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TSLA - Tesla Inc

Discussion in 'Stock Message Boards NYSE, NASDAQ, AMEX' started by Administrator, Mar 21, 2016.

  1. T0rm3nted

    T0rm3nted Moderator
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    As someone who's been in the auto industry in an Assembly plant since 2011, 600,000 units per year out of one facility is a pipe dream. You'd have to build 68 vehicles per hour, 24 hours a day, 7 days a week all year without any down time at all. No plant is capable of that.

    Even if they automate more than anyone else, there will still be human components that need to be installed, so the line can only run so fast.
     
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  2. TomB16

    TomB16 Well-Known Member

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    Interesting.

    Here is an article from May 2020 in which they cite Tesla claims of 400K unit production of 3/Y across 4 general assembly lines. They have since added a 5th GA for Model Y. They also mention their goal is 500K unit production of 3/Y in 2020. They can also build 90K units of S/X, so that's about 600K and it should be in place right now, with the commissioning of GA6.

    Perhaps Tesla is exaggerating?

    https://electrek.co/2020/05/20/tesla-installs-production-robots-fremont-factory/#:~:text=The automaker currently claims a,the end of the year.

    Tesla has always been cell constrained, until very recently. Apparently, they are just now getting to where they have enough cells to run the lines at full speed. For as long as I can recall, they would shut the line down for a while, let batteries accumulate, and then run the lines at maximum speed to test capacity. The battery shortage is why the shutdowns of 2017 were no big deal.

    As I understand, Tesla plans two, three week scheduled shutdowns per year for maintenance and improvements.

    That's the best information I have. It sounds like you are suggesting these numbers are a little suspicious?
     
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  3. T0rm3nted

    T0rm3nted Moderator
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    I guess I haven't done enough research. Re-reading what you're posting, I missed the fact that they have multiple assembly lines. This will obviously allow more production. I still find the numbers suspect. They probably do what every car company does though and not factor in any sort of normal downtime. For example, my plant used to always have a target number of vehicles they wanted built per 10 hour shift. It allowed like 3 minutes of down time per shift or something like that. That's completely unrealistic in a production environment. I believe we hit the goal like 3 times in 4 years or something like that.

    Multiple body shops/paint shops/assembly lines will also produce extreme variance. Quality suffers as variance is added. Long-term, that could be a problem. Think back to the 80's/90's when American car company quality was widely known as far inferior to foreign cars. Now that it's back to basically even across all companies, people still have pre-conceived notions that American companies quality is worse. Tesla could suffer the same problem in terms of quality concerns. That's not to say they'll have quality concerns, but high variance increases the chances that they will.

    According to the bolded above, that's a lot of maintenance. My company usually has 2 scheduled down weeks per year, and due to production demands usually cuts one of them. If they have 6 assembly lines, they could shut them down in cycles to never quit building in theory. I'm assuming they'll have multiple body shops and paint shops as well in order to provide enough product. Body and paint shops also have a cycle time.

    I don't necessarily think they're "exaggerating", but moreso probably doing "basic math" and not realistic math. For example "this line can run at X speed, therefore we can build X vehicles per hour". Instead of: "this line WILL run at X speed because of cycle time allotment for operators, etc. so therefore we'll actually build X vehicles per hour". Ignoring break times for operators, shift change, etc.

    I'm just saying don't expect them to actually build 600,000 vehicles per year. I'd expect them to build <400,000.
     
  4. TomB16

    TomB16 Well-Known Member

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    They registered 105,000 serial numbers in 2019Q4 with Fremont being the only production facility. That extrapolates to 420K unit annual production and GA5 was only sampling, at that time.

    So, Mr. Pyle Styx, it sounds like we cannot say with confidence the production capacity of the Tesla Fremont facility.
     
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  5. TomB16

    TomB16 Well-Known Member

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    I will add that my valuation model uses a likely case of Tesla achieving a production capacity of 750K units of annualized production in 2020. If this number is over-stated, that will significantly impact the valuation.
     
  6. TomB16

    TomB16 Well-Known Member

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  7. TomB16

    TomB16 Well-Known Member

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    Here is the question I would ask on the earnings call:

    "Elon, it was recently revealed that your Twitter account has been hacked. Also recently, there has been a more positive tone in your Twitter feed. Have you considered the upside of yielding operation of your Twitter account to hackers?"
     
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  8. 姑爺仔

    姑爺仔 Member

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    IMG_20200717_162206_hdr.jpg For my money..........it probably doesn't matter. Tesla will sell cars on order, deliver cars on backorder, book sales on delivery, net sales will fall short of real world operating expenses.........it has, and always will, cost more to operate Tesla than income from car sales. History of profit is not what drives the stock price.

    My decision as the buy, sell, hold Tesla stock, and at what price, is not influenced by how many cars they sell and what they made per car. Every auto manufacturer in the world probably sells more cars. But nobody jumped on the Yugo bandwagon. Daihatsu did not see a rally on their stock. The last time there was this kind of excitement around a vehicle, was what?

    Let's look at auto makers. Who is successful on The Street? Toyota sells a lot of Prius. Ford F Series trucks beats everything in the pickup truck market. Look out your window. What's actually in the street? Then there's Wall Street. Tessa is hands down the higher price stock.

    Go ahead. Tell me how many Tesla are on the road in the real world......
     
  9. TomB16

    TomB16 Well-Known Member

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    I live in a small city in a remote area and we have several dozen Teslas here. I haven't seen a model Y yet but I've seen everything else. It's no longer a big deal to see a Tesla, anywhere.
     
