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Something very exciting coming...

Really exciting @TeslaMotors announcement coming on Thursday. Am going to put my money where my mouth is in v major way.

Read it online: http://twitter.com/elonmusk/status/316260319360061440

Care to speculate?

(Thanks Erik)

Elon Musk ‏@elonmusk 1h
Slight change of date to ensure no end of quarter distractions -- will be Tues next week.

Elon is going to buy 100 MS himself for all his relatives!

agree with jackhub and others- investment will directly benefit Tesla, but will not be in TSLA directly- funding of Supercharger network or perhaps funding of new Super-Capitor battery or similar;

Good parsing jackhub - it could very well not have anything directly to do with Tesla. So it could be a Google car announcement (like long term research agreement & creation of new company to use Teslas for driverless cars), or a supercap company investment.

@goteslachicago - did not see your earlier post at first, but clearly, I think you are spot on.

@jackhub - an insightful parsing of Elon's tweet. You might be right about why he chose those words.

Whether the investment is directly into TM or instead Solar City is something of an abstraction though.

This is intended to build momentum for the viability and economic advantages of Supercharged EVs.

If he chooses to put the cash into TM, he gets another benefit. More cushion for TM means more confidence from Wall Street.

TM seems to be where all the eyes are, so I think he will spend his personal money very carefully to maximize its psychological impact.

This is a tough one to guess.

Secondary offering? Perhaps, but doesn't seem exciting enough. A financing round of any kind would be a mixed bag of news.

Superchargers financed as a separate company? No, because they have been announced as "free forever" by Tesla, there are no other cars that can use them (so could not earn revenue that way), so not a viable standalone business, and that wouldn't be primarily a "@TeslaMotors annoucement".

Supercharger network expansion? He would only Tweet days prior to such an announcement if it were a major expansion beyond what has already been announced. Possible, but since they just trickled out some news about where the next superchargers will be located, I would think they would have held that news until this announcement if that were the answer.

Merger with SpaceX? Probably not, since it was characterized as a TeslaMotors announcement.

Faster superchargers? Probably not. They already do 100 kW and they might be able to get to 120 kW but probably not any higher, so it's probably not "exciting" enough to go from 100 to 110 or 120.

Tesla-funded car financing company? Perhaps. Most buyers are currently financing at 1.5% to 2.25%, but an in-house financing arm could be more permissive to buyers and enable leasing.

Maybe it's a new rental car company, funded by Elon, that will purchase exclusively Teslas to rent out at major airports. Even Roadsters rent for $500/day on GetAround. This would be a TeslaMotors announcement, would involve Elon's personal money ("putting my money where my mouth is" not "Tesla's money"), and could be a large sale of Tesla cars ("Exciting @TeslaMotors announcement"). Just a thought.

I'm betting on faster supercharging. 2-3x faster than current SC, and just a few minutes longer than a gas station fill up. Another game changer.

According to Tesla's latest 10-K filing, Elon will fully vest the last portion of his 2009 stock option grant upon producing the 10,000th Model S production vehicle.

So my prediction is Tesla will announce the completion of the 10,000th production Model S and Elon will then exercise the full 2009 option grant of 6.7M shares at a price of $6.63, which will give Tesla a cash infusion of $44.5M.

He will most likely sell some of those shares to cover his tax bill, and hold the remainder.

I don't think it's likely to be supercharger-related. The wow-factor isn't there. This is something new.

I betcha I'm right, and it's a holding co. for SX and TM. That would require Elon's investment to create, and would make many more resources available to TM.

How would that likely affect existing shareholders?

@pureamos - great research, that's the vehicle for the infusion.

SC Step Change is the centerpiece.

@PureAmps, I think you nailed it.. :-)

@PureAmps - thanks for the hint; but it's not quite that, only 12.5% of those options will vest, the other are long in Elon's pocket. Here is the passage from the 10K (notice only 1/4 of the second half corresponds to 10000 MS produced):

"Included in the December 4, 2009 awards, were 6,711,972 stock options granted to our Chief Executive Officer (CEO) comprised of two grants. In recognition of his and our company’s achievements and to create incentives for future success, the Board of Directors approved an option grant representing 4% of our fully-diluted share base prior to such grant as of December 4, 2009, or 3,355,986 stock options, with 1/4th of the shares vesting immediately, and 1/36th of the remaining shares scheduled to vest each month over three years, assuming continued employment through each vesting date. In addition, to create incentives for the attainment of clear performance objectives around a key element of our current business plan—the successful launch and commercialization of Model S—the Board of Directors approved additional options totaling an additional 4% of our fully-diluted shares prior to such grant as of December 4, 2009, with a vesting schedule based entirely on the attainment of performance objectives as follows, assuming Mr. Musk’s continued service to us through each vesting date:
• 1/4th of the shares subject to the option are scheduled to vest upon the successful completion of Model S Engineering Prototype;
• 1/4th of the shares subject to the option are scheduled to vest upon the successful completion of Model S Validation Prototype;
• 1/4th of the shares subject to the option are scheduled to vest upon the completion of the first Model S Production Vehicle; and
• 1/4th of the shares subject to the option are scheduled to vest upon the completion of the 10,000th Model S Production Vehicle.
If Mr. Musk does not meet one or more of the above milestones prior to the fourth anniversary of the date of grant, he will forfeit his right to the unvested portion of the grant."

