Timestamped Summary Of Tesla Shareholder Meeting

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Published on June 11th, 2019 |

by Paul Fosse

Timestamped Summary Of Tesla Shareholder Meeting

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June 11th, 2019 by Paul Fosse

Tesla just completed its annual shareholder meeting. Like in meetings past, it was fairly long and covered almost every Tesla topic under the sun. To make it easier for people who couldn’t watch, wouldn’t watch, or simply want to go back to some of the topics in the meeting, below is a timestamped summary from Paul, who kindly stayed up late in Florida (just not as late as me here in Poland 😀 ) to put this together for the world. The summary notes are timestamped based on Eastern Time (pm), since they were made while the video was live. —Zach

5:35 — Picture of audience by General Counsel, Jonathan Chang

5:36 — Robyn Denholm (Tesla Chairman) gave a short intro and thanked shareholders for their internal fortitude.

5:41 — General Counsel Jonathan Chang starts official meeting and voting on all proposals. Board recommended for all their proposals and against the other proposals.

5:47 — All proposals passed that the company recommended except numbers 4 and 5. In the end, 99% voted for those proposals, but they didn’t get the required 66% of total shares represented, so they failed. Those proposals were:

4. A Tesla proposal to approve and adopt amendments to our certificate of incorporation and bylaws to eliminate applicable supermajority voting requirements (“Proposal Four”).

5. A Tesla proposal to approve an amendment to our certificate of incorporation to reduce director terms from three years to two years (“Proposal Five”).

5:50 — Elon Musk starts speaking. (Note: From here on, I’ll only include things I perceive to be news or highlights. Much is repeated from previous meetings, conference calls, or tweets.)

5:51 — The Tesla Model 3 was highest grossing car in the USA — the car which pulled in the most revenue — in the past 12 months. (We’ve reported on this for three quarters and were first to report on the Q3 milestone — see our Q3 2018, Q4 2018, and Q1 2019 reports.)

The Model 3 outsold its BMW, Mercedes, and Audi competitors — combined.

5:52 — Tesla is more efficient than competitors, much more efficient, and no competitors have exceeded the range of the 2012 Tesla Model S.

5:55 — There is “not a demand problem — absolutely not,” Elon emphasized. He also said that Tesla has “a decent shot at a record quarter on every level.”

Importantly, “90% of orders are coming from non-reservation holders — new customers. … 63% of trade-ins are non-premium cars.”

5:56 — Operating costs of an EV are much less than a gas car. A Tesla Model 3 can cost as little as a Camry or Accord, but is much better.

Fart app is “perhaps my finest work.”

5:57 — Full Self Driving will be feature complete by year end — will be able to drive from garage to work with no intervention (but still monitoring). It will then get better and better and eventually get legal approval.

5:59 — Tesla expects to have 1 million robotaxi-capable cars on the road in 2020, which will massively increase their value.

6:00 — Elon presumes you have to be mad to buy a gas or diesel car, because their value will drop quickly. Non-autonomous capable cars will also go down in value.

6:02 — The Tesla Model Y market segment is 2½ times as big as the market for Model 3. Tesla might be able to lower drag coefficient below that of the 3, which is surprising since crossovers usually have poor aerodynamics.

6:04 — JB Straubel (Tesla Chief Technical Officer) came onstage to help explain that Tesla decided it needed a Gigafactory because it knew it would need more batteries than worldwide production at that time. At 80% or so of capacity, it now accounts for half of global EV battery production.

6:08 — Gigafactory 3 (GF3) in China is quickly being constructed to serve the largest car market in the world. The company will be able to avoid import duties and reduce production costs with GF3.

6:09 — Regarding Gigafactory Europe, Tesla hasn’t yet selected a location. It will make a decision on the location sometime around the end of this year, 2019. Cars for sales in Europe will be more affordable if they are built in a factory in Europe.

6:10 — Tesla Energy is expected to see 2× growth in 2019 compared to 2018.

6:11 — The Tesla Solar Roof is being installed in 8 states. A tough problem is making it durable, low cost, and easy to install. Tesla has a shot at it costing as much as a comp shingle roof plus utility costs. Tesla is currently on version 3 of Solar Roof.

6:13 – Drew Baglino (VP of Technology, has been at Tesla for 14 years) was introduced and talked about the company’s solar goals, among other things.

6:15 — V3 Supercharger was mentioned.

6:16 — New maps for Supercharger deployment, including trans-Canada and Alaska, were also shown.

6:17 — Tesla is excited about its new mobile service vans. If your car breaks down, it will automatically send a notice to mobile Tesla service to immediately be dispatched to go fix your car. Tesla first trialled this in the Bay Area and has now extended it to the LA area and some other areas for tire repairs.

6:19 — Tesla is now adding bumper and minor collision repairs as features of these mobile service vans. Tesla just did its first bumper repair from a mobile service van. Elon noted this kind of repair can typically take weeks or months but it took less than an hour in this initial case.

6:20 — The Tesla Pickup unveiling is planned for this summer. It will be a totally Sci-Fi pickup truck. Elon thinks it is the coolest vehicle he’s ever seen, but he’s not sure yet how much others will like it — whether it will be a hit or not.

6:21 — Semi production is expected toward the end of 2020. “No reason to build more products if we don’t have batteries to supply them.”

6:22 — “We might get into the mining business — I don’t know. A little bit at least.”

