Vision vs. Detail, February Rise and Fall, Culture Reports from Meta

March 3, 2023
It's Thursday folks and we are running through the first week of March as we talk about the early results of Tesla’s Investor Day. We also summarize Auto Industry sales numbers from February, as well as Meta’s new cultural reports straight from Facebook and Instagram conversations.
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  • Yesterday’s three and a half hour Tesla Investor day was heavy on big picture thinking and light on the specifics as the company revealed some of its plans and challenges on the road to its target volume of producing 20 million vehicles per year worldwide
  • Chief Financial Officer Zach Kirkhorn said Tesla could need to spend $150 billion more to reach its long-term goals of that 20M number with a big focus on integration
  • Toyota is the current largest who sells just over 10M
  • Tesla sold 1.3 M last year
  • Plans to get there include 10 more factories, of which one was just announced in Mexico, as well as making the materials needed to produce its battery cells
  • It opened a lithium refinery in Corpus Christi and a is building a battery materials facility in the Austin area
  • No details on the Cybertruck or the much anticipated ‘low cost’ Tesla
  • The company has had 14 consecutive profitable quarters
  • Shares were down 5% in off hours trading following the event

  • Sales reports are coming out this week. Some went up and some went down.
  • Hyundai, Kia, and Subaru went up for their 7th straight month while Toyota and Honda fell back
  • Not surprisingly, Increased demand and rising inventory played a big roll in the winners while tight supply continued to stunt the forward motion of the others
  • Toyota fell back 2.4 percent overall, however it’s Lexus division actually increased 6.1% breaking a 12 month streak of declines
  • Similar story at Honda falling 1.4% overall, but Acura rose by 12%
  • Ford and Volvo will be reporting numbers later today and the rest of the industry is on a quarterly reporting schedule
  • Meanwhile, as new car supply regulates, used car prices are declining moving some buyers back to the value
  • "We have diverging markets today," said Charlie Chesbrough, senior economist at Cox Automotive. "New inventory is slowly stabilizing while used supply is falling. With many affordability-seeking vehicle buyers leaving the new market for the used, dealers may find they have too little used inventory, and price declines may reverse. And [automakers] may find they have too much new-vehicle inventory and be forced to be more aggressive with incentives to boost sales."

  • Meta has released its second edition of its 56 page ‘Culture Rising’ report, which looks at emerging trends, based on analysis of millions of conversations across Facebook and Instagram, alongside additio

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Kyle Mountsier, Paul Daly

Paul Daly  00:27

We've made it through March 1, no problem at all, no problem at all. It's March 2, we're rolling. We're talking about Tesla's investor Day, February sales numbers and culture reports from NetApp. They have a couple of insights

Kyle Mountsier  00:44

when they say, things of what people are doing and stuff and things like that. Okay, let me just say, Look, if you are a longtime listener of the pod version of this, like the audio version, the audio version, we know, we cut you in actually 30 seconds after a little jam.


And if you've never caught that, like, there's, there's, there's a reason why you might want to head to our YouTube or Facebook or LinkedIn just every once in a while, just to like, kind of lean into that.

Paul Daly  01:18

Like it kind of hits you know, so really just picked that music because that's our countdown music. And that's what helps us straightener straighten our energy. Right, right. We usually hit the ground running in the morning and we're on Google meet and we're like texting and we're like, all these things are going on happening. And then that music hits. And then we're like, alright,

Kyle Mountsier  01:36

you just kind of like hit it.

Paul Daly  01:37

Now. We're ready for the show. Come here come the live stream. Verse two got comments like this from Rob downs. Happy Thursday, gents. Love the emoji math. In the meeting this in the email this morning, our daily email, you can get it out of and had some really fun emoji math. And it was great. Yeah. I mean, I'll tell you what, I'll tell you what, if you get the email, you're going to realize why they're like 5000 other people that get the email and opened at an astounding rate every day because it is

Kyle Mountsier  02:06

worth it. absolutely worth it. Yep. hit it up. Let's go. We'll keep you in the loop of everything we're doing. But speaking of keeping you doing?

Paul Daly  02:17

Yes. I was about to rock that one out. If you did, come on. Thursday. Okay, yesterday's three and a half hour Tesla investor day. Yes, it was three and a half hours long, was heavy on big picture thinking and light on specifics as the company revealed some of its plans and challenges on the road to its target volume of producing, listen to this 20 million vehicles per year worldwide for a little context there. It is the money thing of that 20 million vehicles, largest profit margins,

Kyle Mountsier  02:51

gross profit margin of nine G's.

