#elonmusk

Elon hits 200k Cybertrucks

200k Cybertruck orders. As CM wrote this morning, the biggest loads these pick-ups will probably ever carry are double shot grande soy lattes. This car is a fashion accessory, not a work horse.

As a bonafide petrol head, CM hates the whole concept of EVs but this maybe the one product that might sway CM to the dark side. Matte black looks good.

146,000 Tesla Cybertruck orders

Wow. As written yesterday, CM thought Cybertruck would sell. Not as well as this though. In the $100bn domestic pick-up market Musk went big and it seems it will payoff. Whether all 146,000 (likely to be more going forward) end up being fulfilled is another question. Tesla will need more capital to get there but with an order book, he has bought more time.

It was intriguing that the normal $1000 fully refundable deposit for his cars was only $100 for the Cybertruck, a shrewd bit of marketing which essentially turned it into a virtually free option to put one’s name down. One wonders whether he bumps it up now he has these orders under the belt to help with cash flow.

Credit where credit is due. Musk is a visionary. CM has now praised the Tesla CEO twice in 24-hrs. Must be a blue moon.

Tesla Cybertruck maybe a Faux by Faux but should sell well

Image result for tesla truck

Tesla released its pick-up truck this week. Polarising is one word for it. Almost every motoring hack and stock analyst slammed it.

CM thinks Musk had to be bold. Although CM can’t stand Tesla on pretty much every level, especially governance, this truck could do very well. It may not pull the heartstrings of the Mid West pick up loving Trump voters but it will have a market.

The type of people that who will buy it will never use them for hauling loads of machinery or logs. The heaviest payload will be two grande caramel lattes with extra shots. This is a car which people who were thinking of a Model S will buy this instead.

It’s the perfect car for a virtue signaling world where one wishes to stand out and be noticed. It is a Faux by Faux. It screams look at me and it won’t be long before a Ford & GM make bold statements of their own.

So well done Elon. The order numbers will tell the picture of received wisdom and may do much better than many anticipate.

Pure genius. And the broken glass just got him 1,000,000s more hits on social media.

Brain dead award the brainwashed

GQ Magazine has awarded Greta Thunberg with its Game Changer Of The Year award. Can we cynically argue that GQ is hijacking the stardom of the 16yo for their own commercial success?

CM has said for the longest time that she is indeed brave to do what she does and absolutely no criticism lies at her feet. What a shame she is the product of brainwashing from activist teachers and parents. The way political leaders fawn over her. Probably speaks volumes that so many of today’s world leaders have no progeny (France’s Macron – no kids. Former UK PM Theresa May – no kids. The Netherlands PM Mark Rutte – no kids. Swedish PM Kjell Stefan Löfven- no biological kids. Luxembourg PM Xavier Bettel – no kids. Scotland’s Nicola Sturgeon – no kids. Former EC President Jean-Claude Juncker – no kids, Japan’s PM Abe also has no children) meaning they don’t share the feelings experienced by an overwhelming majority of parents who eye roll whenever their 16yo pretend to be experts on any subject.

At least she channelled Melania Trump for her photoshoot. The ultimate form of irony.

As she sails across the Atlantic to the Americas in a boat part-owned by someone who owns a large chunk of a private helicopter transport fleet, we already knew her impact on a scheduled flight would have given her more face time. Note CM calculated her footprint would amount to 0.0000000000007314% of CO2.

Will organizers be waiting at the docks with a fleet of fossil fuel charged Teslas to whisk her away? As long as she uses the Aland Index to calculate the carbon footprint of her hotel stay to minimize her impact on the environment. If the hotel comps her bill the Aland Index will output zero emissions. For the sake of the planet let’s hope they do.

Tesla is good at digging holes

Tesla shares have rebounded from the $180s so CEO Elon Musk has come out of the woodwork suggesting mining might be on the agenda to lock in its future battery supply.

Tesla might be adept at digging financial holes for itself but we shouldn’t think that will turn it into an efficient miner.

Just typical Musk banter.

Tesla: Catching a falling knife

Tesla is breaking down. So many discipled pundits are looking at the company stock falling into “good value” territory. Good value is always relative. Sadly buying Tesla now is catching a falling knife.

It reminds CM of a time when Fuji Film dominated flat screen TV TAC films. It held 40% market share. Yet the market was shrinking and new competitor products were able to combine two films in one, dispensing with the need for TAC altogether. Yet analysts would crow at 40%. CM said 40% of soon to be nothing will be nothing.

