***Official*** 2019 Stock Market Thread

[FelixDeCat]

Turns out Powell made some comments today which could be seen as dovish.

That rally has a chance of sticking around now that Powell has signaled nothing is set in stone (rate increases). Honestly the economy is still good enough to keep raising rates, but since the market needed some reassurance he made those comments.

We are officially in January Effect week anyway.

After that, the market will go up or down based on 4th quarter reports which start comming out en masse soon. They will show how much we have been impacted by rates and tariffs.

 

[ponyo]

The battery packs supposedly will be 90kWh and 120kWh for the two range packages. Considering electric motor efficiency will be largely similar (>90%) and weight will be similar, it depends basically on what BMW can pull off for coefficient of drag. The model 3 is rated at 310 miles for 75 kWh so I'd be extremely surprised if BMW can't beat that by a significant amount with 60% more battery capacity.

edit: might have an 80 kWh battery in which case I agree with you. That said, there's no magic when it comes to Li-ion batteries. This kind of capacity is big and heavy. We'll see if something better comes out but for now it is what it is.

Tesla has the best batteries. Period. They have the best motor. Period. They have the best tech. Period. They have the best software. Period.

If you're bored or want to hear why Tesla is just better than everyone else, watch this 1 hour 40 minutes talk/interview with Sandy Munro. Sandy knows his shit. He's the guy UBS bank hired to take apart the Model 3.

 

[repoman0]

Tesla has the best batteries. Period. They have the best motor. Period. They have the best tech. Period. They have the best software. Period.

Electric motors are a solved problem and have been for decades. The fact that you think Tesla somehow magically has the "best" is enough for me to conclude that you've drank the Koolaid. Sorry 🙁

 

[ImpulsE69]

Beyond. He seems to think he needs to convince everyone else how great Tesla is. Personally, don't care. I don't have anything against them, but until they are making a profit, they are just another company using everyone elses money for R&D.

 

[Charmonium]

The demand for sedans and coupes had evaporated along with the price of oil. Why do you think GM is closing multiple plants in the US?

What everyone really wants are SUVs and crossovers. They want big dick affirming trucks. In an environment like that, where's the market for electric cars?

Tesla will always have a following just because they're Tesla. And if they can meet their Model 3 target quotas, Telsa as a company might continue to make a profit.

But as of right now, EVs are a niche market and will continue to be until you see 70 or 80 dollar oil again.

 

[s0me0nesmind1]

The demand for sedans and coupes had evaporated along with the price of oil. Why do you think GM is closing multiple plants in the US?

What everyone really wants are SUVs and crossovers. They want big dick affirming trucks. In an environment like that, where's the market for electric cars?

Tesla will always have a following just because they're Tesla. And if they can meet their Model 3 target quotas, Telsa as a company might continue to make a profit.

But as of right now, EVs are a niche market and will continue to be until you see 70 or 80 dollar oil again.

As someone that just recently had a kid - all I can say is that this is no surprise. We tried to do a 3 day road trip and my car was totally stuffed to the point where it was a pain in the ass. No doubt my next car will be either an SUV or a minivan.

Stroller, Pack and play for her to sleep in, and the car seat was enough to take up half the space alone. Plus you have all the other junk for babies - Diapers, bottles, wipes, and clothing.

 

[repoman0]

What everyone really wants are SUVs and crossovers. They want big dick affirming trucks. In an environment like that, where's the market for electric cars?

The big 3 German manufacturers have some really nice looking electric SUVs on the horizon (this year and next). Nobody said EVs can only be sedans.

BMW iX3
Audi e-tron
Mercedez EQC

 

[s0me0nesmind1]

The big 3 German manufacturers have some really nice looking electric SUVs on the horizon (this year and next). Nobody said EVs can only be sedans.

BMW iX3
Audi e-tron
Mercedez EQC

Yeah I mean... all 3 of those brands are definitely something the average american can afford lol.

 

[repoman0]

Yeah I mean... all 3 of those brands are definitely something the average american can afford lol.

