeep sells 200,000 Renegades worldwide in its first year, why wouldn’t that franchise alone be worth as much as Tesla?
BMW And Volkswagen Join Forces To Take On Tesla's Supercharger Network
- Volkswagen and BMW join with ChargePoint to build a supercharging network to compete with Tesla.
- In this first instance, the network is rather small with only 100 ports in the Boston-Washington, D.C. and Portland-San Diego corridors.
- For this and other reasons, it doesn’t match Tesla’s road trip capabilities today.
- However, it’s easy to see that other major automakers such as GM, Ford and Nissan will join this effort in the next 1-2 years.
- By 2017, we could be looking at announcing closer to 10,000 ports from a network like this, easily surpassing Tesla.
- The auto industry forecasts solid growth in 2015.
- Elon Musk's comments on a weakening China have sparked concern over international growth for Tesla.
- However, a strong domestic luxury sector might help Tesla's US sales accommodate lost growth abroad.
What Did Tesla Tell Its Analysts And Largest Shareholders?
- On January 13, Tesla’s CEO made public statements about the company’s earnings prospects.
- He said to expect no profits until 2020, or at least no GAAP profits. That appears to be radical new guidance.
- Yet, sell-side analysts aren’t changing their estimates at all, let alone radically.
- Therefore, we must ask what was said in those phone calls between Tesla and its analysts and major shareholders following the CEO’s remarks?
- Such walk-back of the CEO’s publicly-issued guidance must not be allowed to be done over the phone to the favored few. Issue a press release or 8-K.
- Questionable actions by the rock star CEO are starting to impact the stock after getting a pass for years.
- Fears of increasing competition are likely to weigh on the stock whether the threats turn out relevant or not.
- The market is starting to question the vast valuation premium on Tesla and that is more important than the quality of the cars.
Detroit Auto Show: The Good, The Bad, The Ugly And Tesla
- Automakers talked about inexpensive pure electric cars with longer range, many likely available by 2017 before Tesla’s Model 3.
- Several new plug-in hybrids will be coming from BMW, Chevrolet, Cadillac, Volvo, Mercedes, Mitsubishi, Audi, Volkswagen, Hyundai, Chrysler and Porsche.
- Buick, Chevrolet, Volkswagen and Hyundai unveiled interesting new concept cars.
- Automated driving is a huge focus, and it will happen in many steps, with the first cars from Mercedes already on the market today.
- Automakers are raising their standards, and we should see a new wave of extremely attractive cars being launched in 2016, 2017 and 2018.
- Tesla has long had a penchant for limited disclosure, reflected in its lack of monthly sales data.
- However, increasingly Tesla is disclosing less and less information about its operations.
- It turns out there's a pattern to this reduced disclosure.
- And furthermore, a new piece of data seems to have stopped being disclosed, with potential implications.
- My case against the Tesla bubble appears stronger because of statements from CEO Elon Musk that indicate weaker sales in China and that Tesla won't be profitable until 2020.
- Historic pronouncements by Musk and Tesla's share price demonstrate an unhealthy relationship.
- Tesla will remain volatile until it begins to trade on fundamentals and not on pronouncements by Musk.
Before You Short Tesla Remember This: Tesla Is Selling A Brand, Not A Car
- General Motors has announced it will release a new all-electric car, named the Bolt.
- The Bolt is aimed to compete with Tesla's Model 3 at a similar price point.
- This could be described as a negative catalyst for Tesla, with some recent articles making the case for a short sale.
- This article questions the materiality of this development to Tesla's earnings and whether selling Tesla short is a good bet.
- One year ago, Tesla gave its December sales number at the Detroit Auto Show.
- Yesterday, at a separate conference in Detroit, Tesla’s CEO did not want to give out the December sales number.
- However, he said that sales in China had been bad.
- He said that sales elsewhere had more than made up for the China shortfall, so that would indicate beating December guidance.
- He talked about losses until 2020, at least on a GAAP basis. It was unclear to me whether this was new guidance.
Tesla China Problem - Elon Musk Admits Sales Are Down
- Tesla trades at a high valuation.
- Sales are down in China, which is supposed to be a growth market for Tesla.
- Tesla is down 6% after hours, could trade down more.
Tesla's Latest Sales Projection For 2025 Is Next To Impossible To Achieve
- Tesla CEO Elon Musk is making new predictions about Tesla reaching sales numbers of "a few million cars a year" by 2025.
- This is next to impossible to achieve even assuming extremely high and growing demand.
- Cap ex would need to rise to $20-30bn for new battery plants alone.
- Each huge battery plant takes about 3 years to build and 1 year to fully ramp up production.