Elon may choose to supplement that by some share acquisition not far from market price, because 1M shares went basically unnoticed during the previous raise (not to say that those 1.6M vested options will give him a much lower price). Some other could join for a full blast second offering, with some nice candy at the end of the tunnel ;)

I think my idea of a joint venture involving SolarCity and Tesla Motors can generate a revenue stream:

- First of all, Elon has always stated the Supercharger stations are self developed to be selfsufficient, thereby be cost neutral on its own
- Since Tesla owners are richer than average and Supercharger stations are located near restaurants or other local business where you can spend time, they [the Superchargers] are expected to generate revenues to those local businesses. Local businesses could therefore buy a financial stake in those Superchargers and thereby financing a faster rollout of those Superchargers. For example, part of the financing will be done by the Hilton group.
- Possibly Tesla can provide the equipment necessary to make the Supercharger technology available to other electric cars against a fee

I have to see I can also find counterarguments against the points I just made, though I don't think they necessary rule out my idea of a joint venture.

I also agree that providing leasing options to customers may help in creating demand for the model S, though I don't immediately see why Tesla should do this instead of already existing leasing companies. But I am not much into the leasing industry and I assume there is a difference in leasing in Europe, which is mainly done by companies for their employees, compared with the USA, where leasing , if I am correct, is more geared towards the customer directly.

Another idea might be that you can by a Model S for a cheaper price, and paying a monthly fee for leasing the battery pack. A construction like that is offered by Renault over here in Europe.

I don't think it is a major breakthrough in supercharging technology or battery technology as some suggested here.

But I guess it remains guessing until tuesday next week, unless some insider information pops up ;-)

Anyone an idea why he postponed his announcement originally planned on thursday to tuesday? Has is to do with regulations from the SEC or whatsoever? That would mean it could be a status update on the financial side of Tesla.

Sorry for my English by the way, see I made some grammar mistakes. Should have read it before posting ;-)

@ Bart84

I have just read great speculation about Tesla doing a very profitable business long term using superchargers, even giving away electricity to other cars ;)
http://seekingalpha.com/article/1300141-supercharging-tesla

Now this would right up Elon's street (pardon the pun)

http://www.wimp.com/solarhighways/

Wonder if we'll see such roads in our lifetime!

Edit:

Now this would be right up Elon's street (pardon the pun)

http://www.wimp.com/solarhighways/

Wonder if we'll see such roads in our lifetime!

@hpatelmd WOW! Good morning!
Thanks so much for this link on Solar Highways.
Just made my whole day! Actually something that I have thought about for years (solar energy on blacktop roads is SO obvious!) Really exciting stuff! It does sound like something that could get Elon really worked up! Enough to put his money where is mouth is "in a v big way." I kind of hope you are right on this. Something tells me it is likely to be some kind of energy breakthrough/partnership that stimulated Elon's over-the-top excited tweet, rather than something to do with financial wiz-bangery.

@ imherkimer

some incredible "financial wiz-bangery" would be needed to build such roads; keep in mind we (in general, I'm not in the US) are not capable to patch potholes in a timely manner with dirt cheap bitumen + sand + gravel and you want to pave them with super-materials over a layer of electronics and microprocessors?

it's not space for installations that is missing for solar to take off

I think much of the discussion here is getting away from the "putting my money where my mouth is" that EM mentioned.

Not a secondary-has not bragged about this and it puts cost on others.
Future of solar and electric cars possible.
Hyperloop?
Battery cost? I remember years ago discussion of cost of raw material vs battery being greatly different.
10K cars and options- weak argument for this

What has he opened his mouth about?

I'm thinking bar bet, as in I bet I can do 100 pushups or I can get that girl over there! Oh yeah, prove it and put your money where your mouth is!

What has he got to prove that he would put his money on?

Here is what I wrote up about this last night -- http://tesla-insider.com/2013/03/major-tesla-announcement-upcoming/

However, the more I think about it the more I think it will be that Elon is writing a check out of his own pocket for the next ~50 SuperChargers.

How inspiring and cool would it be that he pay for the rest of the nation wide supercharger network out of his own pocket? Tesla won't have to pay a dime, shareholders win, customers win... Elon would demonstrate real commitment no other CEO out there would ever do(once again). Confidence would rocket, short squeeze would play out...

I think using his option vest to buy a bunch of supercharger stations is the best speculation I've heard. It directly benefits Tesla and its customers, comes from his pocket, and turns what could have been a "crap we don't have the cash to build these stations right now" moment into a PR win. I'll settle on that so I don't have to obsess about it for another week.

@Nicu.Mihalache

Thanks for the link. Interesting read and the guy who wrote it put a lot of effort in it. There are some assumptions that I question, but it is good to see that he really put effort in it to make his point.

Despite the "money where my mouth is," I think it's business related -- in other words, technology or rollout news.

If it's truly financing related (loan paydown, option exercise, secondary, even a strategic investment or partnership, etc.), at this very moment, Elon is getting chewed out by every securities lawyer that works at or for Tesla. Plus, if there are underwriters or partners involved, their lawyers are chewing people out to. You simply can't preview that type of information through Twitter.

Don't know if this is any indicator, but Solar City's stock is up about 7% today on no particular news that I notice. Also over the past week or so the stock has moved up about from the low $17 a share price range to close to $20 today.

Maybe the announcement will have something as part of it that will benefit Solar City in additional to Tesla?

I'm sticking with -

- Quantum leap in Supercharger speed (10 min)

- Funded with his option purchase ($44M)

Fast SC is indeed big news that will juice adoption.

Paying for it from his own pocket preempts debate about uses of capital.

An elegant combo where Elon acts decisively to accelerate growth.

Mark,

You don't fund something with a stock option purchase. A purchase requires money. Only if you exercise the stock option and immediately sell the stock will you have dollars available for some other purpose.

If the CEO sells his stock in the company, that could be looked upon as a vote of no confidence in the long term prospects of the company. I doubt Elon will do that.


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