Seeking Alpha


Send Message
View as an RSS Feed
View JackB125's Comments BY TICKER:
Latest  |  Highest rated
  • Full Simulation Of The Tesla Battery: Insights For Investors [View article]
    Great article! Thank you for putting in all that work & sharing the fact based, non-biased writing. I wish that more TSLA articles shared this level of objectivity.
    May 6, 2015. 01:55 PM | 4 Likes Like |Link to Comment
  • Tesla Motors: Did Elon Musk Already Lower 2015 Delivery Guidance? [View article]
    IMHO, Elon’s ambiguous statement to a news organization does not even come close to rising to the level of a Regulation FD violation.

    On the other hand, the BATS exchange sells order flow and pricing information to a whole host of HFT’s about 300 milliseconds before the NBBO computers obtain and make the data public. The HFT’s pay hundreds of millions of dollars annually for the early access to this information and make billions of dollars in profits from these early “selective disclosures.” Does anyone think that this practice is a “Fair Disclosure” violation? Most of us pay for it on the majority of our trades. Thoughts?
    May 5, 2015. 06:22 PM | 2 Likes Like |Link to Comment
  • The Silliness Of Tesla's 10kWh Back-Up Battery [View article]
    Hi Dave_M, I've spent a lot of time trying to puzzle-out some way to put a dryer in a conditioned space without creating the huge infiltration & vent balancing problems that the darn things can cause. I eventually resigned myself to placing it in an unconditioned space -- an unsatisfying solution. This last weekend I read about a Whirlpool heat-pump dryer that doesn't use need a 4" vent to the outside! See . LG is supposed to come out with one as well before long. These heat pump dryers look like an ideal (albeit expensive) solution.

    Before you go with a NG dryer (if you plan for it to be in a conditioned space), while it may be much cheaper to run than a full electric dryer, you also have to pay an infiltration penalty 24/7. Plus, the dryer will overwhelm any other exhaust vent you may have running at the same time. The only way to know the best cost solution is to run an energy balance for your particular situation.

    Best of luck.
    May 4, 2015. 04:44 PM | Likes Like |Link to Comment
  • The Silliness Of Tesla's 10kWh Back-Up Battery [View article]
    For any market to work well, we must have good, current information. To that end, I think that the entire grid charging fees and costs need to be updated to reflect the new available technologies. Homes that have a PV/battery system will help to smooth the demand curve thus saving utilities the capital and labor costs associated with peak generation equipment that will no longer be needed. Moreover, peak-shaving and load-shifting from this type of local generation and storage will allow for higher utilization of the remaining generation equipment as well decrease repair expenses. Furthermore, in a smart grid, the nature of the widespread generation serves to harden the grid against attacks and/or natural disasters. The local generation equipment, the battery packs and eventually tied-in BEV's as well, will additionally make the system more reliable and resilient. Lastly, the bulk of our non-renewable generation has well-known deferred costs in the form of global warming gases that have often been dismissed as pure economic externalities -- externalities that the overwhelming scientific consensus predicts will lead us to a true tragedy of the commons that will likely take centuries to unwind.

    The net of all this is that local generation and stationary energy storage at the current prices would be likely to decrease the true total costs of the majority of today's electric utilities. Moreover, as PV and energy storage costs continue to drop, these benefits will enjoy further gains. The trick is to setup the market so that all of us are paying a realistic portion of our costs to the system minus whatever benefits our local generation and energy storage bring to the table. The most controversial elements of a "true-cost" system like this will be getting people to agree on the values of enhanced equipment utilization, decreased maintenance & repair costs. However, the truly contentious challenge will of course be estimating the savings of the decreased greenhouse gases. Perhaps we could treat this effort as we have done military base closings. Hand the problem over to a body of qualified experts to estimate the projected costs and savings, then require an up or down vote on whether to accept the new proposed cost structure or not.
    May 3, 2015. 09:47 PM | 1 Like Like |Link to Comment
  • Net Metering Leaves Tesla Home Battery Storing A Lot Of Hype [View article]
    You are not considering the problems that net metering is causing in areas of high residential generation. This is well explained by the “Duck Graph” as shown in Mark Rogowsky’s Forbes article titled “Blowing Up: Tesla's Gigafactory Is Going To Revolutionize The Auto And Utility Industries” at .

    The problem is one of utilization. During peak solar generation times, some utilities will have more “net metered” energy than they can use. Yet, they will still need to keep some level of rolling reserve going at all times since it’s not possible to instantly start grid level power generation. When showers pass through an area, solar generation can vary quickly and widely. The utilities are responsible for managing these large swings and that requires additional capital and labor that all of us have to pay for.

