Seeking Alpha

JackB125

JackB125
Send Message
View as an RSS Feed
View JackB125's Comments BY TICKER:
Latest  |  Highest rated
  • Update: Tesla Admitting Reduced Model P85D And 85D Range Versus Promises [View article]
    Paulo,

    I'm not convenienced that Tesla has the final numbers at this point. Especially if they have a firmware update that may change the range numbers again. If so, you will end up with a third printscreen with new numbers yet again. Would it have been better if they had the final range numbers at the announcement? Certainly. Even a "TBD" would have been better than changing the original numbers. But, keep in mind that Tesla has 10,000 relatively new employees; not 300,000+ veterans. It would be naive to expect 100% flawless announcements 100% of the time at this point. And, I still think it likely that the numbers will be updated again as more information (and possibly a firmware update) come in. I still believe it to be premature to draw any final conclusions at this point.

    Good article bringing the changes & discussion to our attention. I just think it unlikely that this story is quite over.

    Best wishes for the new year.
    Dec 29, 2014. 11:31 PM | 1 Like Like |Link to Comment
  • Update: Tesla Admitting Reduced Model P85D And 85D Range Versus Promises [View article]
    Hi Paulo,

    Lots of conflicting, hear-say statements in http://bit.ly/1Bfy9Nk . Plus, I've heard that Tesla is working on a firmware upgrade that will improve the *D model ranges.

    After re-reading the referenced article & discussion + some additional materials, I find myself not really comfortable with the data that is currently available. I suspect things will become clearer in the near future.

    Your article will likely speed the discussions and ultimate findings on the *D ranges; but, IMO, it is too early to draw any final conclusions.

    Thanks for taking the time to write & contribute the article.

    Best regards,

    Jack
    Dec 29, 2014. 04:30 PM | 3 Likes Like |Link to Comment
  • Update: Tesla Admitting Reduced Model P85D And 85D Range Versus Promises [View article]
    Paulo, are you aware that the 5-cycle EPA testing for BEV's has recently been changed? The *D versions of the Model S must use the new EPA 5-cycle test for BEV's where they are tested to 80% capacity & 100% capacity, then the results are averaged. The older versions of the Model S get to "grandfather" their original 100% capacity 5-cycle EPA test results.

    The net is that the *D 5-cycle test results compared to the non-*D results is now an apples to oranges comparison due to the changes in the EPA 5-cycle test protocols for BEV's.
    Dec 29, 2014. 02:44 PM | 15 Likes Like |Link to Comment
  • No Excuses: Falling Gasoline Prices Are Impacting Tesla's Sales [View article]
    MarketLost, they also pay "employment" (social security & medicare) taxes on ALL wage income. This (and many other tax codes that are regressive) is how Warren Buffet pays a lower tax rate than his secretary.

    While it is 100% accurate & true that almost 50% of US households pay zero or near-zero net FIT, this "fact" is extremely misleading. The working poor that fall into this category pay the above mentioned employment taxes, sales taxes, property (if they have any) taxes, gasoline taxes, etc. E.g., if a working poor family is making $25,000 a year, the $500 they pay in sales taxes (e.g., TX has an 8% sales tax on most items other than food and medicine) has much, much more impact on them than the $5000 in sales taxes that a 1%-er making $500,000 a year would feel.

    When I hear the 50% zero FIT fact, I'm thinking, "Good Lord! 50% of families in the US make so little that they're not even paying FIT! Income inequality is going to become socially disruptive at some point. But, how do we make it better?" And, I don't have any good answers to my own question.

    I'm NOT a socialist. I think that well regulated (which we do not have) capitalism is likely the best economic system available to us at this point in history. But, big money politics is warping US capitalism to serve its own needs.

    Since this is a Tesla article, a good case in point is the state automobile franchise laws. Any honest economist will tell you that they have no reasonable basis. They are protectionist, anti-competitive, anti-consumer laws whose sole purpose is to protect the dealership model of new car sales from competition. They run counter to free-market ideology and are unpopular with a supermajority of the state constituencies. Yet, they remain in place year after year. See http://bit.ly/P8HF2j . It's been described as crony-capitalism at its worst.

