Tesla Surges Above $500, Leaving Analyst Targets in the Dust(bloomberg.com)
bloomberg.com
Tesla Surges Above $500, Leaving Analyst Targets in the Dust
https://www.bloomberg.com/news/articles/2020-01-13/tesla-analysts-play-catch-up-as-shares-leave-targets-in-dust
406 comments
Here's what you're missing... Most of the major automakers: Ford, Toyota, Honda, Nissan, Mazda, etc do not have viable business models in the near future. They are so far behind in sustainable transportation its only a matter of time until they lose their economies of scale and are no longer viable businesses. It's an "Iphone moment"... the other car companies have great "flip phones" right now.
This seems really optimistic about the adoption of electric cars. I suspect adoption will be drastically slower than you're imagining, and hybrids as well as gas vehicles will remain relevant for a long time still. Toyota of course has the top-selling hybrid, and introduced a plug-in hybrid version recently. Ford was in the #2 spot and Toyota was again in the #3. Honda takes #5. I think the thesis of these automakers is that they can ride the transition from gas -> hybrid -> plugin hybrid -> electric. I hope you're right, but from what I see, it seems unlikely.
Additionally, Nissan has the #4-selling electric car, and Chevy has the #2.
I think you are overstating your case.
Additionally, Nissan has the #4-selling electric car, and Chevy has the #2.
I think you are overstating your case.
Tesla has already sold every car they can manufacture, and their entry price is $40k-ish in the USA. Other manufacturers are limiting how many BEVs they produce, and still managing to sell most of the ones they build even though they are universally objectively worse than any Tesla offering.
Tesla Model 3 is the best selling BEV in every market it participates in (not sure about numbers compared to PHEVs). It is selling in comparable quantities to ICE vehicles in the same price range.
A significant number of people buying Model 3 are upgrading from cars costing half the price.
There is little to no indication that EV adoption will slow down (before pointing to a drop in Model 3 sales in the USA consider that the one factory supplies the entire world outside China).
Tesla Model 3 is the best selling BEV in every market it participates in (not sure about numbers compared to PHEVs). It is selling in comparable quantities to ICE vehicles in the same price range.
A significant number of people buying Model 3 are upgrading from cars costing half the price.
There is little to no indication that EV adoption will slow down (before pointing to a drop in Model 3 sales in the USA consider that the one factory supplies the entire world outside China).
> Tesla Model 3 is the best selling BEV in every market it participates in
No, that's incorrect.
The Model 3 is the second best seller in France: https://ev-sales.blogspot.com/2019/12/france-november-2019.h...
It's the third best seller in Germany: https://ev-sales.blogspot.com/2019/12/germany-november-2019....
And it's the 9th best selling BEV in China: https://ev-sales.blogspot.com/2019/12/china-november-2019-up...
No, that's incorrect.
The Model 3 is the second best seller in France: https://ev-sales.blogspot.com/2019/12/france-november-2019.h...
It's the third best seller in Germany: https://ev-sales.blogspot.com/2019/12/germany-november-2019....
And it's the 9th best selling BEV in China: https://ev-sales.blogspot.com/2019/12/china-november-2019-up...
Chinese Model 3 production only started in November. Check back in February, you’ll find it’s the highest selling vehicle (perhaps by model, though I am betting also by manufacturer).
Europe-wide, Tesla Model 3 is top of the charts by a wide margin. The articles you linked mentioned this, France and Germany are behind because the vast demand for Tesla in Netherlands and Norway is sucking all the supply up before France and Germany get a seat at the table.
As Fremont production improves and the German Tesla factory opens, we’ll see that lead grow as Europeans switch to BEVs en masse to escape the cheating ICE manufacturers.
Europe-wide, Tesla Model 3 is top of the charts by a wide margin. The articles you linked mentioned this, France and Germany are behind because the vast demand for Tesla in Netherlands and Norway is sucking all the supply up before France and Germany get a seat at the table.
As Fremont production improves and the German Tesla factory opens, we’ll see that lead grow as Europeans switch to BEVs en masse to escape the cheating ICE manufacturers.
It's not the best selling EV in the biggest EV market, China. Your claim was false. Cop to it instead of making excuses.
You are basing that on less than one month of sales after the factory just opened. Your claim is bogus, acknowledge that and be prepared to wait for figures for a complete month of Model 3 actually being available in that market.
By February the factory should be working close to its capacity, let’s see what sales are like once Tesla is actually participating in that market.
By February the factory should be working close to its capacity, let’s see what sales are like once Tesla is actually participating in that market.
No, I'm basing that on the actual sales figures. The Model 3 has been on sale in China since March last year:
https://ev-sales.blogspot.com/2019/04/china-march-2019.html
https://ev-sales.blogspot.com/2019/04/china-march-2019.html
Well, learn a new thing every day :D
Let’s see what News February brings shall we?
5300 seems quite low given China’s size compared to, say, Australia. No doubt you will claim it is demand constrained, but that number looks like one boatload. That market is supply constrained.
Let’s see what News February brings shall we?
5300 seems quite low given China’s size compared to, say, Australia. No doubt you will claim it is demand constrained, but that number looks like one boatload. That market is supply constrained.
We’re about one step away in battery tech (which Tesla leads on, among other things (efficiency, integration, etc) from a mid range electric car be upfront cost equivalent with an mid range gas car. Once that’s there, plus charging infrastructure (which is rapidly coming up) the other benefits (maintenance, torque, quiet, fuel costs, etc) will be front and center for every car buyer making the choice between the two technologies.
I don’t think it’s too optimistic. VW with the ID.3 seems like they’re the only ones who will be able to match the scale and qualities of product to the Model 3/Y in the near term.
We’ll see though. It’s interesting in any case.
I don’t think it’s too optimistic. VW with the ID.3 seems like they’re the only ones who will be able to match the scale and qualities of product to the Model 3/Y in the near term.
We’ll see though. It’s interesting in any case.
do they have a roadmap for charging infrastructure? What if they sell millions and it takes 20min to charge knowing that most people will charge at similar times when going to work?
This assumption is wrong that everyone needs to charge before going to work. Once people started hitting queues at charging stations they will start charging at home over night. Though personally I think work place charging stations should be promoted where electric cars get charged at work using solar energy instead of at night at home using fossil fuel based electricity.
This test in LA is interesting, using existing power infrastructure:
https://electrek.co/2019/11/13/la-adds-hundreds-of-ev-charge...
https://electrek.co/2019/11/13/la-adds-hundreds-of-ev-charge...
Wouldn't most people just charge at home, overnight?
That may work in suburban America but I'm not so sure about the rest of the world. Most of my life I've lived in apartment complexes (US) / blocks of flats (Europe) where there was no car charging possibility when parking. It would require huge infrastructure changes to allow most people to be able to charge at home and work, this is different from gas powered vehicles where you need a relatively small number of (centralized) points that distribute fuel. With electric cars that number needs to be much larger and it's distributed.
It can be done over decades for sure but it won't happen overnight.
It can be done over decades for sure but it won't happen overnight.
The number one factor that leads to one future or the other is battery price.
With high battery prices the market stays with hybrids longer.
With cheap and plentiful batteries it moves faster to full EV.
What'll be interesting is if some vendors have access to lots of cheap batteries and so are living in one future while competitors are in the other.
With high battery prices the market stays with hybrids longer.
With cheap and plentiful batteries it moves faster to full EV.
What'll be interesting is if some vendors have access to lots of cheap batteries and so are living in one future while competitors are in the other.
Hah.. also: fear of war (with Iran) -> oil went up -> people think e-cars will be more attractive -> TSLA up.
One time a few years ago, oil went down and TSLA followed. It'd be interesting to see what will happen with the incoming recession (although then all stocks might go down with people pulling out of the market).
One time a few years ago, oil went down and TSLA followed. It'd be interesting to see what will happen with the incoming recession (although then all stocks might go down with people pulling out of the market).
A few fairly large economies are planning to ban sales of new fossil fuel powered cars by 2030 and a bunch more by 2040. https://en.wikipedia.org/wiki/Phase-out_of_fossil_fuel_vehic...
> Additionally, Nissan has the #4-selling electric car, and Chevy has the #2.
From here: https://insideevs.com/news/343998/monthly-plug-in-ev-sales-s... - by # of units sold, no one is even close to the Model 3. People with money to buy electric cars with can probably afford a $50k car (Model 3) that does everything well over $less cars that do everything kinda poorly.
From here: https://insideevs.com/news/343998/monthly-plug-in-ev-sales-s... - by # of units sold, no one is even close to the Model 3. People with money to buy electric cars with can probably afford a $50k car (Model 3) that does everything well over $less cars that do everything kinda poorly.
You linked to something that only looked at a small fraction of the global market.
It's not optimism, it's arithmetic: Tesla is stealing units from the other car companies. The other car companies require those unit sales to keep the prices the where they are otherwise they have to raise prices (same goes for insurance).
Sure maybe for the next 2-5 years people will do business as normal but are you really going to buy a Corolla for $30K when you can get a Tesla Model 3 for $30K? That is what will cause a quick shift.
Sure maybe for the next 2-5 years people will do business as normal but are you really going to buy a Corolla for $30K when you can get a Tesla Model 3 for $30K? That is what will cause a quick shift.
A new Model 3 is 36k, a new Corolla is 19.6k MSRP. Realistically you can get the Toyota for less than half the price of the Tesla. I am not convinced that gap can be closed in 5 years, much less 2.
Corolla gets 32mpg. Assume 200,000 miles over the life of the corolla, that’s 6250 gallons of fuel. $2.79/gallon where I live for $17437 of fuel over the life of the corolla. $19600+17437=$37k
The Tesla requires 50,000 kWh to drive 200,000 miles. At $0.08/kWh (what I’m paying), that’s just $4000 in electricity. $36k + $4k = $40k
That’s surprisingly close for a Tesla Model 3 versus a Corolla.
The Tesla requires 50,000 kWh to drive 200,000 miles. At $0.08/kWh (what I’m paying), that’s just $4000 in electricity. $36k + $4k = $40k
That’s surprisingly close for a Tesla Model 3 versus a Corolla.
