Tesla’s Perfect Storm

    well perfect storm is brewing ahead of
    and no doubt in the aftermath of Tesla’s
    q1 earnings results and I continue to
    pray to the Flying Spaghetti Monster for
    juicy and prolonged discount as I’m
    still buying with every spare scent and
    future Steven a decade plus from now is
    no doubt going to look back to present
    and or past Steven and say thanks
    brother you did me a solid so before we
    get to the earnings and jump in the gun
    a little bit with some of the questions
    that investors W answered I’ll do my
    best to answer them before Tesla does I
    saw this and have some thoughts but
    optimism around FSD and musks belief
    that this new approach could bring about
    robot taxes is clouding the future of
    Tesla’s $25,000 car project people with
    knowledge of Tesla’s plans disputed the
    notion that the program has been
    cancelled altogether and remember musk
    himself also disputed this fake news all
    along the company has been pursuing a
    lowcost vehicle architecture that will
    underpin several different types of
    models one of which would have no
    steering wheel or pedals no
    Sherlock as I’ve said as many others
    have said Tesla’s Next Generation
    vehicle platform they modular
    manufacturing system ain’t just going to
    be for one vehicle obviously their
    dedicated robotaxi will be built on this
    platform and obviously there will be
    other variations as well likely a
    compact SUV likely a compact sedan
    possibly more I’ve said this many times
    in the past there’s likely to be a
    handful of variations on this platform
    the point here is to produce a vehicle
    that the masses can afford in every
    major category but here’s where things
    get interesting well these people
    confirm the robo taxi is being
    prioritized which by the way folks uh uh
    hello just think about this for a moment
    I don’t want to be too obnoxious but
    let’s use our brains for a moment here
    if Tesla the company is known to
    currently be
    prioritizing their Robo taxi and this is
    all happening on the back of the huge
    rewrite FSD V2 in the future iterations
    no more heuristics train purely on N
    video and we’re seeing its capabilities
    and seeing that they’ve matched and in
    many cases exceeded the past build
    without any of the rigid rules and
    explicit instru about what this is if
    this is all happening it is an extremely
    strong signal that Tesla themselves
    believe that they are finally on the
    cusp of soling autonomy which unlocks a
    decad trillion dollar opportunity I
    cannot stress this point enough if Tesla
    wasn’t confident they wouldn’t be
    prioritizing their robot taxi vehicle
    platform would they one described the
    Next Generation vehicle project as an
    effort to ring cost reductions out of
    components and production methods then
    apply those Innovations to cheaper
    iterations of the model Y and the model
    3 three the company’s two most popular
    EVS teams are placing particular
    emphasis on bringing these cost savings
    to bear with the model y the bestselling
    vehicle in the world last year and
    spoiler alert likely this year and next
    year as well now some people seem a
    little bit surprised at this rumor not
    sure why let think about this if Tesla’s
    developed a new modular manufacturing
    system to massively Drive costs out of
    producing vehicles at scale why in the
    would they not Implement those cost
    savings into existing products if those
    existing products are at sufficient
    volume for the cost savings to be
    implemented for a net gain in other
    words you’re probably not going to see a
    modul of manufacturing system for the
    SRX because they’re piss poor in terms
    of their volumes it’s not worth it’s not
    worth the investment but if the model
    wise already doing a million plus units
    per year it’s probably at 1.25 plus now
    of course they’re going to implement the
    stuff that they’ve developed in terms of
    a module manufacturing system over time
    but spoiler alert that’s likely to occur
    after they’ve begun producing vehicles
    on the next gen platform around that
    $25,000 PR point so in today’s episode
    of obvious things are obvious yes there
    is an nextg vehicle platform it will
    feature a dedicated robot taxi and some
    other variations of vehicles as well and
    Tesla will implement the stuff that
    they’ve learned on that platform in
    particular on the model Y which is at
    sufficient scale for it to make sense
    for Tesla to invest an enormous amount
    up front to ultimately Drive the cost to
    produce model y down much further it is
    worth plugging my valuation model once
    again I currently have an estimate for
    the long-term base price and the average
    price of tesa’s model 3 and Y plus the
    nextg vehicle and the Cyber truck and
    everything actually different variations
    in the base case the bull case the bare
    case and so on but you will discover if
    you look at this valuation model it’s at
    the bottom of each scenario under the
    long-term assumptions under all the
    numbers that the base price I have for
    model 3 and model Y is substantially
    below the current entry level price for
    these vehicles now why would that be I
    have assumed that t will in fact
    continue to drive cost out of these
    vehicles as well so yes this is all
    going to happen it is just a matter of
    time you think the average selling price
    on a Mot Y is going to be $445,000 in
    2033 please save whatever you’re smoking
    I would like some and now the most
    popular investor questions on say which
    will be answered in order by Tesla all
