The valuation is just insane, and being propped up by a weird cult of personality.
A combination of higher interest rates, traditional automakers fielding some good EV options in mass, and Elon’s personal instability seem to all be hitting at once to get towards a more reasonable valuation.
It's on the brink of going under from what I can tell.
People like the product, but they aren't making nearly enough for how much money they burn. If the recession hits and funds dry up, I think it's game over.
VW produces >400k EV this year. And that's about 5% of all cars they produced. And they are scaling up _fast_. Tesla has been an incredible first-mover and bootstrapper - but I do not see how they can keep their lead in the long run. It just is not that hard to build a decent EV anymore. Now it's all about processes, sourcing, quality control - stuff that traditional car makers have a lot of expertise in.
new Toyota EV = wheels falling off, battery overheating and not able to charge to 100%
new VW EVs = large panel gaps
> processes
new VW EVs = if you are lucky with your firmware version, to update the car via OTA you have to leave your car dealer's service center; dealers still a pain in the ass for both VW and customers
GM EVs = just don't produce them because of parts shortage
I don't believe their expertise helps, it was the slow iterative upgrade path that created this myth. As soon as the OEMs need to create a new product, they encounter the same problems that Tesla was criticised for and eventually solved.
> It just is not that hard to build a decent EV anymore.
There are lots of low-hanging fruits for EV efficiency and production that traditional manufacturers are slow on adopting.
Like single-piece rear casting (IDRA Gigapress, etc.)
Any new model introduction has problems, there’s a reason it is popular to avoid the first model year or two.
It’s unlikely these car makers wouldn’t fix these quality control issues after that. By comparison Tesla quality is abysmal and took many years to improve to meet other car makers. It’s hard to stand up large car factories for the first time alongside a new car model.
EVs share probably 90% of the non engine parts with other cars. The big components which are different are the drivetrain (simpler), motors, battery and charging equipment. Motors are a commodity and far simpler to manufacture than ICEs. Batteries are the difficult component right now but will likely become more if a commodity as well. EVs are much easier to build than ICEs.
Ultimately we can expect far higher car quality going forward (from our current period of already excellent car reliability).
as we go forward, cars will become more like phones. it will be interesting to see if the auto industry goes in a similar direction in terms of consolidation of market share.
Ford's planning on building enough production capacity to ship 600k EVs per year by the end of next year, Hyundai/Kia are at 350k/year capacity now, GM is projecting "400k units between Q3 2022 and Q2 2024", VW is shipping 800k EVs in 2022. So all of the traditional autos have caught up.. granted some of those are bad, and many will flop, but as a worst case they're just producing their already popular cars in EV form factors which is a lot of competition to Tesla.
The CCS charging network is starting to ramp up and with the last congressional budget I expect it to explode a bit in the upcoming years. $5 billion dollars was earmarked for EV charging.
The latest CCS charging standard supports the "plug and charge" model like tesla does. It'll take time, but I expect at the end of 5 years most stations will have it.
CCS chargers are unreliable. 75% plus can be broken at any one time. Sometimes you get to a station and find out every single charge is busted. Hope you have charge to go to another!
Tesla chargers.. never heard of a station being dead. If it was, the in-app nav would reroute you.
The difference is Tesla cares about charge quality. CCS network made to settle Diselgate? No one really cares or puts in the effort to keep them all 100% up.
> No one else has such an extensive and easy to use charging network.
Maybe in the US? In Europe, that's not even remotely true. Lots of choice among providers, Tesla is one of many. Germany has ~12k stations, about 900 are Tesla's.
EDIT: I was way off, there are about 900 Tesla charging stations in Europe! In Germany, it's about 150. Of course, this is all debatable because many of these 12k stations have only one connector and often have limited kW, whereas Tesla's are usually equipped with several superchargers, but still, it's a small player in Germany's charging network.
Requiring a non-dealership EV removes all but a handful of companies. Those are the companies that as sibling commentators have pointed out are delivering EVs in volume.
Ford is attempting to change its dealership model to a better system (set pricing, dealership chargers, better training) by forcing them to agree to changes or lose your ability to sell Ford EVs. - https://insideevs.com/news/610114/ford-modele-dealership-rul...
It's better, but the dealer still makes 4-5k per EV they sell.
Rivian or Tesla, you can skip that 4-5k dealer surcharge. I am not sure Ford can really source the parts that much cheaper to sell the same final product for the same price?
Tesla is actually a valuable company and I wouldn't be surprised if it truly is more valuable than Ford or GM at this point -- but for a meme stock, the fundamentals are not tied to the price at all. It could go up or down based on a Tweet.
Completely agree. Tesla might be worth about as much as any of the major car manufacturers, but not more than all of them put together. We've already seen Ford and others put EVs on the road, so there isn't much of a moat there. Either Ford, GM, etc. are all wildly undervalued or Tesla is wildly overvalued. One of those seems more likely than the other to me.