SAY crowdsourced questions:

6:23 — Elon & JB didn’t want to let the cat out of the bag, but they knew something.

6:24 — Elon will wait for the Battery and Powertrain Investor Day later this year to get into the Maxwell details, but he seemed ver enthusiastic about the potential from this acquisition.

6:27 — Insurance details coming soon. Waiting on a small acquisition and need to write some software.

6:28 — Elon wants the pickup to be great, more functional than the Ford F-150 and a better sports car than a basic Porsche 911.

6:29 — The antenna is a little big. Tesla will probably continue to use cell phone networks. The advantage of Starlink is for low-density areas. It is not ideal for high-density cities.

6:30 — Tesla is likely to just a coating to repel rain and snow. (Elon joked about tiny wipers.)

6:31 — Elon feels good about demand. Profitability is tough as a fast growing company, but expects to be steadily cash flow positive despite a continued high growth rate.

6:32 — Elon said it’s a good idea and Tesla will probably launch a supervised robotaxi/rideshare system until it is approved to run driverless robotaxis.

Audience Questions:

6:34 — Q1 — Energy transmission is a problem, could Tesla get involved in that?

Answer: Roofs solve that problem. You don’t need to transmit it anywhere. Just generate where you live. Storage also helps make existing transmission work better — was what a big Tesla Powerpack project in southern California was used for, at a substation to avoid the need for more transmission lines.

6:38 — Q2 — The China factory production target of 500,000 cars a year seems low. With no import fees, the demand should be very good. Is Tesla being aggressive enough in China? Why not 2 factories?

Answer: We can’t spend money too fast. But, yes, the factory may do a million cars a year eventually. Or not. Tesla may want to have two China factories in the long term so that vehicles are produced close to the customers (China is a big country).

6:42 — Q3 — A potentially new way to let people invest in Superchargers, so they can roll out faster, is via finance companies.

Maybe. Maybe not.

6:44 — Q4 — News on Tesla is so negative that people are afraid to buy a Tesla. Can you solve through some new communications strategies?

Answer: Yes, 200,000 gas cars catch fire a year in the US, while Teslas rarely catch fire. Elon is at a loss to solve the media problem. It is driven by a crazy disinformation campaign, something like Elon has never seen before (ditto for us). Elon and crew asked that people continue to share their own positive messages about the cars and company — that’s the best solution Tesla has. They also highlighted that safety is paramount at Tesla and that is evident in its record-safe vehicles.

6:50 — Q5 — Suggestion: Perhaps a joint discussion with Micheal Bloomberg or Arianna Huffington on your mission, in order to help stimulate better media coverage.

Answer: Elon said that the company does need to take action, and seemed to genuinely consider this idea.

6:53 — Q6 — Where are we on the Mission?

Answer: We have helped the auto industry make the decision to move to EVs much faster. The media situation has always been negative, but Tesla is having a strongly positive impact.

Tesla is also helping to take islands to 100% renewable with solar and storage.

6:58 — Q7 — Congrats on Steven Hawkins medal. What will the towing capacity of the pickup truck be?

Answer: Will meet or exceed a Ford F-150’s towing capacity.

6:59 — Q8 — Full Self Driving … more details?

Answer: Features will be coming from now till the end of year. With Elon’s version, it can drive from home to office, but still has interventions. Tesla must have a general solution. Progress is faster than it appears because Tesla can only release something when it works generally, not only when it works for one specific location. Previously, the system just looked for drivable free sp..

GM’s Cruise Is Valued At $19 Billion — Does That Make Any Sense?

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Published on June 6th, 2019 |

by Zachary Shahan

GM’s Cruise Is Valued At $19 Billion — Does That Make Any Sense?

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June 6th, 2019 by Zachary Shahan

The self-driving vehicle startup Cruise that GM acquired in 2016 was recently valued at $19 billion after another round of investments.

That puts Cruise’s valuation at more than half the value of Tesla, and 38% the value of GM as a whole (as of this moment).

That implies, of course, that certain portions of the investment world expect a lot from Cruise, and think it is well on its way to a promising future.

I find the whole thing tremendously interesting. I understand that some auto industry players think Cruise as the perfect approach to autonomous driving, but others think it has fatal flaws and will never outcompete what Tesla is developing. Fine and good — there are differences of opinion in the auto world, and more specifically in a burgeoning new new industry that most consider to be the future. But it still blows my mind a little bit that very little money is invested in the idea Tesla is the world’s autonomous driving leader while Cruise is being valued at $19 billion.

First, though, a few more details on the news. GM raised “an equity investment of $1.15 billion from a group comprising institutional investors, including funds and accounts advised by T. Rowe Price Associates, Inc., and existing partners General Motors, SoftBank Vision Fund and Honda.” The result: “This investment increases Cruise’s post-money valuation to $19.0 billion, inclusive of SoftBank Vision Fund’s previously announced investment commitment. In the last year, Cruise has secured capital commitments totaling $7.25 billion.”