Paul Daly  02:53

That's something I mean, to give you a little context. The world's largest automaker currently is Toyota. And they make 10 million vehicles a year. So Tesla currently only makes 1.3 million. So there's a lot of work that needs to be done and it must be the money. You're right, Kyle, because chief financial officers that Kilbourne said Tesla could need to spend upwards of $150 billion more to reach its long term goals of that $20 million number with a big focus on integration, integrating manufacturing, they plan. They need 10 More Giga factories to do it. One, they just announced his opening in Mexico. And they also are starting to refine their own raw materials. So they have a lithium refinery right here in the US Corpus Christi, Texas, no building a battery, this battery materials plant right outside of their Gigafactory in Austin, they didn't talk about so all this vision. They didn't talk about new things. cybertruck

Kyle Mountsier  03:51

Tesla, nothing like that. No cheap testing, like what Apple does, hey, here's all the things we're doing. And here's the new stuff. None of there's

Paul Daly  03:59

none of the new stuff, none of the new stuff. You know, I guess you know, they said they're going to talk about the cybertruck in a separate event. They don't want to take away from that. That's a great alibi, that's and the Atlantic give them granted. Like all the vision things that they talked about, we're on the path to the anticipated announcements, right? A low cost, Evie, you know, sub 30,020 $5,000 Whatever. And the company has had 14 months of consecutive profits, so I guess they can kind of do what they want with their shares. However, were down 5% In off hours trading because people wanted the sizzle. Or they say buy the hype sell the news? Is that what people say? That's exactly what it is. People that bought the hype and sold the news yesterday made 5%

Kyle Mountsier  04:45

Yeah, something like that. Yeah,

Paul Daly  04:48

they would you buy everybody's getting excited. They're gonna do it and you sell right before the news actually drops. You got some comments here on the way too long of a live stream felt like we were in the clouds of where we want to be with no view of the ground. where we are, that's an insightful comment

Kyle Mountsier  05:01

and don't have our editor that may or may not be kind of in the vibe of a so do you know it's


totally it's in there totally is but thing is with a soda you see we're doing every single day. Yep, exactly. We're doing every single we're always keeping you try and keep you updated speaking of keeping us all up to date. Segway.

Paul Daly  05:24

All right, so Tesla's doing their thing. But all of our OEMs are doing their thing and like they've been doing for like the last 100 years. It's just new sales reports are coming out this week. From a lot of manufacturers. Some are up some are down. Hyundai, Kia and Subaru all went up for their seventh straight month So bravo to our friends there why Toyota and actually fell back. Some of the reasons not Not surprisingly, increased demand and rising inventory plays a big role in the winters while tight supply played a role in the losers torque, Toyota fell back two and a half percent or 2.4%. However, Lexus is carrying some weight now you come back 1% After 12 month streak of the client says little celebration going on in the Lexus side of the business they broke the streak. Honda as well fell 1.4% but accurate, the luxury brand of 12% Well pattern there, which makes

Kyle Mountsier  06:17

a little bit of sense that these manufacturers have women, when they have supply chain issues, they're continuing to press into prioritizing high dollar items is a stump because the buying demographic is still in a high income earning status, right because of high interest rates and high vehicle prices, especially in these manufacturers that don't have incentivize programs trying to bring down prices. So it makes a lot of sense that Toyota and Honda wouldn't move would move in that direction, especially when you look at Hyundai and Kia having a record February for that. Like you know why they did that because they have a lower price point. They have inventory on hand like they're the storylines make a lot of sense for me.

Paul Daly  06:59

They do before to Volvo. They'll be reporting some numbers later today. And the rest of the industry is on a quarterly basis. So we got to wait another month to hear those results. You know, Kyle, you and I talk with and spend time with dealers all the time, all the time on the ground, in phone conversations in consulting, and so much conversation around the used car market the new car market obviously affecting that massively our friend Charlie Chesbro, Senior Economist at Cox automotive has a quote in the auto news article that we're linking up and I'm gonna read it and then let's respond to it. He says we have diverging markets today new inventory is slowly stabilizing, while US car supply is failing or falling, while many affordability secret seeking vehicle buyers leave that are leaving the new market for the US market dealers may find that they have too little used inventory and price declines may reverse. And automakers may find that they have too much new inventory and may be forced to be more aggressive with incentives to boost sales

Kyle Mountsier  08:00

sounds like sounds this sounds like the car business right exactly what I was about to say I talked to two dealers yesterday, they both had like within one word of the same quote. And it was used cars are on fire right now. Had another dealer text both of us letting us know that they just opened up their entire organization. So good and they incentivize the entire organization including accounting and everybody like go buy cars will pay you for it right? The focus on used cars right now is insane. And we're seeing week over week e increases at the wholesale level and retail prices are staying strong as well. So like the roller coaster ride of used cars is not over by any stretch of the imagination. No,