Several Target stores near me have charging stations now. 7/11 starting to put in some as well. Some companies have put in charging spots for employees. Even our library has 3 charging parking slots.
EV charging stations are a lot less demanding in the form of safety, environmental regulation, and liability compared to fossil fuel fueling. You can put one in any parking lot that has a bit of slack space.
It's not that easy. Have you seen the electrical infrastructure that those need?
We have some spaces with Chargepoint chargers where I work, and they are powered by several electrical boxes that are each about half as big as a parking space. There is some serious juice being pushed through those -- and the Chargepoint chargers are only serving 30-40 amps, which is about the same as a home charger and nowhere near what a Telsa Supercharger delivers.
This kind of stuff is not trivial, or cheap. Tesla spent a lot of money to get their network to where it is.
the big issue is not in urban areas. + superchargers usually have 10+ stations, bigger ones in nowhere having 20+. Most of the non tesla chargers I've seen in the wild are 3 max
Well, Tesla still has some of the "first mover advantage" left: they secured gigantic supply of batteries, other manufacturers might struggle to get their hands on sufficient quantities.
The other moat was supposed to be Full Self Driving. Trouble is, it's been "coming soon" for a while now and a cruise control system that's a bit more ambitious and risky than other OEMs' isn't nearly as obviously a moat, and a class action lawsuit from the people that paid for the promise doesn't help matters. Even if you're bullish on Level 4 robotaxis within the near future, Tesla doesn't look like the most likely winner of that market.
It's not just FSD. Even supposedly mainstream analysts have based their targets for Tesla on non-existent revenue streams and assumptions about everything going up and to the right. For example you can't make a cheap Tesla and keep the same margins.
I would have bet that this would have come unraveled based on the dubious rescue of Solar City. But it was going to come unraveled.
Tesla has not succeeded by building 'moats' (an anti-competitive concept favoured by monopolists). Tesla has succeeded and continues to succeed by their pace of (real, not fake) innovation, and there have been no signs, in my opinion, that they are losing this edge. Rather, again in my opinion, they continue to pull away from the major car manufacturers on this front.
Can GM produce this car in volume and with any sort of profit margin? i.e. Are they getting anywhere near Tesla with its manufacturing and battery production innovations?
If you can show me they can and they are then I'll be interested. I'm interested in business facts, not sponsored endorsements by influencers.
They're shipping 70k this year as demand rises, which it is mostly doing because of the big price drop between 2022 and 2023. So yes, it appears that they can produce them in volume and make money doing so.
P.S. Pretty sure MKBHD isn't getting paid by Chevy. His sponsors are phone/tech companies, even on his car-focused videos.
The market cap of the 7 big car-companies combined (Toyota, Honda, Mercedes, VW, Ford, GM, BMW) = $557b. Tesla market cap = $527b.
This means at comparable margins, for Tesla to reach its current valuation, 3/4 cars sold in the developed world would have to be Teslas. For reference, the marketcap of the entire automobile industry [1] minus Tesla is $1300b.
Tesla is a stock to gamble on. Unlike GME, there is probably a lower bound on how much you can lose. (maybe ~70% at worst if Elon has a heart attack). But, 70% is a long way down.
I am no MBA but how do mass market auto makers defend margins like these in the presence of robust competition? Porsche is a brand built basically on top of VW infrastructure and they painfully win their high margins from expensive add-ons to cars which are (mostly) shared platforms with VW and Audi. Can Tesla carve out a similar niche? If you look at value, Teslas are not at the top of the list in terms of quality or the percentage by which their batteries empirically under/over-perform their range ratings. Consumers are slowly coming to learn how to compare EVs and no matter how well things go for Tesla I am a bit skeptical that their profit margins will survive fully intact.
Are Teslas yet becoming unfashionable to the well-to-do tech workers who traditionally bought Teslas?
When the cult of personality is being a big jerk to the well-to-do tech workers at one of the biggest companies for them, that's pretty close to home. (It's easier for someone to seem fabulous when they're only stepping on other people.)
> The woke mind virus is either defeated or nothing else matters
The first one seems connected to various conspiracy theories around COVID. The second one is more of a general culture war thing, maybe with some suggestions towards civil war. Altogether Musk is saying stuff that is pretty close to QAnon, which I suspect is what was meant by "fascist conspiracy theories".
I wouldn't necessarily call it fascist conspiracy theories, but the first tweet is deeply irresponsible. It puts a target on a single person that already received plenty of death threats and supports all kinds of outlandish conspiracy theories.
He also gave "extensive,
unfiltered access to Twitter's
internal communication and
systems" to (among others) the author of a book titled "Irreversible Damage: The Transgender Craze Seducing Our Daughters."
