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Little News From Tesla

Elio Amazed

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So finally season 4 of Z-nation is available on Netflix. 12:55 into S4:E1 and what do I see?
Roberta and Murphy eight years into the apocalypse being shuttled around Zona completely autonomously in the back of a Tesla.
 

Watashiwah

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I read all the negative and positive I can. Being cautious I usually give more weight to the negative.

When, for dubious and apparently unique reasons, positive news isn’t put out or capitalized on, a prudent person must be open to all the real and numerous reasons for the negativity. Burying it, or ignoring it, doesn’t help anyone, especially the principals. Burying bad news and opinion won’t work for Tesla, and sure hasn’t worked for Elio
 

RSchneider

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What I like is that Tesla has proven over the years of being presented with a problem and found a solution. The company keeps doing this over and over again. Right now it's getting the Model 3 up to speed and not costing them a fortune. It's like back when the roadster came out. It was riddled with problems and costing Tesla a fortune to get it to the customer. After about a year, problem solved and then they went onto the next set of challenges (the P). After that, it was the SUV which had it's problems but eventually they were solved. It's like the ongoing problem with direct selling. They are slowly solving it.

There were times they were almost done, yet kept chugging along and found a solution without just going into hiding and waiting for a solution to come to them as opposed to them going after a solution. This is where businesses are successful they solve problems quickly. I compare Tesla to a successful restaurant. They find solutions to problems and thrive. Even with excellent food and a world class chef, they will fail if they can't solve issues like financing and customer relations. Those two right there can kill a restaurant if not handled properly. I've been in restaurants that are empty and they are hoping that some miracle is going to happen, yet if they would have recognized the looming problem a year ago, they could have solved it proactively and thus, not be staring at the door waiting for customers to walk in.
 

Made in USA

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Here's an interesting article about how Tesla is updating its "autopilot" software. Big brother will tell you what you can do?
https://electrek.co/2016/12/22/tesla-autopilot-speed-limits/

Snippet:
Owners of Tesla vehicles equipped with Autopilot have, up until now, been able to set the speed of the Autopilot’s ‘Traffic-Aware Cruise Control’ feature to up to 5 mph over the speed limit on roads and non-divided highways when using Autosteer.

Now they are restricted to following the speed limit exactly, without the 5 mph leeway.
 

johnsnownw

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Here's an interesting article about how Tesla is updating its "autopilot" software. Big brother will tell you what you can do?
https://electrek.co/2016/12/22/tesla-autopilot-speed-limits/

Snippet:
Owners of Tesla vehicles equipped with Autopilot have, up until now, been able to set the speed of the Autopilot’s ‘Traffic-Aware Cruise Control’ feature to up to 5 mph over the speed limit on roads and non-divided highways when using Autosteer.

Now they are restricted to following the speed limit exactly, without the 5 mph leeway.

Article is more than a year old, and I'm not positive it's till like that. I've only ever used TAC or AP on divided highways, however.
 

Coss

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Little update on word from Tesla:
Tesla's Model 3 Problems Keep Getting Worse
Feb. 21, 2018 10:34 AM ET

Summary

As Model 3 production continues to lag, Tesla’s window of opportunity to seize significant mass-market EV market share has largely closed.

Bloomberg has started a tracking estimator that will make management and analyst obfuscation more difficult.

Concerns over production delays and lack of access to EV tax credits has spurred growing interest in the Chevy Bolt.

Other EV competitors are preparing to debut, which will compete against Tesla across all its product lines.

Tesla's near monopoly on consumer and analyst attentions is already fading fast.

Tesla Motors (TSLA) is in serious trouble – not that anyone would notice from its share price performance year-to-date. Despite a Q4 2017 earnings report and subsequent analyst call that could not bury the persistent financial and operational problems across the Tesla enterprise, the stock has done pretty well. After an initial drop, shares have climbed in recent sessions. Indeed, the closing price on Friday, 16th of February was up more than 4% since the start of 2018.

