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Tesla China Registrations Pop As EV Giant Teases A Welcome Sign For Investors
Elon Musk Called This Tesla Business a "License to Print Money" -- and Profits Could Start Soaring
November 07, 2023 — 05:15 am EST
Written by Danny Vena for The Motley Fool ->
There's little question that Tesla (NASDAQ: TSLA) stock has been a winning investment for shareholders. So far this year, the electric vehicle (EV) maker's stock price has climbed roughly 78%, far outpacing the comparable 13% gains of the S&P 500. The longer term has been even more lucrative, as the stock has soared 853% and 1,930%, respectively, over the preceding five- and 10-year periods.
This significant run-up in recent years has some investors questioning whether the easy money has already been made, with Tesla stock expected to generate much more muted gains in the years to come.
A challenge to that assumption might be found in a recent pronouncement by CEO Elon Musk which suggests that one of Tesla's new ventures will be incredibly lucrative, saying, "It's a license to print money." Even better, the profits from that business could start flowing sooner than expected.
Lithium refining is in high demand
Tesla has been working hard to get its lithium refinery up and running, and the lithium hydroxide it will produce will be used as a component in the battery cells manufactured at Tesla's Gigafactory. Earlier this year, the company revealed that it was expanding its facility in Nevada to include a 100-GWh 4680 cell factory, which will be capable of producing enough batteries to equip roughly 1.5 million light-duty EVs each year. Additional reports suggest Tesla is targeting 500 GWh over the long term, though the company has yet to provide a timeline for the additional capacity.
The refining facility in Robstown, Texas, was originally scheduled to be completed by the end of next year, with lithium production beginning sometime in 2025. The facility is now poised to come online earlier than originally envisioned. In an interview with local media in Corpus Christi, Texas, Tesla's battery materials manufacturing manager, Jason Bevan, provided updated guidance:
We will begin commissioning the assets, roughly the first of next year, and that will continue, in earnest, over the first half of next year. They will start ramping up production the latter half of next year.
Bevan went on to say that there is ample room for growth: "We have property that is well-suited for a future expansion beyond these first two trains, so I think there is ample opportunity for further economic impact beyond just those direct employees that we hire."
Tesla is controlling its destiny
This is an important move for Tesla. Lithium is one of the key elements used in manufacturing electric vehicle batteries, but highly refined lithium hydroxide has been in short supply as demand boomed. It turns out the issue isn't a shortage of the raw metal, but the "limited global capacity to deliver ultra-high-purity battery-grade hydroxide," according to a report by Bloomberg. China accounts for more than half the world's available refining capacity and roughly 40% of the demand.
The resulting shortfall caused refined lithium prices to spike earlier this year, driving up production costs. Prices have since eased but are expected to remain volatile, with another surge in prices expected when the economy recovers and demand for EVs ramps back up. This could ultimately cause a worldwide shortage of refined lithium, and at least one analyst is suggesting the shortfall could hit as early as 2025.
It doesn't seem like a coincidence then that Tesla has accelerated the opening of its refining facility. When completed, this project will greatly increase the lithium refining capacity in the U.S., which currently generates just 2% of the global supply.
Demand for lithium will only increase from here, according to reporting from CNBC. The report cites a report from S&P Global Commodity Insights that forecasts EV sales will more than double by the end of the decade, climbing from 13.8 million in 2023 to 30 million by 2030.
By refining its own supply of lithium hydroxide, Tesla will benefit in two ways. First, the company won't be held hostage by the constraints of supply and demand for the metal, taking control of its own destiny in the process. Furthermore, Tesla will be able to sell off any excess lithium hydroxide it produces -- "minting money" in the process.
Getting ugly, wonder about numbers coming
Influencer must apologise after court finds Tesla didn't cause fatal crash - report
Tesla has won a court battle in China after a fatal crash was found to be the driver’s fault, rather than a defect with the vehicle.
James Gelding
A court in China has found Tesla not responsible for a fatal crash that occurred in the city of Chaozhou last year.