Since most big-tech workers are not transphobes, they do not share your views. So, if Musk's actions continue, he will likely alienate a substantial portion of his customer base.
So by your argument we should act as if people with e.g. Dissociative identity disorder, are completely healthy, just because they "identify" as somebody, and we should not judge their identity ?
What about clinical cases of people who identify as Hitler ? Should we label that healthy in the name of progression ?
I'm sorry but I cannot be convinced that a condition where you want to mutilate your sexual organs and change through surgeries (to whatever) is healthy and normal.
It's also highly questionable whether it's even a stable identity. In dementia health care, there are many reports of transsexuals forgetting their opposite-sex gender identity, and becoming shocked and horrified at what has been done to their bodies. Perhaps gender identity is not as innate as activists would like us to believe.
"Might want to be selling that Muskmobile soon. Value falling at 2-3 times the Car Guru index. Look at the fall between 30 and 90 days. Much, much steeper than, say Mercedes or Toyota"
Shows Model3's off almost 16% in the last 90 days.
When I bought mine, one of the considerations was the car's resale value over time. 15% was what everything else lost driving it off the lot - in Dec 2021, that's what a Y lost over three years. (Everything else = EV/PHEVs luxury bigger-then-sedans).
So... sure? If you're owning a Tesla as a form of value store, you might want to sell? If you're owning a Tesla as a car, then these don't look like the right numbers - you'd need the spread for buy->sale price, probably for new and used (since these used prices look about the same as new prices).
Edit:
Also, on second look, the tweet links to a Car Guru chart of a bunch of gas cars. The one I'd look at is the Rav4 Prime, IMHO one of the alternatives to the Y (sure was for me), which while still doing better than the Y on these charts, not by nearly as much as the originally selected cars.
The drops for 2021 models are almost identical, although I'd probably look at the 2022 numbers since the Rav4s in 2021 were heavily marked up by dealers ($10k+) due to rarity that year.
While I can't sell my Y for more than I paid for it, I can sell it for more than than the outstanding balance on the loan (by... 25%?) sooo
Yeah, I wasn't posting that to make any kind of investment advice, only to show that it looks like the value of Tesla's seem to be impacted by Musk's shenanigans.
Ah! Sure. The timelines don't really line up well with Musk's shenanigans; they line up pretty well with the "Inflation Reduction Act", which AFAIK is the one that made changes to EV stuff.
(Note: totes agree that the recent stuff is having / will have an impact; but; it doesn't look like it's this impact)
For example: Both the Rav4 and the Model Y show ~10% drop over this time period according to this website; but, non-EV staples show a ~2% drop. And the Y shows a bigger drop than the Rav4. So, could be interpreted as Federal changes causing the 10% drop in EVs and the Musk shenanigans causing the additional 5% drop in Model Ys.
> Shows Model3's off almost 16% in the last 90 days.
Imo, this could be attributed to a few factors all compounding each other.
1. Most Tesla owners/interested consumers are more "online" than average. (no evidence, just my experience)
2. Tesla recently asked the FCC to withhold docs on a newer radar system. [0]
3. The Model 3 has also been rumored to have a refresh next year. [1]
But also I think they are just cherry picking data points to try and make a claim. [2]
Other brands are down worse than Tesla but not mentioned.
- Tesla is down 9% YoY or 15.03% in the last 90 days.
Now let's compare to some others in the list...
- Lexus is down 24.56% YoY or 5.69% in the last 90 days.
- Wagoneer is down 28.92% YoY, or 5.99% in the last 90 days.
- Infiniti is down 9.44% YoY or 6.76% in the last 90 days.
While others are still down similarly (within a few % points), but not worse than Tesla.
- Scion is down 6.45% YoY or 7.76% in the last 90 days.
- FIAT is down 5.95% YoY or 8.84% in the last 90 days.
- Dodge is down 7.04% YoY or 6.63% in the last 90 days.
- Chevrolet is down 6.19% YoY or 4.97% in the last 90 days.
I think what we're actually seeing in the numbers here are just signs that people are slowing on buying used cars, but also slowing on buying more expensive vehicles in general (at least until you hit the other side of the curve, where rich people are still buying ex ferraris).
Earlier this year, used Teslas were selling for upwards of $10k over what Tesla sold them for new, and Tesla kept bumping up the MSRP. It was the worst used/new value ratio across the industry, probably since there are no dealers you could pay a market adjustment to in order to get a new one immediately instead of waiting half a year.
Now that the delivery time for new Teslas is down to a month or two depending on model, of course used prices are dropping like a rock.
My friends that are interested in electric vehicles (and myself) are now much more interested in the traditional car manufacturers electric vehicles. My wife is eyeing the Cadillac Lyric instead.