8 cents per kw/hr is nearly the cheapest rate in America.
And most people will not be on track to drive 200k miles in their car before the loan is paid off. Which leaves them upfronting a very large percentage of the savings.
And most people will not be on track to drive 200k miles in their car before the loan is paid off. Which leaves them upfronting a very large percentage of the savings.
https://www.srpnet.com/prices/home/electricvehicle.aspx
Yes, Arizona has good rates.
Yes, Arizona has good rates.
Current electric car prices already make economic sense for car fleets where maintenance and fuel saving make it cheaper. One of the reasons delivery companies have been interested in electric vans.
I spec'd it at the top of the line Corolla ~25K. Change it to a Camry if we're getting nit-picky
Automakers don't like gas/electric hybrids as they are more complex to design and manufacture than either gas or electric vehicles.
Fuel-cell/electric hybrids are a different value proposition and will keep going.
But they'll increasingly drop gas hybrids and jump to full electric, perhaps after the next generation of vehicles.
Fuel-cell/electric hybrids are a different value proposition and will keep going.
But they'll increasingly drop gas hybrids and jump to full electric, perhaps after the next generation of vehicles.
They're going to follow customer demand. If demand for electric cars remains low, they aren't going to abandon the types of cars that are selling really well for them in order to simplify the production process. And there are a lot of reasons to think that demand for electric cars is not going to skyrocket all of a sudden: range anxiety, lack of charging stations, gas prices being fairly low, the time it takes to charge, etc.
Honda's Tesla killing fuel cell civic has a price tag of $300K+.
> Toyota of course has the top-selling hybrid, and introduced a plug-in hybrid version recently.
I thought that was in 2012? Of course "recently" is kind of subjective.
Edit: Ah, so they only introduced plug-in hybrids in the United States in 2016. Wonder what took them so long.
I thought that was in 2012? Of course "recently" is kind of subjective.
Edit: Ah, so they only introduced plug-in hybrids in the United States in 2016. Wonder what took them so long.
Fuel prices in the USA are quite low. There isn’t much demand for a plugin hybrid. People looking for “green” cred and branding may go straight to an electric car, while everyone else buys SUVs and light trucks.
Most of the major automakers work in 5 year cycles, where the cars are basically the same for 5 years but get cosmetic changes. Major design changes need to be part of the next cycle if its non-trivial.
In addition to the very large market opportunity for their stationary storage batteries and solar panels / solar tiles. You can sell those big grid scale megapacks to virtually every government in the world. You can't necessarily sell Tesla cars to every person in most of the third world (or western first world for that matter!).
There is also the potential taxi and trucking businesses if they ever nail self driving. These side businesses are what a lot of people are missing in the comments only talking about Tesla's car business. They are diversifying in a way that some other car companies aren't. I'm not 100% sure that the self driving tech will get where it needs to be for this to become viable anytime soon, but the same applies to Uber and they have a market cap near $60 billion largely based off that same upside.
Only sort of.
John Q. Public has no reason to buy an EV. Today's gas prices don't put the same dent in his pocket that $5/gallon* gas did. And there's good reason to believe that $5/gallon gas is probably never coming back.
I am for EVs, Tesla, and anything that can keep us from making large portions of Earth unarable and uninhabitable. But most people's car-buying decisions are driven by economic realities, not environmental concern.
*$5/gallon US average price - I understand it's frequently this high on the coasts and in large cities, and it's almost always higher in countries with appropriately levied fuel taxes.
John Q. Public has no reason to buy an EV. Today's gas prices don't put the same dent in his pocket that $5/gallon* gas did. And there's good reason to believe that $5/gallon gas is probably never coming back.
I am for EVs, Tesla, and anything that can keep us from making large portions of Earth unarable and uninhabitable. But most people's car-buying decisions are driven by economic realities, not environmental concern.
*$5/gallon US average price - I understand it's frequently this high on the coasts and in large cities, and it's almost always higher in countries with appropriately levied fuel taxes.
If commercials tell me anything about what car buyers value, there are so many other apsects John Q Public would appreciate!
John likes fast cars. And oh boy my Nissan Leaf is fun to drive! Mountain driving feels like floating silently into the air. Instant torque, no gear shifting.
John may also appreciate the extra leg room, as even a compact car gains a lot of room without a gas engine.
John also likes saving money and convenience. And while gas isn't super expensive, I wake up every morning with a full charge for about $1. Gas stations just aren't a part of my life. (charging away from home is still a PITA, FWIW)
John might also like skipping the majority of standard maintenance. No oil changes. No random belts. Less brake wear (I think?) from regeneration. Sure, after 100k you'll probably want a new battery, but it's a known cost that's dropping.
Maybe EVs need to drop the 'environmental' badge and focus on how awesome they are.
John likes fast cars. And oh boy my Nissan Leaf is fun to drive! Mountain driving feels like floating silently into the air. Instant torque, no gear shifting.
John may also appreciate the extra leg room, as even a compact car gains a lot of room without a gas engine.
John also likes saving money and convenience. And while gas isn't super expensive, I wake up every morning with a full charge for about $1. Gas stations just aren't a part of my life. (charging away from home is still a PITA, FWIW)
John might also like skipping the majority of standard maintenance. No oil changes. No random belts. Less brake wear (I think?) from regeneration. Sure, after 100k you'll probably want a new battery, but it's a known cost that's dropping.
Maybe EVs need to drop the 'environmental' badge and focus on how awesome they are.
> And oh boy my Nissan Leaf is fun to drive!
just curious, what else have you driven to compare it against? I rarely hear even hardcore EV enthusiasts describe that car as "fun".
just curious, what else have you driven to compare it against? I rarely hear even hardcore EV enthusiasts describe that car as "fun".
Fun is pretty subjective. I'm not a car guy and don't have much experience with nice cars.
But, this isn't a nice car- I paid $6,500. I'm just comparing it to every ICE car I've driven (aside from that one time I got 20 minutes in a Lamborghini), and definitely every ICE car you can purchase used for $6,500.
But given the acceleration and smoothness, I'm just betting it's more fun to drive than nearly every car described in commercials fun to drive.
But, this isn't a nice car- I paid $6,500. I'm just comparing it to every ICE car I've driven (aside from that one time I got 20 minutes in a Lamborghini), and definitely every ICE car you can purchase used for $6,500.
But given the acceleration and smoothness, I'm just betting it's more fun to drive than nearly every car described in commercials fun to drive.
for $6500 you're probably right, unless you're willing to purchase a "project" vehicle. I bet it's a lot more peppy than a 1.5L honda civic. I mainly ask because I see the MSRP for a new leaf is almost $30k, which is where you can start getting into some new entry-level performance cars or a lightly used bmw coupe.
> Less brake wear (I think?) from regeneration.
On the Model 3, if you enable Hold mode, then it's possible to drive without EVER using the brakes outside of emergency situations. The rotors and pads will theoretically last forever outside of environmental damage.
On the Model 3, if you enable Hold mode, then it's possible to drive without EVER using the brakes outside of emergency situations. The rotors and pads will theoretically last forever outside of environmental damage.
While I like the idea of Hold mode, not regularly using the brake will cause the breaking reflex action to fade with time. You really want to have a good "slam the breaks" reflex if you drive a car On the other hand, maybe Tesla feels their automatic systems will break better than humans and this is not really a problem to worry about.
I'm not a Tesla driver, but I would guess the Hold mode doesn't turn off "slam the brakes" when the driver needs to stop fast.
I think njarboe feels that it is the human reflex to 'slam the brakes' will fade if the human doesn't use it enough in 'hold' mode, not the mechanism in the car.
Correct. Moving your foot from the accelerator to the brake is a much practiced motion and your body can do it very quickly without much thought. I rarely use cruse control, so when I do and think I might want to brake soon, I get nervous. I don't really know where the brake is. At that point I put my foot back on the accelerator and now my body knows how to hit the brake again.
Which is why the cybertruck announcement was so huge. The styling dominated the headline, but IMO the biggest news was the pricing. $40K for a full size medium duty crew cab pickup is cheaper than the equivalent gasoline truck.
Yeah, the cybertruck gives me hope, too.
If the $40K model had a longer range, I'd place a preorder.
If the $40K model had a longer range, I'd place a preorder.
As a counter point to this, gas in Atlanta costs $3.11 for premium. A BMW 3 series gets about 30mpg. Driving 1000 miles per month in the BMW costs $104 in gas.
GA Power offers $.01 per kilowatt hour rates in the middle of the night. A Tesla Model 3 gets 2.91 miles / kWh. Driving 1000 miles per month in the Tesla costs $3.44.
Fueling the Tesla costs $1200 less per year than the BMW if you drive an average number of miles, and we haven't even gotten to the cost of oil changes and brake pads.
GA Power offers $.01 per kilowatt hour rates in the middle of the night. A Tesla Model 3 gets 2.91 miles / kWh. Driving 1000 miles per month in the Tesla costs $3.44.
Fueling the Tesla costs $1200 less per year than the BMW if you drive an average number of miles, and we haven't even gotten to the cost of oil changes and brake pads.
If 1000 miles / month is an average US mileage... well then maybe there needs to be some way how to lower that.
Apparently it's closer to 14k miles / year. I underestimated at 12k.
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Isn't this ignoring other parts of the world? Europe single handidly can drive this market. Also large portions of asia that would love affordable electric vehicles (not ness "cars") for their densely populated cities. Never mind the short range cargo vehicle market throughout the world.
Europe currently faces a bit of an chicken and egg problem with the EV market. European manufacturers don't produce meaningful EVs which results in no subsidies that would accelerate the market (or those subsidies are also available to hybrids in their lineup which won't be driven in EV mode). In turn they don't have any incentive to move forward with their EV lineup, as most people are loyal to their local manufacturers.
> as most people are loyal to their local manufacturers.
This is perhaps true for a few countries making good cars. The rest of EU is more than happy to drive German and French cars (if they can afford it, of course).
This is perhaps true for a few countries making good cars. The rest of EU is more than happy to drive German and French cars (if they can afford it, of course).