Shanghai Securities News reports (via Bloomberg) that a crash that killed two people and injured three others in November last year wasn’t caused by a defective Tesla Model Y.
The electric car manufacturer had reportedly sued the driver of the vehicle – a social media influencer – after it was claimed that a defect in the Model Y caused the vehicle to uncontrollably accelerate and crash.
Shanghai Securities News cited a court document that reveals a forensic investigation found no faults with the steering or braking systems on the vehicle.
The influencer, who reportedly has an account on the Chinese version of TikTok (Douyin), was ordered to pay Tesla ¥30,000 (A$6300) in compensation for reputational damage, and must issue a public apology on his account.
Tesla (NASDAQ:TSLA) Hikes Wages of German Workers; Avoids Union Woes
Sirisha Bhogaraju
Tesla has announced wage hikes for its German workers amid increasing pressure from the IG Metall union.
Electric vehicle (EV) maker Tesla (NASDAQ:TSLA) is hiking the wages of 11,000 factory workers in Germany by 4% effective this month, the Wall Street Journal reported. The announcement was made by Tesla executives during CEO Elon Musk’s visit last week. The move comes at a time when the company is facing increasing pressure from the prominent IG Metall union in Germany to agree to a collective bargaining agreement governing wages like other automakers in the country.
Aside from the immediate hike, Tesla will also pay a bonus of €1,500 to offset the impact of high inflation. Further, the company plans to raise annual wages by an additional €2,500 for employees in production.
Wall Street Thinks Tesla Has a $500 Billion Artificial Intelligence (AI) Opportunity.
Morgan Stanley believes that Tesla Dojo could add $500 billion of enterprise value to Tesla.
Tesla is making significant progress in self-driving and may eventually license its software to other vehicle manufacturers.
Pay attention to artificial intelligence
Dojo is Tesla's supercomputer. The cameras in Tesla's vehicles are constantly capturing loads of data from the road. In turn, this data is fed back into Tesla's core architecture (or neural network) and processed by a series of graphics processing units.
Tesla's China Rival Nio Trims Workforce By 10% Amid Intense Competition
Exciting News for Tesla Stock Investors
By Neil Rozenbaum – Nov 5, 2023 at 10:30AM
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NASDAQ: TSLA
Tesla
Tesla Stock Quote
Market Cap
$699B
Today's Change
(0.66%) $1.45
Current Price
$219.96
Price as of November 3, 2023, 4:00 p.m. ET
Here's everything you need to know about the electric vehicle maker's week.
In this week's video, I cover need-to-know news items related to Tesla (NASDAQ:TSLA) during the week of Oct. 30. Today's video will focus on Tesla's sales numbers in California, China, and Europe; Elon Musk's big announcement in Germany; and a look at Tesla stock from a technical analysis standpoint.
Ron Baron says Tesla's valuation can hit $4 trillion, but 'SpaceX has a chance to be even bigger'
Provided by Dow Jones
Nov 4, 2023 1:16 PM EDT
By Nathan Vardi
The billionaire investor has beaten the market by betting on Elon Musk. He lands on the MarketWatch 50 list and, in this interview, remains as bullish as ever.
When Ron Baron was starting an investment business, he got some advice from Steve Wynn. The casino magnate told Baron to name his investment company after himself as a way to show clients and customers that he promised to stand behind it. Some four decades later, Baron Capital has made its most important investment in Elon Musk, Inc.
Baron invested $570 million in Tesla (TSLA), mostly between 2014 and 2016, which was about 2% of his assets under management at the time. Today, after selling some shares, Tesla represents about 10.9% of Baron Capital's $41 billion under management, and the winning position has helped Baron's main mutual fund become the only mutual fund to beat the Nasdaq COMP over the last 5, 10 and 15 years, according to a recent Bloomberg analysis, during which time it returned 17% annualized.
"You get rich by being long-term and by being focused, by owning a small amount of companies," Baron said in an interview.
