Seeking Alpha

JackB125

JackB125
Send Message
View as an RSS Feed
View JackB125's Comments BY TICKER:
Latest  |  Highest rated
  • Adding Downside Protection To Tesla [View article]
    Not necessarily. I bought most of my TSLA for just under $40 & protected a little over $105 of my unrealized gains with a $145 put that I paid for with $335 covered calls.

    Collars can be a smart hedge if you're holding significant unrealized gains.
    Aug 22, 2015. 02:09 AM | 2 Likes Like |Link to Comment
  • Tesla Motors higher after massive Morgan Stanley PT boost [View news story]
    Big bankers don't go to jail.
    Aug 17, 2015. 07:51 AM | 27 Likes Like |Link to Comment
  • Tesla's $500M Financing: We Were Right Again [View article]
    I'll take one of those bozo hats. I have just the spot for it in the house that I paid off with a portion of the profits I took on the way up.
    Aug 14, 2015. 08:36 AM | 1 Like Like |Link to Comment
  • Tesla Motors prices secondary offering [View news story]
    So, this is about a 1.6% dilution. That's below the noise level of daily price changes on the stock. Yet, it puts Tesla in a significantly better cash position. TSLA closed up over $4 on the news yesterday & is up another $3 in today's pre-market at the time of this writing. The market seems to approve of this secondary offering. I certainly do.
    Aug 14, 2015. 07:38 AM | 17 Likes Like |Link to Comment
  • Tesla Motors to test referral program [View news story]
    Hi Dave,

    The one thing that really surprises me is how many people know zero about Tesla. Virtually all of my test drivers knew zero about Tesla before I hounded them into scheduling a test drive. This just amazes me! 2013 MTCOTY, all the Consumer Reports coverage, all the YouTube videos, all the financial news coverage -- I really don't understand it. But, I can tell you that the test drive has been transformative for all of them. The last one I got to do a test drive about a month ago was typical, never heard of Tesla before I brought it to his attention. But, after the test drive, could not stop talking about the car & is looking at the 70D model.

    When folks like me get someone interested in the car, I have to admit I would like some token acknowledgement at least if a sale does occur. But, if Tesla really needs to generate more demand, this program seems a questionable way to proceed. I really cannot predict how it will turn out. And, although I appreciate the acknowledgements for these incidental sales, I would hope that they would use a more reliable lever (advertising) if they really need some additional demand.

    The more that I think about it, the more I suspect that it really is just an experiment. Elon's had folks like me bugging him repeatedly for some sort of incidental sales program. We do sort of act like pseudo salespersons in the nutty franchise dealership states like Texas. There seem to be reasons to try it; but, I'm a bit doubtful that demand generation is the big one. Again, I suspect advertising would do a much better job if that were the primary goal.
    Aug 1, 2015. 06:21 AM | 3 Likes Like |Link to Comment
  • Tesla Motors to test referral program [View news story]
    Hello Dave!

    I think that you bring up a very good point. I'm already enamored with the car & don't see the program changing my behavior. Oh perhaps it may help nudge me a bit just because I'd like to help a friend save $1000. However, since I'm not in the market for any vehicle, I was just hoping for a jacket, water bottle & a note of thanks.

    In fact, under the current rules of the program, I'm not eligible to participate since I don't own a Tesla -- I'll be contacting Investor Relations about my situation soon.

    This program is definitely an experiment at this point. As I understand the logic, each customer initiated sale is suppose to offset the estimated $2000 costs in the pure store sale that didn't occur. But this really doesn't make 100% sense to me. My friends will still be using the stores for test drives and speaking to the product specialists. On the other hand, my cousin lives in Texas where the state legislature has decided to keep some antiquated regulations in place in order to keep a rentier capitalistic system intact to protect their dealership campaign contributions. In my case, I'll be taking on part of the salesperson role since the Texas Tesla employees are forbidden to do so! Elon did mention something about this program and guerrilla sales tactics in states like Texas.

