TSLA All-Time High Close, FSD Beta Updates, Consumer Reports, Giga Berlin (11.19.20)
A little bit quieter day for tesla's stock today but nevertheless we did see an all time. High close for the stocks are not quite an all time high print that actually happened and extended our tradings around five hundred and thirty eight dollars per share but all time high close still a nice milestone. We'll talk a bit about that. We also have some news on the full. Self-driving beta news on gigabytes lynn. An update from consumer reports as well as from gm their electric vehicle strategy news on tesla tequila and then a bit of follow up to yesterday's warren buffett episode. All right so tesla. On the day to day finishing up two point six percent a little bit less than the eight percent. Ten percent rises. We had seen on tuesday and wednesday but that compared to the nasdaq up zero point nine percent and the clothes just shy of five hundred is the all time high close as i said before by about a dollar previously that was on august. Thirty first volume. Today was what we've kind of seen for the last few days about sixty two million shares so again basically double the volume that we've been seeing for the last month prior to the snp announcement but pretty much in line with the three month and twelve month. Averages are moving into the news. Then we have an update here from ilan on twitter about the full. Self-driving beta actually a couple of them. He replied to a tweet from a few days ago by tesla owner silicon valley. He's one of the members of the full. Self-driving beta nealon says quote next week's release is special lot of fundamental improvements both important bug fixes and entire new areas of functionality and quote so tesla has continued to push these updates. We heard from ilan earlier that they intend to do that about every five to ten days. But it doesn't sound like this one will be even more significant. Andy lon also added in a separate reply boat. If next week's release looks good. We will widen the beta and quote. So if you remember the original timeline on the d. beta roll out the target was really to have it in wide release in the us by sort of mid december two end of year. Doing that will help us recognize a lot more of that deferred revenue from full self driving sales in the us. So there is a financial incentive there to do that and then i think we've seen things progressing pretty much on schedule so far although stuff to know for sure but the review seem to be pretty positive so far and then we have this tweet from you on here as well as the tweet a couple of days ago talking about a pretty big release for at around the holidays which is hopefully at least partially a teaser for the fasd beta. Next up here is. I don't know that. I would necessarily call it news but we have an update on giga berlin. From york steinbach. The minister of economic affairs over in brandenburg. And after thank one of our listeners. Tim over in germany for sending this over and helping me translate but steinbach in an interview. Last week with rb did talk about tussles gigafactory and he confirmed a little bit. More of the information that heard him allude to in the past saying quote if this is set to work out as laid out by tesla and also the extensions as imagined. By tesla will have a car. City like volkswagen's wolfsburg that will be even bigger than wolfsburg as a carries less than one million vehicles annually. Here we will eventually see two million vehicles per year. get off the lines. that's a whole different dimension. I've seen some architectural proposals. And i am sure are people will eventually recognize it as part of their local identity and quote so again. This isn't really news. We've talked about this before. But i continue to think that the targets for each of these new factories continues to be underestimated. I think between giga shanghai giga berlin and gigi texas where easily looking at a targeted production rate of greater than five million vehicles per year and as each day goes by to me it continues to look more and more likely that can do that pretty easily not easily but they can achieve that well ahead of what. The fifty percent compound annual growth rate would suggest which is only about four million vehicles produced in twenty five. Anyway good to see that target confirmed again if you wanna check out that full interview. It is in german. But i'll put a link to that in the show notes and let me know if there's anything else interesting in they're all right next up. Today is a report from consumer reports. This has been generating some headlines today because the model s. has lost its recommendation status from consumer reports based on its reliability score which came in as worse than average as did the model x. and then the model y was rated for the first time by consumer reports on this metric at believe and it came in with a much worse than average reliability rating. Those of you that have listened to the podcast for a while. Now that i've already gone way way down this rabbit hole with consumer reports. I've talked to jake fisher the director of automotive testing at consumer reports multiple times on the podcast linked to those in the show notes. If you want more information on their methodology but essentially the conclusion that i have come to you after those conversations is that tesla tends to get dinged pretty heavily for cosmetic type of reliability issues under the theory that if those cosmetic issues exist well perhaps. That's a sign of poor build quality that will later show itself internally as well which i do think is reasonable to some extent but i think because electric vehicles are a little bit. Newer consumer reports methodology has not necessarily evolved along with that and perhaps doesn't give quite enough credit for the reliability of the drive train versus an internal combustion engine for example now i don't have a consumer reports subscription so. I can't see the report and full detail. I'm certainly not saying that. The only issues are cosmetic issues but those do always seem to be the focus of consumer reports comments to the media. So in a reuters article. Here from jake fisher. He says quote. I'm surprised that we would see the paint and trim type issues and body panel fitbit issues. You would think that would have been worked out a long time ago. And so i pretty much maintain my previous stance on this. I know we would all like to see tesla have better initial quality. That's no argument from anybody on that. But the model three went through this model three has been wildly successful. The motto is gonna go through this. It's going to be wildly successful and overtime tussles gonna continue to improve these things and the one thing that i would add on the consumer reports methodology. Just because they say the model y is much worse than average doesn't mean that they're like all of these issues necessarily it's being compared to the same model year car so it's against all these other new cars presumably. All