The EU has introduced fleet CO2 emission standards that are going to go up every year. As a consequence the European manufacturers are scrambling to design and produce ev's.
plus a tiny factor from the fact that Tesla is just out of the death trap and growing ... always raises the value a bit
Well, in truth they most likely have something like a decade or so to adjust which is both not a lot and enough for such organizations to adjust.
Sure some manufacturers will go bust and collapse, but other will adapt, and new ones will be created.
I'm quite puzzled by Tesla's valuation, such a valuation is betting on it becoming a huge actor in the post IC automobile industry which is not a given.
I'm also skeptical about the "Iphone moment", functionally the Iphone was a huge step forward (basically having a small computer in your pocket vs having something just doing phone calls, SMSes and snake), but a Tesla, well, right now, it's still a car which does more or less the same thing as any other car (just slightly better in some aspect, slightly worst in others).
It's also not the same market, the Iphone appeared in the booming market of mobile phones which was seeing exponential growth at the time. And also, the gain in functionality and convenience was enough to transform the market from consumers willing to pay at most ~100$ for a flip phone to consumers willing to pay 1000$ for a smartphone with all that entails in term margins and profitability.
The car market by contrast, is not seeing such a growth, and it's unlikely consumers will be willing to spend that much more for their car.
There are potential market shift possible which could be caused by things like reliable autonomous vehicles, tighter regulations forbidding IC vehicles in some cities, cheaper cars (as EV are mechanically simpler, it's a possibility), but these are somewhat elusive.
Tesla valuation is at the very least a huge bet.
Sure some manufacturers will go bust and collapse, but other will adapt, and new ones will be created.
I'm quite puzzled by Tesla's valuation, such a valuation is betting on it becoming a huge actor in the post IC automobile industry which is not a given.
I'm also skeptical about the "Iphone moment", functionally the Iphone was a huge step forward (basically having a small computer in your pocket vs having something just doing phone calls, SMSes and snake), but a Tesla, well, right now, it's still a car which does more or less the same thing as any other car (just slightly better in some aspect, slightly worst in others).
It's also not the same market, the Iphone appeared in the booming market of mobile phones which was seeing exponential growth at the time. And also, the gain in functionality and convenience was enough to transform the market from consumers willing to pay at most ~100$ for a flip phone to consumers willing to pay 1000$ for a smartphone with all that entails in term margins and profitability.
The car market by contrast, is not seeing such a growth, and it's unlikely consumers will be willing to spend that much more for their car.
There are potential market shift possible which could be caused by things like reliable autonomous vehicles, tighter regulations forbidding IC vehicles in some cities, cheaper cars (as EV are mechanically simpler, it's a possibility), but these are somewhat elusive.
Tesla valuation is at the very least a huge bet.
> Iphone was a huge step forward (basically having a small computer in your pocket vs having something just doing phone calls, SMSes and snake)
The iPhone wasn't the first smartphone. In fact when released it was significantly inferior to existing Symbian and Nokia offering in terms of "objectively useful" stuff like browser behavior, modem bandwidth and third party app support. Obviously it was transformatively better, in ways that the established players didn't understand enough to emulate, but it's not correct to imagine it as a first mover.
In fact the Tesla/Apple comparison seems almost perfectly apt to me.
The iPhone wasn't the first smartphone. In fact when released it was significantly inferior to existing Symbian and Nokia offering in terms of "objectively useful" stuff like browser behavior, modem bandwidth and third party app support. Obviously it was transformatively better, in ways that the established players didn't understand enough to emulate, but it's not correct to imagine it as a first mover.
In fact the Tesla/Apple comparison seems almost perfectly apt to me.
I still like reading the essay [1] from former Vice Chairman and Head of Product Development of General Motors Bob Lutz from time to time: “Everyone will have 5 years to get their car off the road or sell it for scrap.”
I personally have bought my last internal combustion engine car. I had planned to purchase another vehicle by now, but will wait for the Model 3 (perhaps another?) to mature a bit then go electric. I’m curious how many others out there have changed their calculus, too. I think it’s very analogous to iPhone’s rise, which must account for the stock.
[1] https://www.autonews.com/article/20171105/INDUSTRY_REDESIGNE...
I personally have bought my last internal combustion engine car. I had planned to purchase another vehicle by now, but will wait for the Model 3 (perhaps another?) to mature a bit then go electric. I’m curious how many others out there have changed their calculus, too. I think it’s very analogous to iPhone’s rise, which must account for the stock.
[1] https://www.autonews.com/article/20171105/INDUSTRY_REDESIGNE...
Gotcha, I can see that analogy making sense.
Except that flip phones appear to be making a comeback now.
iPhones did not need a charging network. They did not have any disadvantages besides the high price, which made them even more desirable. But I just do not see average people who live in condos buy an EV anytime soon.
> They did not have any disadvantages besides the high price
iPhones couldn't run Flash (which powered all of the interactive content on the internet at the time), couldn't send MMS (which was the way everyone shared photos at the time) or run apps (which was how feature phones added functionality at the time).
"Why on Earth would anyone want one of those!?" was a pretty common reaction, yet they still sold like hotcakes. In the case of Flash and MMS, the whole mobile internet changed to suit the iPhone. In the case of apps, Steve Jobs finally relented, leading to the single biggest software marketplace in the world.
iPhones couldn't run Flash (which powered all of the interactive content on the internet at the time), couldn't send MMS (which was the way everyone shared photos at the time) or run apps (which was how feature phones added functionality at the time).
"Why on Earth would anyone want one of those!?" was a pretty common reaction, yet they still sold like hotcakes. In the case of Flash and MMS, the whole mobile internet changed to suit the iPhone. In the case of apps, Steve Jobs finally relented, leading to the single biggest software marketplace in the world.
> "Why on Earth would anyone want one of those!?"
That reaction really only came from makers of competing phones. (RIM execs famously refused to believe the battery life was possible, Balmer threw very unconvincing dismissals.)
Everyone else was standing in line to buy one.
That reaction really only came from makers of competing phones. (RIM execs famously refused to believe the battery life was possible, Balmer threw very unconvincing dismissals.)
Everyone else was standing in line to buy one.
I think this is hindsight talking.
I remember thinking (and hearing):
'Way too expensive'
'I want a tactile keyboard'
'Nice, but I don't need one'
and so on.
I remember thinking (and hearing):
'Way too expensive'
'I want a tactile keyboard'
'Nice, but I don't need one'
and so on.
The only commonwealthidespread complaint was about the lack of 3G and copy/paste.
However, the overwhelming response to the iPhone was extremely positive. Even from non Apple sources.
RIM didn’t think the iPhone was possible when it was first released. Google instantly changed the direction of their Android project when the iPhone was released.
However, the overwhelming response to the iPhone was extremely positive. Even from non Apple sources.
RIM didn’t think the iPhone was possible when it was first released. Google instantly changed the direction of their Android project when the iPhone was released.
> The only commonwealthidespread complaint
Maybe also complaints about bad autocompletion?
Maybe also complaints about bad autocompletion?
"Too expensive" is a perfectly fine thing to think about a product like that, and is very far away from thinking nobody wants it.
Qwerty keyboards were always a niche, and "nice, but I don't need one" is reasonably classified as an underestimate of the product but it's still approval.
Qwerty keyboards were always a niche, and "nice, but I don't need one" is reasonably classified as an underestimate of the product but it's still approval.
I still want a slide out keyboard like my Nokia N900 had... and if you don't think $1000 is overpriced for an I-Phone, you probably haven't tried a $300 phone that has very similar capabilities...
I certainly didn't stand in line. The iPhone seemed primitive and lacking to me at the time. And I wasn't alone in spending lots of money on alternative phones.
It really wasn't that popular initially, at least nowhere near what it is today. There were only 1.5 million sales in 2007, and about 12 million in 2008. For comparison, there were over 210 million sold in 2018.
Actually, the first one wasn't in that much demand, because it had laughably slow processor and cell standard support even by 2007 standards (no UMTS, which was already available on cell networks back then, just not with an iPhone). Apple fanboys stood in line for it and since Apple wasn't able to even produce enough for them, it seemed like "everyone wanted one".
The iPhone 3G changed this fundamentally; you didn't have to be a die-hard Apple fanboy to justify wanting one of those, because it was the only phone on the market that actually gave you sufficiently usable mobile access to "the real Internet".
The iPhone 3G changed this fundamentally; you didn't have to be a die-hard Apple fanboy to justify wanting one of those, because it was the only phone on the market that actually gave you sufficiently usable mobile access to "the real Internet".
The iPhone was also ridiculously profitable.
The original iPhone sold for $600 and a 2 year AT&T contract.
The iPhone had a ton of pricing headway to make itself more attractive.
Tesla is almost the exact opposite.
Now, this isn’t an argument against Tesla or its stock price (that’s a different argument altogether). This is an argument against the idea That Tesla and the iPhone are in any way comparable.
The original iPhone sold for $600 and a 2 year AT&T contract.
The iPhone had a ton of pricing headway to make itself more attractive.
Tesla is almost the exact opposite.
Now, this isn’t an argument against Tesla or its stock price (that’s a different argument altogether). This is an argument against the idea That Tesla and the iPhone are in any way comparable.
The iPhone hit in a market where competitors have mutually agreed to hide away from regulator attention as long as possible.
That is most certainly not the state of the car industry.
And you can see how "old industry" will play with old wet cell batteries and newer batteries in data center spaces (newer batteries are considerably safer in reality with each cell monitored, with the battery wall automatically removing problematic cells, and requiring less than a fifth of the space of wet cells). However wet cell manufacturers have been really good at manipulating and adding regulations that make newer batteries untenable to have since regulations are purposely broad enough that each inspector you bring in will cited the same regulation as having a different meaning.
That is most certainly not the state of the car industry.
And you can see how "old industry" will play with old wet cell batteries and newer batteries in data center spaces (newer batteries are considerably safer in reality with each cell monitored, with the battery wall automatically removing problematic cells, and requiring less than a fifth of the space of wet cells). However wet cell manufacturers have been really good at manipulating and adding regulations that make newer batteries untenable to have since regulations are purposely broad enough that each inspector you bring in will cited the same regulation as having a different meaning.
haven't we seen the auto industry hiding from environmental regulations like Volkswagen and emissions standards?