    question dodged in order by Tesla not
    sure how many they’ll address probably
    at least the top five if not maybe seven
    or more but let’s run through these and
    I’ll try to guess what Tesla is going to
    say the most popular question what is
    the status of the 4680 what is the
    current output pretty clear at this
    point Tesla is no longer sell
    constrained at least not for their
    vehicles so 4680 does not appear to be a
    limiting factor here I think the best
    we’re going to hear about the current
    output is a snapshot of recent output
    somewhere over a short period of time
    and a reference to the increase in
    output over time the truth be told I
    don’t really think this is a
    particularly valuable answer for us
    investors to know what is the current
    status of Optimus are they currently
    performing any Factory tasks when do you
    expect to start mass production now this
    is a great question we have seen demos
    of Optimus but we don’t really know are
    these robots actually performing any
    tasks in factories yet are they still
    being trained we do not know where this
    is at so more insights equals better
    here that said I don’t know if Tesla’s
    going to want to Spill the Beans too
    much given the fact that they’re very
    likely to have an AI Day this year and
    show a massive update there as for when
    tesar expects to start mass production I
    have my own thoughts on this check out
    the link in the pin comment to join
    patreon at the best level and above and
    have a look at my valuation model you
    will see my estimates but in either case
    I don’t think it’s that far away maybe a
    couple of years at most one of the key
    reasons here is that Tesla’s been able
    to transplant the brain of their
    vehicles so to speak into Optimus so
    they got a huge Head Start and another
    important factor Tesla will be their own
    first customer even if the initial
    builds of Optimus are almost useless but
    not quite once they’re no longer a net
    Dragon productivity they can contribute
    in some way the only real cost is energy
    which is going to be almost nothing so
    the bar for what’s acceptable in terms
    of performance is quite low furthermore
    unlike Vehicles which are multi ,000
    death machines on Wheels potentially if
    something goes wrong these things way
    less than most of your girlfriends do if
    they up they might make a bit of a
    mess be annoying but it’s extremely
    unlikely they’re going to cause
    fatalities serious injuries or permanent
    disabilities this means Tesla can take a
    much more aggressive approach they don’t
    need to be so cautious because the
    stakes are nowhere near as high as they
    are with autonomous vehicles and the
    beauty of Tesla being their own first
    customer is once they’ve got Optimus
    being able to meaningfully contribute
    labor in a factory setting first an
    automotive Factory suddenly every other
    company on the planet that has a factory
    that produces things that are corable to
    what Tesa is doing is already going to
    be an eligible customer shout out to the
    UAW its Psychopathic leader sha Fain
    extremely corrupt big guy also known as
    Joe Biden and the deeply ill-informed
    UAW members who were extremely
    supportive of making unreasonable
    demands in terms of their total
    compensation of their employers because
    these dmfs are going to end out out of
    jobs very fast when companies
    like Ford General Motors BW Toyota you
    name it doesn’t matter who and I’m not
    just referring to UAW members but
    everyone now universally in the
    automotive industry there are going to
    be huge huge disruptions and mass
    layoffs of humans being replaced by
    humanoid robots first in factory
    settings as soon as Tesla’s Optimus
    spots are providing useful labor in
    their own factories providing a positive
    return on investment they potentially
    have many hundreds of thousands actually
    Millions of Optimus bot sales that will
    begin flowing through not all at once
    but bro money talks in business if an
    Optimus bot rather than being
    compensated to the tune of six figures a
    year can be purchased but well under
    that amount and the software call it a $
    few hundred a month doesn’t really
    matter what the price is it’s recurring
    Revenue huge profits for Tesla but from
    the business’s point of view he’s
    actually purchasing the Optimus spot
    when these things more than pay for
    themselves over a reasonable period of
    time demand for these is going to be
    close to infinite labor cost account for
    a significant portion of the total cost
    of producing vehicles and that’s not
    where this is going to end T will
    continue to increasingly add
    capabilities for Optimus spots over time
    and you guys may have seen a
    demonstration where an Optimus was being
    remotely controlled by Tesla operator
    folding laundry even if the AI is not
    there yet in terms of capabilities just
    imagine this hypothetically imagine
    you’re a busy professional a couple you
    got children you’re under a lot of time
    pressure you spend too much time doing
    housework cleaning cooking folding
    laundry Etc just to imagine this imagine
    you buy a Tesla Optimus spot and then
    have a remote operator who’s operating
    this spot somewhere else with the cost
    of living is not so high and the
    expectations for income per hour per
    year not so high you could in theory
    have an offshore Optimus operator for
    the fraction of the cost of hiring a
    nanny or a housekeeper or a cook locally
    for up a huge amount of time and guess