- Tesla has a long history of over-promising on dates and numbers.
Tesla Will Set A New Model S U.S. Sales Record In Q4 2014
- The P85D was enough for Tesla to put to bed my own "peaked deliveries" thesis in Q4 2014.
- However, pent-up demand for what was mostly a new model, which prompted massive upgrades among Tesla's existing customer base, might be distorting this reading regarding deliveries.
- The heavily front-loaded P85D deliveries in Q4 2014 make it likely TSLA will beat EPS and revenue guidance for Q4 2014.
- Guidance for Q1 2015 still carries risk.
Why Falling Oil Prices Won't Stop Tesla Or EV Sales In General
- Since falling prices are meant to be a structural phenomenon, they shouldn’t result in a substantial market rebound in the form of a decrease of EV sales.
- One way to verify this reasoning would be to find no strong positive statistical correlation between oil prices and EV sales.
- The results of a chart and correlation analysis for Tesla, the U.S. EV market and the world EV market provide considerable support to my supposition.
- However, evidence that falling oil prices hurt sales of 6 (out of 19) models (most of which priced at less than $36,000) in the U.S. places doubts on Tesla’s prospects.
- In this context, two additional results suggest that consumers could still be willing to buy many EVs from Tesla as long as it keeps producing high-quality products.
How Will Tesla's Model 3 Fare Against Affordable High-Range EVs?
- General Motors is preparing to launch a 200-mile EV to compete against Tesla's Model 3.
- Tesla's comparative advantage won't disappear within two years.
- Competition is good for EV exposure.
- GM’s 200-mile electric car for $30,000 will be unveiled Monday morning in Detroit.
- I list the 12 things you need to know about it, mostly in terms of my predictions.
- What most people really want to know is the impact to Tesla. In brief, it is brutal. This is margin compression 101.
- Furthermore, if GM can deliver a 200-mile range EV for $30,000, Audi and others could do the same as well.
- Audi, not wanting to compete with GM for a $30,000 EV, could launch a 300-mile range EV for $45,000, based on this logic.
- Tesla Investors Are Focusing Too Much On the Short Term.
- At $210, the Risk/Reward is Favorable to Long Term Bulls.
- Tesla's stock has been in a lull due to a lack of new information about current demand for the Model S and future models.
- Tesla Investors Should Focus on the Future.
- I talked to several large automakers about their intentions to build a competitor to Tesla's supercharging network for long-distance EV travel.
- All of them said no, they don't want to be in that business.
- In my opinion, when they start head-to-head competition with Tesla as early as 2017, this lack of a competitive network will impede their sales.
- There is still time for them to build this network, either individually or jointly. But time is running out.
- Panasonic also had good things to say about Tesla, even though there weren't any new information per se. Still, a positive for Tesla.
- According to InsideEVs.com, Tesla sold a record 3,500 Model S vehicles in December, which puts total US sales for the Model S at an estimated 17,300 for the year.
- Other positive developments include larger general demand for electric vehicles and the beginning of construction on the new Gigafactory in Nevada.
- However, the Model X continues to face challenges and will only potentially begin delivery in Q3. Tesla's share price remains extremely volatile and has been hurt by low oil prices.
- If it does not start to show evidence to support sky-high expectations for the Model X and Model 3, 2015 may be the year Wall Street turns against Tesla.
Dec. 30, 2014, 4:18 PM
- Tesla Motors (NASDAQ:TSLA) updates the estimated driving range for its family of Model S variants.
- EPA 5-cycle range per Model S type: 85D @ 270 miles, P85+/P85/85 @ 265 miles, P85D @ 253 miles, 60 @ 208 miles.
- The EV automaker has an online tool which estimates the potential range of a Model S based on a variety of factors including the impact of performance tires and average driving speed.
Dec. 30, 2014, 8:37 AM
- China will extend subsidies on electric vehicles of up to 55K yuan ($8.8K) per vehicle until at least 2020, according to new draft rules published by the government.
- The development is the latest indication that Beijing plans to back the EV industry in the region as part of a broadened pollution-control initiative.
- Related news: Shenzhen (population ~10M) caps new car sales.
- Stocks of interest: TSLA, OTCPK:BAMXY, KNDI, TM, and Berkshire Hathaway (BRK.A, BRK.B) via BYD Group.
Dec. 28, 2014, 12:40 PM
- Germany plans to build out the network of charging stations for battery-powered cars in the nation as it looks to stoke growth in the EV industry, according to Reuters.
- The government has a goal of having a million electric cars on the road by 2020.
- EV sellers in Germany: OTCPK:BAMXY, OTCQX:VLKAY, OTCPK:DDAIF, OTCPK:MMTOF, TSLA, OTCPK:NSANY, OTC:RNSDF.