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Which phone was able to run Flash at that time?
On top of that: no (physical) keyboard, no GPS, no 3G support.
They were almost the textbook definition of a disruptive product (worse on traditional metrics by which products compete, but better on some key factors that have customer value)...
They were almost the textbook definition of a disruptive product (worse on traditional metrics by which products compete, but better on some key factors that have customer value)...
Then you need to look closer. A long range model 3 can go 310 miles and charge quickly at superchargers. Condo dwellers can basically treat this car just like a gas car with fewer fillup options.
A lot of people should do the math on the model 3. The math is current car payment + 90% gas payment = new car payment on a model 3. The remaining 10% is what you pay for electricity.
A lot of people should do the math on the model 3. The math is current car payment + 90% gas payment = new car payment on a model 3. The remaining 10% is what you pay for electricity.
Many people's car payment is $0.
Then the car is a trade-in downpayment. Sure, if you can't afford a $20,000 car then there are very few Tesla options for you.
I can afford any production car. I choose not to allocate money that way and I’m far from unique there.
We drive 10K miles per year across two drivers. My daily electric (LEAF) costs me $0.05/mi for energy (and I love it). My wife’s SUV costs $0.10/mi for gas and a few pennies for oil (and she loves it). She pays $600/year max for fuel. That covers about a month of Tesla car payment.
We drive 10K miles per year across two drivers. My daily electric (LEAF) costs me $0.05/mi for energy (and I love it). My wife’s SUV costs $0.10/mi for gas and a few pennies for oil (and she loves it). She pays $600/year max for fuel. That covers about a month of Tesla car payment.
Ah, it doesn't work out in your case because you've already made the transition to electric. We went from two gas guzzlers (one of them was a 40mpg diesel, the other a fairly typical 25mpg) to one model 3 and the financing equation easily works in our case. Obviously not everyone is going to give up a car, and the math doesn't work for everyone. But more people should be doing the math rather than just looking at the sticker price of the teslas.
Going from $0.11/mi to $0.05/mi ($0.20/kWh in MA) even at 20K miles per year saves $100/mo. That’s not economically compelling. Driving 1/4 of that (per driver) is even less compelling. I bought an electric because I wanted one (and there was $10K in government cheese in the trunk).
$100/mo is pretty compelling to lots of people. Why throw money away? My locale is even better because I pay $0.08/kwH (Portland, Oregon). We like to ski; every time we drive up the mountain was $50 in gas for our Ford Escape. Now it's roughly $5. That alone represents $180 a month. In the summer we have different hobbies that are equally travel intensive so it's a year-round win.
Why spend $50K or more to save $100 or even $180 a month for maybe 8 years and get $10-20K back at the end? That’s just not compelling on an RoI basis.
There are many reasons to like a Tesla. It’s almost surely not the cheapest way to motor though. A $5K Honda and investing the difference will be wildly cheaper during the ownership period (including no need to carry collision/comprehensive insurance!) and have a much higher residual value (in the investment account). To me, that should be more compelling to many people.
There are many reasons to like a Tesla. It’s almost surely not the cheapest way to motor though. A $5K Honda and investing the difference will be wildly cheaper during the ownership period (including no need to carry collision/comprehensive insurance!) and have a much higher residual value (in the investment account). To me, that should be more compelling to many people.
At least in Germany, that math doesn't add up. Electricity is - if it's not heavily subsidized, which had been the case for a long time with a lot of EV charging spots over here, although only by accident - at least about 50% of the comparable gas price per mileage. Can be even more than 100% in some corner cases, but I think 50% is a good approximation, assuming you charge mostly at home.
> At least in Germany, that math doesn't add up. Electricity is - if it's not heavily subsidized...
In Germany, 1 kWh costs over 30 cents. As far as I know, that's one of the highest rates in "Western" countries.
If electric cars make sense in Germany, then they can succeed pretty much anywhere.
Edit: https://en.wikipedia.org/wiki/Electricity_pricing#Global_com... lists Germany price/kWh at 0.35 USD, making it indeed the most expensive Western country at least by quick eyeballing.
In Germany, 1 kWh costs over 30 cents. As far as I know, that's one of the highest rates in "Western" countries.
If electric cars make sense in Germany, then they can succeed pretty much anywhere.
Edit: https://en.wikipedia.org/wiki/Electricity_pricing#Global_com... lists Germany price/kWh at 0.35 USD, making it indeed the most expensive Western country at least by quick eyeballing.
So perplexed, why did this get downvoted? Everything is factually correct.
I drive a hybrid and charge at home. My stats on electricity costs, after almost two years, is that my electric kilometers cost me 1/3 of my gasoline kilometers. For reference, it's in Portugal where electricity cost 0.2€/kWh and gasoline 1.5-1.6€/L.
And there's the local difference that makes or breaks this kind of calculation. For Germany these numbers currently are more like 0.3€/kWh and 1.2-1.3€/l.
Portugal has the fourth most expensive electricity in the EU. You are unfortunately above our level, because of taxation (Germany holds the top spot). Throughout the EU, the calculation is better for EVs. The median is at about 15¢/kWh.
I love the implicit assumption that electric vehicle adoption will run rampant, but at the same time, electricity costs will remain "negligible" and charging/pricing won't adapt to the increased demand...
Higher costs for electricity would be a great problem to have because solar is already competitive at current prices. Costs would have to go up 5x at least to make even a bad EV in an expensive kW/h locale cost as much as a gasoline car. At that rate almost anybody could make money deploying solar generation and storage in a remote locale, and of course for those with the luxury of having a roof.
> Condo dwellers can basically treat this car just like a gas car with fewer fillup options
The building that I live in is going to run out of physical space for electric meters long before it has issues with electrical capacity. My neighbor opted to forgo having a charger for his Model 3 and instead put one into the garage of his weekend home (he doesn't drive much during the week so he'll be ok).
Given existing equipment on the market now, our building can support maybe 10-15% electric cars. If you are designing a new building, there is no limitation. Our condo board has been searching for a solution and has found some things that are "promising", but nothing that will solve our problem before we run out of space. Again, this is a physical space limitation for the meters, not electrical capacity. And it's a problem where the solution will have to interface with the existing built environment and the existing electrical grid and the existing safety codes, etc. If all you pay attention to are single family homes with garages, you'll never know this is an issue until sales take a nosedive in big cities.
The building that I live in is going to run out of physical space for electric meters long before it has issues with electrical capacity. My neighbor opted to forgo having a charger for his Model 3 and instead put one into the garage of his weekend home (he doesn't drive much during the week so he'll be ok).
Given existing equipment on the market now, our building can support maybe 10-15% electric cars. If you are designing a new building, there is no limitation. Our condo board has been searching for a solution and has found some things that are "promising", but nothing that will solve our problem before we run out of space. Again, this is a physical space limitation for the meters, not electrical capacity. And it's a problem where the solution will have to interface with the existing built environment and the existing electrical grid and the existing safety codes, etc. If all you pay attention to are single family homes with garages, you'll never know this is an issue until sales take a nosedive in big cities.
Isn't the solution to put smart meters that can track usage on a common meter and bill the condo owners for their share of the electrical bill?
Do you have an example of a purchasable product that works with existing electrical systems?
All the charger networks have solved this. Just choose a network (Chargepoint, Semaconnect, etc.), put in a 2- or 4-connection charger, and each EV owner pays for each charge with an RFID card or their phone. There are also online services for scheduling and paying for use of private (not-smart) chargers (evmatch.com), and others that specialize in your exact problem (multiple chargers in shared dwellings): evercharge.net
In a condo building, each parking space is deeded to the owner as a limited common element for the exclusive use of the owner. The charger in the parking space is owned by the owner of the parking space and the electrical connection runs to a utility closet that the electrical utility controls.
In a new building, you just design the electrical system so this is a non-issue. In an existing building, it's not so simple. Any state that has a lot of condos is going to have 100+ years of condominium laws that govern the ownership and usage of space in a condominium. You can't force someone to share their space and you can't authorize someone to enter someone else's space.
In a new building, you just design the electrical system so this is a non-issue. In an existing building, it's not so simple. Any state that has a lot of condos is going to have 100+ years of condominium laws that govern the ownership and usage of space in a condominium. You can't force someone to share their space and you can't authorize someone to enter someone else's space.
Condo associations that want to solve this can. It isn't a technical problem and it won't slow down EV adoption very much. It is kind of like adding satellite TV and plenty of HOAs have figured that one out despite not having it wired into the building. Yes, specific organizations will be slower than others, but as the demand ramps up more and more people will want this solved in their own HOA and they'll start getting it done like dominoes.
People on our condo board have owned Teslas for years. We are a building that is out in front of it. Coax cable doesn't carry 240V power. This isn't something you can hand-wave away.
The why isn't the board voting for an easement for overhead distribution and a single junction off the service connect to power the charger network?
Why not just put the meter at the charging station?
What's the insurance like on a model 3 compared to a similar gas sedan?
> But I just do not see average people who live in condos buy an EV anytime soon.
Depending on where you live, there are sometimes EV charging spots in apartments/condos. To me, this is pretty clearly a supply/demand issue.
Today, there aren't enough EV drivers for condos to care, but as the percentage of people who own EVs increases, more places will install chargers. It's the exact same process that resulted in gas stations being everywhere.
Depending on where you live, there are sometimes EV charging spots in apartments/condos. To me, this is pretty clearly a supply/demand issue.
Today, there aren't enough EV drivers for condos to care, but as the percentage of people who own EVs increases, more places will install chargers. It's the exact same process that resulted in gas stations being everywhere.
And you'll start to see free charging evaporate (or appear in the form of rising rent/HOA fees). Condos can afford to "subsidize" a couple of free spots for a complex, but they're not going to be saying "free electric charging for hundreds of vehicles".
You'll probably end up paying to have one installed at a dedicated parking spot and get the power charged to you. It's going to be the equivalent of renting a spot in a carport instead of a standard uncovered parking. Most of the Apartments I've rented have had covered or garage parking available, I've never paid the extra for it, but it's there.