    what if such a scenario were to occur
    while this bot is being operated
    remotely it’s training and it’s learning
    you understand this is just like having
    Tesla drivers in their vehicles
    monitoring intervening when fsds active
    and not right the same shit’s going to
    happen with these Optimus spots in my
    opinion not only will they be sold to
    customers with some basic functionality
    first in Factory and Warehouse settings
    but that will increasingly widen to just
    about every task you can imagine but
    while this is happening there’s also
    going to be a separate set of Optimus
    spots the same Hardware that are being
    sold to customers with the intent of
    being operated remotely an enormous
    amount of training data at scale this is
    to be wanting to build these things as
    fast as they possibly can so that was a
    very very very long way of saying I
    suggest what we’ll hear from Tesla is
    that Optimus production’s going to be
    happening within a few years and most
    people are going to laugh at that idea
    ignore it pretend it’s not happening
    call it a stock pump and continue
    trimming their Tesla positions what is
    Tess’s current assessment of the pathway
    toward regulatory approval for
    unsupervised fstd in the US and how
    should we think about the appropriate
    safety threshold compared to human
    drivers this is quite a good question as
    I’ve said in the past here’s what’s
    likely to happen Tesla’s already having
    many hundreds if not thousands of
    intervention free drives in cforia right
    now especially in the city of San
    Francisco Tesla is collecting data on
    all of these drives Tesla currently
    already has a mountain of data
    Regulators listen to data I don’t think
    that Tesla getting regulatory approval
    is the major obstacle most people
    suspect I think when Tesla themselves
    are confident that their vehicles are
    significantly safer and I don’t know the
    exact threshold to the second part of
    the question but let’s just say twice as
    safe now you might argue it needs to be
    10 times maybe it only needs to be 5%
    more I don’t know who cares Tesla’s got
    to have an increasingly large mountain
    of data showing ever increasing
    capability and safety so whatever that
    threshold is Tesla is going to be able
    to mount a bulletproof case two
    Regulators here’s the data for vehicles
    in this region look the Teslas are twice
    as safe in all situations and scenarios
    as human drivers you will have blood on
    your hands if you don’t approve the
    operation of our Rob taxis at least in
    this region my best guess is we’re going
    to see pocket after pocket after pocket
    different geographies in the United
    States initially where Tesla one after
    the other very quickly gets approval for
    unsupervised FSD now it’s quite likely
    that initially Tesa will have human
    drivers supervising their initial robot
    taxis maybe I’m wrong but I suspect the
    process goes as follows Tesla gives
    Regulators an absolute T of data
    look look how safe these vehicles are
    twice as safe as humans please we need
    approval thank you done Tesla
    gets approval Tesla then takes the extra
    step being extra cautious and safe of
    deploying the first 100 500 th000 Robo
    taxis in San Francisco pick your area
    but they all have human drivers
    supervising just in case and there’s a
    sort of Handover period where there are
    humans even though they don’t legally
    need supervision they’re in the vehicles
    just in case this is more for Optics
    than anything else and once Tesla has
    demonstrated many tens of thousands
    hundreds of thousands millions of miles
    maybe even the first billion miles in
    this small pocket at some point the
    safeties continue to improve then Tesla
    themselves say look we’ve now proven to
    ourselves beyond a shadow of doubt these
    thingss are enormously safe
    significantly more so than humans we
    don’t need the human supervisors here I
    think this is the same kind of role that
    we’re likely to see region after region
    after region and I actually think that
    Tesla is going to be the more
    conservative party not the regulators
    and talking about approval here this
    remember folks robot taxis have legally
    been operating in a number of locations
    in the United States now for a few years
    I would be curious though let me know in
    the comments below what do you guys and
    girls think how does this roll out
    happen that’s my best guess and I won’t
    be surprised if the first t robot tax
    are operating extremely likely in San
    Francisco sometime next year now it is
    possible that happens even earlier could
    be later if you want to see all of my
    estimates again check the link in the
    pin comment to my Tes valuation model
    where you find them just join patreon at
    the investor level and above and I do
    just once again want to remind people
    that autonomy is a literal Deca trillion
    is in 10 plus trillion opportunity and I
    do believe that tesra is on the cusp of
    solving this with an unsalable lead in a
    Winer takes most Market which is exactly
    why I I’m panicking and and selling all
    my Tesla stock cuz gross Automotive
    margins and demand another question on
    robotaxis following Tesla’s robotaxi
    unveil on 88 what is a realistic
    timeline for launching a revenue
    generating robot taxi Network now of
    course the boy who cried robot taxi will
    no doubt call himself out on this and
    say I think it’s probably going to be at
    this point but I’ve been wrong in the
    past but I think even in the most
    conservative scenario it can’t possibly