From what I’ve gathered, Cruise’s autonomous driving architecture is much more similar to Waymo’s than Tesla’s. We’ve never done a deep dive on Cruise versus Tesla Autopilot/Full Self Driving, but we have published these comparisons of Tesla’s system with Waymo’s:

Tesla Autopilot Hits 1 Billion Miles! & Why Tesla Autopilot Is The Top Approach To Autonomy
Deep Dive Into Tesla’s Autopilot & Self-Driving Architecture vs Lidar-Based Systems

Aside from those, the following may bring some useful light to the overall story:

Tesla vs. Self-Driving Competition — New MIT Video
Elon Musk Calls Lidar “A Fool’s Errand” … & Other Autonomous Driving Experts Starting To Agree
Tesla Autopilot Miles Soaring
Tesla Autonomy Day: What We Learned
Tesla Autonomy Day Video & Dozens Of Quotes

See more in our Tesla Autonomy Day archives.

Is Cruise worth $19 billion? Well, I certainly couldn’t tell you. Should it be worth $19 billion when Wall Street hardly values Tesla’s autonomous driving leadership? Well, that seems crazy to me, but such is the market today.

About the Author

Zachary Shahan Zach is tryin' to help society help itself (and other species). He spends most of his time here on CleanTechnica as its director and chief editor. He's also the president of Important Media and the director/founder of EV Obsession and Solar Love. Zach is recognized globally as an electric vehicle, solar energy, and energy storage expert. He has presented about cleantech at conferences in India, the UAE, Ukraine, Poland, Germany, the Netherlands, the USA, and Canada.

Zach has long-term investments in TSLA, FSLR, SPWR, SEDG, & ABB — after years of covering solar and EVs, he simply has a lot of faith in these particular companies and feels like they are good cleantech companies to invest in. But he offers no professional investment advice and would rather not be responsible for you losing money, so don't jump to conclusions.

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Hot: Elon Musk Interview On “Ride The Lightning” Podcast — A Tesla Geek’s Dream

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Published on June 2nd, 2019 |

by Paul Fosse

Hot: Elon Musk Interview On “Ride The Lightning” Podcast — A Tesla Geek’s Dream

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June 2nd, 2019 by Paul Fosse

Image from Ride The Lightning YouTube

The Tesla community was excited when they heard that Ryan McCaffrey had scored an interview with Elon Musk for his 200th episode of the “Ride The Lightning” podcast, and he did not disappoint!

To listen to the podcast, you can go to major podcast services, like iTunes or Stitcher, or you can listen to it on YouTube. Here’s a timestamped summary:

0m — Intro to the podcast
1m — Asks, “When did you know the Model S was special?” Also talks about the hiring of Franz.
3m — Designed the Model S as a car he would love — he tried to make something he was sure he would love and hopefully others would love it too.
6m — “Could you foresee the impact the car was going to have on the world?” Elon says he was pessimistic, expected maybe a 10% chance of success.
8m — “Even if we sold 100% electric cars today, it would take 15 years to replace existing cars.”
9m — Ryan’s theory was that Ludicrous Mode was created because nobody copied the Model S, so Tesla was going to shame them.
10m — Elon: Everyone thought EVs would fail in 2008 and 2012.
11m — Everyone said it was impossible to make a high-performance, long-range EV, but physics said it was possible. They then said nobody would buy it. [Editor’s note: This and this.]
13m — Companies are finally building EVs, especially in China. Was hard to compete in China when not locally produced.
14m — Countries will start to ban gas cars, which will impact their gas car sales as those bans approach.
16m — “What was your toughest design choice on Model 3?” Two screens to one screen. Hard to make the Model 3 look good. Central heat exchanger.
18m — Width of the Model 3 driven by the size of parking machines in Japan. Pushed the cabin forward to give it more room. Glass roof adds a lot to the headroom.
19m — Elon explains why the Model 3 doesn’t have a heads-up display.
20m — New Roadster is dessert. Will not produce more than 10,000 a year. It will outperform every gas car at every level.
22m — Can’t say what is in the Founder’s Series. Can go in any direction at 2G’s with cold gas thrusters.
23m — Kept new Roadster a secret by using a separate nondescript building.
24m — Model Y is MUCH roomier on the inside than it looks on the outside, confirming what I wrote in my Model Y styling tricks article. Elon confirmed styling similarity was very much intentional.
26m — Door handles and falcon-wing door movement are designed for beauty. Elon explained the complexity of the logic used to decide when to open Model X doors.
29m — Tesla is trying to make the manufacturing of the Model Y easy because it is too risky to do otherwise. Changing up design for SUV capability, seating 7, ride height, and more cargo capacity while still have a low drag coefficient and not increasing the frontal area too much, in order to keep range high.
31m — Manufacturing improvements for the Y include casting for the rear underbody (70 parts in Model 3 to one part in Model Y, reducing weight and cost).
32m — Underplayed his hand at the Model Y reveal to avoid stealing too many sales from Model 3 (see: Osborne effect).
34m — Probably building Model Y in Fremont, but gating factor is the giant stamping tools for the body. Optimizing for speed of execution. Found extra unused space.
36m — Talked about games in cars, Unity and Unreal Engine. Cuphead is running on Tesla now and is incredibly hard. Storage a limitation, so may only be able to have one game at a time.
39m — Tesla app store: as number of vehicles grows, it makes more sense, but not yet. Today, just have “a few cool games.”
42m — Spotify vs Slacker: just not a priority.
45m — Earning $30,000 a year from your Tesla.
46m — Doesn’t know how to make a $20,000 car yet, needs more R&D and time to get there. Gas cars have had 150 years to get there.
48m — Autonomy changes the game. Use the Tesla Network to make your lease payment. This will make a Tesla affordable to everyone!
51m — Tesla pickup truck will start at less than $50,000. Will look very sci-fi. “Will be more capable than an F-150 and a better sports car than the Porsche 911.” Teaser image is of the front.
54m — V3 Superchargers first deployed on long-distance routes and are replacing V1 sites. Most V2 sites are pretty fast already.
55m — Elon hasn’t gotten any calls from other carmakers yet to use Tesla’s Supercharger networks.
57m — Semi and pickup will both be very important and high-volume products.
59m — Ryan thanks Elon for everything he does!