    If you think that I'm overstating US wealth inequality, please see http://bit.ly/16YxFlx . Perhaps more alarming is that we're losing wealth mobility as well. I.e., it's becoming harder to move from a lower-wealth level to a higher-wealth level.

    That's the end of my rant today. The afternoon is just to nice to get stuck in this quagmire. :-)
    Dec 28, 2014. 04:21 PM | 7 Likes Like |Link to Comment
  • Dissecting Tesla Motors' Competitive Advantages [View article]
    Hello MarketLost, I was mostly going by what Elon calls himself. Although, seeing him in “The Revenge of the Electric Car", comments from the SpaceX engineers, and stories of him writing code on the Tesla manufacturing floor during the first few weeks of production, all of these things have given me a personal view of him as an engineer. Even when he says things in public that he probably shouldn't, they often sound like an engineer speaking his mind without the typical forethought that you would expect from a CEO. I find this trait both refreshing (as an engineer myself) and a bit hair-raising (as an investor). In any case, I'd hate to be Tesla's corporate counsel!

    You bring up a good point that he has no formal training as an engineer. But, I don't think that can be a disqualifier at this point. The best software engineer that I ever had the pleasure of working with had zero college education. His body of work served as the proof of his engineering status.

    I have to admit to a curiosity as to why Elon calls himself an engineer. With his "first principles" thinking and college background, he could easily call himself a physicist. Perhaps he prefers the practical application of those skills as the attribute he wants to emphasize.

    Best wishes!
    Dec 18, 2014. 03:31 PM | 1 Like Like |Link to Comment
  • Dissecting Tesla Motors' Competitive Advantages [View article]
    Paulo, the large existing manufacturers are in a TERRIBLE quandary. They need to quickly shift their high end products to BEV platforms -- and not shove batteries & a motor into some existing chassis; i.e., new from-the-ground-up designs will be required -- in order to successfully compete with Tesla. And, they have to do it without killing their mid & lower end cash making businesses. Why? Infrastructure for the lower end stuff is going to take a while to build-out no matter how much money they have to invest. To move the bulk of the industry to the BEV technology will require about 200 Gigafactories & that’s just for the automobile industry. Don’t forget that the stationary energy storage business is raising its battery ravenous head at the same time. We had a saying where I used to work as an engineer, "You can't make a baby in one month with nine women." In fact, throwing too much resource at a problem will eventually slow you down due to the increased complexity of coordinating the additional resources. The supporting infrastructure is going to take time. 10-15 years?

    So, say you’re a large auto manufacturer & you pour in the resources to compete with Tesla & after a few years, you do a pretty good job producing a new “halo” product that folks are impressed with. Let’s say this jewel comes in at around $150,000 & your high-end customers are buying it and are very happy. All is good, yes? Probably not. You can pull a profitable BEV off only in your high-end, high-margin products at this time. Even if you could build profitable mid and/or low level models, when will the infrastructure be ready? At first, you will have to stick to just the high end.

    Now, let’s take the view of the mid & lower tier consumers. These are the folks where the second most expensive single purchase they will ever make following their housing, is their car. So, they have an older car that they would normally be looking to trade in for a new model. But, they see all the “halo” products are now on the BEV platform. And, boy! Is everyone talking about them! “They can do things that the old ICE/Hybrids will never be able to match. The industry is changing!!!” Are these folks going to want to buy the old technology? Of course not. They’re going to keep their old cars (or, at best trade up to a newer used car) and wait for the BEV technology to come down to the level that they can afford. The purchase of the second most expensive item that they will every buy is too important to waste those funds on a technology that is heading out the door just as soon as the supporting infrastructure can be put into place.

    Let’s go back to the large manufacturer’s viewpoint. Yes, your new BEV halo product is a success. BUT, you just KILLED virtually all of you mid and lower end business!!! How do you survive until the infrastructure for the mid & lower end is put into place?

    This is the major problem that the big auto-manufacturers face. There are many, many more that go along with the creative destruction that will be integral with this transition. Only 20% of the moving parts of an ICE. Your unions and their workers will be afraid – will you need as many workers? All your technical employees that specialized in engines, transmissions, exhaust systems – how many can be retrained? How many will be let go? Manufacturing suppliers that you have worked with for decades & now no longer need – what do you tell them?