    at least based on Tesla’s own goals and
    estimates it can’t possibly be any later
    than about 2 years from now if they’re
    unveiling a robot taxi terms of the
    vehicle they’ll be finalizing the
    production systems then they’ll be
    starting to rent production then they’ll
    be producing them do the math another
    investor was asking for progress on the
    cheaper Next Generation vehicle so a lot
    of people wanting to know about the new
    platform last we heard from Tesla I
    think it was last earnings call they’d
    almost finalized the production systems
    so let’s see if they now confirm they
    have finalized them another investor
    asking can we make FSD transfer
    permanent now look I don’t understand
    why this isn’t a thing anyway you buy
    the software I would expect as somebody
    who’s paid for the software that you
    should be able to transfer now I
    understand once autonomy solve things
    get a little bit whack the value of this
    software could immediately 5 10x or more
    overnight so the caveat here until FSD
    is fully delivered and level to five
    autonomy which I totally get I think
    this is completely reasonable I don’t
    know why Tesla would not offer permanent
    FSD transfer at least up until the point
    where that software can now enable robot
    taxes although that being said I think
    there’s a pretty good chance once
    autonomy is solved there’s no longer
    going to be an upfront outright purchase
    option for FSD I think instead everyone
    is going to be moved onto a monthly
    subscription and this one have any of
    the Legacy automakers contacted Tesla
    about possibly licensing FSD in the
    future well you already know at least
    one has and spoiler alert I am extremely
    confident if it wasn’t Ford Ford
    certainly since then have contacted
    Tesla and I’ll take it a step further
    and say that Ford who rumors recently
    surfaced are in the early stages of
    developing their own dedicated
    autonomous vehicle are hoping remember
    hope is not a strategy but it’s all for
    Squad at the moment hoping that Tesla
    FSD can actually save the company how do
    I mean Jim fer gets on the phone yo El
    what’s up brother keep doing what you do
    bro so uh we’re kind of dying here we
    need a bit of help we’re thinking our
    only possible chance of surviving now is
    to rely on Ford loyal customers who just
    will never buy anything but a Ford and
    let our ice vehicle business implode
    spin out our EV business and actually
    just focus on transport as a service so
    would it be cool if we can agree ahead
    of time that once you’ve solved autonomy
    and you’ve got approval and done all the
    hard work we can license FSD and be
    producing vehicles with enough cameras
    in the right places that the software
    can run on our vehicles to and then have
    a generous Revenue split so we can
    actually make money selling FS to our
    customers so that we don’t go bankrupt
    Elon says well yeah that I guess that’s
    in line with our mission it’s better for
    you to not go bankrupt than for you to
    go bankrupt so yes we’ll do that and
    just finally I did poll my audience on X
    quite recently maybe 2 hours ago when
    will the first Tesla pay trip in a robo
    taxi take place 15% voted for 2024 44%
    the majority 2025 and almost 35% 2026 or
    later so if the wisdom of the crowd is
    anything to go by this is a little art
    and a little science it looks like
    expectations among deluded Tesla Fanboys
    who happen to follow this guy on X or at
    least vote on his polls are leaning
    towards the second half of 2025 and hey
    might not be that far off now before I
    wrap up I thought exercise if in 2019
    I’d pulled people and said when do you
    think that you’ll be able to provide a
    text prompt to an AI that will be able
    to generate an image indistinguishable
    from a photograph a Renaissance painting
    what results might we have seen what
    about the same time 2019 asked people
    how long until we’ll be able to have a
    conversation with a language based AI
    that will seem coherent and
    indistinguishable from something
    generated by a human what about text the
    video I think you get the point and if
    you don’t let me spell it out the thing
    about progress with AI is that we seem
    to have these breakthrough moments these
    hockey stick moments in terms of
    capabilities where seemingly out of
    nowhere suddenly what people thought was
    decades or a century or more into the
    future happens and not too much longer
    after that in retrospect apparently it
    seemed obvious to just about everyone so
    what if autonomy has one of those hocky
    stick moments as I record this with the
    market closed late April 2024 Tesla’s
    current market capitalization is $460
    billion Tesla achieving 52- we lows B
    down almost 64% from its peak closing
    price back in 2021 many shortterm term
    Traders abandoning the stock good for
    them hope it pays off some lamenting if
    only they’d sold their entire position
    and I mean In fairness if trading in and
    out of stocks is how you make your money
    you didn’t own Tesla stock the last
    couple of years you’d have been better
    off but my question is 10 15 years from
    now how many people are going to be
    looking back to April 2024 lamenting if
    only it had been obvious what was around
    the corner if only we’d seen it come how
    could Poss how could anyone have known I
    mean how could it’s not my fault right
    we couldn’t have known nobody could have
    known it’s totally unpredictable no one
    could have seen this coming want more
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    29 Comments