And the idea will never be picked up by other manufacturers at affordable price points. Similarly the luxury brands will never be available at affordable prices a few years used.

lol

Edit: Hyundai Kona electric. It’s already happening.

 

[Charmonium]

As someone that just recently had a kid - all I can say is that this is no surprise. We tried to do a 3 day road trip and my car was totally stuffed to the point where it was a pain in the ass. No doubt my next car will be either an SUV or a minivan.

Stroller, Pack and play for her to sleep in, and the car seat was enough to take up half the space alone. Plus you have all the other junk for babies - Diapers, bottles, wipes, and clothing.

Oh there are definitely good reasons for having a truck, SUV, etc. And I'm sure that eventually you're going to see electric versions of those types of vehicles. Maybe even from Telsa, who knows.

I've certainly thought about getting something like that in the past and there have definitely been times when I regretted not having a bigger car. But I got around the cargo hauling aspect of the problem by having a trailer hitch installed on my little Honda. Unfortunately that doesn't solve the problem for people with families or people who need a vehicle for transporting things on a regular basis.

Although the more I see people on the road driving these behemoths, the more I wonder how much is actual need and how much is vanity.

The only point I was making is that there aren't a lot of electric SUV's, trucks, etc out there right now and although I don't know this for a fact, my guess is that the ones that ARE available or soon will be aren't going to be cheap.

Of course existing models of that type aren't really what you want to call "cheap" either. I just looked up the base price for a Ford F150 - $29k. And that's stripped.

People are going to reprioritize though once gas goes back to 3 or 4 bucks a gallon. And that's going to happen sooner than I think most people expect.

 

[zinfamous]

The demand for sedans and coupes had evaporated along with the price of oil. Why do you think GM is closing multiple plants in the US?

What everyone really wants are SUVs and crossovers. They want big dick affirming trucks. In an environment like that, where's the market for electric cars?

Tesla will always have a following just because they're Tesla. And if they can meet their Model 3 target quotas, Telsa as a company might continue to make a profit.

But as of right now, EVs are a niche market and will continue to be until you see 70 or 80 dollar oil again.

well, the US is the only market in the world that is so brainless. The other 6.whatever billion people in the world don't want SUVs, Trucks, gas-guzzling monsters. If the US manufacturers are only concerned with selling to less than a 10th of the world market, then more power to them, I guess.

 

[FelixDeCat]

I dont want, nor need a stinkin' utility car. I will stick to my econobox, thank you.

We all know gas will go back over $4 eventually, and all these poor utility car buyers will be boo-hooing.

🙁

 

[FelixDeCat]

Further, I would like to add, now is not the time to buy. Better to see what 4th quarter earnings reports look like.

 

[ponyo]

Electric motors are a solved problem and have been for decades. The fact that you think Tesla somehow magically has the "best" is enough for me to conclude that you've drank the Koolaid. Sorry 🙁

I don't just drink the Koolaid, I bathe in it.

Oh there are definitely good reasons for having a truck, SUV, etc. And I'm sure that eventually you're going to see electric versions of those types of vehicles. Maybe even from Telsa, who knows.

I've certainly thought about getting something like that in the past and there have definitely been times when I regretted not having a bigger car. But I got around the cargo hauling aspect of the problem by having a trailer hitch installed on my little Honda. Unfortunately that doesn't solve the problem for people with families or people who need a vehicle for transporting things on a regular basis.

Although the more I see people on the road driving these behemoths, the more I wonder how much is actual need and how much is vanity.

The only point I was making is that there aren't a lot of electric SUV's, trucks, etc out there right now and although I don't know this for a fact, my guess is that the ones that ARE available or soon will be aren't going to be cheap.

Of course existing models of that type aren't really what you want to call "cheap" either. I just looked up the base price for a Ford F150 - $29k. And that's stripped.

People are going to reprioritize though once gas goes back to 3 or 4 bucks a gallon. And that's going to happen sooner than I think most people expect.