Conclusion
Ryan did a great job asking questions nobody has asked before, so this is a special one for fans of Tesla and/or Elon Musk. I tried to timestamp the topics so that if you don’t have time for the whole interview you can use your time to just listen to the parts you care the most about. I recommend you listen to the whole thing if you have time.

About the Author

Paul Fosse A Software engineer for over 30 years, first developing EDI software, then developing data warehouse systems. Along the way, I've also had the chance to help start a software consulting firm and do portfolio management. In 2010, I took an interest in electric cars because gas was getting expensive. In 2015, I started reading CleanTechnica and took an interest in solar, mainly because it was a threat to my oil and gas investments. Follow me on Twitter @atj721 Tesla investor. Tesla referral code: https://ts.la/paul92237

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Sources Say Tesla Model Y Will Be Built In Fremont, California

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Published on May 29th, 2019 |

by Steve Hanley

Sources Say Tesla Model Y Will Be Built In Fremont, California

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May 29th, 2019 by Steve Hanley

Note: Everything that follows is based on comments made by Tesla employees to CNBC News. Nothing has been officially confirmed by Tesla despite multiple requests.

CNBC is reporting that Tesla has decided to manufacture the upcoming Model Y electric SUV at the existing factory in Fremont, California. There has been speculation for months that the Model Y could be the first Tesla vehicle built at Gigafactory 1 in Nevada. Elon Musk has previously said that the Model Y could be built in Nevada or in Fremont, that the decision hadn’t been made. Though, the Gigafactory seemed to be preferred at one point.

If true, what the news means is that until the Shanghai factory gets up and running, all Tesla automobiles will be built in California. At the rapid pace of progress in Shanghai, though, Model Y production may start there when it starts in the USA.

Employees tell CNBC the company has just begun ordering the tooling needed to construct the Model Y assembly line. In order to make room within the already congested factory, the Model S and Model X will be built on one assembly line. Today, they are built on separate lines.

The Model X, as good as it is (and it is very, very good), stands as a memorial to Musk’s and Tesla’s manufacturing inexperience. The X was supposed to be built on the S chassis, but the way things turned out, 70% of the parts needed to manufacture the X were different from the sedan. In particular, the iconic falcon-wing doors required a separate assembly line, at least at first.

Tesla has learned its lesson. Even though Musk wanted significant differences between the 3 and the Y, his manufacturing specialists talked him out of that plan. As a result, the Y and the 3 will share many common parts and components, speeding production and lowering costs.

Several Teslascenti had reported their Tesla factory tours had been cancelled because of changes taking place at the Fremont facility, but Elon Musk chimed in on Twitter (apparently changing company plans) and said tours were still available but some parts of the factory would no longer be included because of ongoing factory upgrades.

(Note: You can always enjoy our special custom tour of the Tesla Fremont factory on YouTube.)

Tesla Model S Refresh Coming
People working at the Fremont factory also tell CNBC a refreshed Model S is scheduled to start production in September. They say the “new” Model S will have an all-new interior that borrows from the minimalist look and feel of the Model 3. (In other words, if you prefer the more traditional look of the current S & X interior, now is a good time to buy. If you like the minimalism of the Model 3, you may want to wait.)

Tesla will also use the same drive motors as the Model 3 and the seats the company uses in the top-of-the-line versions of the Model 3.

With more efficient motors and unspecified changes to the battery pack, the updated Model S will have an EPA range of 400 miles or more, they say.

Those sources also say that production of the Model S and Model X is only happening during regular working hours Monday through Friday — no weekend or second shift work is being done. Whether that is because demand for the two cars is softening or because Tesla is getting better at building them is unclear.

Tesla cut the price of the Model S by $3,000 and the Model X by $2,000 last week. It is also expanding the amount of free Supercharging available to buyers of both models. In that now infamous tweet by Elon Musk earlier this year, he said his company would produce about 400,000 vehicles this year and be on pace to build 600,000 a year by the end of 2019. What the mix of cars will be has not been revealed.

About the Author

Steve Hanley Steve writes about the interface between technology and sustainability from his home in Rhode Island and anywhere else the Singularity may lead him. His motto is, “Life is not measured by how many breaths we take but by the number of moments that take our breath away!” You can follow him on Google + and on Twitter.

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Adam Jonas’s Thoughts on Tesla: Facts or Fantasies?

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Published on May 29th, 2019 |

by Peter Forman (aka Papafox)

Adam Jonas’s Thoughts on Tesla: Facts or Fantasies?

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May 29th, 2019 by Peter Forman (aka Papafox)

The trading week of May 20–24 was not kind to Tesla. The stock dropped more than 20 points, which translates into a loss of some $3.5 billion in market capitalization. The primary reason for the plunge was investor reactions to a full-court press of negative comments from analysts and the media.