  10. T0rm3nted

    T0rm3nted Moderator
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    I live in a city of about 200,000 and see maybe one a day in my about 30 minutes on the road a day.
     
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  11. TomB16

    TomB16 Well-Known Member

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    We're starting to see structure at Giga Berlin. I can't imagine this building will use internal space efficiently with all of those columns and walls but, as long as they can crank out Model Y out of the snow and rain, that's all that matters.

    GigaBerlin-20200718.png
     
    #1711 TomB16, Jul 18, 2020
    Last edited: Jul 18, 2020
  12. TomB16

    TomB16 Well-Known Member

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    I should mention that GA5 is not as automated as GA1~4. I don't know much about GA6 but I would guess it is a copy of GA5 since it is exactly the same size and positioned adjacent. Because of this, I would guess GA5 and 6 have significantly lower capacity than GA1~4.

    Since Q4, the plant has been shut down for efficiency upgrades so GA1~4 should be more efficient than they were when they could crank out 420K units in a year.

    Here is what we know.

    - I believe all Model Y come from GA5
    - Tesla produced 8500 Y in Q2
    - Fremont was shut down for over half of Q2
    - We know initial Y production in Q2 was at sample quantities


    At the end of 2018, Tesla cited 3K units per week, per line. They cited 150K units of annualized production as a target at Shanghai in December.

    Since then, they have done maintenance and upgrades to production across the company. They now cite 200K units of annualized production at Shanghai. Thats a 33% increase; difficult to believe but they have switched to large scale casting to eliminate about 30% of chassis production (with no mention of casting process limits or complexity).

    If 200K unit production at Shanghai is real, assuming 6 weeks of annual production downtime, that's 4500 units per week for one line.

    If 200K unit production at Shanghai is real, that also suggests 600K unit production at Fremont for GA2~4 alone. Add in another 90K units for GA1. Add in 100K unit production for each of GA5 and 6 and you have 890K of annualized production. Something isn't adding up.

    It's easy to see how these numbers are difficult to believe. In order to be true, they would have to have achieved tremendous efficiency gains with the casting process. They claim to have done so, even with the two piece casting of the rear frame on the 3.

    This is a turning point for investors. Believing production numbers requires faith. Past claims do correlate to VIN registrations so there is no history of lying but current claims are extremely aggressive. If current claims turn out to be lies, surely Tesla will tumble heavily and I will lose a consider able piece of my net worth. It's a sobering thought.


    Not sure where to add this paragraph so suffixing....

    The Fremont paint shop received a wholesale upgrade in April, and has adopted a new process. I hope it improves Tesla paint quality and I also hope it burns down less often than the old one.
     
    #1712 TomB16, Jul 18, 2020
    Last edited: Jul 20, 2020
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  13. TomB16

    TomB16 Well-Known Member

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    The other obvious question relating to the tremendous GA footprint reduction gained with the cast sub-frame is: Does that mean Fremont can increase the number of general assembly lines on it's existing heavily occupied footprint in the main plant? I would assume so but have heard nothing of lines 7 or 8.

    On the other hand, they have said they will build the Semi at Fremont and I'm pretty sure they will build the Roadster there. Perhaps this shines a light into where that space will come from.
     
  14. TomB16

    TomB16 Well-Known Member

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    One more thing....

    The plans for Giga Berlin show the GA building being less than 1/2 the size of casting and paint building and also only a single story where casting and paint are two. That seems to provide a little insight into footprint related to production complexities.

    GigaBerlin-20200718-2.png
     
    #1714 TomB16, Jul 18, 2020
    Last edited: Jul 18, 2020
  15. leonx81

    leonx81 Well-Known Member

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    In my neighborhood there are four Tesla, three model 3 and one model X. I am waiting for my 7-seat Model Y to be available. It is quite common to see Tesla vehicles on the road nowadays in Texas.

    So excited for the ER this week. I am still holding all of my shares from $283 but sold all of my calls around $1100 to book some decent profits. I could make additional $100K if I held my calls but oh well.
     
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  16. leonx81

    leonx81 Well-Known Member

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    Bought the dip this morning for a quick profit.

    upload_2020-7-20_11-54-18.png
     
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  17. TomB16

    TomB16 Well-Known Member

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    The current Tesla bear case is the Three Gorges Dam could collapse and take out huge amounts of development downstream, including Giga Shanghai and about 400M people.

    This narrative cannot be dismissed outright. The dam is currently in precarious condition.

    15828948-0-image-a-4_1562687473377.jpg
     
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  18. TomB16

    TomB16 Well-Known Member

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    China has stated the dam distortions are an issue with the space based imaging system and are not real.

    I've been looking at quite a few recent terrestrial images and they seem to confirm the Dam being physically straight, at this time. It looks like there is a funhouse mirror on the satellite used by Google.

    three-gorges-dam-3.JPG


    Current water levels at the dam measure over 165m. Flood gates are wide open. I'm not aware of a bypass for the dam.

    Design capacity of the Three Gorges Dam is 175m, which it achieved in both 2010 and 2011 without incident.

    The bad news is that record flooding is scheduled to flow into the Yantse basin on July 21 so they have been releasing water at best speed, flooding out cities down stream.

    I've been monitoring this for a while. China has been evacuating people from cities close to TGD for several days. There is risk here.
     
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  19. leonx81

    leonx81 Well-Known Member

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    #1719 leonx81, Jul 20, 2020
    Last edited: Jul 20, 2020
  20. 姑爺仔

    姑爺仔 Member

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    I said this in the Nikola thread. May as well post it here as well.


     
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