World going electric will happen with or without $4 gas. And Tesla and the Chinese will lead the charge. In the next 20 years, the Chinese will go from being nobody in the car business to becoming the most dominant player and leading electric market. Just wait. And all the current dominant ICE automakers from the US, Europe, Japan, and Korea? I see major trouble for them and many are not going to make it. China is crazy about electric. They know they don't have a chance with ICE cars but electric cars? That's whole new ballgame and China is determined to be #1. And they will.

Tesla just broke ground on building the new Shanghai Gigafactory. This is a big deal as this will be the first factory fully owned by non-Chinese company. Previously, any foreign company doing business in China had to have joint ownership with Chinese company. China wanted Tesla to come to China so bad that they changed this rule. The Shanghai Gigafactory should be completed this year and start producing the Model 3 this year for the Chinese market and the future Model Y. The Model Y will be unveiled in March this year. Model Y is the crossover SUV based on the Model 3. The hype and demand for the Model Y will be insane.

And I expect Tesla to be added to the S&P 500 index this year. That will probably happen around Spring/Summer after Tesla reports two more quarters of profit.

 

[bigi]

It'll be fun to watch TSLA over the next year or two as traditional automakers start to put out some EVs ...
...
A bonus: traditional automakers know how to fit a car together properly so there aren't half inch gaps everywhere

Fun? Yea, it will be. Tesla is just starting out.

Other EVs? Well, all automakers are champs of press releases and concepts only. Even Nissan and GM blew theirs with new Leaf and Bolt.

They don't have the technology, they don't have batteries,

"half inch gaps" - dude, you really have to pull out your head out of your ass. People are not stupid. Tesla sold more Model 3's than all of other "press release champs" together in respective segment.

http://www.goodcarbadcar.net/2018/12/small-and-midsize-luxury-car-sales-in-america-november-2018/

Last, listen to Ellison a bit:

Many have speculated that their stock will hit 3K a pop in 5-8 years.

Even MB is late with their "Tesla Killer" it shows with terrible efficiency and lack of engineering innovation.

Tesla will hit us with Model Y in 2 months and overtake entire big rig industry with their EV Truck.

Their supercharging network is the only player in town (World) and they will double it in a year.

Other competitors, LOL.

 

[repoman0]

^ A wild Tesla shill appeared. You must work for them (or own a bunch of stock 😉 ) to get so defensive and share so much incorrect information over a differing opinion. Superchargers are the only players in town? Okay then, have fun with your panel gaps and 3000 dollar shares. Wonder if you were one of the people who called for Bitcoin to hit $100k.

Personally I hope they do fine, more competition is always better. That way I'll get to buy my EV in a few years from a different company for a lower price than it would be otherwise.

All these Tesla shills are hilarious who think that every other automaker is just going to disappear and be unable to compete just because Tesla got a few year head start. Yeah, 100 years worth of automobile manufacturers are ALL going to go out of business! Tesla will be the only company in the world selling cars when we inevitably switch to EV only within the next 15-20 years! As if every automotive engineer who doesn't work at Tesla is sitting around doing nothing. It's really tiresome.

 

[ponyo]

Tesla at $3k share might sound crazy today but if Tesla keeps executing and things go well, it can easily happen. In fact, Elon Musk entire compensation package depends on Tesla hitting $650 billion market cap in the next 10 years. He gets $65 billion if they do. He gets nothing if Tesla is not at least $100 billion.

What will be the worth of Tesla energy in 10 years? I bet Tesla energy will be just as big as Tesla auto. What's the worth of possible fully autonomous driving and replacing Uber and Lyft? What's the worth of having worldwide Supercharger network replacing gas stations? What's the worth of owning worldwide auto service stations and body shops for repairs and keeping the new car, used car, and repair/service profits? What's the worth of not having dealer network and keeping the 3-5% dealers typically make on auto sales? What's the worth of selling 10 million electric cars a year direct at 25-30% margin?