A central figure in the week’s vortex of negativity was Morgan Stanley analyst Adam Jonas. Not only had he posted recent reductions in Tesla stock’s price targets, but he went so far as to host an investor’s conference call, aimed at institutional investors, to share his negative impressions of Tesla with those companies holding the lion’s share of the company’s stock (TSLA).

How well did Jonas portray Tesla’s prospects? We have a unique opportunity to judge his presentation because just one day later, on May 23, Elon Musk issued an email to employees in which he shared critical information about second quarter vehicle production and deliveries. Armed with actual data, let’s look at the claims in Jonas’s investor call and judge his points on a scale of Hit or Miss.

Adam Jonas position

Reality Check

Hit or Miss?

Tesla is burning money.

Tesla had operating cash flow of $1.4 billion in Q3 2018 and $1.2 billion in Q4 2018. Q1 of 2019 had substantial negative cash flow, but Q2 2018 deliveries in the vicinity of Q4 2018’s would produce positive cash flows again, and expectations are that Q3 2019 will be better than Q2. One quarter does not a money burner make, especially when Musk warned early that logistics of beginning international deliveries in Q1 would lead to an additional 10,000 vehicles in transit during the quarter.

Miss

Supply of Tesla vehicles is greater than demand

Tesla’s production of Model 3 in Q1 2019 was constrained by the availability of Panasonic produced cells. Message boards indicate brisk demand for all Tesla vehicles at the moment. With M3 production at 900/day, trying to push 1000/day, production is the bottleneck in Q2, not demand. Q2 increase in production is possible because of shift to standard range M3s, which use fewer cells. No standard range M3s were shipping to Europe or China in Q1. Musk’s email explained how 50,000 new orders had come in already during the first 7 weeks of Q2, suggesting continued growth of organic demand.

Miss

Nobody cares about Model Y

In Q1, Model 3 was the highest grossing vehicle of any type in California. As Jonas points out, the sedan market is dying in America. It’s being replaced with the CUV and SUV market, which is why Elon Musk predicts Model Y will outsell S,X, and 3 combined. If you review the Model Y presentation, you’ll see how Musk downplayed the vehicle (likely to avoid distracting from Model 3 orders during the long wait for Model Y). Moreover, the Tesla Semi is a commercial vehicle with extremely attractive economics and it, too, begins production in in 2020.

Miss by a mile

China is a big concern

Model 3 begins production in China late this year, and the vehicle will be tariff-free to Chinese customers, regardless of trade war status. Chinese automotive expert Michael Dunne appeared on the May 26 edition of Autoline This Week and explained how well positioned Tesla is for success in China with its factory, huge support from Shanghai’s government, and the Chinese being big fans of Tesla and Elon Musk. Meanwhile, teardown expert Sandy Munro says the China-built Model 3 SR should generate 25% gross margins. Current orders in China for long-range Model 3s with tariffs attached does not provide a good basis for judging demand for the more affordable Model 3s soon to be built in the country.

Miss

Tesla is no longer a growth story

To solve the battery cell bottleneck, installation of three fast cell production lines at GF1 and transition to local labor will help in the short run. In long run, changing to a dry electrode battery technology pioneered by recently-acquired Maxwell Technologies will allow many times the production within the existing factory space. These cheaper and longer-lasting batteries will allow Model Y and Semi to move forward with adequate cell availability and cost reductions of about 20%. The exciting lineup of future Tesla models, along with GF3 coming on line, will allow substantial growth in 2020. Musk’s email suggests that Tesla has a chance in Q2 to exceed the 90,700 vehicles delivered in Q4 2018 if production allows.

Miss by a country mile

The problem with the Jonas report on Tesla was not one or two isolated points, but rather a pattern of over-the-top negativity that completely distorts the company’s attractiveness as an investment.

The publication of these points of negativity brought up by Jonas damaged Tesla’s stock price because the public expects analysts from a firm with the stature of Morgan Stanley to be capable of somewhat accurately analyzing a company that falls within their specialty. Moreover, Jonas went after Tesla’s biggest investors with this presentation, the people who could most damage Tesla’s stock price. He called Tesla “a distressed-credit story and restructuring story,” thus sounding his alarm as loudly as possible.

The fallout for Tesla was greater than what one would expect from just a bad analyst’s opinion, however. In a note released by Jonas earlier in the week, he dropped his bear-case price target for Tesla from $97 to a mere $10 (yet didn’t change the overall price target). This amount was so far removed from reality that even Musk’s nemesis Jim Cramer called the number “really insane.” Nonetheless, that $10 target received enormous traction as reporters of every type picked up and repeated the $10 price target story. Predictably, a copycat “really insane” worst-case target soon followed, this time from Citigroup, as it gave a $36 target which was likewise picked up by reporters. Such ridiculously low targets turned out to be a truly effective form of FUD, however, and those of us who share Tesla stock information with friends and family members were deluged with questions from worried stockholders ready to sell. If the goal was to drive down the stock price, it worked.

The calamity of a seriously inaccurate appraisal of a company’s prospects reached its zenith as reporters chose to write stories about Jonas’s imaginings rather than base stories upon the far less sensational words of Tesla’s CEO, who had just indicated to employees that Q2 looked promising. The week concluded with the Associated Press sending out a story which quoted Senior Analyst Jessica Caldwell of Edmunds as saying, “There doesn’t appear to be anything in the (product) pipeline that is going to save them.” Each retelling of the story gets worse as the ethics of click reporting continue to erode the few remaining hints of journalistic integrity still out there.