Paul Daly  08:45

it really does. Like I know it's a drum that you know it's kind of been being beat since nada but basics fundamentals every day attention, right like folks that are like adjusting use car prices once a month, like that doesn't cut it. No, no just doesn't cut it. I'm not buying cars

Kyle Mountsier  09:04

weekly daily basis. I mean, search trends, what you know, on the on the data that I'm seeing where some of the insights that we have access to like analytics accounts and stuff like that. It like everything is moving in an up direction. So, yeah,

Paul Daly  09:21

sounds like gotta be on your toes and play the game. It's a good way to roll in the spring. Like you know, you come out of spring training and you're like ready to go like you're all

Kyle Mountsier  09:28

I'm telling you is gonna be lit if you're not pushing hard on March I'm telling you it's gonna be lit. Not financial advice, but here we go.

Paul Daly  09:39


Kyle Mountsier  09:41

Speaking of stuff being lit. Segue

Paul Daly  09:47

tell us about your friends.

Kyle Mountsier  09:49

Over at meta they've released their second edition of a 56 page called surprising report which looks at emerging trends, analysis of millions of conversations across their platforms Facebook Instagram. And then along with a global insights search survey, basically they look at four areas exploratory identities, refined relationships, assertive aspirations, and lived values, which are really big words for we're watching you break down these key topics in which segments have seen substantial growth over the years. And so we are seeing stuff like people talking about work and wellness and self discovery, you know, trying to figure out like, what am I doing here? Why am I doing it are kind of the trends that they were seeing a lot. So, and I see, like, I see that on social media, it's a lot of people going, you know, there was this trend of quiet quitting. And now it's, there's this trend of like, oh, the grass wasn't greener. You know, all of these things that people are trying to figure out. What is the work dynamic? How am I self discovering? Am I mind? Am I an individual? Or am I part of a company, all that type of stuff is, so anecdotally I see that and this kind of like, threads that needle?

Paul Daly  11:03

Well, some of the highest insight areas seem to be in psychology and therapy, meaning people feel a little lost right now. They do. Right? The quiet quitting thing is feeling a little lost, right? Lack of vision, lack of purpose. And so great, like the fact that we have these insights from what people are actually talking about, might not directly apply to what exactly operational you're doing today. But if you think about the overlay, if people are feeling like there's a lack of vision or they're a little lost, you have such an opportunity to speak in those terms of giving people a place of belonging, a place where they can be comfortable a place of, of maybe feeling a little better. There's one term in there Kyle, I hope you didn't look it up. But do you know what the lasso therapy is? It's one of the highest research terms for lasso therapy.

Kyle Mountsier  11:56

I don't the only thing that comes to mind is Ted lasso therapy. It's nothing to do guessing that's not it but like it was what hit my brain right off the top but hey, that's

Paul Daly  12:06

only two letters away from Ted last Oh therapy. Take the Dhg actually one letter so the last so therapy is actually an unproven obviously and unproven therapy of using the ocean for therapy and that's things with see things in them like sea water and standing in the ocean and the climate around the last Oh therapy it's a thing you heard it on the show

Kyle Mountsier  12:29

first man I can tell you there's a certain level of therapy of dipping your toes in the ocean so it

Paul Daly  12:35

really is I mean, I It makes me feel better. And here's the interesting for the industry hashtag car reels has seen 150% growth in the last year so meaning people are paying more attention to automotive in general we've been so

Kyle Mountsier  12:51

telling me pa telling me is meta affirmed our theory that pop culture and automotive are at a at a critical juncture right now. Yeah,

Paul Daly  13:02

they listed like 10 areas of like the highest growth and hashtag car reals was in there. This is somebody coming in on the podcast is more Hey, Rob Ito he's talking about $15 A month from Reddit and Instagram verification seems like annoying cost but should be more impactful than a $15 ad spend we were going to cover that but Mehta is coming verification $15 a month. You gotta give him your government issued ID and everybody feels great about that. But I'm just gonna make my government issued ID my profile picture and just get on with my

Kyle Mountsier  13:31

with it. There it is everybody. But anyway, so verification,

Paul Daly  13:34

maybe we'll talk about it some other time. But you can pay 15 bucks be verified and they do say you'll have access. It'll be harder for you to hack. So easier to hack. If you're in the free version, get more service and it says it'll boost the awareness of your posts. So I think that's probably worth $15 We'll get verified. Why not verified? Let's get verified. Well, whatever day if you're listening to this show you are verified in the car business or cared about the car business which means you should be caring about people. And it's March 2, you'll opportunity spring is just around the corner.

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