    Any sort of local buffer, like a residential battery pack (especially if tied into a smart grid), makes the entire system more efficient and reliable. As more solar comes online, the utilities will likely be forced to make some sort of buffering system like these battery packs a mandatory part of the PV installation if the homeowner wants to be connected to the grid.
    May 1, 2015. 02:38 PM | 2 Likes Like |Link to Comment
  • Genius Of The Tesla 70D: Sell More Cars, Use Fewer Batteries [View article]
    Hello Siddharth!

    Great article! I hadn't thought about the potential battery utilization improvements. That's a very important piece of information. Thanks for taking the time to put this together & share with the rest of us.

    I recall a comment yesterday with the bearish observation that the 70D sales would be robbing the 85, 85D & P85D sales resulting in a lower ASP. The comment reminded me that Elon's prime directive for Tesla goal is to accelerate the advent of the electrification of transportation -- not to make every dime you can as quickly as possible. The latter is certainly a requisite to fund the former at this point. But, we investors should make sure that we know the difference between the two. Thanks again for the article and its insights.

    Best regards,

    Apr 10, 2015. 12:19 PM | 30 Likes Like |Link to Comment
  • Tesla And The State Of The Electric Vehicle Debate [View article]
    @Davewmart, Thanks for the great reply! That was just the info that I was looking for.
    Apr 9, 2015. 12:10 PM | Likes Like |Link to Comment
  • Tesla And The State Of The Electric Vehicle Debate [View article]
    Has anyone heard anything about the expected life cycles of the smaller battery packs? I'm thinking that they will be undergoing a full discharge/recharge cycle on most commutes & hitting those capacity endpoints repeatedly may have a significant effect on the pack's life cycle.

    Also, will any of the smaller battery packs have active thermal management systems? I lived in Texas most of my life & can attest to a Central Texas August being hard on a battery.

    Thinking about the above questions makes me wonder if they may elect to use a lower specific energy cell chemistry in order to get a more robust life cycle.
    Apr 7, 2015. 02:45 PM | Likes Like |Link to Comment
  • A Tesla Valuation Using DCF Under 3 Scenarios [View article]
    Navigant Research has done a lot of work in this area. And, for many of the reasons already mentioned in the replies to your comment, Li-ion batteries are thought to be the most likely technology at this time.
    Apr 6, 2015. 05:16 PM | 1 Like Like |Link to Comment
  • A Tesla Valuation Using DCF Under 3 Scenarios [View article]
    Listen to the keynote address, read the article about the deal. The Texas wind farm produces electricity for less than $0.03/kWh. It kills them to have to shut things down because there is no place to put the energy.
    Apr 6, 2015. 05:12 PM | 2 Likes Like |Link to Comment
  • A Tesla Valuation Using DCF Under 3 Scenarios [View article]
    The current discussions with Oncor for $5.2B is a single deal that we know about. It doesn't include any residential systems or other possible commercial systems that may be under discussion. However, reading about a single deal this big makes me think that JB Straubel could be right about a future Tesla stationary energy storage business that might actually eclipse the Tesla car business. With so many unknowns, I'm only saying that it is a plausible possibility at this point. We live in interesting times.
    Apr 6, 2015. 05:08 PM | 3 Likes Like |Link to Comment
  • A Tesla Valuation Using DCF Under 3 Scenarios [View article]
    Andre, Thank you for taking the time and effort to put together this valuation of Tesla. I do see one hole in the work... Tesla is soon to expand beyond their auto manufacturing business.

    You've likely heard of the upcoming residential battery announcement at the end of the month. But, you may not be aware that Tesla is in discussions with the West Texas Wind Farm electric utility named Oncor. This deal (to be completed in 2018) is worth $5.2B and is completely outside of the Tesla Motors business other than some battery expertise. You may want to take a deeper look at Tesla's nascent stationary energy storage business. There is more going on over there than most analysts realize. JB Straubel (Tesla CTO) believes that Tesla's stationary energy storage business will eclipse their auto business in the next few years. When Elon was taking about Tesla growing into an Apple size valuation in 10 years, I doubt if he was thinking that cars would be even 50% of it. Take a look at JB Straubel's Keynote Address to the 2014 Stationary Energy Symposium on YouTube. See .