To Adam Jonas, I pose this question: Knowing what you learned from the Musk email to employees the day after your investor’s call, are you going to publicly share a significantly revised view of Tesla within a week?

A lack of action would suggest only the worst of motivations for producing such an inaccurate assessment of Tesla. Mr. Jonas, do the right thing.

About the Author

Peter Forman (aka Papafox) Peter is a writer and innovator who began buying Tesla’s stock at $28 a share and has never looked back. This former airline pilot and college professor has a passion for applying new technologies to education. More recently, he has focused on understanding the trajectory of today’s clean energy revolution. He drives a Tesla and powers 100% of his house and vehicle’s energy needs through rooftop solar panels.

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Tesla Order Rate Surges 25% Worldwide, 116% In North America, According To New Data

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Published on May 29th, 2019 |

by Michael Grinshpun

Tesla Order Rate Surges 25% Worldwide, 116% In North America, According To New Data

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May 29th, 2019 by Michael Grinshpun

While the financial media and analysts continue to question Tesla’s demand on the basis of one unusually “bad” quarter, quarterly data and internal Tesla emails show worldwide order rates are actually up 25% in Q2 versus Q1. Meanwhile, a crowdsourced Tesla order tracker shows US and Canada Model 3 orders are up 116% versus Q1, and website traffic and interest data show that interest in Tesla’s vehicles is higher than in the past.

These data points are especially significant as the stock hits 3-year lows mostly due to speculation about soft demand, resulting in the stock price divorcing from reality for a company whose demand is actually very healthy. Many powerful and influential actors stand to profit from the declining stock price, which directly affects Tesla’s employees’ compensation and Tesla’s ability to raise capital to fund its vision of a sustainable future.

The worldwide order data for the second quarter comes from Elon Musk’s recently leaked internal email, in which he told employees that Tesla has over 50,000 new orders net of cancellations from April 1–May 21. This represents an order rate of about 980 cars per day for all three models (S/3/X) worldwide. This number was underreported in the news about Tesla, partially because it doesn’t fit with analysts and media commentators claiming soft demand, and partially because the number isn’t directly comparable to any other number.

However, it is possible to estimate Tesla’s orders for previous quarters simply due to the way it reports its production and deliveries.

Tesla reports how many cars were delivered and how many were in transit to customers. Cars in transit are defined as ordered cars that have been built and are currently being shipped to a customer. In most recent quarters, Tesla builds the bulk of its cars at the same time or even before the car is ordered, and then assigns the car to a buyer after it leaves the factory. That means that one could calculate the orders in a particular quarter by starting with deliveries in that quarter (in order for a car to be delivered, it must be ordered), and subtracting in-transit cars from the previous quarter (in-transit means the car was already ordered last quarter), and then adding back the in-transit cars from the quarter of interest (which had to have been ordered in that quarter). Finally, we divide by the number of days in the quarter to see the daily order rate.

For example, in Q1, Tesla entered the quarter with 2,907 cars in transit from Q4, delivered 63,000 cars, and had 10,600 cars in transit to customers at the end of the quarter. This implies 70,693 orders in the first quarter over 90 days, or 785 orders per day.

With 980 orders per day in Q2 so far, according to the leaked internal email, that is a 25% increase over the 785 order per day rate in Q1. This methodology for calculating orders is adopted from twitter user @vgrinshpun.

I would note that this methodology will be flawed and actually overestimate orders for quarters in which Tesla started with a significant backlog of orders (a backlog implies some cars have been ordered but not yet built and therefore not captured in the in-transit numbers). However, Q1 2019 is not such a quarter since there was virtually no backlog from the fourth quarter when Tesla pulled out all the stops to deliver as many vehicles worldwide as possible, including in the largest market, the US, before the first step in the tax credit phaseout. It is also discernible from the short wait times for Tesla’s cars that there has not been significant backlog this year. Q4 2018 and Q3 2018 might have had significant backlogs at the beginning of the quarters, so it is likely that this methodology will overstate the number of orders in the quarter, which in fact makes the Q2 order number look even stronger when comparing to those quarters.

There is even more evidence for significantly increased orders in the second quarter versus the first for US and Canada, according to a crowdsourced spreadsheet that tracks orders and deliveries and samples around 1% of all orders per quarter. It is worth noting that participation rates in this spreadsheet decline over time, so the underlying order rate might be the same between two quarters even when the spreadsheet shows a decline in the orders. Despite this slight flaw that makes order rates in more recent quarters appear lower than previous quarters, average daily order rates in Q2 are up 116% versus Q1 in the US and Canada.

Finally, the last piece of data that corroborates Tesla’s increasing demand story is the increasing website traffic, website engagement, website time spent, and overall search interest data from Alexa.com and Google Trends. Discussions of this have been published on both CleanTechnica and Seeking Alpha.

Tesla.com ranking relative to other websites.

“Numbers represent search interest relative to the highest point on the chart for the given region and time. A value of 100 is the peak popularity for the term. A value of 50 means that the term is half as popular. A score of 0 means there was not enough data for this term.”