Yeah, I noticed lately this past year I've been seeing a lot more of non-Tesla EVs in my area (which is probably the ideal target demographic for Telsa and other EV makers). Especially Ford Mach-Es, VW ID4s, and now that new Polestar. Seems to be a ton of options whereas a few years ago there weren't really any good alternatives to Tesla.
That said Telsa is still probably the most common vehicle on the roads here, but not quite as dominant as a few years ago.
We don’t really get swayed by the drama one way or another but so far the affordable Teslas have been too small to replace a Ford Escape for our family. Looking forward to the future of EVs.
Some people prefer it because of the buying experience. They're not on the top of my list (I prefer a PHEV), but I am absolutely dreading going to a showroom. Many of my friends say the same thing (and in a recent HN thread, [1] I saw lots of people commenting on how awful the typical car-buying experience is).
Some people probably can't get Musk out of their head whenever they see a Tesla. But the company has an independent brand as well, so many people just associate it with EVs, environmentalism, fast cars, etc.
I bought a used BMW from a dealer recently. Many of the conventional dealers have apparently copied internet sellers' sales model, and are now no-haggle.
The experience was completely fine, especially compared to the last two cars I purchased, which previously made me swear I'd only deal with tesla, specifically to avoid dealerships. The biggest problem was that the online EV inventory was completely out-of-date, so I had to physically show up to browse cars.
The whole process took less than 5 hours end-to-end (roughly 2-3 in the dealership). I paid a fair price vs. other local sales of similar cars. I'm not sure how much of the good experience was due to being at a luxury car dealership vs. them copying off of tesla and other online-only dealerships.
One thing that always struck me as inappropriate is that they want to scan your DL before you test drive a vehicle. That lets them look you up, see your home value and possibly your salary (if you're a big exec — for the record, I am not!). Is there a diplomatic way to decline to hand over your DL, and a bunch of bargaining power along with it? I'd rather a salesperson not know whether I can barely afford their cheapest car or easily afford their most expensive when we go to the bargaining table.
It's a novel idea! I would have never considered spending tens of thousands of dollars on a vehicle that I wouldn't drive before committing to the purchase. It certainly goes against everything I was ever taught about buying a car!
I'm sure Ford, GM, et al are pretty ecstatic about his current behavior. It's almost like he's intentionally trying to offend and turn off the largest demographic of EV buyers.
I've soured on Musk, but I still love driving my Tesla. I enjoy it enough that I find excuses to take it on night time trips with no destination in mind, driving for the sake of driving. I've only had it for 4 months, but I'm hoping the novelty doesn't wear away anytime soon. I thought I would hate the extreme minimalist interior, but after renting a new ICE vehicle for a little bit on a trip I had severe anxiety seeing all the buttons and knobs and controls littered everywhere, longing for the simple cleanliness of my Tesla.
My cynical, tongue and cheek "Elon is playing 4D chess while us mere mortals can only watch in amazement" is that the current persona is a ploy to break the Tesla brand from the confines of the Silicon Valley/California customer base as that market is close to fully saturated.
The move to Texas and the embrace of antics that play well with conservative social media is an attempt at getting free marketing to a new segment of buyers.
It is beneficial to Tesla if it wants to expand into the middle American auto market - which is probably bigger in size - where buyers are probably skeptical of adopting EVs and would otherwise be hesitant to trade in their gas powered F150/Hemi for an EV Cybertruck.
I've sort of wondered if this was his ploy. If this is truly what he's trying to do, then he runs the risk of losing his lefty sales. Perhaps he's banking on being the best EV on the market?
I've thought about this too, but it's one thing to go on twitter and post some memes for free (or 8$/month lol) and another to shell out $50k for a car just to own the libs.
If this were really his ploy, I think he'd get more mileage out of less contentious stunts, like making an electric monster car and using it to drive over ICE cars at county fairs, ...or something like that. The political tweeting seems like a bad idea as a sales stunt, so I suspect he's mostly genuine with the political stuff.
Hemi driver here. We're planning to trade it in for an electric F-150.
I get the appeal of the Cybertruck and Rivian, but they're completely impractical for use as pickup trucks. I hope they find their niches and everything, but there's no way they'd replace a conventional full sized pickup that was actually being used for truck stuff.
Speaking of unfashionable I think that is the major test for Tesla - sustaining sales through a redesign/styling. The Hyundai IONIQ 5 looks really cool to me (the headlights look like pixels for crying out loud) but was well out of my price range when I was looking recently. In a few years some other manufacturer will have an awesome look for some model. This is all subjective, as is any style/fashion type of thing.
All car manufacturers end up having to redesign/restyle their cars because they literally become unfashionable. People look forward to redesigns and then when the new design is out, older models look dated. Tesla hasn't gone thru that cycle that I'm aware of and all of their models, sans cybertruck, look exactly the same. I imagine there is significant cost to redesigns and re-tooling manufacturing processes while keeping old design parts, etc. still available.