Condo associations in my city have been permissive/proactive about this issue, wiring a few parking spots near the building with 220v, and assessing the owner with the cost. Our city has also installed charging stations at public buildings to encourage EV adoption.
Some startup is going to create a condo/apartment charging network by sharing profits with landlords.
Tesla is already on that sort of - there is a contact page about hosting superchargers but I am uncertain of the precise details.
It's really unknown at that time. If (IF) a few changes in techniques, materials and manufacturing processes align, with the climate friendly mentality, it's far from impossible that ICE will vanish fast and be replaced by EVs.
Of course these are all IFs:
- battery chemistry: change in electrolyte, if not solid state
- modular wiring (way less expensive cable to make and install)
These two are worked on as of now, if they pan out, that's another drop in price and increase in usability.
Taking in account that the amount of money flowing into EVs has most probably increase by an order of magnitude (German brands, etc, all are investing). This may very well cause an overall drop in prices in all parts. Commoditization..
Time will tell
Of course these are all IFs:
- battery chemistry: change in electrolyte, if not solid state
- modular wiring (way less expensive cable to make and install)
These two are worked on as of now, if they pan out, that's another drop in price and increase in usability.
Taking in account that the amount of money flowing into EVs has most probably increase by an order of magnitude (German brands, etc, all are investing). This may very well cause an overall drop in prices in all parts. Commoditization..
Time will tell
You are right about infrastructure, but I'm not convinced it's going to be a deal breaker for many people living in condos.
Even a level 1 charger (1.4kW) can add >50 miles worth of charge overnight (12h) and people living in condos tend to have a shorter commute.
And it's going to get better - for example Ontario mandates 20% parking spaces have charger installed and remaining 80% be ready to have one installed since 2018. IIRC the requirement is 200A per parking spot.
Even a level 1 charger (1.4kW) can add >50 miles worth of charge overnight (12h) and people living in condos tend to have a shorter commute.
And it's going to get better - for example Ontario mandates 20% parking spaces have charger installed and remaining 80% be ready to have one installed since 2018. IIRC the requirement is 200A per parking spot.
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Steve Ballmer points out iphone's "disadvantages": https://www.youtube.com/watch?v=qycUOENFIBs
The bet is that the advantages outweigh the negatives.
The bet is that the advantages outweigh the negatives.
I don't understand your air quotes.
Being hundreds of dollars more expensive is objectively a disadvantage.
"not a very good email machine" sounds right, in comparison to something like a blackberry.
And that's it, he only listed those two things. He didn't try to make up fake reasons.
Something being better does not mean the disadvantages somehow don't exist.
Being hundreds of dollars more expensive is objectively a disadvantage.
"not a very good email machine" sounds right, in comparison to something like a blackberry.
And that's it, he only listed those two things. He didn't try to make up fake reasons.
Something being better does not mean the disadvantages somehow don't exist.
Sorry, I should have been clearer. I did not mean to imply that they were fake reasons but they seem way less material in hindsight.
Depending on the version of the iPhone, they had disadvantages such as not being able to send MMS.
https://www.imore.com/1st-generation-iphone-owners-mms
https://www.imore.com/1st-generation-iphone-owners-mms
it's certainly a little inconvenient but people are already buying evs who live in condos in Seattle and San Francisco and probably other places. Don't forget apartments, they have the same issue
The higher end apartment buildings are getting chargers here in the Seattle area, while the lower ones are still slow on the uptake. It is just a matter of time now, anyways.
If you google "ford enterprise value" and "tesla enterprise value" you get values of 156B and 86B, respectively.
Stockholders are not the only people who have claims on the liquidation value and future profits of a company. Bondholders and pensioners do as well. Market cap != valuation.
Stockholders are not the only people who have claims on the liquidation value and future profits of a company. Bondholders and pensioners do as well. Market cap != valuation.
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Hmm that sounds misleading for the conversation at hand.
If enterprise value is market cap - debt (forget cash) then you’re saying this is the net dollar value of owning every share of Tesla.
But “rational” investors are aware of debt. It would seem to me you should be adding the debt to the perceived future earnings to actually come up with gross expected income.
That is if I buy Tesla and Ford for $10 each, and the Ford has no debt, and the Tesla has $10 debt, and I pay $10 because I consider them equal value... that would mean you expected total future earnings from holding each to be $10 from Ford and $20 from Tesla.
If enterprise value is market cap - debt (forget cash) then you’re saying this is the net dollar value of owning every share of Tesla.
But “rational” investors are aware of debt. It would seem to me you should be adding the debt to the perceived future earnings to actually come up with gross expected income.
That is if I buy Tesla and Ford for $10 each, and the Ford has no debt, and the Tesla has $10 debt, and I pay $10 because I consider them equal value... that would mean you expected total future earnings from holding each to be $10 from Ford and $20 from Tesla.
That's a little miss-leading because Ford's EV includes a lot of debt for car loans & leases which tend to get paid back by someone else and are secured by the cars.
Book value = assets - liabilities
Market value = market capitalization
Bondholders have claims on part of the company's assets and these claims reduce the value of the company (that's the liabilities part of the equation).
Pensioners don't have any claims on anything except perhaps on their pension funds if they have one.
Market value = market capitalization
Bondholders have claims on part of the company's assets and these claims reduce the value of the company (that's the liabilities part of the equation).
Pensioners don't have any claims on anything except perhaps on their pension funds if they have one.
Right, those other claim holders represent reductions in the value of the company.
If I borrow $300 billion (heh) and call myself a car company, that doesn't make me a more valuable company than Ford and Tesla combined - my net worth hasn't changed.
Market cap == (perceived) value.
Enterprise value is the COST TO PURCHASE the company, if I'm considering buying it.
Like buying a used car and assuming payments:
If I borrow $300 billion (heh) and call myself a car company, that doesn't make me a more valuable company than Ford and Tesla combined - my net worth hasn't changed.
Market cap == (perceived) value.
Enterprise value is the COST TO PURCHASE the company, if I'm considering buying it.
Like buying a used car and assuming payments:
enterprise value (real cost) = purchase price + loan balance - coins under the seats
Market cap is the cash I have to pay up-front
Debt is the new debt I will have to pay when I own it.
Cash-on-hand is the cash I get back when I buy itThe enterprise value is the value of a company.
enterprise_value = market_cap + debt - cash
Different companies are capitalized differently - some use all equity, some all debt, some a mix.
Not sure I agree that other claim holders represent reductions in the "value of the company". The same company can be capitalized different ways - the enterprise value for that company should be unchanged.
enterprise_value = market_cap + debt - cash
Different companies are capitalized differently - some use all equity, some all debt, some a mix.
Not sure I agree that other claim holders represent reductions in the "value of the company". The same company can be capitalized different ways - the enterprise value for that company should be unchanged.
Hold market cap constant.
Borrow $1 trillion. Burn the cash.
Is the company now more or less valuable?
By your formula, how has the enterprise value changed?
Borrow $1 trillion. Burn the cash.
Is the company now more or less valuable?
By your formula, how has the enterprise value changed?
This isn't "my formula" - it's the textbook finance formula: https://en.wikipedia.org/wiki/Enterprise_value
Absolutely.
Enterprise Value is a metric used for acquisitions to determine the real cost of acquiring a company (that’s why cash lowers enterprise value, since it helps pay off some of the cost of acquiring the company, and liabilities increase the enterprise value because those are additional amounts of money you will Have to pump into the company).
Enterprise Value is a metric used for acquisitions to determine the real cost of acquiring a company (that’s why cash lowers enterprise value, since it helps pay off some of the cost of acquiring the company, and liabilities increase the enterprise value because those are additional amounts of money you will Have to pump into the company).
> Is the company now more or less valuable?
More. Normally burning a trillion dollars would have taken about a trillion off the market cap, so if it held steady that means a trillion dollar gain somewhere else.
More. Normally burning a trillion dollars would have taken about a trillion off the market cap, so if it held steady that means a trillion dollar gain somewhere else.
Less valuable. What you're missing is that the reason debt is counted is because it is used to buy up assets. In this case, if the cash is entirely burned, it means the value of equity dropped to zero because debt typically has collateral. So the trillion dollars you borrowed would need to be paid back by selling the rest of the company's assets. So in reality, if let's say this trillion dollar debt was super senior and first claimant to assets. It'd drop to the previous market value of the company and the rest of the company's capital structure drops to zero.
Enterprise Value is absolutely not the “value” of the company. The Enterprise value is the actual amount a company will cost you if you buy it at Market Cap.
IOW, if you buy a company for a $100bn but it has liabilities of another $100bn that means it’s cost to you is actually $200bn, because you will also have to pay that additional $100bn. That’s why cash reduces the EV of a company, because if you pay $100bn for a company that has $50bn in cash, you effectively paid only $50bn (which is the EV).
Market cap is the value of a company.
IOW, if you buy a company for a $100bn but it has liabilities of another $100bn that means it’s cost to you is actually $200bn, because you will also have to pay that additional $100bn. That’s why cash reduces the EV of a company, because if you pay $100bn for a company that has $50bn in cash, you effectively paid only $50bn (which is the EV).
Market cap is the value of a company.
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Market cap is the market value of a company's equity.
market_cap = total_shares_outstanding * share_price
I passed all three CFA exams a few years back and studied this extensively. I might be remembering incorrectly, but think you're making factually incorrect statements. Appreciate your comment and the motivation to think about this more.
I recommend reading up on these terms: * market value of equity * book value of equity * intrinsic value of equity
market_cap = total_shares_outstanding * share_price
I passed all three CFA exams a few years back and studied this extensively. I might be remembering incorrectly, but think you're making factually incorrect statements. Appreciate your comment and the motivation to think about this more.
I recommend reading up on these terms: * market value of equity * book value of equity * intrinsic value of equity
If you borrow $300 billion you still have $300 billion in assets. Unless something unexpected changes, Ford won't be able to realize that Enterprise value. The number of car companies will shrink, not grow, evs are just the wave over the horizon that will really hurt them. Tesla actually has a chance to drastically grow their sales.
Right - $300 billion in assets, plus $300 billion in debts means the company is worth:
a) $600 billion
b) $300 billion
c) $0
assets + liabilities = book_value_of_equity
The intrinsic value of a company's equity often differs from the book value of equity.