Baron epitomizes a bullish buy-and-hold investing style that has worked in the current environment, where a few big tech stocks, like Apple (AAPL), Microsoft (MSFT) and Alphabet (GOOGL), have accounted for a disproportionate share of the stock market's gains. Baron runs a concentrated portfolio and owns one of the best performing big tech companies, Tesla, and has benefitted from the electric-car maker's remarkable stock-market run. As a result, he lands on The MarketWatch 50 list of the most influential people in markets.
Musk himself may have just thrown cold water on Tesla's long-anticipated cybertruck and expressed concern about the ability of consumers to buy his expensive cars in the face of high interest rates. But Baron says Tesla's stock will keep rising over time and its market capitalization can grow from its current $630 billion to as much as $4 trillion in 10 years.
"In the case of Tesla, we are convinced that people cannot do what they're doing and that, ultimately, it's not just going to be a car company and it's not just going to be a battery company," said Baron. "All the other car companies, which 50 years ago, elected to become much more profitable and outsource supplies and compute to other people. We're going to be like Intel was inside of computers. This is going to be Tesla inside of cars. All the cars are going to be using Tesla autonomous driving. No one else can possibly compete."
Swedish employees turned them down
Cost is key
Not to me but we all have to get along so no worries.
This is utter bs. I have dealt with unions at a previous job. They rip away independence from the members and control them completely and charge them! I never joined as I have more belief in myself. If I'm not happy I can always finds another job that values initiative and independent thought. Unions also suck away a lot of time from management and adds tremendous administrative and legal costs. Companies are then left with complaining lemmings. Unions would have no benefit to Tesla in any form never mind destroying the current profit sharing system from options. Tesla thrives because of the DNA of their employees, the weak demanding employees need not apply.
Unions go against free market priciples and does nothing but add cost to its members and the companies all the while union bosses line their own pockets. Unions have no place at Tesla who has a ton of regular workers that have become millionares from stock options.
Cost is the problem and also the fact that management already cashed in on options.
Key word; bottom 😄
What's Going On With Nvidia Stock Monday?
Mentioned: AAPL GOOG GOOGL INTC MSFT NVDA
Nvidia Corp (NASDAQ: NVDA) stock is trading higher Monday amid reports that the U.S.'s fresh artificial intelligence technology sanctions on China are not affecting the chip designer's short-term revenue.
Analysts say China represented 20% - 25% of Nvidia's data center revenues.
CNBC's Jim Cramer remains bullish on Nvidia's prospects courtesy of increasing demand from the likes of Google parent Alphabet Inc (NASDAQ: GOOG) (NASDAQ: GOOGL) and Microsoft Corp (NASDAQ: MSFT).
The stock price movement also reflects the chip designer partnering with MediaTek and utilizing the 2.5D packaging technology from CoWoS for its first processors, intensifying rivalry with Apple Inc (NASDAQ: AAPL) and Intel Corp (NASDAQ: INTC).
Meanwhile, the U.S. government released its executive order on safe, secure, and trustworthy AI for consumers, workers, and more.
The President's Executive Order introduces comprehensive measures to ensure AI safety and security, requiring developers of influential AI systems to share safety test results with the U.S. government.
The order mandates notification and sharing red-team safety test results for foundation models posing significant risks.
It establishes rigorous standards for AI system safety, introduces new standards for biological synthesis screening to prevent AI-enabled engineering of dangerous natural materials, and sets guidelines for detecting AI-generated content to protect against fraud and deception. The order also emphasizes protecting Americans' privacy, advancing equity and civil rights, supporting workers, promoting innovation and competition, advancing American leadership abroad, and ensuring responsible government use of AI.
Price Action: NVDA shares traded higher by 0.94% at $408.80 premarket on the last check Monday.
As Tesla Executive Bemoans EV Adoption Pause In H1'23, Fund Manager Says Reacceleration Coming In 2024 Due To These 3 Factors
Mentioned: TSLA
Tesla, Inc. (NASDAQ:TSLA) hasn't seen an appreciable volume lift from the series of price cuts it has announced since January this year. As a Tesla executive bemoaned the sequential decline in the electric vehicle market in the first half of 2023, Future Fund's Gary Black said he sees a recovery could be in the offing.