Big difference between Tesla and Amazon though is Amazon has built a big moat via its logistics operation. Even if workers unionized and their costs went up the economies of scale they have are extremely difficult to be competitive with unless you're walmart.
Tesla has some impressive factories being built but at the end of the day batteries are the limiting factor and the other automakers are catching up. Not to mention the QC is awful for teslas compared to traditional car manufacturers.
Yeah, there are car people thinking they can get the margins Apple does.
These are the people who came up with heated car seat subscriptions.
I once went to an IoT meetup, and the Samsung guy was touting a refrigerator with a built-in tablet. For more than the cost of a refrigerator and a tablet. That margin didn't last.
(Are people actually paying $15,000 for Tesla's Fake Self Driving?)
Elon's antics and politics are causing problems. IMHO the politics don't change Tesla huge lead in the EV space. Seems like people are conflating their hatred of Elon with Teslas potential as a company.
None of the other car makers can produce EVs at a profit. Tesla has very high margins on their cars and are continuing to reduce their production costs.
They have the following advantages:
1) Most efficient use of batteries (kWh per distance)
2) Most extensive charging network
3) Contracts for battery minerals, and battery supply contracts
Once the the 4680 dry electrode process, structural battery pack and castings for the new Model Y and 3 are worked out and ramped, their manufacturing mote with be even bigger.
I'm ignoring the FSD software, even though they are in the best position to pull that off. It's still too far off.
1) Tesla's drivetrain's kWh per distance is the best, but only by 10% or so. That's not enough to be a deal breaker for the other brands. Body style selection completely dominates 10% drive train efficiency, and Tesla is rapidly falling behind there.
2) The Tesla charging network seems less extensive in silicon valley than the multiple competing networks. Also, Tesla is advertising that they'll open it up to all other manufacturers (at least in the US) really soon, so to the extent you believe Tesla can still deliver stuff, the charging network is not a competitive advantage. On top of that, the Biden infrastructure plan is subsidizing standard chargers, so the proprietary Tesla charging port is turning into a competitive disadvantage.
3) I agree that Tesla still has an advantage in terms of production ramp, but this is eroding too. BofA is projecting Tesla's market share will be in the low teens within a few years. Assuming their analysts aren't idiots, this implies the other manufactures have been able to secure battery sources.
Regarding FSD: I strongly prefer the jog wheel computer + physical buttons in my BMW over Tesla's touch screens, and that's comparing features that exist. Other manufacturers have a bigger software functionality gap, from what I've heard, but that's not unique. Most manufacturers have auto-braking and lane keeping, which is most of what FSD has delivered so far.
Regarding the rest of the company: Apparently, they pulled out of solar installs. Anecdotally, all the tesla powerwall licensed contractors around here hate supporting them (poor reliability), and point homeowners to LG on the low end or Enphase on the high end.
I think most comments ignore that Tesla is making much more profit for each car sold than its competitors. I didn’t make the math but I remember Tesla margin being around 20% while average in industry is quite below 10%.
Tesla is increasing production and keeping its margin while competitors are still having problems to catch up. Now they produce comparable EVs but still with much less margin.
Also Semi seems to be quite a game changer that will keep Tesla ahead in another market for quite a while
Good point about margin. I imagine a good chunk of that margin is from eliminating dealers from their sales model.
Even with the higher margin, Tesla would need an insanely higher volume to justify their market cap. It’s never going to reach those volumes.
I also suspect Tesla will not be able to maintain all of their margin as they face increased competition. Some of that margin doubtlessly comes from selling their FSD - and I think it’s unclear if they will be able to keep selling that at a premium as other car makers catch up and/or regulators investigate some advertising claims around it. Tesla’s highest margins appear to be in China, where operations are distinctly delicate for someone owning a large social media company.
The Semi may legitimately make a difference; we’ll have to see how many they are able to produce and their market uptake. There are going to be other competitors in that space who are more aligned to the trucking industry. The current Tesla Semi seems to be a niche for short haul runs (which is still a big segment).
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[ 3.4 ms ] story [ 202 ms ] threadA combination of higher interest rates, traditional automakers fielding some good EV options in mass, and Elon’s personal instability seem to all be hitting at once to get towards a more reasonable valuation.
Rivian looks like it might pop.
Really would love there to be some alternatives of good EVs that aren’t tied to stealerships.
People like the product, but they aren't making nearly enough for how much money they burn. If the recession hits and funds dry up, I think it's game over.
new Toyota EV = wheels falling off, battery overheating and not able to charge to 100% new VW EVs = large panel gaps
> processes new VW EVs = if you are lucky with your firmware version, to update the car via OTA you have to leave your car dealer's service center; dealers still a pain in the ass for both VW and customers GM EVs = just don't produce them because of parts shortage
I don't believe their expertise helps, it was the slow iterative upgrade path that created this myth. As soon as the OEMs need to create a new product, they encounter the same problems that Tesla was criticised for and eventually solved.