    In short, I really don't know if this program is going to be helpful or not. I think it really is an experiment.
    Jul 30, 2015. 06:43 PM | 5 Likes Like |Link to Comment
  • Tesla Motors to test referral program [View news story]
    Well... Say that I talk my cousin into taking a test drive & he buys the car. If Tesla gave me $2000, I'd want to split it with my cousin. I'm not trying to sell him something for some sort of a commission. He's my cousin & I just want him to test drive a car that I think he will really like. That's my primary intention. If Tesla rewards me in some way, I'll definitely want to split it with him. Tesla has set the program up for folks like me that primarily are just wanting to share the cool new thing with friends and family.
    Jul 30, 2015. 02:50 PM | 2 Likes Like |Link to Comment
  • Tesla Motors to test referral program [View news story]
    I don't drive (medical restriction) and do not own a Model S. However, I am a stockholder and very enthusiastic about the car. So, I talk about it with friends and family. So far, I've gotten 7 people to take a test drive. One was close to buying, but had a change in employment and decided to wait. Another test driver is considering a 70D. All the rest are waiting for the Model 3. I'm planning on convincing a cousin to finally take a test drive when I can make sure that a P90D "Ludicrous" model is available. And, I think it very likely that the cousin will either buy the "Ludicrous" model or perhaps a high end Model X after a spousal "Oh no you're NOT" conciling session.

    In any case, I have been acting as a pseudo salesman/educator for Tesla -- not to be paid; but, just because I believe in the products & technology.

    However, if my activities generate a sale, I think it only fair that Tesla should give me some small compensation. I'm not really interested in the $1000 for a future purchase. But, I would very much appreciate the recognition.

    I have heard many owners express similar views on generating incidental sales like this. And, I've heard folks express this opinion to Elon multiple times.

    Consequently, I think that this new program is about making sure that current Tesla owners who generate sales feel like they are being treated fairly. And, more importantly, get some recognition for those sale(s).

    The program has nothing to do with demand -- it's about customer satisfaction (in my case, investor satisfaction).

    If demand were a problem, a little advertising would make a lot more sense.
    Jul 30, 2015. 06:40 AM | 5 Likes Like |Link to Comment
  • Tesla Will Need To Restructure [View article]
    Whenever I see that an argument is based on comparing Tesla to long established nearly exclusively based ICE technology auto manufacturers, I pretty much dismiss the article at that point and move on. Tesla is a very rapidly expanding technology company -- the old auto manufacturers are anything but.
    Jul 27, 2015. 07:31 AM | 3 Likes Like |Link to Comment
  • GM Pokes Tesla With Chevy Bolt Development Progress Report [View article]
    Hello @Davewmart,

    First let me say that I agree with you that the PHEV solution for long distance trips is likely to always be superior than that of a quick charge pure BEV. That said, with a PHEV you loose every other benefit that makes the BEV so compelling.

    1) Reliability -- The Model S has 20% of the moving parts of a comparable ICEV. That percentage is even lower when compared to a PHEV with all the parts of an ICEV plus all the parts of an EV plus the crossover system.

    2) Maintenance -- See 1.

    3) Safety -- With all the additional ICEV & crossover parts, you will have a higher center of gravity, a likely uneven distribution of weight across the front and rear wheels, smaller crumple zones & less ideal energy absorbing crush members.

    4) Convenience -- Less passenger space & less storage space.

    I don't know how much value most folks put on each of these characteristics. However, if I were still driving, I would very rarely (2-3% of the time) be going on trips that would be long enough to enjoy the better range and quicker refueling of the PHEV. Also, with a PHEV I would be giving up the four superior BEV characteristics listed above 100% of the time. It's really true that you can do so many things better with a BEV when compared to an ICEV, HEV or PHEV. Putting an ICE into a BEV ruins the BEV's value proposition -- at least it would have for me.

    All that said, I am sure that there are folks that for one reason or another would do better with a PHEV. Nevertheless, I suspect most of us have driving patterns that would favor the BEV as long as it had at least a 250 mile range.
    Jun 27, 2015. 02:04 PM | 5 Likes Like |Link to Comment
  • GM Pokes Tesla With Chevy Bolt Development Progress Report [View article]
    @watchingfromabove,

    Thanks for laying out such a detailed explanation. I can see both the legitimization argument and the additional ICE amortization time argument from GM's perspective. From the customer's perspective, however, I think that the comparison to Tesla's SuperCharger network will put GM's CHaDEMO solution in a very bad light. I wonder how this might affect initial sales -- it sure won't help. And those that buy a Bolt and live with the disparity for 2-3 years may be much more likely to choose Tesla if they go for another EV.

