Tesla Model 3

[RedDevil]

Originally Posted by RedDevil

... But that program is working a bit too well for Tesla ...

https://electrek.co/2019/01/17/tesla...erral-program/

Tesla started offering discounts on the upcoming new Roadster. After 5 referrals, you unlock the level and get a 2% discount per new referral.
...
but Tesla kept the program running for a long time and many people started hitting the threshold for a completely free Roadster.
...
At this point, over 60 people are qualified for a Roadster and over 20 of those should get a second one too.

That was unsustainable. Surprised it took them so long to take it down.

[RedDevil]

So what would Tesla do, now they decided to end the referral program?

https://cleantechnica.com/2019/01/18...ean-countries/

Err... The program cost them more than $20 million already, which isn't the end of the world. But still.
Only thing I can think of is that the Tesla Model 3 price over here is still quite steep, so those new sales will yield profit - more that the referral codes cost Tesla.

[oil pan 4]

More bad news for tesla. They are laying off 3,000 and their stock is down 12% as of a last night in after hours trading.

[RedDevil]

Tesla stock moves up and down like crazy. It was this low 15 days ago too, then went up, now came back down. 3 months ago it was at 260. Over the last year it hovered around its current level.

Nor does laying off 7% say much.
They had layoffs in the past too, but hired 30% more personnel last year despite a 9% layoff: https://www.cnbc.com/2018/06/12/tesl...ny-report.html
2017: https://www.theverge.com/2017/10/13/...uction-ramp-up
2008! https://www.mercurynews.com/2008/10/...sume-ceo-post/

Business as usual.

[JSH]

Stock price is critically important to Tesla. In March they have $1 billion in debt due. If Tesla stock is above $360 a share Tesla can convert the debt to stock. If the share price is below $360 a share then Tesla needs to come up with $1 Billion to pay off the bonds.

[aerohead]

Originally Posted by oil pan 4

More bad news for tesla. They are laying off 3,000 and their stock is down 12% as of a last night in after hours trading.

Aside from losses to shareholders,it doen't appear that Elon Musk would be shattered if Tesla was run completely out of business,as long as whoever supplanted the company produced an affordable EV and nationwide charging infrastructure.
This seem to be his primary motivation.
If hes' not nominated for the Nobel Peace Prize,I'd say..................................
He could share the stage with James Hansen.

[MetroMPG]

Originally Posted by NeilBlanchard

That is possible; but the estimation before the Model 3 came out, is that it would cannibalize sales from the Model S and Model X - and it has not.

I read an article that suggested cannibalized sales were the motivation behind Tesla recently re-jigging the battery options available on the S and X.

[redpoint5]

Originally Posted by aerohead

Aside from losses to shareholders,it doen't appear that Elon Musk would be shattered if Tesla was run completely out of business,as long as whoever supplanted the company produced an affordable EV and nationwide charging infrastructure.
This seem to be his primary motivation.
If hes' not nominated for the Nobel Peace Prize,I'd say..................................
He could share the stage with James Hansen.

Elon cares about maintaining control of Tesla because he's a competitive guy and thinks he knows better than everyone else (which he probably often does).

Nobel Prize will be tough for him to get with the pedo tweets and other abrasive character traits though. It's those unpleasant traits that are probably necessary to have achieved the success he has.

[RedDevil]

Originally Posted by JSH

Stock price is critically important to Tesla. In March they have $1 billion in debt due. If Tesla stock is above $360 a share Tesla can convert the debt to stock. If the share price is below $360 a share then Tesla needs to come up with $1 Billion to pay off the bonds.

As mentioned here: https://www.businessinsider.nl/tesla...onal=true&r=US

My take is that Tesla actually prefers to pay cash, even when the stock is well above $359.88. They enlarged their cash position, so that would make sense.
Their weekly revenue is more than half a billion anyway.

An analysis of the options: https://cleantechnica.com/2018/10/17...-in-2018-2019/

[roflwaffle]

Originally Posted by JSH

Stock price is critically important to Tesla. In March they have $1 billion in debt due. If Tesla stock is above $360 a share Tesla can convert the debt to stock. If the share price is below $360 a share then Tesla needs to come up with $1 Billion to pay off the bonds.

AFAIK, Tesla can choose to pay cash, some combination of cash/shares, or convert notes to shares down to $252.54/share.

https://www.sec.gov/Archives/edgar/d...8614d424b5.htm

There are four situations where Tesla is required to pay all cash for the notes/interest, but those seem to all involve the company either going under or changing ownership.

The fundamental change purchase price we are required to pay will be equal to 100% of the principal amount of the notes to be purchased, plus accrued and unpaid interest to, but not including, the fundamental change purchase date (unless the fundamental change purchase date falls after a regular record date but on or prior to the interest payment date to which such regular record date relates, in which case we will instead pay the full amount of accrued and unpaid interest to the holder of record on such regular record date, and the fundamental change purchase price will be equal to 100% of the principal amount of the notes to be purchased).

Originally Posted by MetroMPG

I read an article that suggested cannibalized sales were the motivation behind Tesla recently re-jigging the battery options available on the S and X.

That's one possibility. Model S/X sales in the US are above last year's total based on InsideEVs estimates, so I'm not sure how much demand the 3 is pulling away from those two. Another possibility is that they're going to automate a significant portion of the S/X line and tweak the S/X design to conform with the 3.

By effectively increasing the price of the S/X, they can reduce demand and fulfill a quarter or more of demand in less than a quarter, leaving them with a couple months to rework the cars/lines. IIRC, those two were still pretty high on labor hours per car, and now that they own Perbix and Grohmann they can automate and streamline whatever they want within reason.

More to the point, having lower margins with more cars produced suggests that they may not have sold as many ZEV credits to other car companies. If this is the case, then those companies are likely going to build more EVs to comply with the ZEV mandate, and to keep their competitive advantages, Tesla needs to reduce costs via more automation and better quality.