> It just is not that hard to build a decent EV anymore.
There are lots of low-hanging fruits for EV efficiency and production that traditional manufacturers are slow on adopting. Like single-piece rear casting (IDRA Gigapress, etc.)
It’s unlikely these car makers wouldn’t fix these quality control issues after that. By comparison Tesla quality is abysmal and took many years to improve to meet other car makers. It’s hard to stand up large car factories for the first time alongside a new car model.
EVs share probably 90% of the non engine parts with other cars. The big components which are different are the drivetrain (simpler), motors, battery and charging equipment. Motors are a commodity and far simpler to manufacture than ICEs. Batteries are the difficult component right now but will likely become more if a commodity as well. EVs are much easier to build than ICEs.
Ultimately we can expect far higher car quality going forward (from our current period of already excellent car reliability).
The latest CCS charging standard supports the "plug and charge" model like tesla does. It'll take time, but I expect at the end of 5 years most stations will have it.
Tesla chargers.. never heard of a station being dead. If it was, the in-app nav would reroute you.
The difference is Tesla cares about charge quality. CCS network made to settle Diselgate? No one really cares or puts in the effort to keep them all 100% up.
Maybe in the US? In Europe, that's not even remotely true. Lots of choice among providers, Tesla is one of many. Germany has ~12k stations, about 900 are Tesla's.
EDIT: I was way off, there are about 900 Tesla charging stations in Europe! In Germany, it's about 150. Of course, this is all debatable because many of these 12k stations have only one connector and often have limited kW, whereas Tesla's are usually equipped with several superchargers, but still, it's a small player in Germany's charging network.
Requiring a non-dealership EV removes all but a handful of companies. Those are the companies that as sibling commentators have pointed out are delivering EVs in volume.
Rivian or Tesla, you can skip that 4-5k dealer surcharge. I am not sure Ford can really source the parts that much cheaper to sell the same final product for the same price?
Tesla is actually a valuable company and I wouldn't be surprised if it truly is more valuable than Ford or GM at this point -- but for a meme stock, the fundamentals are not tied to the price at all. It could go up or down based on a Tweet.
We have some spaces with Chargepoint chargers where I work, and they are powered by several electrical boxes that are each about half as big as a parking space. There is some serious juice being pushed through those -- and the Chargepoint chargers are only serving 30-40 amps, which is about the same as a home charger and nowhere near what a Telsa Supercharger delivers.
This kind of stuff is not trivial, or cheap. Tesla spent a lot of money to get their network to where it is.
I would have bet that this would have come unraveled based on the dubious rescue of Solar City. But it was going to come unraveled.
Tesla has not succeeded by building 'moats' (an anti-competitive concept favoured by monopolists). Tesla has succeeded and continues to succeed by their pace of (real, not fake) innovation, and there have been no signs, in my opinion, that they are losing this edge. Rather, again in my opinion, they continue to pull away from the major car manufacturers on this front.
It's easy to quibble about that, of course, but the Chevy costs 30% as much.
Hard to see how Tesla is "pulling away" from anybody in 2022.
0. https://www.youtube.com/watch?v=NuaFJTQMoPI
If you can show me they can and they are then I'll be interested. I'm interested in business facts, not sponsored endorsements by influencers.
P.S. Pretty sure MKBHD isn't getting paid by Chevy. His sponsors are phone/tech companies, even on his car-focused videos.
This means at comparable margins, for Tesla to reach its current valuation, 3/4 cars sold in the developed world would have to be Teslas. For reference, the marketcap of the entire automobile industry [1] minus Tesla is $1300b.
[1] https://companiesmarketcap.com/automakers/largest-automakers...
Tesla is a stock to gamble on. Unlike GME, there is probably a lower bound on how much you can lose. (maybe ~70% at worst if Elon has a heart attack). But, 70% is a long way down.
So what about in reality, where Tesla makes over double the margins of GM or Ford[0] or on the extreme end, 8x Toyota's profit margins[1]?
[0]: https://www.reuters.com/business/autos-transportation/teslas...
[1]: https://asia.nikkei.com/Business/Automobiles/Tesla-earns-8-t...
Once Tesla starts selling Prius & Corolla competitors, their margins should go down accordingly.
When the cult of personality is being a big jerk to the well-to-do tech workers at one of the biggest companies for them, that's pretty close to home. (It's easier for someone to seem fabulous when they're only stepping on other people.)
https://twitter.com/elonmusk/status/1601894132573605888?
Then there is a conspiracy theory about Paul Pelosi and a male prostitute: https://www.npr.org/2022/10/31/1132906782/elon-musk-twitter-...