All the available data points to increasing demand for Tesla’s cars, not softening demand as financial media and some analysts often suggest. The takeaway from this is that financial media and analysts often speculate and do not necessarily update their speculations when hard data comes out, leaving everyone else to do their own homework or wait until official data is released to come to conclusions. Another side effect is that Tesla’s stock keeps falling due to speculation about soft demand when the reality is the opposite. Most people would call this an opportunity.

About the Author

Michael Grinshpun Michael Grinshpun is a dual undergraduate and graduate student in economics. He writes about the electric car industry and works on sustainable energy issues. He works on Carbon Free Boston, an initiative to lower Boston’s carbon emissions to zero by 2050, as well as on water utility projects. Previously, Michael has worked in solar consulting and energy facilities.

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52% Of Consumers Likely To Buy An Electrified Vehicle In Canada Within 5 Years

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Published on May 27th, 2019 |

by Paul Fosse

52% Of Consumers Likely To Buy An Electrified Vehicle In Canada Within 5 Years

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May 27th, 2019 by Paul Fosse

Although we reported less than 3 months ago that more education is needed to accelerate EV adoption, a recent survey provides some encouraging news. In a survey commissioned by Toyota Canada this month, 36% said they had “seriously considered buying a more fuel efficient vehicle, such as a hybrid electric, plug-in hybrid electric, or fuel cell vehicle.”

Looking into the future, slightly over half (52%) “say they are likely to buy a more fuel-efficient vehicle in the next 5 years.”

Not surprisingly, those in the rural provinces are the least likely, while the more urban provinces are more likely. More interestingly, the study shows it is rising gas prices that is both prompting a change in summer travel plans and encouraging consumers to reconsider their choice of vehicle.

Although this research shows that older drivers are the least interested in electric vehicles and tend to view the technology as unproven, they are also the demographic most concerned about rising fuel costs. Younger drivers show an increased interest in performance. That suggests EV education targeted toward an older audience should focus on the practical aspects of the EV (low fuel and maintenance costs), while advertising targeted to the younger demographic should lead with the driving experience and improved performance.

It’s hard to say if Canada’s recently added EV incentives, described here, or the regional incentives described in this article have moved public opinion. It could simply be the result of the increased fuel prices. We continue to think the biggest influence on people’s behavior is awareness of both the existence of modern EVs and their advantages — by either advertising, a family member, or a close friend buying one and sharing their experience — but the role of fuel prices is one that should not be forgotten.

Photo of Vancouver downtown by Zach Shahan, CleanTechnica. Photo of Tesla Shuttle Indie Ryan R. Mitchell and his son by Sarah Mitchell.

About the Author

Paul Fosse A Software engineer for over 30 years, first developing EDI software, then developing data warehouse systems. Along the way, I've also had the chance to help start a software consulting firm and do portfolio management. In 2010, I took an interest in electric cars because gas was getting expensive. In 2015, I started reading CleanTechnica and took an interest in solar, mainly because it was a threat to my oil and gas investments. Follow me on Twitter @atj721 Tesla investor. Tesla referral code: https://ts.la/paul92237

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Nissan ProPilot 2.0 Is A Lot Like Tesla Autopilot, With One Key Difference

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Published on May 26th, 2019 |

by Steve Hanley

Nissan ProPilot 2.0 Is A Lot Like Tesla Autopilot, With One Key Difference

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May 26th, 2019 by Steve Hanley

Next fall, Nissan will begin offering cars for sale in the Japanese market that include its new ProPilot 2.0 semi-autonomous driving technology. As CNN reports, ProPilot 2.0 will let drivers traveling on limited access highways to take their hands completely off the steering wheel as long as the car remains in the same lane.

Credit: Nissan

It will also allow for lane change maneuvers and will help guide the car through highway junctions when following a preset route with a hand on the wheel. The system alerts the driver to place a hand on the wheel whenever the car needs to depart from the travel lane it is in.

As the graphic above illustrates, the sensors for ProPilot 2.0 include an array of cameras, radar, and ultrasonic sensors. It clearly resembles graphics we are familiar with that illustrate how Tesla’s Autopilot system works (below).

How does Nissan allow drivers to take their hands of the wheel for significant periods of time when Tesla does not (Tesla notifies you after 15 seconds)? The key difference is the Nissan system includes a camera that monitors the driver’s eyes to make sure she or he is paying attention to the road ahead. For Nissan, the critical piece is whether the driver is monitoring the road visually, not whether a hand is placed on the steering wheel.

50 years ago, early cruise control systems allowed drivers to remove their foot from the gas pedal while driving long distances. Now, Nissan makes it possible for drivers to take their hands off the steering wheel for significant periods of time as well. The important metric in both cases is watching the road. No reading the newspaper or having sex in the back seat. Unless and until full Level 5 autonomous systems are offered, the driver must remain actively engaged in the driving process at all times.

Cadillac also monitors the driver’s eye as part of its new Super Cruise package and it is that ability that led Consumer Reports to rate Super Cruise as the best semi-autonomous system available today.

Jake Fisher, CR’s director of auto testing, calls that kind of driver monitoring “a game changer in terms of safety for these sorts of systems.” Monitoring the eyes of the driver is something Tesla, with is mastery of camera technology, could easily do but has declined to include in its Autopilot system.

Current systems like ProPilot and ProPilot Assist from Nissan are little more than adaptive cruise control and lane-centering systems. ProPilot 2.0 will be a significant step forward. Nissan has offered no information on when, or if, this latest technology will be available on cars sold outside Japan.