The book value debt can also differ from the market value.
Learning some financial accounting concepts should help you understand this better.
The intrinsic value of a company's equity often differs from the book value of equity.
The book value debt can also differ from the market value.
Learning some financial accounting concepts should help you understand this better.
(B). The company is worth $300 billion to the bondholders, and $0 to shareholders, giving a total value of $300 billion.
And that's assuming the company is being liquidated. Most companies with viable businesses are worth a lot more than their assets because the big part of the valuation is assumed future earnings.
And that's assuming the company is being liquidated. Most companies with viable businesses are worth a lot more than their assets because the big part of the valuation is assumed future earnings.
> The company is worth $300 billion to the bondholders, and $0 to shareholders, giving a total value of $300 billion.
But if it was cash and debts instead of assets and debts, the company wouldn't be worth $300 billion to bondholders?
But if it was cash and debts instead of assets and debts, the company wouldn't be worth $300 billion to bondholders?
If you spend a dollar to buy a chocolate bar, you say the chocolate bar is worth $1 and that you spent $1.
If you give a teller $1 for 4 quarters, you don't say that you spent $1.
If you give a teller $1 for 4 quarters, you don't say that you spent $1.
I borrow $10 from a friend.
I currently am worth $0 to that bondholder.
I spend one of those borrowed dollars on a chocolate bar.
Now I'm worth $1 to that bondholder??
The spending is done with a completely different person than the bondholder.
I currently am worth $0 to that bondholder.
I spend one of those borrowed dollars on a chocolate bar.
Now I'm worth $1 to that bondholder??
The spending is done with a completely different person than the bondholder.
So you can create infinite value by borrowing more and more money.
I'd love to create lots of value for you by borrowing money from you. I would even consent to not destroy any of that value through making payments.
The bond is worth $300b to the bondholders, but only because it is expected to be paid back and is secured by the $300b assets. You can prove that by assuming those assets disappeared: how much is the bond (or the company) worth to the bondholders then?
I'd love to create lots of value for you by borrowing money from you. I would even consent to not destroy any of that value through making payments.
The bond is worth $300b to the bondholders, but only because it is expected to be paid back and is secured by the $300b assets. You can prove that by assuming those assets disappeared: how much is the bond (or the company) worth to the bondholders then?
Every single fair transaction has a net value of $0. If I buy a chocolate bar for $1 that's worth a dollar to me, I'm up one chocolate bar worth $1 and down a dollar. No net worth change, but it is validation the chocolate bar is worth $1.
You don't add up assets and debt. You add up equity and debt and make it match up to assets.
I read a different analysis [0] arguing that comparing the market cap of Tesla to that of Ford and GM isn't really comparing apples to apples, since the latter have enormous pension fund liabilities.
0: https://mondaynote.com/tesla-and-apple-valuation-questions-c...
0: https://mondaynote.com/tesla-and-apple-valuation-questions-c...
How enormous are these pension fund liabilities? Looking at the balance sheet of GM, their last annual pension fund liability was put at $18B, roughly 10% of their total liabilities. It doesn't seem much and probably shouldn't factor that highly into comparisons with TSLA, right?
Thanks for the article, very insightful!
> who can compete with Tesla
From my seat, that really remains to be seen. The existing companies don't seem to have found a way to compete with Tesla's EVs yet. They may get there eventually, but Tesla has it now.
Regarding valuation, one point I read elsewhere is that Tesla does a lot more in-house, which adds to the valuation, whereas the existing companies will buy a lot of their parts and/or contract out work. I don't have a source on the specifics, but if true, the logic certainly seems reasonable and would explain things. The value of a company shouldn't be based on their final product, but on the value they added to the parts/components they took in to create that product.
From my seat, that really remains to be seen. The existing companies don't seem to have found a way to compete with Tesla's EVs yet. They may get there eventually, but Tesla has it now.
Regarding valuation, one point I read elsewhere is that Tesla does a lot more in-house, which adds to the valuation, whereas the existing companies will buy a lot of their parts and/or contract out work. I don't have a source on the specifics, but if true, the logic certainly seems reasonable and would explain things. The value of a company shouldn't be based on their final product, but on the value they added to the parts/components they took in to create that product.
>From my seat, that really remains to be seen. The existing companies don't seem to have found a way to compete with Tesla's EVs yet. They may get there eventually, but Tesla has it now.
This somewhat reminds me of BlackBerry. They're basically the only game in town right now, and thus maintain a market advantage.
However as larger companies shift to EV's as the technology matures how will Tesla be able to maintain its advantage and market valuation?
Should the VW group, Toyota, or the Renault–Nissan–Mitsubishi Alliance decide to go all in on EV's will they be able to produce something akin to the iPhone to Tesla's BlackBerry?
This somewhat reminds me of BlackBerry. They're basically the only game in town right now, and thus maintain a market advantage.
However as larger companies shift to EV's as the technology matures how will Tesla be able to maintain its advantage and market valuation?
Should the VW group, Toyota, or the Renault–Nissan–Mitsubishi Alliance decide to go all in on EV's will they be able to produce something akin to the iPhone to Tesla's BlackBerry?
No! No, no, no. This will not happen. It's a total pipe dream.
These ancient companies, so set in their ways, who have been incrementally making tiny adjustments to their cars for decades, will never "suddenly leap forward" to come out with something more advanced and more appealing than a Tesla.
Tesla isn't the blackberry here, the other car companies are! You're basically the guy in 2008 saying "sure Apple has an advantage now, but what will they do when Blackberry catches up and shifts to touchscreen based phones?" Guess what never happened.
These ancient companies, so set in their ways, who have been incrementally making tiny adjustments to their cars for decades, will never "suddenly leap forward" to come out with something more advanced and more appealing than a Tesla.
Tesla isn't the blackberry here, the other car companies are! You're basically the guy in 2008 saying "sure Apple has an advantage now, but what will they do when Blackberry catches up and shifts to touchscreen based phones?" Guess what never happened.
VW group is going very heavily for mainstream EVs, seriously ramping up production, and the models don't look like the toy concept EVs of yore either.
Maybe Audi and BMW have to think about what it means to make a competitive EV since their price-points are similar to Tesla's, but VW proper will be pushing EVs at the ~$30k MSRP range. They don't need to be more advanced than a Tesla at that price because there is no significant market of people cross-shopping $50k Teslas and $30k VWs. What these manufacturer's need to do is release electric cars with reasonable ranges, near existing price-points, that look and feel "German Car".
Maybe Audi and BMW have to think about what it means to make a competitive EV since their price-points are similar to Tesla's, but VW proper will be pushing EVs at the ~$30k MSRP range. They don't need to be more advanced than a Tesla at that price because there is no significant market of people cross-shopping $50k Teslas and $30k VWs. What these manufacturer's need to do is release electric cars with reasonable ranges, near existing price-points, that look and feel "German Car".
Volkswagen ID.3 will be ~30k€ not 30k$, so about 33k$. Tesla model 3 is ~40k$ not 50k$.
So it’s only 7k$ difference, not 20k$ as you wrongly assume.
Still not coming to the US?
https://ww.electrek.co/2019/12/13/vw-not-launching-id3-elect...
https://ww.electrek.co/2019/12/13/vw-not-launching-id3-elect...
The ID.3 isn't but the bigger ID.4 will be:
https://www.cnet.com/roadshow/news/volkswagen-id4-electric-s...
It's supposed to get its official reveal in the next month or so.
https://www.cnet.com/roadshow/news/volkswagen-id4-electric-s...
It's supposed to get its official reveal in the next month or so.
I read that VW will start EV production in Tennessee in 2022. Seems like a long way off.
It will be imported to start. Local production later.
>You're basically the guy in 2008 saying "sure Apple has an advantage now, but what will they do when Blackberry catches up and shifts to touchscreen based phones?"
Not really. BlackBerry basically invented the smartphone, and introduced it to market success. We're talking pre-2008 BlackBerry is Tesla today.
Tesla basically invented the EV, and is leading the market.
Not really. BlackBerry basically invented the smartphone, and introduced it to market success. We're talking pre-2008 BlackBerry is Tesla today.
Tesla basically invented the EV, and is leading the market.
I think where the analogy breaks is that Tesla didn't invent cars. Electric cars are new as a viable thing and have some advantages and disadvantages, but they're not a difference in kind, like a Blackberry/smartphone was over a thing that only makes phone calls. They compete directly with the old thing on the traditional terms, like performance and fuel cost.
People are going to start preferring electric cars. They're faster and more efficient and battery improvements are likely to continue to reduce their disadvantages (up front cost and range). The traditional carmakers could make a strong commitment to electric cars right now, the question is will they? It's like asking Microsoft to embrace Linux in 1999. They could do it, and they might be better off if they did, but you can certainly see why they might drag their feet in a way that makes them worse off in the long run.
They also have a huge problem with dealer incentives, because the dealers make most of their money on service and electric vehicles need less service, but the dealers are the ones choosing which cars to promote to anybody who walks in the door. It's no use to make a great electric car if any time somebody comes in looking to buy it, the dealer convinces them not to.
People are going to start preferring electric cars. They're faster and more efficient and battery improvements are likely to continue to reduce their disadvantages (up front cost and range). The traditional carmakers could make a strong commitment to electric cars right now, the question is will they? It's like asking Microsoft to embrace Linux in 1999. They could do it, and they might be better off if they did, but you can certainly see why they might drag their feet in a way that makes them worse off in the long run.
They also have a huge problem with dealer incentives, because the dealers make most of their money on service and electric vehicles need less service, but the dealers are the ones choosing which cars to promote to anybody who walks in the door. It's no use to make a great electric car if any time somebody comes in looking to buy it, the dealer convinces them not to.
> These ancient companies will never "suddenly leap forward" to come out with something more advanced and more appealing than a Tesla.
Volkswagen are doing exactly that. They have many BEVs models coming out this year across their multiple car brands (such as VW, Audi, SEAT, Skoda, Porsche).
The Porsche Taycan is the only 800 volt EV on the market today. The Volkswagen ID.3 has similar range to a Model 3 at a lower price point.