There are numerous replies of his that are somewhat questionable without being outright promotion, but troubling nevertheless. https://www.rollingstone.com/culture/culture-news/elon-musk-...
> My pronouns are Prosecute/Fauci
and
> The woke mind virus is either defeated or nothing else matters
The first one seems connected to various conspiracy theories around COVID. The second one is more of a general culture war thing, maybe with some suggestions towards civil war. Altogether Musk is saying stuff that is pretty close to QAnon, which I suspect is what was meant by "fascist conspiracy theories".
I wouldn't necessarily call it fascist conspiracy theories, but the first tweet is deeply irresponsible. It puts a target on a single person that already received plenty of death threats and supports all kinds of outlandish conspiracy theories.
https://www.latimes.com/california/story/2022-10-30/column-e...
https://www.nbcnews.com/think/opinion/elon-musk-s-hitler-twe...
https://en.wikipedia.org/wiki/Views_of_Elon_Musk
What about clinical cases of people who identify as Hitler ? Should we label that healthy in the name of progression ?
I'm sorry but I cannot be convinced that a condition where you want to mutilate your sexual organs and change through surgeries (to whatever) is healthy and normal.
"Might want to be selling that Muskmobile soon. Value falling at 2-3 times the Car Guru index. Look at the fall between 30 and 90 days. Much, much steeper than, say Mercedes or Toyota"
Shows Model3's off almost 16% in the last 90 days.
So... sure? If you're owning a Tesla as a form of value store, you might want to sell? If you're owning a Tesla as a car, then these don't look like the right numbers - you'd need the spread for buy->sale price, probably for new and used (since these used prices look about the same as new prices).
Edit:
Also, on second look, the tweet links to a Car Guru chart of a bunch of gas cars. The one I'd look at is the Rav4 Prime, IMHO one of the alternatives to the Y (sure was for me), which while still doing better than the Y on these charts, not by nearly as much as the originally selected cars.
Model Y - https://www.cargurus.com/Cars/price-trends/Tesla-Model-Y-d30... RAv4 Prime - https://www.cargurus.com/Cars/price-trends/Toyota-RAV4-Prime...
The drops for 2021 models are almost identical, although I'd probably look at the 2022 numbers since the Rav4s in 2021 were heavily marked up by dealers ($10k+) due to rarity that year.
While I can't sell my Y for more than I paid for it, I can sell it for more than than the outstanding balance on the loan (by... 25%?) sooo
(Note: totes agree that the recent stuff is having / will have an impact; but; it doesn't look like it's this impact)
For example: Both the Rav4 and the Model Y show ~10% drop over this time period according to this website; but, non-EV staples show a ~2% drop. And the Y shows a bigger drop than the Rav4. So, could be interpreted as Federal changes causing the 10% drop in EVs and the Musk shenanigans causing the additional 5% drop in Model Ys.
Imo, this could be attributed to a few factors all compounding each other.
1. Most Tesla owners/interested consumers are more "online" than average. (no evidence, just my experience)
2. Tesla recently asked the FCC to withhold docs on a newer radar system. [0]
3. The Model 3 has also been rumored to have a refresh next year. [1]
But also I think they are just cherry picking data points to try and make a claim. [2]
Other brands are down worse than Tesla but not mentioned.
- Tesla is down 9% YoY or 15.03% in the last 90 days.
Now let's compare to some others in the list...
- Lexus is down 24.56% YoY or 5.69% in the last 90 days.
- Wagoneer is down 28.92% YoY, or 5.99% in the last 90 days.
- Infiniti is down 9.44% YoY or 6.76% in the last 90 days.
While others are still down similarly (within a few % points), but not worse than Tesla.
- Scion is down 6.45% YoY or 7.76% in the last 90 days.
- FIAT is down 5.95% YoY or 8.84% in the last 90 days.
- Dodge is down 7.04% YoY or 6.63% in the last 90 days.
- Chevrolet is down 6.19% YoY or 4.97% in the last 90 days.
I think what we're actually seeing in the numbers here are just signs that people are slowing on buying used cars, but also slowing on buying more expensive vehicles in general (at least until you hit the other side of the curve, where rich people are still buying ex ferraris).
[0]: https://insideevs.com/news/625502/tesla-alerts-fcc-new-radar...
[1]: https://www.carscoops.com/2022/11/tesla-working-on-model-3-r...
[2]: https://www.cargurus.com/Cars/price-trends/ (9/13/2022 through 12/10/2022
Now that the delivery time for new Teslas is down to a month or two depending on model, of course used prices are dropping like a rock.
That said Telsa is still probably the most common vehicle on the roads here, but not quite as dominant as a few years ago.
Some people probably can't get Musk out of their head whenever they see a Tesla. But the company has an independent brand as well, so many people just associate it with EVs, environmentalism, fast cars, etc.