About the Author

Steve Hanley Steve writes about the interface between technology and sustainability from his home in Rhode Island and anywhere else the Singularity may lead him. His motto is, “Life is not measured by how many breaths we take but by the number of moments that take our breath away!” You can follow him on Google + and on Twitter.

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Tesla Successful In Buying Maxwell Technologies

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Published on May 16th, 2019 |

by Maarten Vinkhuyzen

Tesla Successful In Buying Maxwell Technologies

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May 16th, 2019 by Maarten Vinkhuyzen

The news of the day is that Tesla bought around 79% of Maxwell’s shares on May the 15th, 2019, after the acquisition offer was extended twice. The original proposal was from February 4th, 2019, and was discussed well by our authors in “Tesla Inks Deal To Acquire Maxwell Technologies In Stock Deal” and “The Ultracapacitors, Electrodes, & Battery Manufacturing Tech Tesla Gets With Maxwell Technologies.”

To make it clear that this is a 100% merger, the stock not offered is converted to a right to get Tesla shares and cash on the same conditions as the shares offered and accepted in the acquisition. They are not shares any more — they are essentially IOUs.

It is a short but very important announcement. Now let’s look a bit more closely at what Tesla bought.

Maxwell Technologies.
Maxwell Technology was a company specialized in high-quality supercapacitors. A supercapacitor is a kind of electricity storage device that can charge and discharge very fast and many thousands of times without any wear and tear. But the density of energy is very low, making supercapacitors unusable as permanent storage. It has been speculated, though, that use of supercapacitors could enable better storage and reuse of braking energy, making EV’s better track cars.

Perhaps, but that is not what made Maxwell a target for Tesla. Maxwell developed a way to improve battery production. The company’s own estimate was that, in time, Maxwell could grow to a many-billion-dollar company, multiplying their stock value at least tenfold and perhaps a hundredfold. If only they could bring the patents to production. An excellent description of the technology is in an article by Randy Carlson, “Tesla and Maxwell: Assessing the deal.”

To become so valuable, you need customers for your batteries and/or other battery companies willing to use your technology for a fee. Alas, only Tesla was a little bit interested. Tesla and Panasonic can likely realize the billions in saving on battery production that Maxwell predicted. Others?

This would give Tesla, currently having already the lowest cost batteries, an unassailable advantage over the competition for the coming years. The questions are how fast this can be incorporated into the Panasonic processes at GF1, and how big the savings will really be.

For the time being, Maxwell will continue with its business all over the world. Too many employees and customers and contracts to do anything else.

What the future will bring we can only guess. I would not be surprised if the capacitor business gets a management buyout after the battery technology is transferred to Tesla.

About the Author

Maarten Vinkhuyzen Grumpy old man. The best thing I did with my life was raising two kids. Only finished primary education, but when you don’t go to school, you have lots of time to read. I switched from accounting to software development and ended my career as system integrator and architect. My 2007 boss got two electric Lotus Elise cars to show policymakers the future direction of energy and transportation. And I have been looking to replace my diesel cars with electric vehicles ever since.

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Tesla’s Acquisition of Maxwell Technologies — More Thoughts & Information

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Batteries

Published on May 16th, 2019 |

by Dr. Maximilian Holland

Tesla’s Acquisition of Maxwell Technologies — More Thoughts & Information

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May 16th, 2019 by Dr. Maximilian Holland

Tesla today announced the completion of its acquisition of the battery and supercapacitor company Maxwell Technologies. This has been on the cards since early February and is in line with the recent timeline given in Tesla’s Q1 investor call. Maxwell’s battery dry electrode manufacturing process has already been piloted by Tesla, and will allow significant battery cost reductions and energy density improvements.

Tesla has made the acquisition via a stock-swap, which approximates to a value of $230 million, for a controlling stake of 79% of Maxwell.

Tesla’s current cell costs of around $100/kWh amount to approximately $3.5 billion in battery production costs per year (around 70 kWh per vehicle and 500,000 vehicles). Maxwell’s dry battery electrode manufacturing technology claims to allow a 10–20% cost reduction versus traditional wet-electrode manufacturing techniques.

It’s not clear at this stage what overall reduction this 10–20% gives to the entire cell manufacturing process. Given Tesla’s $3.5 billion annual cell costs, even an overall cost reduction on the order of 5% would mean that the acquisition pays for itself over just a couple of years, and thereafter will be all upside.

Time savings and environmental benefits are also significant potential gains, as well as a plethora of other performance benefits that Maxwell has hinted at and Tesla is no doubt interested in. These include energy density of 300 Wh/kg with a path to 500 Wh/kg. Tesla is currently running somewhere around 250+ Wh/kg.

It’s not clear whether Tesla will find a use for Maxwell’s supercapacitor technology. We’ve previously speculated that there may or may not be use cases that leverage this. Alternatively, Tesla might leave the existing supercapacitor business undisturbed, or ultimately sell that side of the business.

We’re keen to learn more about the Maxwell Technologies acquisition, and what it means for Tesla. We will bring you more updates when we have them.

About the Author

Dr. Maximilian Holland Max is an anthropologist, social theorist and international political economist, trying to ask questions and encourage critical thinking about social and environmental justice, sustainability and the human condition. He has lived and worked in Europe and Asia, and is currently based in Barcelona.

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