HOLY TESLA SEMI TRUCK | Tesla Stock GAME CHANGER transcript

We got to talk about the Tesla semitr because uh Top Gear just did a fantastic breakdown of this and we're going to take some of the information in this and apply it to what it could mean for Tesla's stock. Uh a couple things I want to note here is that first of all, they did a fantastic job in this video. I just have to say I was a little surprised that apparently somebody to get one of these first major breakdowns of the semi is apparently a commercial channel from the BBC.

I didn't see that coming. [laughter] The BBC coming for one of these first big deep dives uh into the Tesla semi. But they did a fantastic job on this video and I encourage people to watch it. But I would argue that this right here is one of the more important components of what we saw in this video. Just to remind you, uh, the Tesla semi-truck was unveiled in late 207. That's actually right around the same time I got my Black X.

I loved it. Uh, and my dad still rides my Black X. It's great. But the Semi was supposed to come out within like a year and a half, sometime in 2019. And what we really saw was delay after delay after delay, partly because of supply chains, partly because of efficiencies of these vehicles, uh, and partly because of COVID. And so you didn't actually get a pilot fleet delivered uh until 2022. And that was December of 2022.

So we're like four years ago when we got the first pilot fleets out. Those were mostly to PepsiCo in Florida. And they just opened their high volume line for these semi-truckss on April 29th of 2026. So like from concept to high volume production line it's been nine years and we are finally getting to the point where these production lines are moving and so we got to use that to sort of project what do we think uh the output could be like on these lines.

Uh but the some of the big things that you'll find as you go through this video and we'll look at some components of this is there's a massive talk about the efficiency of the vehicle and what they've been able to pull off to actually get these vehicles to be on par with diesel semitrs. And the key accomplishment that Tesla is trying to make is how can we make it so that we can let truckers get from the start of their shift to their end of their shift when mandatory rest breaks or whatever are required.

How can we get from start to end of shift without having to charge and then how can we charge and get to 60% battery in like a 30 minute break which is insane. You know that's Tesla supercharging for you. uh a and then continue to dose up during a break period. That is critical marketing for Tesla because you don't want downtime on semis that you wouldn't otherwise have. If a trucker is stopping because they are legally mandated to stop and they're going to go for a rest break anyway and they're going to go take a nap anyway or go to sleep, well, you may as well be charging during that time.

So, honestly, brilliant. But I think one of the core components that I'm most excited about for Tesla as a company and and Tesla stock mostly because I actually don't think this is heavily rated into Tesla stock yet. I think there's a lot of hope about Optimus and Cybercap. The Cyber Cap and Roboaxi have really blown me away with uh you know this this expansion that we've seen in in Austin. I do think there was a lot of edge mapping involved in that.

So my catalyst for Tesla is really watching how quickly we can edge mapap other territories whether that's Dallas, Houston, Tampa, whatever. That's that's what I've got my eye on for Cyber Cam. That's created a lot of enthusiasm for Tesla, but the Tesla Semi has somewhat been left forsaken because it's been such a long time promise coming. Uh and so it comes down to economics, not only development, but also why would people buy the Tesla Semi? and they have a little bit of a discussion about that right here.

[snorts] So, let's back up and go through some of these numbers right here about the efficiency and then the most important line to me is that break even cost estimate. And so, we've got to talk about that. So, let's go and play from right about here. >> Cheaper to buy a diesel truck. >> Yeah. So, mind you, just a short interruption. Yes, it is cheaper to buy a diesel truck. The Tesla semi-truck is expected to sell for the long range version at $290,000 and have an $822 kilowatt battery.

That's like 10 times the battery you would have in a normal like Model Y. That'll be closer to a 75 kW battery. This is close to 20x the size of the battery that you have in the Cyber Cab. The long range Tesla semi-truck is huge in terms of the battery size. The standard range model uh is expected to sell for about $260,000 which honestly isn't that much of a discount. 260 divided by 290 represents a discount of about 10%.

But you are going all the way down to 325 miles which is a reduction of 35% of the range. So, I don't think most people are going to go for that standard range model. I'm not entirely sure why they're even selling the standard range model because a 10% discount on the standard range model at 325 mi compared to the 500 mile range you could get with a, you know, a vehicle that cost you $290,000 that seems like a better deal to me.