Dec. 26, 2014, 8:47 AM
- Elon Musk on Twitter: "Roadster upgrade will enable non-stop travel from LA to SF -- almost 400 mile range." With the Roadster currently having a range of 244 miles, the upgrade stands to deliver a ~60% range boost. Details will be provided shortly.
- Musk adds a similar upgrade for Tesla's (NASDAQ:TSLA) Model S (265-mile range with the 85 kWh battery pack) is "not coming soon," but will happen long-term.
- Tesla sold ~2,500 Roadsters from 2008-2012. A next-gen model is rumored to be in the pipeline.
- Earlier: Tesla pushes Model S in China
- Update: Tesla has officially announced the upgrade, known as the Roadster 3.0 package. A new 70 kWh battery pack provides a 31% energy increase; "modern computational methods" allow drag coefficient to be lowered by 15%; and new tires provide a 20% improvement in rolling resistance coefficient. "There is a set of speeds and driving conditions where we can confidently drive the Roadster 3.0 over 400 miles."
Dec. 26, 2014, 3:02 AM
- Elon Musk is partnering with used-car traders in China to help Chinese buyers trade in their old cars if they buy a Model S.
- Tesla (NASDAQ:TSLA) will deduct the value of the sale from the price of the car, which in China starts at 648K yuan ($104K).
- Musk expects to start building Model S sedans in the country within three to four years.
Dec. 23, 2014, 7:25 PM
- It’s pretty clear why many energy stocks are hurting amid falling crude oil prices, but Morgan Stanley has researched across industries to determine some less clear-cut winners and losers.
- Airlines consume huge amounts of fuel, but the firm says American Airlines (NASDAQ:AAL) and Allegiant Travel (NASDAQ:ALGT) should benefit more than most from lower oil prices since they do not hedge the price of fuel to reduce price volatility.
- Among autos, Tesla (NASDAQ:TSLA) draws concern because "lower-for-longer oil certainly hurts the case for mass-market adoption of electric vehicles.”
- Since lower gas prices should reduce shipping costs, Stanley sees the benefit trickling into Q1 per-unit shipping costs at Amazon (NASDAQ:AMZN).
- The firm likes Monster Beverage (NASDAQ:MNST) on the idea that Americans getting cheaper gas might be more ready to splurge on energy drinks, and gas stations and convenience stores account for 75% of MNST’s sales.
- Among apparel companies and retailers, Stanley likes brands that are most popular with lower-income consumers, who they believe are most likely to put the money they save into new purchases: PLCE, FL, FINL, BWS, SKUL, ARO, BURL, ROST.
Dec. 19, 2014, 5:58 PM
- Consumer spending in several areas is likely to benefit from lower pump prices, but J.P. Morgan's Ryan Brinkman thinks the auto industry may benefit more than most from consumers having more money to spend on all things apart from fuel.
- The analyst sees Goodyear Tire (NASDAQ:GT), American Axle (NYSE:AXL), GM and Ford (NYSE:F) - in that order - as best positioned to benefit, followed by suppliers with material exposure to full-size trucks and SUVs that is not as great as AXL, including Tenneco (NYSE:TEN), Lear (NYSE:LEA) and Tower International (NYSE:TOWR).
- Tesla (NASDAQ:TSLA) is an exception, however, as Brinkman sees a potential reduction in the terminal value of cash flows on his reduced outlook for Model 3 vehicles if fuel prices remain low longer-term.
Dec. 19, 2014, 4:11 PM
- Tesla Motors (NASDAQ:TSLA) is out with more details on the new battery swap pilot program set to launch.
- Select Model S owners will be give the chance to test the service at a new facility in Harris Ranch, California
- The EV automaker says the battery switch will take three minutes.
- If Tesla determines that there is sufficient demand, it will invest in automation and design upgrades to cut down the swap process to under a minute.
Dec. 19, 2014, 2:17 PM
- The age of connected cars appears closer with Google pushing forward with its next-gen Android M software designed to be integrated into automobiles.
- The industry has a bit of an uneasy relationship with Google, despite the company's open-source approach to the technology.
- Though most major automakers collaborate with Google through the Open Automotive Alliance - which aims for a common platform to drive innovation - the self-driving car initiative of Google and their own infotainment ambitions keep them wary.
- Analysts originally forecast vehicle-to-vehicle communication would be part of the connected car concept and be integrated into some models by 2016, although that timetable now appears unlikely.
- What to watch: Before any major breakthrough occurs, the DOT needs to weigh in on next-gen connected cars. That gets trickier with safety and security concerns teed up again after the high-profile GM recall debacle and crippling Sony hacking incident.