Not all legacy automakers will go out of business. But anytime there's disruptive tech and paradigm change, there will be major casualties. What's the legacy automakers are going to do with all those ICE motor factories they currently have? Some will be switched to make electric motors but they don't need all those factories for that. So what's going to happen to those excess factories when their ICE cars sales drop? Legacy automakers have 100 years worth of experience building ICE cars. But batteries, electric motors, and computers, software, and programming are new ballgame. Tesla will not be the only company selling electric cars in the next 15-20 years. There's no way single company can meet the worldwide demand when the switch to electric happens. There will be other companies too. Probably couple legacy automakers will make the successful switch. Which ones, I don't know. But too many will be entrenched in the old ways and not adapt fast enough and die. And new auto companies from China will take their place. China will copy, learn, and steal as much as they can from Tesla. I expect China to be world leader in electric and Tesla like Apple today fighting all these Chinese Android phone makers.

 

[ImpulsE69]

Lots of your assumption is that there will be a major shift in a handful of years though. It is going very slowly, for multiple reasons. For electric to take off many things need to happen beyond just getting them made. This includes things such as infrastructure, which exists in very minimal numbers now, and making something that meets the needs as well as current tech, and most importantly, the cost is the same or lower. Those are just the high level issues that need to be overcome. The cost alone won't get better unless more people get into production.

 

[ponyo]

Lots of your assumption is that there will be a major shift in a handful of years though. It is going very slowly, for multiple reasons. For electric to take off many things need to happen beyond just getting them made. This includes things such as infrastructure, which exists in very minimal numbers now, and making something that meets the needs as well as current tech, and most importantly, the cost is the same or lower. Those are just the high level issues that need to be overcome. The cost alone won't get better unless more people get into production.

I agree and I made lot of assumptions. But we're talking about Tesla at $3k /share which is assumption in itself. Lot of things have to go right for Tesla for that to happen.

Costs will come down. It's all about the battery cost. Which is why Tesla's lead is not insignificant and will be hard to overcome by other automakers. Tesla is the only one with their own Gigafactory making the batteries. Everyone else have to rely on LG and SK from South Korea for their batteries. China has bunch of companies making batteries as well but most will be used in China by Chinese electric automakers. Once batteries become cheaper than ICE motors, you'll see the start of mass EV adoption. We're not there yet with Tesla the closest. I expect Tesla to get there first. From what I read Tesla is closet to the magical $100/ kWh with LG still further back.

 

[PianoMan]

The problem with Tesla isn’t their IP, it’s their execution into manufacturing a mass production car. They need to get solid cash flow from volume sales (previous table provided only showed US sales, most of the other car manufacturers lead with global sales, which Tesla has not established a firm foothold yet). Elon even mentioned they were on the verge of insolvency a few months ago. They have a great product, just need to get the business in order.

We’ve been driving Leaf(s) since 2011, as the Tesla S and X were a bit much dinero for a commuting car. When we looked at the 3, wife thought it ugly and we ended up passing up the Bolt as well due to looks. We’re now driving a 2018 Leaf. Our neighbors just purchased an i-Pace (still to expensive to justify), but I have to admit it looks better than the X.

Tesla needs to switch to defending their market position, as much of the head start is eroding.

BTW, I am long Tesla.


Sent from my iPhone using Tapatalk Pro

 

[ponyo]

Tesla just finished going through "production hell" with the Model 3 in 2018. Model 3 was their first real mass production car and they went through tough learning curves. But look at Model 3 production numbers month by month in 2018. Tesla finally learned how to mass produce the Model 3 in the 2nd half of the year. Tesla made some big mistakes with the body design and also with the factory setup and automation. But Tesla is not going to repeat the same mistakes at the Shanghai Gigafactory. They're going to redesign the body for easier production and big cost savings and the Shanghai factory and the lines will be setup free of the mistakes they learned from the Freemont, CA plant and also their Gigafactory in Nevada.

You said, "Tesla needs to switch to defending their market position, as much of the head start is eroding."