Yet, even as Tesla’s share price continues to defy gravity, fundamental business realities are coalescing to pull it back down to earth. Specifically, the epic boondoggle that is the Model 3 production ramp has yet to be fixed. Production is slow, promised margins are nonexistent. Worse still, demand for Tesla’s higher-end products, the Model S and Model X, also appear to have peaked in demand.

That is not a pretty picture for a company at the best of times. For Tesla, which is trying to get through production hell even as a wide array of direct competitors finally enter the fray, things look very bad indeed.

Production Is Still Way Behind
The most obvious problem is production of the Model 3. Tesla followers will be well aware that the company had promised not that long ago that it would be producing 5,000 vehicles per week by this point. That goal was subsequently revised, then revised again. According to the current target set by CEO Elon Musk, Tesla should be pumping out 2,500 Model 3s every week by the end of Q1 2018, and be up to the much-ballyhooed 5,000 per week rate by the end of Q2 2018. That target was reiterated during the latest analyst call.


Unfortunately, for Tesla and its boosters, even this massively truncated goal appears unattainable. Bloomberg has recently begun tracking production estimates, and updates its projections weekly. As of the week ending February 16th, Model 3 production was estimated to be just 1,052 per week. That leaves just five weeks for the company to more than double weekly production. Not impossible, but certainly looking increasingly unlikely.



Whether markets shrug off another production miss remains to be seen. While any ordinary company would be punished severely for breaking a pledge reiterated as recently as February, Tesla is no ordinary company. Its share price is buoyed by a degree of faith and irrational exuberance I have never witnessed in any other security. So, even as the Model 3 languishes in production hell, I doubt the market will consign Tesla to the abyss over something as trivial and gauche as meeting production expectations.

The Chevy Bolt Is A Threat After All
The Chevy Bolt, produced by General Motors (GM), has been highlighted by several bearish analysts – including yours truly – as a serious competitor to the Model 3. GM has ramped up production on the Bolt and has found a ready market for its offerings. In 2017, the established automaker sold 23,297 Bolts, including 3,227 in December.

The notion that the Bolt can compete head-to-head with the Model 3 has been roundly poo-pooed by more bullish analysts and commenters, who have long made the case that the Model 3 has no genuine competitors in its niche. They cite the Model 3’s superior range, greater acceleration, and high-quality brand, and a few other less important factors as reason to believe that the Model 3, at least for now, is in a league of its own.


Recent data now seems to favor the bears’ reading of the situation. Indeed, reports from dealerships and car buyers bears out the fact that production delays have redirected demand from the Model 3 to the Bolt. The movement is unsurprising, given the fact that customers who had preordered the $35,000 basic Model 3 had their scheduled delivery dates pushed out into 2019.

That is an awfully long time to wait for a new car, and likely means that those consumers would not be able to avail themselves of the $7,500 federal tax credit. Tesla is expected to hit 200,000 total vehicles produced this year. That means the tax credit will be phased out in stages during 2019.

Buyers expecting a bargain are now weighing the prospect of paying significantly more for a car they cannot expect to receive until much later. Even if the Bolt offers a bit less in terms of performance, it gets the job done. And it has the added advantage of actually being available for purchase.

Head-to-Head Competition Is Starting To Heat Up
Tesla has enjoyed something vanishingly rare: a near monopoly in an extremely popular and rapidly expanding industry segment. While other EVs exist, Tesla has managed to build a reputation as the very best available. That has been true, but not so much because of Tesla’s insurmountable quality advantages. Rather, it has simply been a first mover advantage. That advantage is now threatened by a host of competitors barreling into the EV space.

Within the next 12 months, the Model 3 will face head-to-head competition from a range of incumbent automakers, including the new expanded-range Nissan (OTCPK:NSANY) Leaf, Audi’s (OTCPK:AUDVF) eTron, and EV versions of Kia’s Niro and Hyundai’s (OTCPK:HYMPY) Kona. While bulls may try to wave away these new offerings in the same fashion they have discounted the ability of the Bolt to compete with the Model 3, the market reality is plainly different. All of these models will be competing with the Model 3 in one fashion or another, and all will be exploiting Tesla’s astonishingly slow and fraught production ramp.


