This was written for someone who took one of my numbers out of context.
Scare Bull, I didn't mean my $875/sh to be taken as a serious prediction. Please let me explain.
exchange2000.com
exchange2000.com
When I read Matsushita's announcement, I put it in the same category as T&B, and didn't see it as a serious threat. When I received a phone call from someone who was worried by it, I couldn't resist posting some numbers for comparison.
If they were a serious threat, their pricing of $6+ per watt hour would leave plenty of room for Valence to sell all they could make at $2 per watt hour. I am sorry if you understood that I predicted an $875 share price for Valence. I was just playing with some numbers to help put things in perspective and make Matsushita's press release less worrisome!
I do find it reasonable to expect that the present 3 lines will be running at least two shifts each by yearend and lines 4-6 will be added, perhaps one per quarter, with line 4 arriving around the end of March. I would estimate that they should ramp to a 300 mln watt hours/year rate in December.
Another point is watt-hour pricing. It is my understanding that Valence intends, for the most part, to produce in high volume and leave the finishing touches to "repackagers" who will stack the cells together and perhaps add some smart circuitry to exactly match particular portable equipment manufacturer's requirements. I believe repackager/OEM product development programs have been underway since last summer.
As Lev stated, he expected customers to pay $2.50 per watt-hour for laptop applications. I was earlier estimating $1.65 and raised this to $2 for general applications.
When we hear $6 plus per watt-hour for a battery, it might be equivalent to Valence's final product or, instead, it might apply to a repackager's "value added" product that has been tailored for a specific customer's needs.
In any case, it would appear that Valence can make ample profit
at $2 per watt hour, and can probably get more for quality and
performance reasons. |