Even Audi's headlights are interesting. They're essentially projectors fast enough to run animations: https://www.youtube.com/watch?v=v2ara0My_Yg
Volkswagen are doing exactly that. They have many BEVs models coming out this year across their multiple car brands (such as VW, Audi, SEAT, Skoda, Porsche).
The Porsche Taycan is the only 800 volt EV on the market today. The Volkswagen ID.3 has similar range to a Model 3 at a lower price point.
Even Audi's headlights are interesting. They're essentially projectors fast enough to run animations: https://www.youtube.com/watch?v=v2ara0My_Yg
Chevy and Hyundai already offer EVs with better range than the Model 3 SR+ at a lower cost.
Too bad no one cares about them and no one is buying them.
Yeah, it's a shame. I have a Bolt and absolutely love it.
This comment comes across as wishful thinking and not thoughtful analysis.
People have been saying this same shit for a decade and yet here we are in 2020 and still "the legacy manufacturers will be catching up ANY DAY NOW, just need a LITTLE more time."
I think that you are close, but its more like Tesla is Apple now and the rest of the industry is trying to be Android. Where Tesla dominates the US with a proprietary charging network, others are slowing inching (or millimetering?) forward with open charge networks and a variety of new designs.
Eventually they are bound to catch up on volume. But by then, might Tesla have a significant desirability advantage? And in the auto-market, desirability is an amazingly effective proxy for assessing margin advantages.
Eventually they are bound to catch up on volume. But by then, might Tesla have a significant desirability advantage? And in the auto-market, desirability is an amazingly effective proxy for assessing margin advantages.
Tellingly, though, Blackberry failed not in the face of emerging competition from the existing establishment (e.g. Nokia and Palm) but because it got one-upped by another, even more innovative platform by a newcomer to the mobile market.
I mean, I agree that at some point Tesla is going to get beaten. But to argue that GM or Toyota will do it seems... less likely.
I mean, I agree that at some point Tesla is going to get beaten. But to argue that GM or Toyota will do it seems... less likely.
In a sense yes, the mobile phone market shifted from being phones to mobile computers, and a computer company dethroned them.
For all I know as cars become more integrated with computers we'll see an iCar, or a Google Car which will shake up the industry. Currently major car brands view tech companies as their competition in the long run.
For all I know as cars become more integrated with computers we'll see an iCar, or a Google Car which will shake up the industry. Currently major car brands view tech companies as their competition in the long run.
You're implying that the legacy manufactures could come up with some radically new sort of ev that would be as superior to Tesla cars as the iphone was to the BlackBerry. But the legacy manufacturers are already producing and designing ev's, and they are all inferior to Teslas.
> Tesla does a lot more in-house, which adds to the
> valuation, whereas the existing companies will buy
> a lot of their parts and/or contract out work.
It's cheaper this way.
The suppliers are beholden to their master and can live or die on a whim. GM, et al know the cost of manufacturing down to a penny and control supplier margins very tightly. They also collude with other manufactures to suppress prices.
The suppliers are beholden to their master and can live or die on a whim. GM, et al know the cost of manufacturing down to a penny and control supplier margins very tightly. They also collude with other manufactures to suppress prices.
> The existing companies don't seem to have found a way to compete with Tesla's EVs yet
If you look at actual vehicle sales, I'd say this quote is optimistic at best. Tesla is still very much fighting an uphill battle in terms of market share.
If you look at actual vehicle sales, I'd say this quote is optimistic at best. Tesla is still very much fighting an uphill battle in terms of market share.
Optimistic? In the US, Tesla is selling an order of magnitude more cars per month than value EV's like the Leaf and two orders of magnitude more than "Tesla killers" like the iPace or eTron.
https://insideevs.com/news/343998/monthly-plug-in-ev-sales-s...
https://insideevs.com/news/343998/monthly-plug-in-ev-sales-s...
Tesla isn't selling 1.3 million cars per year yet like Ford, so yes, optimistic. I wasn't speaking about strictly the EV market. Why would the big automakers need to compete in the EV market when EV adoption numbers still only amount to a rounding error in terms of the big companies' overall sales?
Why? Because it obviously won't be a rounding error in a few years time.
2 reasons.
1) We have to do something about climate change. Doesn't mean we will, but more and more countries besides Norway will get serious about it.
2) At some point BEV's will be price competitive with ICE. The $40K Tesla Cybertruck is cheaper than a medium duty crew cab from legacy manufacturers.
2 reasons.
1) We have to do something about climate change. Doesn't mean we will, but more and more countries besides Norway will get serious about it.
2) At some point BEV's will be price competitive with ICE. The $40K Tesla Cybertruck is cheaper than a medium duty crew cab from legacy manufacturers.
1) EV's will not solve this problem
2) Price is only a very small part of the adoption equation, people happily pay $80k for ICE pickup trucks for instance.
3) You didn't add this but I will - it's not clear the EV platform is the preferred alternative to the ICE for consumers yet, as evidenced by overall global vehicle sales.
2) Price is only a very small part of the adoption equation, people happily pay $80k for ICE pickup trucks for instance.
3) You didn't add this but I will - it's not clear the EV platform is the preferred alternative to the ICE for consumers yet, as evidenced by overall global vehicle sales.
I mean, multiple companies have higher quality electric vehicles, but that isn't what sells. The name is what's selling.
Tesla's are pretty ugly, they have horrible reliability. You don't buy a Tesla for style, you buy it to show off.
Tesla's are pretty ugly, they have horrible reliability. You don't buy a Tesla for style, you buy it to show off.
> multiple companies have higher quality electric vehicles
When I bought my Tesla in mid-2018 the alternatives were the Bolt and the Leaf. Both had significantly worse range--I was looking at a 180-mile roundtrip commute for the next year, so range was important. Both were uncomfortably small for me. Neither matched Tesla's driver assist features for my almost entirely highway commute. Neither had fast-charging options along my commute route; Tesla had two superchargers.
The situation has changed a bit in the last 1.5 years, but still nobody else matches Tesla's range or charging network.
I'm not sure what metric you're using for quality, but Tesla won me over on features, not name.
> Tesla's are pretty ugly
Subjective. The X is a bit strange, but the falcon doors are actually super convenient (as long as they don't break). The S and 3 exteriors are both very nice looking in my opinion, though I'm not such a fan of the spartan interior on the 3.
When I bought my Tesla in mid-2018 the alternatives were the Bolt and the Leaf. Both had significantly worse range--I was looking at a 180-mile roundtrip commute for the next year, so range was important. Both were uncomfortably small for me. Neither matched Tesla's driver assist features for my almost entirely highway commute. Neither had fast-charging options along my commute route; Tesla had two superchargers.
The situation has changed a bit in the last 1.5 years, but still nobody else matches Tesla's range or charging network.
I'm not sure what metric you're using for quality, but Tesla won me over on features, not name.
> Tesla's are pretty ugly
Subjective. The X is a bit strange, but the falcon doors are actually super convenient (as long as they don't break). The S and 3 exteriors are both very nice looking in my opinion, though I'm not such a fan of the spartan interior on the 3.
> I was looking at a 180-mile roundtrip commute ... Tesla had two superchargers.
Oof. The last thing I'd want to add to an already horrible commute is a supercharger stop, or more.
> the falcon doors are actually super convenient (as long as they don't break)
Kinda a pain in the ass in a garage.
Oof. The last thing I'd want to add to an already horrible commute is a supercharger stop, or more.
> the falcon doors are actually super convenient (as long as they don't break)
Kinda a pain in the ass in a garage.
> Oof. The last thing I'd want to add to an already horrible commute is a supercharger stop, or more.
The Tesla had enough range that if I was able to charge regularly I didn't need the supercharger, but it was a nice backup if something prevented me from charging.
Also stopping halfway through the drive and grabbing a snack while at the supercharger wasn't really a bad thing.
>Kinda a pain in the ass in a garage
I have a standard 7ft garage door and they can fully open with about 2 inches of clearance at the top. Not really a pain at all.
The Tesla had enough range that if I was able to charge regularly I didn't need the supercharger, but it was a nice backup if something prevented me from charging.
Also stopping halfway through the drive and grabbing a snack while at the supercharger wasn't really a bad thing.
>Kinda a pain in the ass in a garage
I have a standard 7ft garage door and they can fully open with about 2 inches of clearance at the top. Not really a pain at all.
[deleted]
Having tried all reasonably priced EVs, its not a question of style.
My original plan was to get a Leaf but I ended up buying a Tesla. It just drives better than the other cars and you get a much better car with a larger second row, more practical cargo space with a Tesla than the other EV options. That is without mentioning that you have to wait months to get a Leaf plus or a Kona electric. The latest VW may be interesting but it didn't exist at the time. I don't see where the higher quality electric vehicles are coming from.
It is a very polarizing car, some strangers will go up to you and tell you how Tesla will go bankrupt, you'll have no one to service the car, it will lose all its value and other things like that. "The name" is nearly a liability to me. It is just a car, it is useful.
It is a very polarizing car, some strangers will go up to you and tell you how Tesla will go bankrupt, you'll have no one to service the car, it will lose all its value and other things like that. "The name" is nearly a liability to me. It is just a car, it is useful.
> "The name" is nearly a liability to me.
Yes, same here. I also initially wanted a Leaf, in part because I don't really want my car to be so conspicuous--before the Tesla I drove a tan Corolla, about as inconspicuous as you can get. But the Leaf (and Bolt, which was the other EV option at the time) simply didn't make sense.
Yes, same here. I also initially wanted a Leaf, in part because I don't really want my car to be so conspicuous--before the Tesla I drove a tan Corolla, about as inconspicuous as you can get. But the Leaf (and Bolt, which was the other EV option at the time) simply didn't make sense.
> they have horrible reliability
Any references about this? So far I've only found evidence they're functionally highly reliable.
Any references about this? So far I've only found evidence they're functionally highly reliable.
The early build quality was poor and they had a lot of problems with ordinary things breaking that had nothing to do with being electric and everything to do with being inexperienced at making cars. They could be doing better now but it's a little early to say because the more recent cars aren't that old yet. Either way it seems more like teething issues than something they won't get right eventually.