    Can you see why the big, established manufacturers are not going to just want to jump into the deep end of the BEV pool and hope for the best? They have one monstrously treacherous path to negotiate with this change. And, no matter what they do, a lot of folks are going to get hurt along the way.
    Dec 17, 2014. 11:15 PM | 6 Likes Like |Link to Comment
  • Dissecting Tesla Motors' Competitive Advantages [View article]
    Most people would have said the same thing about Ron Baron a year ago as well.
    Dec 17, 2014. 10:16 PM | 3 Likes Like |Link to Comment
  • Dissecting Tesla Motors' Competitive Advantages [View article]
    Hi Frank, If Tesla would just cut back on the R&D, Supercharger build-out & slow the Gigafactory spending way down they could get the highly coveted GAAP profits for a few quarters. But, I would argue that it's few years too early for that. The established manufacturers are figuring out the inherent BEV benefits. A fast expansion for Tesla is key at this point for the long range success of the company. Will GAAP profits matter down the road? Absolutely! But, timing is key on this issue of profits vs. expansion. When is that time? I surely don't know. But, I do think that the folks at Tesla are in the best position to make that determination. Best regards!
    Dec 17, 2014. 10:12 PM | 5 Likes Like |Link to Comment
  • Dissecting Tesla Motors' Competitive Advantages [View article]
    Paulo, a less expensive, higher energy, high cycle rate, safe battery is VERY difficult; a larger battery pack cooler, probably not so much.
    Dec 17, 2014. 09:59 PM | Likes Like |Link to Comment
  • Dissecting Tesla Motors' Competitive Advantages [View article]
    tech01x, I agree 100%. Also, if you are a very top shelf engineer, Tesla has the new, hot, sexy product that everyone wants to work on. And, the company has a real ENGINEER CEO! When difficult decisions that have an important technical component arise, not too many other companies can claim a leader with that level of technical competence to lead the way.
    Dec 17, 2014. 09:50 PM | 4 Likes Like |Link to Comment
  • Dissecting Tesla Motors' Competitive Advantages [View article]
    Paulo, since the battery pack is the fuel container, I would think that maintenance is the more appropriate category. Also, 10-12 years may be a conservative projection for the Model S. 10-12 years for the Roadster; but, probably longer (15?) for the Model S.

    Last thought, if JB straubel & Elon Musk are correct, battery cell costs should be under $100/kWh in 10 years. I wouldn't mind a new 125 kWh battery pack for $15,000-$18,000 on a used Model S as long as I could get a decent major systems, certified used car warranty as well. 125 kWh should translate into about 400 miles on a full charge.

    With the drastically lower number of moving parts, it will be interesting to see what BEV residual values do in the long run. I make no predictions on this however. On the one hand, BEV's should be more reliable; but, folks are still going to want the latest features -- perhaps even more so with BEV's.
    Dec 17, 2014. 08:43 PM | 3 Likes Like |Link to Comment
  • Tesla's Strategic Advantage [View article]
    Hello @TheMtgBanker, Although very conservative in most ways (e.g., fighting the EPA on... well... everything), Texas is actually fairly progressive on energy. The Austin and San Antonio electric utilities have some of the best conservation and alternative energy programs in the nation.

    In 1992, I built a house 45 minutes north of Austin that had a GeoThermal heat pump, radiant barrier in the attic, a 10" double exterior wall with off-set studs to disrupt thermal bridging, triple-pane 50/50 argon/krypton filled low-e windows. I had never done any house design prior to the 1992 house. The bulk of my low energy use design information came from from the Austin electric utility all at no charge for a house that wasn't even going to be built in Austin!

    And, the state that produces the most power from wind turbines... Texas. Now in discussions with Tesla on a possible $2 Billion deal for stationary energy storage for those wind farms.