What Happened: Tesla's VP of Investor Relations Martin Viecha said in a recent post on X, formerly Twitter, that global EV sales saw its first sequential decline in a long time in the first half of 2023. 'Let's see what happens in the 2nd half of this year,' he added.
Reposting his comments, Black said after the 2023 EV adoption pause, he expects EV adoption to re-accelerate in 2024 due to three factors. The fund manager said the $7,500 U.S. EV tax credit allowed under the Inflation Reduction Act 2022 will go to off-invoice on Jan. 1, 2024, and the $7,500 reduction will be reflected in lower monthly payments.
Secondly, category news driven by the Cybertruck launch will spark new interest in all EVs, Black said. Thirdly, renewed interest in global EV adoption is likely as autonomous driving systems reach Level 3 and Level 4 automation, he added.
See Also: Everything You Need To Know About Tesla Stock
Why It's Important: The slow uptake of EVs prompted a price war among EV manufacturers, spearheaded by Tesla. While Tesla could afford to take a hit to its margins due to its being profitable and the scale of its manufacturing, the flurry of new entrants, which thronged the EV market, has found the going tough. This has been reflected in the stock prices of these startups.
Tesla CEO Elon Musk has been blaming the economy for the predicament, although critics suggest it is an excuse. If the Federal Reserve begins reversing its rate hikes and the economic uncertainty ceases to be an overhang, a reversal could be in the cards.
In premarket trading on Monday, Tesla stock rose 1.30% to $210, according to Benzinga Pro data.
Tesla Sweden Strike Failed To Happen
https://www.teslarati.com/tesla-union-strike-fails-sweden-workers-refuse-walkout/
Supply and demand
'Positive Signal,' Says Tesla Investor As EV Giant Raises Prices Of Certain Model Y Variants In US, China
Mentioned: TSLA
Tesla, Inc. (NASDAQ:TSLA) shares closed at a five-month low on Thursday. The stock has lock-stepped with the broader market in recent sessions, although its weakness began well ahead of the current market mayhem. Falling margins in the wake of successive price cuts were among the chief reasons attributed to the stock slide and so news of upward adjustments to prices of one of its EV models was met with optimism by a Tesla investor.
What Happened: Updated pricing provided on Tesla's website showed that the price of the Model Y dual-motor, all-wheel-drive, Long Range variant in the U.S. is now at $48,990, a $500 increase.
Tesla has also adjusted prices in China. The price of the high-end, dual motor, all-wheel-drive, performance variant is 363,900 yuan ($49,738), up from the previous pricing of 349,900 yuan ($47,825). In dollar terms, the hike amounted to $1,913.
Commenting on the moves, Future Fund's Gary Black said, ' Positive Signal.'
See Also: Everything You Need To Know About Tesla Stock
Why It's Important: Tesla's core auto gross margin, which by definition is auto gross margin, excluding regulatory credits, has been on a declining trend ever since the company began cutting prices in Jan. 2023. The situation worsened so much that the company reported below-consensus earnings for the quarter that ended Sept. 2023.
Black is among the camp that argues that the price cuts have proved inelastic, or in other words, the demand has not increased significantly following the price cuts.
Tesla's deliveries declined sequentially in the third quarter and also missed expectations. Even as CEO Elon Musk continues to blame the economy and higher interest rates for the slow uptake, Black has said in the past that price cuts can only produce a sugary high, and for a sustainable uptick in sales the company has to spend on advertising to increase awareness regarding EVs in general and underline the merits of its own vehicles.
BP to Acquire EV Charging Units From Tesla for $100 Million
Mentioned: BP TSLA
By Dean Seal
BP has signed a $100 million deal to acquire ultra-fast charging hardware units from Tesla.
The oil giant said Thursday that its electric-vehicle charging business, BP Pulse, will acquire the units as part of an expansion of its public network across the U.S.