Maybe for short hall trucks, 325 is all you need. You know, short hall shipping, short hall delivery, whatever. So, maybe for someone those economics make sense, but to me that doesn't make sense. But whatever. Uh the whole point though is that people are comparing these prices to diesel trucks and and that's where a lot of this math becomes really critical because remember if the longrange semi is 290 and a diesel truck is running about 165 to 200,000 and it doesn't require a big charging station where you're parking your semi-truckss, you're probably looking at an extra investment that you're making into Teslas of somewhere between 100 to 200 $100,000.

That'll scale up obviously the more you buy. But the point is, and that'll be relevant in just a moment, when they talk about the break even between the Tesla Semi and the uh diesel trucks, the reason they talk about a break even is because they know the Tesla Semi is going to cost more upfront. This is an investment decision. It's not supposed to be an emotional decision. It's an investment decision to make an ROI. on a 5-year break even, which they project, you're probably at like a 15% annual rate of return, which is pretty good if you can break even and start making money then after that, especially with how diesel prices are skyhigh right now.

One thing that is a risk factor that could slow down the adoption of semis, if magically all of a sudden the war in Ukraine with Russia ends and the war in Iran ends, I would imagine oil prices absolutely plummet. So, you're really at the start of a ramp right now where oil prices are mega high. If we get ramped and oil prices are mega low again, that might slow down some of the desiraability here because you're extending the break evens, right?

We'll talk about some of those break evens in just a moment, but let's just listen for now. >> We always talk about it in a a cost per mile basis, right? So to use some simple examples is that if you're out and running and it costs you in California like you could say 20 cents a kilowatt hour, right? And you are consuming 1.7 kwatt hours a mile. So that means that you're running on an electric basis 34 cents per mile.

Then compare that to diesel which in California right now is about seven bucks a gallon. And at $7 a gallon and a diesel truck which might get around 7 miles a gallon, it's a dollar a mile. So you're saving around 65 per mile that you drive. >> So if you're driving 100,000 m >> now in fairness, some of that diesel MPG, that's a little low. You're you might be closer to 10 to 14 miles to the gallon there. But even still, even at 14, even at twice this, you still have better mileage economics on the Tesla Semi at $7 per gallon.

The problem is what happens if diesel goes down to, you know, call it $4 a gallon. If you go down to $4 a gallon, then these economics become a little bit closer to par. And so what you're really offsetting isn't necessarily just the fuel, it's the maintenance savings. The maintenance savings or clutch for the Tesla that that is I mean anybody who's driven a Tesla before, owned a Tesla knows the savings on maintenance and even just the pain in the butt and the downtime you save not having to take your car to service all the time.

EVs win hands down here. And I might be a little too extreme suggesting that, you know, these trucks can actually get up to 14 MPG, but even call it 10. I think seven, I think they're skewing on the low side, but it makes math simple. It's fine. It does show you a real delta that is there miles a year. That's $65,000 a year that it's saving you in fuel. Now, those numbers vary heavily across the country and even within Europe, they vary country to country as well.

But the thesis is the same everywhere and that is that on a cost per mile basis, electric is cheaper to operate. What really just varies is the how fast the payback period is. But for most folks, it's well less than 5 years. >> And what if anything would you want people to know about the Tesla Semi and its factory that we've not yet discussed today? >> I mean really the big thing is that you know the electrification is here and it's going to come very quickly.

The economics are undeniable and then the overall operational benefits in terms of service and maintenance can't be argued with either. And so this isn't just going to happen. It's going to happen very quickly. The factory is designed to build things at volume. We are deploying charging and service to support that exact volume because this is a objective purchase. This is not an emotional purchase. You're not buying a car. >> Exactly.

Okay. So let's try to understand a little bit of of this coloring here. So, a 5-year break even as a good investment. Typically, these cars are going to la or these cars, these semi-truckss are going to last 10 to 15 years. Your break even point at that point is about a third to 50% of the way into still a depreciating asset. At today's diesel prices, totally makes sense. If prices for diesel tank, now you're talking about trying to compete in the upgrade cycle.

And do people want to throw more money into investing in their trucks up front? Now, the average uh MPG, miles per gallon, right now for diesel trucks sits somewhere around 8 to 9. Again, they're usually seven here. More modern diesel trucks can get as high as 11.5. So, to be clear, 11.5 is like the latest extreme. You're still better off on unit economics for the Tesla. And a lot of that, I think, has to do with the manufacturing uh and the aerodynamics that they're putting into these these vehicles.