1: https://news.ycombinator.com/item?id=33948535
The experience was completely fine, especially compared to the last two cars I purchased, which previously made me swear I'd only deal with tesla, specifically to avoid dealerships. The biggest problem was that the online EV inventory was completely out-of-date, so I had to physically show up to browse cars.
The whole process took less than 5 hours end-to-end (roughly 2-3 in the dealership). I paid a fair price vs. other local sales of similar cars. I'm not sure how much of the good experience was due to being at a luxury car dealership vs. them copying off of tesla and other online-only dealerships.
Presumably most sellers would be happy to drive and have you sit shotgun without a license.
But if you don't want anyone to make a copy of your drivers license, you have the options I laid out: buy without driving, or be a passenger.
The move to Texas and the embrace of antics that play well with conservative social media is an attempt at getting free marketing to a new segment of buyers.
It is beneficial to Tesla if it wants to expand into the middle American auto market - which is probably bigger in size - where buyers are probably skeptical of adopting EVs and would otherwise be hesitant to trade in their gas powered F150/Hemi for an EV Cybertruck.
I get the appeal of the Cybertruck and Rivian, but they're completely impractical for use as pickup trucks. I hope they find their niches and everything, but there's no way they'd replace a conventional full sized pickup that was actually being used for truck stuff.
All car manufacturers end up having to redesign/restyle their cars because they literally become unfashionable. People look forward to redesigns and then when the new design is out, older models look dated. Tesla hasn't gone thru that cycle that I'm aware of and all of their models, sans cybertruck, look exactly the same. I imagine there is significant cost to redesigns and re-tooling manufacturing processes while keeping old design parts, etc. still available.
Tesla has some impressive factories being built but at the end of the day batteries are the limiting factor and the other automakers are catching up. Not to mention the QC is awful for teslas compared to traditional car manufacturers.
Yeah, there are car people thinking they can get the margins Apple does. These are the people who came up with heated car seat subscriptions.
I once went to an IoT meetup, and the Samsung guy was touting a refrigerator with a built-in tablet. For more than the cost of a refrigerator and a tablet. That margin didn't last.
(Are people actually paying $15,000 for Tesla's Fake Self Driving?)
None of the other car makers can produce EVs at a profit. Tesla has very high margins on their cars and are continuing to reduce their production costs.
They have the following advantages: 1) Most efficient use of batteries (kWh per distance) 2) Most extensive charging network 3) Contracts for battery minerals, and battery supply contracts
Once the the 4680 dry electrode process, structural battery pack and castings for the new Model Y and 3 are worked out and ramped, their manufacturing mote with be even bigger.
I'm ignoring the FSD software, even though they are in the best position to pull that off. It's still too far off.
2) The Tesla charging network seems less extensive in silicon valley than the multiple competing networks. Also, Tesla is advertising that they'll open it up to all other manufacturers (at least in the US) really soon, so to the extent you believe Tesla can still deliver stuff, the charging network is not a competitive advantage. On top of that, the Biden infrastructure plan is subsidizing standard chargers, so the proprietary Tesla charging port is turning into a competitive disadvantage.
3) I agree that Tesla still has an advantage in terms of production ramp, but this is eroding too. BofA is projecting Tesla's market share will be in the low teens within a few years. Assuming their analysts aren't idiots, this implies the other manufactures have been able to secure battery sources.
Regarding FSD: I strongly prefer the jog wheel computer + physical buttons in my BMW over Tesla's touch screens, and that's comparing features that exist. Other manufacturers have a bigger software functionality gap, from what I've heard, but that's not unique. Most manufacturers have auto-braking and lane keeping, which is most of what FSD has delivered so far.
Regarding the rest of the company: Apparently, they pulled out of solar installs. Anecdotally, all the tesla powerwall licensed contractors around here hate supporting them (poor reliability), and point homeowners to LG on the low end or Enphase on the high end.
Tesla is increasing production and keeping its margin while competitors are still having problems to catch up. Now they produce comparable EVs but still with much less margin.
Also Semi seems to be quite a game changer that will keep Tesla ahead in another market for quite a while
Even with the higher margin, Tesla would need an insanely higher volume to justify their market cap. It’s never going to reach those volumes.
I also suspect Tesla will not be able to maintain all of their margin as they face increased competition. Some of that margin doubtlessly comes from selling their FSD - and I think it’s unclear if they will be able to keep selling that at a premium as other car makers catch up and/or regulators investigate some advertising claims around it. Tesla’s highest margins appear to be in China, where operations are distinctly delicate for someone owning a large social media company.
The Semi may legitimately make a difference; we’ll have to see how many they are able to produce and their market uptake. There are going to be other competitors in that space who are more aligned to the trucking industry. The current Tesla Semi seems to be a niche for short haul runs (which is still a big segment).