    I think that the most disappointing part of this is that GM is doing their Bolt customers such a disservice with this choice. GM sure doesn't need to add any more doubt or even ill will towards their brand. But, they are in a much, much better position to see how to run their company than I am.

    Final thought... I really would like to see GM get past all the negative recalls, pay back its loans and regain all the respect it once had. If they had gone the other route, their customers would definitely be happier & perhaps some of the Tesla cache would come their way as well. But, again, they know their business far better than me.
    Jun 27, 2015. 01:13 PM | 4 Likes Like |Link to Comment
  • GM Pokes Tesla With Chevy Bolt Development Progress Report [View article]
    Dave_M,

    I too see the "no road trip capability" as a glaring hole in their business plan. If they were serious about the BOLT, why not strike a deal with Tesla for use and buildout of the SuperCharger network? The fact that they haven't done so leads me to think that they want this to be a limited run compliance car only -- absolutely no cannibalization of any of their ICE vehicles. GM is still treating their EV group like a "red-headed stepchild." <-- That is one of my Dad's very strange sayings. I always translated it to "least favored child by a wide margin."
    Jun 27, 2015. 09:44 AM | 5 Likes Like |Link to Comment
  • Will Tesla's Model 3 Compete? [View article]
    Dave:

    Great reply. I find myself dismayed about the early 2013 near sale to Google with no indications whatsoever that there was such a serious cash problem at the time. I have to remind myself that with Elon it's all about the mission. That is "to accelerate the advent of vehicle electrification in order to move to a sustainable energy system." We investors should print that out and read it at least once a week. It's not about the money with Elon; it really is all about the mission. With most companies it's just the opposite -- money is #1, #2 & #3 and the mission statements are just nice prose that executives feel obligated to put down every so often then forget about.

    I think that this all consuming drive for the mission is what compels him to not be as open with investors as I wish he would be. On the other hand, it was largely this very same drive that got me to invest in Tesla during the high $20's to low $30's in 2012 & 1H2013 (stock & calls). I was very lucky & did well with those investments and I'm still holding on to the bulk of my TSLA stock. But, I too no longer trust that I'm getting the full story. Consequently, I've been putting 3-6 month collars around my TSLA stock to protect a good portion of my unrealized profits.

    Back to Elon's (atypical for a CEO) goals... Making money is a secondary objective done entirely to support the above mission. However, it's this secondary objective that is usually the primary goal for the investors. We're fortunate that the $ objective and the primary mission are so closely aligned. I still believe Elon to be basically honest, but often misunderstood. On the one hand, we don't hear about the near sell to Google; on the other, he blurts out that the stock price is "higher than it deserves to be" at the Nevada Gigafactory press conference! I think the former was done in an attempt to safeguard the mission; the latter was just an engineer blurting out what he was thinking at the time.

    I too love the car. It was after I watched Peter Rawlison's 3 Tesla Engineering YouTube videos that I began to think that EV's could displace ICE vehicles over the next 20-30 years. I just wish that I could drive one of the darn things! I became medically restricted (Parkinson's) from driving in 2013 -- sigh... That was a drag, but my TSLA investments were a godsend right when we needed one.

    On to reliability... They certainly had some troublesome early problems & still have some annoying minor problems. But, when I think of them building a completely new, from-the-ground-up design in a new manufacturing facility with new equipment operated mostly by an inexperienced workforce, I am AMAZED with how good the reliability was!
    I expected significantly more problems. And, it sounds like the quality has made great strides forward since those first handful of sedans were delivered in June 2012. Furthermore, I fully expect the quality to continue to improve.

    In closing, I agree with you that TSLA is still quite risky at this point & that risk is exacerbated by Elon's incomplete communication. On the other hand, I still think that perhaps as much as 10-20x gains are possible over the next decade or so. I'd give the chances 60% for the very good outcomes & 40% for problematic outcomes. Ten years from now (if an AI hasn't destroyed the world) we'll probably know.