    It surprises me too & I lived there the first 55 years of my life.
    Dec 16, 2014. 01:02 AM | 2 Likes Like |Link to Comment
  • Have Tesla Shares Fallen Far Enough? [View article]
    @fiwiki2, I very much appreciate your reply. Tesla seems almost unique in its ability to create divisiveness with both pro & con factions. It's sort of fascinating in a morbid way. In any case, thank you again for your reply.
    Dec 14, 2014. 04:42 PM | Likes Like |Link to Comment
  • Have Tesla Shares Fallen Far Enough? [View article]
    @fiwiki2, in the SA commentaries, I'm actually looking for people to point out facts that were previously unknown to me. I also appreciate thoughtful analysis that ends in conclusions that are different from my own previous conclusions. All investors must wrestle with confirmation bias & I think the best way to do that is to pick other investors whom you respect that have prospective views different from your own and read what they have to say. Even if what they say doesn't often change your view, if you respect them, then they will make you carefully review your own positions with an open mind.

    I'm not insulted by peer commenters’ views that are contrary to my own. In fact, it's just the opposite. I greatly value their contrary views. They help provide direction to critical thinking about and reviews of my investments.

    What insults me is the constant use of pejoratives (moron, fool, ignorant, etc.) in the commentary. They add nothing to the discussion. In fact, they tend to steal the focus away from the logical parts of a comment.

    From some reason, Tesla discussions seem to stir the limbic brain more than other investment discussions. Somehow this company has edged its way into the collective mindset near the areas where we store religion and politics.

    My hope is for us to move our Tesla thinking & discussion back to the more logical forebrain & cease use of the pejoratives. In sort, I ask that we please move back to a more civil, productive form of dialog.

    Let me be clear... I am NOT asking for agreement -- I am asking for civility.
    Dec 14, 2014. 10:37 AM | 6 Likes Like |Link to Comment
  • Have Tesla Shares Fallen Far Enough? [View article]
    @fiwiki2, <sarcasm on> Absolutely! The market should have nothing to do with investing or supplying capital or funds to businesses -- the supposed engines of our economy. The true purpose of the market is to provide us the opportunity for casino style gambling with a lenient tax code. </sarcasm off> Sadly, IMO the latter seems to be true, disappointing, and just plain sad.

    After WWII, the average holding period for a US equity was about 4 years & that was true for the next 30 years following the war. Now, HFT's often hold their equities for just sub-second periods of times keeping the markets rigged (yes, rigged) in order to take advantage of microsecond latencies between the SIP (what we small investors use to see the prices of our equities & the orders against those equities) as opposed to the faster proprietary feeds that the HFT’s all use. And while the HFT’s are only lifting a few cents out of our pockets on most of our transactions, even then, that’s not so much is it? And, the way they steal that money from us – it’s so clever! Their total "take" from the markets only runs into the billions of $'s annually. When you spread it out over the trillions of stock $’s that change hands each year, is it really so much? Just think of it as a small tax that has no reasonable basis. Annoying, but what can you do?

    Unfortunately, much of these funds come from unsophisticated traders. Many of them just holding simple index funds in their retirement accounts. So, the nickels and dimes that the HFT's steal from these small investors are actually compounded over several decades. But, with the political influence of the financial industry and the revolving door policies between our government regulators and the industries and the markets they regulate, is it really so surprising that the current system of rigged markets is absolutely legal?

    Stealing billions of $'s from the US markets, including retirement accounts of people that don't really have too much in the way of assets to begin with, isn't a crime; rather, it's just smart business. On the other hand, sneaking $10 worth of medicine out of a drugstore for a sick family member at the end of the month when funds may be low... NOW, THAT'S A CRIME!!!! And, actually, I believe that to be true. It is a crime and unacceptable behavior. There are normally other ways to get the needed medicine legally. However, I think in comparing the morality of the HFT barons against the medicine thief, I’m afraid I find the HFT barons lacking even though they have committed no “crime”.

    One last question for you fiwiki2… Why do you think we find it acceptable to insult other people in the commentary in ways that we would probably never do to their face? It seems such a common practice, I was hoping that you may have an explanatory reason for this behavior. I really would like to understand it. Thank you in advance.

    Best regards,
    Dec 13, 2014. 08:18 PM | 4 Likes Like |Link to Comment
COMMENTS STATS
317 Comments
991 Likes