The rollout will begin next year at locations that include TravelCenters of America and Thorntons. The first installation sites will be in Houston, Phoenix, Los Angeles, Chicago and Washington D.C.
Tesla chargers will also be deployed at certain BP Pulse fleet customer depots.
The companies said this is the first time that Tesla's chargers will be purchased for an independent electric-vehicle charging network.
"Selling our fast-charging hardware is a new step for us, and one we're looking to expand in support of our mission to accelerate the world's transition to sustainable energy," said Rebecca Tinucci, Tesla's senior director of charging infrastructure.
CFRA MAINTAINS BUY RECOMMENDATION ON SHARES OF NVIDIA CORP.
Mentioned: NVDA
According to Reuters, NVDA intends to begin designing CPUs for PCs on ARM-basedarchitecture as early as CY 2025 (AMD also plans to do the same). We would notethe market is currently dominated by INTC and AMD's x86 chips, while QCOM hasbeen developing ARM-based CPUs for years now. Windows has lost considerableshare since Apple's decision to start designing ARM-based CPUs for Macs, andMicrosoft could be luring others to develop CPUs (exclusive QCOM ARM contractexpires in 2025) to reduce its high emphasis on Intel. We think the news is apositive for NVDA as it further expands the company's addressable market andadds further fuel to its CPU initiatives (recently launched Grace CPU in datacenters). We highlight that developing an all-encompassing CPU for theenterprise space is no easy task, but we think NVDA has the potential to besuccessful and can take incremental share from 2025 to 2030. PCs focusedspecifically on the gaming space could be a potential opportunity for aNVDA-designed ARM-based CPU.
Nvidea going to compete with Intel on PC chips, great news!
Do financials matter? I suggest you all take a look. Also not that none of the revenue comes from their proprietary products. Let's see Q3 numbers
#Tesla Cuts Model 3 And Y Lease Prices To $329 And $399 A Month
Horribly negative bs from Elon, wonder why he didn't focus on the positive
Cybertruck launch November 30
Miniscule revenue from proprietary products. Revenue from website lighting sales around $15M. Hefty loss for the quarter
$300+
Revenues from their proprietary products is what I'm looking for, not from websites that sell lights
Profit would count way more
Nvidia Is Maintained at Buy by Citigroup
Nvidia, Foxconn to Develop New Class of Data Centers Focused on AI
Mentioned: NVDA
By Kosaku Narioka
Chipmaker Nvidia is expanding its partnership with Taiwan's Foxconn Technology Group, and aims to develop a new class of data centers that can power artificial-intelligence services.
U.S.-based Nvidia said that Foxconn--formally known as Hon Hai Precision Industry--will use its technology to build data centers that can help digitalize manufacturing, and develop AI-powered electric vehicles and robotics, among other applications.
"Working closely with Nvidia, Foxconn is expected to build a large number of systems based on Nvidia CPUs [central processing units], GPUs [graphics processing unit] and networking for its global customer base," the companies said in a statement.
Foxconn customers can use Nvidia's technology to deliver generative AI services, as well as use simulations to speed up the training of autonomous machines, including industrial robots and self-driving cars, the U.S. company said.
Nvidia Chief Executive Jensen Huang announced the partnership alongside his counterpart at Foxconn, Young Liu, at the Hon Hai Tech Day in Taipei on Wednesday.
Demand is not a problem next couple of years even without china sales
Let's see Q3
Colette Kress, Nvidia's chief financial officer, said at a conference in June that new restrictions on sales of even its less-powerful chips to China wouldn't have an immediate financial impact because demand is so high in other places. Still, she said long-term restrictions on China "will result in a permanent loss of opportunities for the U.S. industry to compete" and "the impact on our future business and financial results is there."
Revenue and profit from their proprietary products needed, that's zero so far. Expenses are crazy, sublease the $30M+ Miami office space as it's not needed
There's over 4M marketers on the road, no other car manufacturer has that many believers in their brand
Tesla Is Maintained at Overweight by Piper Sandler