Tesla’s valuation at $180 is ridiculously high compared to other auto manufacturers. Tesla still misses the two most important ingredients to profitable car companies – production efficiency and distribution. It has neither the first and has chopped back on the last. Digital dealerships are just not feasible especially given the nightmare quality or Tesla cars.

Big money is dumping. T Rowe Price has exited. fidelity following suit. Musk’s musings now carry little weight. Promises of stupendous Q2 volumes and making cars with ridiculously short ranges for Canadians to get the benefit of subsidies smacks of desperation.

This company, if it could, is running on the smell of an oily rag. The inability to rally back up above $200 with any conviction is showing the rattled confidence of existing holders. It’s like finding out you’ve been given the employee of the month award from your boss and you’re the only staff member. It carries no significance.

CM holds to the $28 fair value price from the 2017 report. That is CM’s optimistic scenario. So much for funding secured at $420.

Apple to buy Tesla? Is Tim Cook on autopilot?

If Apple truly stumped up for Tesla that would make two companies that are complete novices at auto manufacturing. It would be the Apple Lisa of the auto world.

Worse for Apple it would signal that the world’s largest company is completely out of creative ideas and its existing product line up was truly approaching stall speed. It already is but and the lack of transparency only adds to doubts.

Rumours circulated that Apple considered a $240/share purchase back in 2013. 6 years ago Tesla was full of hope. Now the stock is full of hype. It has been a litany of disasters from fatal crashes, production hell all the way to complete wishful thinking on Level 5 autonomous driving which Israeli company Mobileye, a leader in the field, believes is decades off.

Let’s assume a $240 per share deal was done. Apple would pay around $40bn and assume another $12bn or so in debt.

The most dangerous strategy for highly successful companies is to throw spaghetti at a wall and hope some sticks. Tesla is by no means an overnight repair job. It needs the skills of Toyota to turn it around. Don’t forget Apple has no manufacturing expertise as its products are all built by 3rd parties. Toyota rescued Porsche several decades back and Lockheed Martin called in the production efficiency king to help build the F-35 Joint Strike Fighter better.

It reminds CM of the time Hoya bought Pentax back in 2007. Such was the earnings dilution against the incumbent high margin business, hunting for growth sent Hoya shares down 50% soon after the deal. Hoya was completely dominant in glass photomasks. Yet the $1bn merger of a 2’d tier camera/optics maker was thought of by the founder’s grandson as a total failure and divested many divisions.

Losses continue to mount at Tesla, senior management departures are a revolving door and demand is slowing. The recent cap raise sees investors well under water. The Maxwell Tech deal looks a dud for the management to accept an all share rather than an all share deal (if the tech is so leading edge).

If Apple truly wanted a car deal, it could buy an established maker like Fiat Chrysler with decades of production expertise and global reach for half the price. Not to mention a wide choice of vehicle styles to broaden the appeal to customers.

Although the history of car mergers, even between industry players, has led to some pretty disastrous outcomes. Daimler overpaid for Chrysler so badly that its shares cratered 80%. BMW bought Rover from Honda. Fail. Even Land Rover had to be sold by the Bavarians. Ford ended up selling most of its Premier Automotive Group stable – Aston, Lincoln, Jaguar, Land Rover and Volvo. Just Lincoln remains.

Tech companies meddling in the automobile sector reveals a graveyard of sad stories. Korean analysts jumped for joy when Bosch sold out its stake in the Li-ion batteries JV SB Li-motive. How could a Korean tech company proclaim to have a better read on the global auto industry than Bosch, a supplier to the major auto makers for over 100 years? Panasonic is already kicking itself hrs over the Tesla deal and management is highly unimpressed with Musk after his disparaging remarks made about production.

Have investors ever wondered why Tesla has no mainstream suppliers? Many are obscure parts companies from Taiwan. More established auto suppliers have been burnt by experiments before and they’ll only sign up for makers who have much better prospects and track records.

If anyone thinks Apple buying Tesla makes sense they need their heads read. The last 6 years have detracted value. Pre-pubescent fund managers who have never seen a cycle might see the value of millennial nirvana but the damage to Apple would be considerable. Just because Apple has been so successful doesn’t mean it won’t make mistakes. Tesla would be a disaster. It is in the product creativity blackhole of following the path of Hoya. It would be better to flutter at a casino.