And they're fantastic. Uh they were talking in this video about how they've specifically designed this to be as aerodynamic as a sports car, which I I I find it very confusing how they're arguing some some of these aerodynamic claims, but uh either way, it's very exciting if we can actually achieve these numbers relative to diesel trucks. We're obviously not comparing to sports cars. They do also show quite a bit of footage inside of the factory.

And they talk about how uh not only does Tesla get to save money because you have the driver sitting in the middle of the vehicle, so you don't have to have sort of a left and a right time component of the factory, but because they leave the back of the actual uh diesel truck exposed, it's more econom or more ergonomic and more economical to work on. All very exciting. So cool things here that we got to see inside of in the Tesla factory.

Now let's talk a little bit about what this could mean for the stock and how to write this into the play. So for me, I've got this 2030 sheet on Tesla only. Uh not assuming any merger in this sheet. We have other sheets where we assume Tesla mergers with with SpaceX. But what I've thrown in here was about $1.5 billion of operating income for the semi-truck by the end of 2030 with a risk that if for some reason the semi-truck doesn't get adopted, maybe you don't get the enough of the subsidies.

Like right now, federal support for these trucks is gone. However, the reason they talk California in this video is because California still pays big dollars and there are huge weight lists for these trucks, but uh the $40,000 federal EV tax credit for semi-truckss that went away September 30th of 2025 that went along away along with a lot of these other um tax credits that were available for EVs in general. But California still has what's called what's called the HVIP voucher, which gets you about $120,000 per truck.

And there are even more subsidies you can get with something called the new clean fuel reward. So stacked together, you could get the cost of a semi-truck potentially if you stack these together down under $100,000. in which case the break even goes from being five years to being negative. Like you get basically break evens day one. That's where the way you value this is you look at the states that are going to give the most subsidies are going to see the most adoption of these Tesla semi-truckss.

California is a huge trucking state all the way up and down the state. They're going to throw money at these EVs. And here's what I think. I think Democrat victories, whether it's in midterms or it's in the election of 2028, are going to lead to a resumption of federal EV tax credits for semi-truckss. So, one of the next big plays for Tesla could actually be Democrats. Again, Democrat victory. Let's write it down. victory uh in 2028 uh could lead to massive renewed subsidies for semi-truckss.

Currently uh California offering 120k through HVIP program and up to another 120k through the um clean fuel rewards program. That's crazy. Now, now you have a sub 100k cost, break even instantly becomes negative, you know. So, they're talking about a fiveyear break even, you know, when you start getting nickel and dimey on the math and diesel prices come down, that's a risk, totally offset, by the way, by credits. So, here's where we sit with delivery projections for this.

Delivery projections are expected to get to about 1,000 vehicles per week at their 1.7 million square foot facility in Nevada, which is really exciting. They've put like $3.6 billion into these two factories. One the semiplant and the other the battery cell plant for the 4680s that go into these. They're also not painting them. They're using uh powder coating technology, which is the same thing they do for mega packs.

Pretty impressive. Uh and that's why they come in white. You can have any color you'd like as long as it's white, I suppose. [laughter] Uh, but what I think is interesting is, uh, the current expectations are that Tesla's only going to deliver about 4,000 in 27 and about 12,000 in 2028. But if you could ramp up on these semi-truckss uh to 1,000 a week, let's do the math for that. 50,000 per year at about I'm going to go with I'll go with an average blend of 285,000.

I think most people are going to buy the long range vehicles. That math 50,000* $285,000 is a gross price. That works out to $14.25 billion. Okay. the margins on that margins on this since mostly EV tax credit uh IMO probably 30%. Because I think they're going to take a bigger margin on the semir once it scales by 2030 because of the democratic tax credits a that already exist and b that I s suspect are coming. Okay, at 30% this actually suggests my my original thought here about5 is really low.

That's 4.275 of operating income. Uh, mind you, that doesn't uh include FSD subscriptions, which I think in the grand scheme of things, while they're high margin, FSD subscriptions on the Semitr, they're going to be lower in initial volumes. Uh, so I don't think that's going to be too much of a needle mover. But I mean, think about that for a moment. If we go from $1.5 billion over here, here's what it's worth to the stock.

Future value, $800. Let's change this now to uh semi semi semi semi. Where did I just put semis? Democrat. Oh, here we go. Okay. So, we're going to change this to 4.2. Oops. 4275. There we go. That would be about 30% margin at full ramp. So, this is 4.275 275 at 30% and 50k a year by 2030 might I think is relatively reasonable actually if they pull it off especially with these credits that adds about $37 to the stock.