these new vehicles should be relatively low in terms of issues so even if there are you know a really high percentage of new owners that are completely and totally satisfied and they read their vehicle completely. Reliable which i think is already a weird metric to have on a brand new car anyway the motto. Or whatever car we're talking about here could still come in as worse than average or much worse than average even if for example and i don't know the numbers again i don't have the full report but even if something like ninety five percent of owners report now issues but if that were the case and the average was okay. Ninety seven percent report now issues. Then it's going to be worse than average or much worse than average depending on how the distribution looks so. Those are my thoughts on that. But again if you want more detail on that literally. We had like a half an hour conversation about how this all works. It was really interesting. But i also don't have enough interest to you. Dive all the way back in again. All right next appears a couple of stories on gm and then we do have a couple quick tussle things to wrap up with so i hear on gm. They announced today that they will be accelerating their investment in electric annonymous vehicles that they'll be increasing their spending plans up to twenty seven billion dollars through twenty five from the previously announced. Twenty billion dollar plan which was actually just as recent as march. Gm says they will offer thirty all electric models by twenty twenty five two thirds of which would be available in north america gmc. yo. Mary barra said quote. We are transitioning to an all electric portfolio from a position of strength. And we're focused on growth. We can accelerate our plans because we are rapidly building a competitive advantage in batteries software vehicle integration manufacturing and customer experience and quote. We'll come back to that in a second but a couple of other things noteworthy here. Gm says that forty percent of the companies us entries won't battery electric vehicles by the end of twenty twenty five and the more than half of gm's capital spending and product development team will be devoted to electric and autonomous vehicle programs. So i don't know that sounds okay. But then on the other hand that means that sixty percent of their entries by the end of twenty twenty. Five are still going to be something. That's not all electric. And they're still planning on spending almost half of their resources on non electric thinks so doesn't sound all that great to me and then over the course of the last week or so. You also have jim ceo mary. Barra selling some gm's stock just over a million shares or about forty three million dollars normally. I don't talk too much. about insider. selling destler obviously has its own insider selling on occasion and though sales are preplanned so the timing is often overemphasized. But this looks like a pretty big sale. If focus dot com is correct. That would be more than half of her stake. I haven't double checked to that myself but it does seem like a pretty significant sale. Obviously if he on sold half his stake in tesla that would be something worth considering. So just something. I thought was interesting here also with this. Gm even announcement. I also hadn't looked at gm's market cap for a long time and it's actually back above sixty billion dollars which i was shocked by suffice to say that's not where i would value the company at are shifting back to tesla here then just a quick update on tesla tequila. I know a lot of people are curious about this alone on twitter yesterday. Saying hopefully more tesla kua next month kind of funny that he's still calling it s akilah but sounds like there will be another shot at that task ula and then he had another tweet today responding to somebody asking if it'd be available in europe soon and he said quote unfortunately there are too many rules around a liquor distribution even in the us however we will be selling the lightning bottle and shot glasses worldwide and so it sounds like there will at least be a second run tassell tequila. Sounds like they're working on some sort of tandem shock last to go with it. And they'll make the empty bottle available everywhere so i think what remains to be seen is do they plan on continuing matt for a long time or is this still limited quantity type of item a believe that glass was hand blown. So it's nice the Getting another run out there for the people that couldn't get it getting away for to acquire. Maybe that can't purchase now. But i would still say if you are interested. Probably jump on that earlier rather than later when a second batch does arrive. Because unless we get some clarification who knows how long that will last all right leslie today. I just want to briefly. Follow up on yesterday. Second episode the speculation and exploration of warren buffet and berkshire hathaway potentially taking a stake in tesla. One of the counter arguments being made was charlie munger and warren buffett's comments on tesla and on. Musk in the past. I do think that's valid but a few commenters have noted that berkshire hathaway has changed a little bit in recent years. Buffet has been giving more control to other people within the firm specifically to to investment managers. Todd combs and ted wilshire and they each manage a chunk of money for berkshire hathaway perhaps they could be the ones that would be making a move to invest and tesla. A few people also noted that berkshire hathaway recently invested in the snowflake ipo which would at least be an evolution if not a complete departure from the traditional investment style from buffet. And perhaps something that could have been pushed by combs or wilshire so when we think about the possibility of berkshire hathaway investing tesla. I think this is probably the most interesting angle my gut still says. It's not tesla. But i think those are some good arguments on the side. It looks like in terms of the amount of assets under management for combs and washer. They got each about fourteen billion according to reports thirty billion in total. That's of the roughly two hundred and fifty billion that berkshire has invested. So if part of the logic that is pointing us to think that maybe this investment is tesla is that it's you know ten billion dollars or around that level that's capable of an investment to be made just by combs or wilshire. So i really don't think that's something. They would do as individuals or even in tandem. but maybe they could have influenced in that direction. And as for the snowflake investment that was a much more investment about seven hundred thirty million at the time of ipo. So anyway thanks to those of you that share those comments. But that'll wrap it up for this episode as always thank you for listening. Don't forget to subscribe and sign up for notifications following me on twitter at podcast. They'll see tomorrow for the friday november twentieth. Episode of tesla. Daily thank you.