    I've enjoyed our conversation. If you would like to continue it further, would you consider a phone call? The PD makes typing this much difficult for me. If so, you could send me your number in a private message. Or, if you prefer, I could send you mine. Just let me know.

    Best regards,

    Jack
    Jun 27, 2015. 08:41 AM | 4 Likes Like |Link to Comment
  • Will Tesla's Model 3 Compete? [View article]
    @Davewmart,

    In 2012, Tesla only sold 2,650 Model S's. Suppliers didn't believe the order sizes that Tesla attempted to line up & were caught flat-footed when Tesla was actually selling cars in the thousands. Tesla had to do crazy expensive things like shipping tires via international air flights. Those parts were wildly expensive. But, Tesla kept making cars & suppliers' orders kept coming in. Some suppliers were dropped; some new ones added.

    In 2013, Tesla sold 22,477 Model S's; in 2014, 31,655. This year they are aiming for 50,000+ -- we'll see.

    These numbers are insignificant when compared to the VW group or Toyota. So, you are correct that the larger manufacturers will certainly get better prices on common parts.

    However, from 2650 to let's guess 50,000 in 3 years with a business plan for 500,000 vehicles in 2020, I think it is safe to assume that Tesla has gotten some significant price reductions from their suppliers since 2012. Yes, the VW group can get even better prices due to their size. But, the suppliers don't expect the same year over year growth from the VW group that they do from Tesla -- that's bound to help a bit as well.

    Also, I imagine that some of the suppliers may be thinking along the same lines as Ron Barron. If Tesla hits its 2020 $100/kWh cell cost, they will have cost parity with ICE vehicles. That will be the beginning of an unstoppable decline of ICE vehicle sales. If the EV (I'm assuming a 250-350 mile range & even faster SuperChargers in 2020) costs the same as an ICE vehicle, most people are going to choose the EV. The EV will be safer, cost less to operate, and will be more reliable (only 20% of the moving parts of an ICE). Any supplier with that sort of outlook will want to develop a good relationship with Tesla now.

    It will be years (if ever) before Tesla will get supplier pricing in absolute terms as good as the VW group. But, if they can execute to their plan, they should continue to see pricing improvements that when compared on a year-to-year percentage improvement basis would be something the VW group could never even hope to dream for.

    One last thought... I've read again, and again over the last couple of months, "LOOK AT TESLA'S CASH BURN!!!" Then, in the next paragraph, "xyz competition is coming!" I would argue that the latter (although not as dire as it is often stated) is the cause of the former. As an investor, yes, I too am concerned about how fast the cash is going. But, I also believe it is in the best long-term interests of the company to expand as quickly as possible at this stage of the game. And, I'm relieved with the slow pace of EV development by the major manufacturers. In fact, it looks like compliance car games only to me at this point. When one of the majors works out a deal for use and shared buildout of Tesla's SuperCharger network, that we be the sign that they are serious about building & selling EV's.
    Jun 27, 2015. 06:22 AM | 4 Likes Like |Link to Comment
  • GM Pokes Tesla With Chevy Bolt Development Progress Report [View article]
    More EV's in the market can be a good thing for Tesla. It helps educate the new vehicle consumer about EV's & it bolsters consumer confidence that EV's are a viable product that will be here in the future.

    The disappointing thing about the GM announcement is that they did not share any ambitious plan for significant increases in battery production. Are they planning on just a small number of compliance cars? That would be very disappointing.

    Also, what if any provisions will they have for quick charging on long trips? Will their packs be able to charge at 100+ kW power levels? Are they planning to build their own SuperCharger network or will they try to strike a deal for use of Tesla's SuperCharger network?

    Anton, thank you for disclosing that you are short TSLA -- the article certainly reads that way. IMO, it seems like you have started with a conclusion about TSLA, then cherry-picked facts in support of your conclusion. Any "Tesla Killer" article that does not cover a huge new battery production project and a viable plan for long cross-country type trips seems incomplete at best & disingenuous at worst.

    Sorry to be so harsh, but IMO, you have done much, much better articles that have had novel information & insightful analysis. This one appeared to be more of a "talking your book" article -- at least to me.
    Jun 25, 2015. 10:46 AM | 12 Likes Like |Link to Comment
COMMENTS STATS
363 Comments
1,354 Likes