So today it adds about 10% to the stock that you could pay for it just just this alone. This video it's this is sort of like how semi-truck adds 10% to Tesla today, right? But it it shows you that this is a project that's going on for nine years and people have almost all but forgotten it. Uh and it's gotten pretty dang impressive now. And so it's not unusual to somewhat miss some of these volumes uh and mis forecast, but once they start coming to reality, you know, Elon's on to something here.

It'll probably be the same with the Roadster. I know there's the Roadster event coming up, which is going to be a very exciting event. You know, when's that going to turn into sales? I don't know. But they're taking deposits again from people. So, you know, I don't think it's going to be like the iPhone where they're like, "Oh, yeah, opening pre-orders next week." [laughter] you know, that'd be crazy, but or uh you know, take delivery next week rather, like with the iPhone event.

But anyway, uh they also expect uh to deliver these across Europe and like 15 other countries. Amazon's ordered somewhere around 200 of these. Uh to me, Europe is a great place because you're definitely looking at picking up more subsidies in Europe than you are on average in the United States. I think you're going to get fewer subsidies in on a federal level in the United States than you will in Europe. Uh so to me that's optimistic.

Uh so nearterm bullcase, you know, it's useful today if you want to sort of pre-pric in those revenues and those expectations. But what gets exciting is once you get to 50k a year or 1k a week, you're going to start seeing these on the road everywhere. And everybody's going to start looking at, oh, you know, I want to get a Tesla semi too, you know, who's who are semi-truck operators. And when they look at the unit economics plus the tax credits, I wouldn't be surprised that they could actually scale way past that 50,000 target.

But that's when we actually get to broad scale. I mean, how many semi-truckss are sold per year? Let's let's look really quick. How many semmit trucks in US and Europe sold per year? Those two markets. because you're going to have Chinese competition too. Uh so between uh you're typically between 200 to 250,000 per year in the US and another 3 to 350 in Europe. Wow. So you know if I go take the midpoint of that that's about 550,000 per year. 50,000 per year is only 10% of the entire addressable market for for Europe. and um Europe and US total addressable market that's per year is around 550k semis per year 10 uh 50k per year by 2030 is just 10% of that total addressable market so it's still pretty early which is pretty awesome all right so uh we talked about the price and those are estimates for the price you know the certain pricing hasn't come out yet, but these are sort of the best analyst estimates, which I think a lot of estimates have kind of come through leaks so they could sort of start early testing the market.

Obviously, there are going to be more competitors in this range. The risk here is that fuel prices come down. But again, one of the things to look for in this election cycle is Democrats start picking up seat democrat seats and they start winning. That's uh when you're reintroducing solar tax credits, EV tax credits, semi-truck tax credits. Those are all a big W for Tesla. You just have to kind of get through the crap right now.

Axios actually put an interesting piece together about Trump. And this isn't to bag on Trump. This is just to kind of say like how things are evolving and how it's good for Tesla. See, Axios literally wrote, "This is the beginning what the beginning of the end looks like for Trump, where Trump lashes out when he feels powerless." And so, he's lashing out, banning news organizations. He's constantly thinking about power.

He's exerting control on whatever he can when he feels like he's losing. He's privately confessing that he's getting cranky. And they basically go through the argument and say or the article and say like Republicans aren't agreeing with them. uh their you know voter approval has fallen. So all of those things in my opinion just normal like every politician has their shelf life. All of it contributes in my opinion to a flip in terms of who's in control and that is bullish Tesla going in the long run.

Now this morning in our alpha report we actually talked about a little bit on the Tesla semi as well and how we said this this is actually a bullish catalyst for Tesla. So, watch Tesla stock. Uh, in uh the pre-market, Tesla stock was trading for about $369. It's currently [music] trading for about $375. So, about 1 and a.5% of Tesla's intraday gain came after uh our alpha report. And we're very excited about uh about some of these uh numbers that we're seeing from Tesla [music] and and these new catalysts coming up because these are a lot of things that have been years in the making.

Uh Tesla investors have been very many of them have been very very [music] patient, but I think the rewards are starting to come out. Uh, so that's pretty exciting. >> Why not advertise these things that you told us here? I feel like nobody else knows about this. >> We'll we'll try a little advertising and see how it goes. >> Congratulations, man. You have done so much. People love you. People look up to you. >> Kevin Praath there, financial analyst and YouTuber.

Meet Kevin. Always great to get your [music] take.