- Automaker stocks: GM, F, TM, HMC, OTCPK:NSANY, TSLA, OTCQX:VLKAY, OTCPK:DDAIF, OTC:HYMLF, OTCPK:BAMXY, OTCPK:MMTOF, OTCPK:PEUGF, OTC:RNSDF, TTM, OTCPK:MMTOF, OTCPK:SZKMY, OTCPK:FUJHY, OTC:RNSDF, OTCPK:GELYF, FCAU.
Dec. 19, 2014, 11:19 AM| 95 Comments
Dec. 17, 2014, 8:32 AM
- Morgan Stanley is out with new long-term production estimates on Tesla Motors (NASDAQ:TSLA).
- Analyst Adam Jonas lowers the 2018 forecast for Model 3 volume to ~40K.
- The outlook for 2020 deliveries is dropped to 297K vs. Tesla's target of 500K.
- The lowered expectations from MS on production are counterbalanced to a degree by the higher average transaction price it sees as the sales mix stays shifted toward the luxury segment.
- The price target on Overweight-rated TSLA is taken to $290 from $320 by MS.
- Tesla's dip below $200 drew out 187 comments yesterday on SA from bulls and bears
- TSLA -1.8% premarket to $194.20.
Dec. 16, 2014, 9:59 AM
- Shares of Tesla Motors (NASDAQ:TSLA) dipped below $200 in premarket trading before pulling back over the threshold. Tesla hasn't closed below $200 since May.
- The stock is ~31% off its 52-week high as the production timetable of the EV automaker's Model X becomes clearer and factors into estimates.
- The lower price of gas in the U.S. isn't an overriding concern for Tesla, say many automobile analysts.They note Tesla buyers aren't typically the penny-watching types.
- There was good news on the Gigfactory front after city officials in Reno and Sparks exuded confidence at a County Commission meeting that the region can support the massive plant.
- Tesla is now down 1.08% to $201.54.
Dec. 12, 2014, 8:53 AM
- Veronica Wu has been with Tesla (NASDAQ:TSLA) for over a year, but will leave the company in the coming days, reports the WSJ, and confirmed by Tesla.
- Tom Zhu - currently in charge of Tesla's supercharging network in China - will assume responsibility for operational leadership in the country, says the company.
- Wu's exit comes shortly after the resignation of Tesla's China chief of communications, Peggy Yang.
- Shares -1.8% premarket
Dec. 9, 2014, 7:05 PM
- Tesla's (NASDAQ:TSLA) late push into the green helped shares avoid a company record eighth straight down day, amid talk that the severe decline in oil prices has been taking a toll on TSLA; the thinking is that car buyers would be less adamant about fuel efficiency when the price at the pump drops.
- But Bespoke researchers say the correlation between TSLA's stock and the price of oil has been changing slowly for years, and “over the last six months... they have moved completely independent of each other on a day-to-day basis.”
- Among the "real" reasons cited for the recent declines: recent media reports in Germany that cooled excitement about a potential partnership between with BMW, a lower than previously announced driving range for the new P85D, and broad losses among momentum stocks.
- TSLA still trades at more than 70x next years projected earnings, but bulls look ahead to 2017 when the company’s Model 3 is scheduled to hit showrooms; Bespoke also likes TSLA’s long-term prospects but says the stock will suffer downswings "like the one it is currently experiencing.”
Dec. 9, 2014, 10:20 AM
- Tesla Motors (TSLA -3.2%) trades lower as the impact of lower oil prices on demand continues to be hotly debated.
- InsideEvs pegs the number of U.S. Model S sales in November at 1,200. The lukewarm demand in the month was somewhat expected in front of the P85D launch.
- In regard to the P85D, the enthusiasts at the Tesla Motors Club blog have spotted the new model on the streets already.
- The automaker confirms it opened two supercharger locations in Australia as it begins to build a network in the region.
Dec. 8, 2014, 10:45 AM
- New data from Truecar.com indicates more than one million cars with a transaction price over $50K will be sold this year.
- Sales at the price point are up 30.8% through November compared to a year ago.
- Transactions for cars below the $50K level were up 4.1% for the same time period.
- Detroit automakers (GM, F, FCAU) have big plans for the Cadillac, Lincoln, and Fiat brands in the U.S. in 2015.
- Meanwhile, German automakers (OTCPK:DDAIF, OTCPK:BAMXY, OTCQX:VLKAY) are all increasing production capacity in the U.S. based on forecasts for strong high-end sales growth.
- Strong demand in the U.S. for cars priced over $50K also bodes well for Tesla Motors (NASDAQ:TSLA).
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