    Other than "bigger than the auto business" we have very little guidance. Still, if you can, I would love to see your valuation with this new business added in to the tune of 55-60% of Tesla's total business 10 years from now. Perhaps that could be a second article.

    Best regards.
    Apr 6, 2015. 06:01 AM | 9 Likes Like |Link to Comment
  • Tesla says Nevada battery plant on track, refutes report of delay [View news story]
    Smart money lowering the price & culling nervous fools so they can pick up shares at a discount?
    Mar 6, 2015. 04:19 PM | 14 Likes Like |Link to Comment
  • Tesla: Gigafactory Tipping Point [View article]

    I agree with you that acceleration is not the most highly sought after characteristic for every auto consumer. My wife is definitely in that group. On the other hand, my two daughters would love exceptional acceleration (no wonder our insurance premiums are so much higher at 20 years of age than at 45 years of age -- all else being equal).

    Probably about 12 months after the Model 3 becomes generally available, I'm planning to buy one each for my wife and two daughters. Alas, I became medically restricted from driving right when the Model S came out. Oy vey!

    However, moving on... The #1 characteristic that I value in those cars that no comparable ICE or hybrid will ever be close to matching??? SAFETY! The floor battery pack will give the vehicles an incredibly low center of gravity. With the placement of the battery pack and no engine, transmission or exhaust system to design around:

    1) The very low center of gravity will greatly mitigate the risk of a rollover.

    2) The weight distribution over the front and rear wheels will be close to 50/50 % making for superior handling & stopping distances.

    3) Compared to ICE or Hybrids, the Model 3 will have enormous sacrificial crush spaces with nearly ideal energy absorbing crush members that the engineers won't be have to weave around big ICE's, transmissions, etc.

    By the nature of the Tesla skateboard design & the lack of large ICE mechanical components, it will be virtually impossible for ICE or hybrid vehicles to match (or even come close to) the expected superior safety characteristics of the Model 3.

    The second most important item on my list of vehicle characteristics is RELIABILITY. Before I go any further, let me concede that the Model S's reliability has not been flawless. There has certainly been well (if not overly) documented problems with the early drive units, unusual tire wear with the 21" wheels, and the "vampire" power losses. My understanding at this point is that the first two problems have been resolved; the third, heavily mitigated.

    However, what should we have realistically expected in the area of reliability for the early Model S units? In 2012, the Model S had a completely new, from-the-ground-up design with a very high level of novelty that was manufactured in a brand new facility (except for the shell) with mostly brand new equipment by an inexperience workforce. Were there reliability issues? Yes. However, think about the following question before we go any further...

    If GM were building a completely new ICE/hybrid car, drastically unlike anything else it had ever done, under those conditions, do you think the new GM vehicle would have been as reliable as the new Tesla vehicle?

    I can’t help but think that they would have had far more reliability issues. Furthermore, I believe that this would have been true for any of the ICE/hybrid manufacturers. The Model S only has 20% of the moving parts of comparable ICE vehicles. That percentage has to be even lower (although I haven’t seen the numbers) for hybrid vehicles (all the parts of an ICE & BEV, plus crossover systems).

    I’ve come to believe that the reason the early Model S units didn’t have far more reliability issues is primarily due to the nature of the mechanically simpler Tesla BEV design. Moreover, this is something that no ICE or hybrid design will ever be able to match.

    So, there you have it. At least one future auto consumer that fully expects to be choosing the Tesla Model 3 primarily for its safety and reliability characteristics rather than its expected exceptional acceleration. I guess that I should mention that my brother is of the same thinking. So, there are at least two of us; and, I suspect many, many more.

    Best regards.
    Mar 5, 2015. 03:47 PM | 9 Likes Like |Link to Comment
  • Tesla: Gigafactory Tipping Point [View article]
    Hello PVGO,

    Similar questions have been going through my mind. I can’t imagine that Tesla would want to release the Model X with ranges less than that of the Model S. Therefore, I’m guessing that there may be enough manufacturing capacity around of the new format/chemistry batteries to supply whatever Model X deliveries are made prior to the beginning of production at the Gigafactory. Once the Gigafactory is producing a sufficient supply of the new batteries, I expect that we’ll see a new top-end battery pack option (110-120 kWh?) for the Model S with improvements in range (325+ miles?) and performance (0-60 mph in the high 2’s?). Even if I’m correct in the direction of these changes, I have no feel for the timing. But, another December surprise upgrade (or at least an announcement) for the Model S would be nice!
    Mar 5, 2015. 02:48 PM | 3 Likes Like |Link to Comment