Competition is definitely coming but Tesla doesn't need to switch to defending their market position. Tesla is still growing rapidly and taking big market shares from legacy automakers. If anything, I would say it's the complete opposite and the legacy automakers need to fight hard to defend their declining market position from Tesla. I don't think Tesla head start has decreased at all. I think it has grown and Tesla is now in much better financial position. And they gained valuable knowledge on how to mass produce a car. Hopefully this will be the end of the "production hell" and the Model Y manufacturing will go much smoother.

 

[FelixDeCat]

Gold has a better chance of reaching $3,000 an ounce far sooner than Tesla reaches $3,000 a share.

If not - I will eat my hat! 😱

 

[Charmonium]

With the seeming capitulation of Powell to Trump and the markets, watch for the dollar to go lower and the market higher, just to reflect that weakness. Same with gold.

Gold at $3k would be sweet though. Especially if silver goes along for the ride.

 

[PianoMan]

ponyo - I'll need to explain my statement a bit (written on an iPhone while out of the office at lunch). Tesla's head start was bringing an actually desirable all-electric sedan to market. Then they brought an SUV which no other manufacturer had (though there were some hiccups in the Model X's production, which would eventually amplify itself when the Model 3 was in "hell"). I'm sure most will look at the Model 3 ramp as not as cleanly executed, but it also was a "first" in the $50K all-electric realm. However - bringing a $35K version to market doesn't seem to be coalescing in the near future (I'm hoping Tesla surprises); but if the original production ramp is any indication - we may be in for a rough ride.

But boiling this all down, at the $35K price-point - there are other offerings in the market; Tesla doesn't enjoy a head start. So they introduce a Model Y (with other competitive offerings in the market) and a semi. Former is questionable, latter might be good - but can they execute? Instead of introducing all these other models - Tesla needs to start mass producing the mass market cars and stifle the nascent competition knocking at their door.

If you innovate and people buy - they best way to ensure success is to build a lot of what they want and satisfy the volume demand. Yes, Tesla is ramping up - but can they maintain the momentum? The competition, while catching up with the innovation, will easily transition to large scale manufacturing quantities.

 

[ponyo]

PianoMan, I'm not sure I understand your points. Tesla is not going to have problem with $35k Model 3 ramp once they start. They just can't make it right now because they will lose money on the $35k version. Later this year Tesla will release small batch of $35k base Model 3 since they promised. But my guess is the $35k base Model 3 will be made at the new Shanghai Gigafactory where it will be cheaper and profitable to make the car.

You claim at the $35k price point, there are other offerings in the market. What offerings? The only EV comparable to the Model 3 at $35k are the Chevy Bolt and the Hyundai Kona EV. The Chevy Bolt is dead. GM killed it. Hyundai Kona EV is extremely supply constrained and pretty much sold out for the next 2 years. Hyundai can't produce it in volume. Not yet anyways. Hyundai is likely battery supply constrained. Pretty much no Western automaker besides Tesla will be making any EV in volume until 2021 when the battery supply will somewhat catch up. LG Chem, SK Innovation, and CATL are all building giant battery factories like Tesla Gigafactory to meet the worldwide demand but the big supply won't come online until 2021. Tesla still has about 3 year lead in batteries with its Gigafactory and also has the lowest cost and the best batteries as well. Tesla Nevada Gigafactory produced like 60% of the total worldwide lithium ion battery in 2018. And even Tesla said they were battery supply constrained for couple weeks in 2018. Now imagine you're all other automakers fighting to get the other 40% battery supply. There's massive shortage of affordable batteries for Western automakers. Only Tesla has the necessary supply of cheap batteries to make EV in volume right now. This is why you really won't see competition arrive until 2021. By then, Tesla battery costs should even be lower and Tesla should be producing and selling over million cars a year between the US Gigafactory and the new Shanghai Gigafactory. And Tesla should've started building the new Gigafactory in Europe by then.

Tesla is not resting and standing still. This is their product roadmap for 2019 & 2020. And this is just what we know now.

This Bloomberg article kind of explains all the trouble Tesla went through in 2018 for the Model 3 and how Tesla is in much better position now going forward. https://www.bloomberg.com/hyperdrive