    1. $460B. April 2024.
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    2. It blows my mind how much people just fundamentally don't understand computers. This combined with not understanding tesla mission statement is the catalyst for this "perfect storm". because Tesla's mission statement doesn't directly enslave itself to capitalism and has an altruistic aspect, a lot of people especially on Wallstreet literally can't compute the logic and reasoning. Combine this with the way computer code tends to not work and be buggy until 1 day there is a change or bug fixes and then boom it works flawlessly. I think it has been shown that we have the needed tools to make autonomy happen. So then it's simply trying to forecast the timing of these events not "if" these events will happen. That's a very massive difference.

    3. Damn, Stephen, the idea of remote human operator/trainer for Optimus in my home or garden is a perfect fit. Not just the training and operation, either — a remote human operator with appropriate experience and equipment could also be a healthcare monitor able to call 911 in case of witnessing a human falling, stroke, heart attack, etc. Extra service points for assuring that meals are consumed, quantities of fluids are drunk, medications are swallowed, etc. So. Many. Possibilities.

      You might want to flesh that out and put it where the Optimus team can pick it up and compare with other, similar plans. I could imagine the Optimus only needing a human operator for some, but not all tasks. Hence, human operator hours would be billed separately from Optimus unmonitored hours. It should also be possible to deliberately schedule a human monitor for healthcare purposes during specific hours when only the person needing observation is present in the home with the Optimus. And so many more . . . for instance, when Optimus is working in my garden can I have a human with great gardening skills provide a certain number of hours for training/professional skills applications and then when they are done, have the Optimus provide additional general labor with no human operator for several more hours?

    4. Have you wonder why is the gigafactory, the machine that builds the machine so quickly replicated by the Chinese EV companies?
      It’s a pattern experienced by all the industries that entered China. From textile to phones to high speed rail. Now pure EV is no longer a blue ocean, but a bloody ocean.

      Once the tech transfer is completed, chinese communist party subsidizes the state companies to defeat the innovator.

      Just hope Elon is smart enough to not hand over FSD or AI. But he is autistic, so you are probably a better gauge than me.

    5. Elon blew an easy layup. If Reuters was wrong about Tesla dropping production of the model 2, then all Elon had to do was reiterate their commitment to the model 2. Instead, he decided to go juvenile in keeping with his X silliness and make a glib comment. Please Elon. Grow up, and at least try to play at being a proper CEO.

    6. I did sell some of my Tesla stock when it was high because I needed the money , it was just coincidence that i needed it then lucky for me I have since bought back at a very lower rate now I’m down😅

    7. I wonder if we'll see Optimus sabotage by employees thinking they're being replaced. Like when they threw clogs into machines when the world first industrialized.

    8. I really don't want them to use Optimus in the factory. I understand all the benefits of having Optimus in the factory but if they want to be
      competitive they need get Optimus out in the real world.

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