But the Model 3 is not the only Tesla vehicle facing the threat of competition. Indeed, all of Tesla’s current models will soon be facing serious competitors. Jaguar’s (NYSE:TTM) I-Pace, a luxury electric SUV, will serve as a cheaper, more compact alternative to Tesla’s Model X. The I-Pace is set to debut on March 1st at the Geneva Motor Show.

Tesla has already tacitly admitted that the competitive environment facing the Model X and Model S is getting harsher. During the Q4 2017 earnings call, Tesla management stated that production had essentially peaked and that the investment in the battery production facilities necessary to expand production was not deemed economically sound.

Even Tesla’s vaunted Roadster, which is entering a specialty production run, is not safe. Aspark, a small Japanese automaker has set a new bar for acceleration in EV sports cars, with its Aspark Owl going from 0 to 60 miles per hour in 1.9 seconds. That shatters the acceleration record previously held by Tesla’s Model S. While Tesla has since promised that the Roadster will be able to match the Owl, it will not even be delivered to buyers until 2020. Meanwhile, niche EV sports car makers, as well as established players such as Porsche (OTCPK:pOAHY), will be pumping out ever more competitors.

Investor’s Eye View
The EV market will never look better for Tesla than it does now. Its failure to seize the advantages that are now available means it will suffer badly in the years of fierce competition ahead. Production hell continues with no clear end in sight. New entrants threaten Tesla’s position even as loyal customers get fed up with interminable waiting, broken promises, and rising costs.

Tesla is grossly overvalued as a business. The market has been able to ignore that fact by always looking to some bright, but vague, future in which Tesla is a dominant player in the EV industry. Investors should spend more time assessing reality than in indulging in fantasy.

Reality always wins. Sometimes it just takes longer than expected.


Looking to go further into this topic? See Seeking Alpha’s premium research and private communities.

Disclosure: I am/we are short TSLA.
 

RSchneider

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Made in USA

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https://electrek.co/2018/03/05/tesla-stores-threaten-local-car-dealers-missouri/

When Tesla has issues with direct sales in some states, which is often these days as we recently reported, it generally means that the automaker can’t open new retail locations. However, things are even weirder in Missouri where Tesla’s current locations are actually threatened.

The local car dealer association is now pushing for new legislation that could allow it to sue the state over allowing Tesla to sell its cars directly to consumers.


Last year, Tesla was forced to temporarily close its stores in Missouri after the Missouri Automobile Dealers Association (MADA), a trade group representing car dealers in the state, tried to have Tesla’s dealer license revoked.

In December, a three-judge panel of the Missouri Court of Appeals ruled in favor of Tesla and dismissed the case in a big win for the automaker’s continuous fight for direct sales.

At the time, Doug Smith, president of MADA, said that they were looking now at other options.

Now they have convinced Republican Sen. Dave Schatz to introduce Senate Bill 872, which would give them the standing to file a lawsuit like they did last year.

Smith told the St-Louis Post-Dispatch:

“That’s really all we’ve asked since 2013 is a legal interpretation as to the merits of the (Department of Revenue) to allow manufacturers to sell direct to consumers. We believe the appellate court unintentionally created a scenario where the DOR could make arbitrary decisions without any legal oversight — a licensing decision without us or any private citizen the right to question or file litigation against it.”

A Tesla spokeswoman called the new tactic “anti-competitive and monopolistic”:

“Despite the Legislature and the courts both rejecting the Missouri Auto Dealers Association’s position in the past, the dealers continue to attack consumer choice by trying to force Tesla from selling its cars direct to residents. Tesla wants to continue to invest and grow jobs in Missouri, while giving consumers the choice to buy the car they love. The proposed legislation is again anti-competitive and monopolistic, and Tesla will continue to fight for the rights of consumers and the many jobs that it has created in the state.”

The company currently operates 3 locations in Missouri and it is reportedly building a fourth store and service center.

Tesla says that it has “more than 1,000 customers and more than 2,000 Model 3 reservation holders in the state.”
 
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