Meanwhile it's fairly unambiguously true that electric drivetrains are a lot simpler and should require less maintenance in general.
Meanwhile it's fairly unambiguously true that electric drivetrains are a lot simpler and should require less maintenance in general.
They have fantastic reliability. You heard wrong.
Short seller FUD, on the other hand, is quite real.
Short seller FUD, on the other hand, is quite real.
Car companies have years of office politics that impact their ability to see the future. I think this has clouded their judgment. People are rooting for Tesla. The gas industry has propped up the short sellers and now the ones that have the money are the ones that believe climate change is real and that Tesla is apart of the solution. New technology in batteries, automation, AI, etc is driving Tesla not sales of the car. That’s because Tesla is a tech company not a car company. How much data have they collected for their autonomous driving?
>> That’s because Tesla is a tech company not a car company
The traditional car companies specialy is not cars. Its manufacturing and supply chain management.
Tesla does seem to be mastering manufacturing, and being more vertical they dont need as much supply chain handling.
They are not particularly advanced in tech from what I've seen. They do have a bunch of young motivated engineers that have a lot to learn and they can skip over a lot of things and take advantage of the supplier network providing the hard stuff.
The traditional car companies specialy is not cars. Its manufacturing and supply chain management.
Tesla does seem to be mastering manufacturing, and being more vertical they dont need as much supply chain handling.
They are not particularly advanced in tech from what I've seen. They do have a bunch of young motivated engineers that have a lot to learn and they can skip over a lot of things and take advantage of the supplier network providing the hard stuff.
> They are not particularly advanced in tech from what I've seen.
You may not have seen as far as Sandy Monro [1]
[1] https://cleantechnica.com/2018/07/16/munro-model-3-electroni...
You may not have seen as far as Sandy Monro [1]
[1] https://cleantechnica.com/2018/07/16/munro-model-3-electroni...
>> You may not have seen as far as Sandy Monro
I've seen further than that. I did read something a while back that sounded like they have a nicely integrated inverter/motor combo.
I've seen further than that. I did read something a while back that sounded like they have a nicely integrated inverter/motor combo.
>The traditional car companies specialy is not cars. Its manufacturing and supply chain management.
Don't forget the finance side of things! GMAC was founded 101 years ago and also got a large portion of the bailout.
Don't forget the finance side of things! GMAC was founded 101 years ago and also got a large portion of the bailout.
> You may think it’s the future, but to justify such a valuation over all other car companies which have been operating for years
Operating for years is a cost, not a benefit. TSLA can hire all their most experienced engineers, without the cost of paying pension benefits to their former employees. It's the same playbook that JetBlue used to beat the existing airlines, by poaching pilots from other airlines without paying for their training or funding their legacy cost structure.
Operating for years is a cost, not a benefit. TSLA can hire all their most experienced engineers, without the cost of paying pension benefits to their former employees. It's the same playbook that JetBlue used to beat the existing airlines, by poaching pilots from other airlines without paying for their training or funding their legacy cost structure.
"At 10 times revenues, to give you a 10-year payback, I have to pay you 100% of revenues for 10 straight years in dividends. That assumes I can get that by my shareholders. That assumes I have zero cost of goods sold, which is very hard for a computer company. That assumes zero expenses, which is really hard with 39,000 employees. That assumes I pay no taxes, which is very hard. And that assumes you pay no taxes on your dividends, which is kind of illegal. And that assumes with zero R&D for the next 10 years, I can maintain the current revenue run rate. Now, having done that, would any of you like to buy my stock at $64? Do you realize how ridiculous those basic assumptions are? You don’t need any transparency. You don’t need any footnotes. What were you thinking?"
- Scott McNealy
Now, TSLA is only at P/S of 3.8, but that's even more absurd for a car company than 10 is for a computer company.
We'll see. So far we have been wrong. The bulls deserve to gloat, but time will tell.
- Scott McNealy
Now, TSLA is only at P/S of 3.8, but that's even more absurd for a car company than 10 is for a computer company.
We'll see. So far we have been wrong. The bulls deserve to gloat, but time will tell.
Ferrari is at 8.
Edit: not sure why the downvote.
Ferrari has a $32.7b market cap on $3.7b in annual revenue for 8.8x.
Tesla has $93b market cap on $24.5b in annual revenue for 3.8x.
Edit: not sure why the downvote.
Ferrari has a $32.7b market cap on $3.7b in annual revenue for 8.8x.
Tesla has $93b market cap on $24.5b in annual revenue for 3.8x.
It's a fact, but needs context. Specifically, it ignores the fact that Ferrari is profitable ...
Honestly, price to sales alone is a joke of a metric for a growing business. Tesla revenue will likely double within the next 24 months (with quarterly trends clearly showing that towards the end of the year). That would put them at 1.9 P/S at that point with more products on the way.
P/S only works well when the situation is relatively static.
P/S only works well when the situation is relatively static.
That’s a pretty stupid quote.
I mean, yes, context matters, and there are cases where things are overvalued (obviously), but the reason prices rise is because revenue (profit) is expected to grow. All of those “basic” assumptions seem to assume that there is 0 growth. The arbitrary ten year payback period doesn’t make sense either.
It’s like saying a baby can’t possibly get a job, and ignoring the fact that some babies grow up into adults. I’m sure a more clever analogy exists but that’s the best I have on hand.
I mean, yes, context matters, and there are cases where things are overvalued (obviously), but the reason prices rise is because revenue (profit) is expected to grow. All of those “basic” assumptions seem to assume that there is 0 growth. The arbitrary ten year payback period doesn’t make sense either.
It’s like saying a baby can’t possibly get a job, and ignoring the fact that some babies grow up into adults. I’m sure a more clever analogy exists but that’s the best I have on hand.
>who can compete with Tesla
Perhaps in theory. In reality, Ford & GM are slow to move, slow to adopt, and not seen as a "luxury" / "cool" car manufacturer. I am not a Tesla fanatic, but you must admit it seems they're gaining a bigger and bigger competitive advantage.
Perhaps in theory. In reality, Ford & GM are slow to move, slow to adopt, and not seen as a "luxury" / "cool" car manufacturer. I am not a Tesla fanatic, but you must admit it seems they're gaining a bigger and bigger competitive advantage.
I actually don't consider Tesla a car company. They are a software company with world-leading expertise in energy production and storage. Vehicles are currently what they're mostly focused in applying this technology to, but that will change in the future. The stock price reflects the likelihood that Elon will accomplish the goals he has set out.
If they solve self-driving, that by itself will be worth over 100 billion dollars.
If they solve self-driving, that by itself will be worth over 100 billion dollars.
> If they solve self-driving, that by itself will be worth over 100 billion dollars.
Sadly, as a Tesla driver, I don't think this is coming anytime soon. There are still significant issues with Tesla's hardware, like the cameras getting blinded when the sun is at a low angle.
Sadly, as a Tesla driver, I don't think this is coming anytime soon. There are still significant issues with Tesla's hardware, like the cameras getting blinded when the sun is at a low angle.
> like the cameras getting blinded when the sun is at a low angle.
That sounds like a pretty serious issue for a vision based system. I wonder how lidars do in that condition.
In Europe, I'd also be worried about ability to detect crossing cyclists (when they have right of way) and pedestrians in bad weather conditions, like in mist or when it's snowing heavily.
Perhaps front sideways pointing radars could help with that a bit?
That sounds like a pretty serious issue for a vision based system. I wonder how lidars do in that condition.
In Europe, I'd also be worried about ability to detect crossing cyclists (when they have right of way) and pedestrians in bad weather conditions, like in mist or when it's snowing heavily.
Perhaps front sideways pointing radars could help with that a bit?
I agree it won't be anytime soon, but I think there's a decent chance that we see something in 5-7 years.
Here's a better comparison (another company where owners love their cars):
Tesla built 35x as many cars as Ferrari and is valued at 3x.
Tesla trades at 4x sales, Ferrari at 8x.
Having been in business longer is not always advantage and is frequently a disadvantage.
Tesla built 35x as many cars as Ferrari and is valued at 3x.
Tesla trades at 4x sales, Ferrari at 8x.
Having been in business longer is not always advantage and is frequently a disadvantage.
How on earth is a reasonable comparison Company A, whose _most expensive_ car _tops out_ at about $140K, and Company B, whose _least expensive_ car _starts_ at $335K.
These are not remotely comparable companies, regardless of how much "owner love" each may have.
These are not remotely comparable companies, regardless of how much "owner love" each may have.
Ferraris start at $215k vs Roadster at $250k. I don't think the comp is as bad as you suggest. More appropriate than GM/Ford.
I stand corrected, I assumed that their lineup was sorted by pricing. The Portofino does start from there.
The Roadster has been discontinued for seven years. What it sold for then, as a fundraising vehicle (literally and figuratively), or what it sells for now as a collector item, used, is still a problematic comparison.
I'd probably be thinking more Lincoln / Cadillac when I was looking for a comparison for a US higher end manufacturer.
The Roadster has been discontinued for seven years. What it sold for then, as a fundraising vehicle (literally and figuratively), or what it sells for now as a collector item, used, is still a problematic comparison.
I'd probably be thinking more Lincoln / Cadillac when I was looking for a comparison for a US higher end manufacturer.
Have all the other auto makers dumped massive amounts of investment into sourcing batteries? Do they have their own GigaFactories? How about contracts with lithium mines?
Sure, the other auto makers have the existing infrastructure to assemble cars, but if they don't have a way to get batteries cost effectively, they are way behind the curve compared to Tesla.
Sure, the other auto makers have the existing infrastructure to assemble cars, but if they don't have a way to get batteries cost effectively, they are way behind the curve compared to Tesla.
Isn't it more likely speculation on future stock price than a belief in real world performance? People can pretend it's due to diligent research resulting in a confident position that Tesla will come out on top, but that sounds more like someone trying to create a narrative rather than admitting a lot of people are gambling.
I don't think your conclusion is inaccurate at all. Yes, enterprise value reflects total business value...but the EV of these companies is pretty similar given the discrepancies in actual profit.
Part of Telsa makes sense, they are staking out a corner of the market that isn't big now but will be in the future. But the price you are getting for this risk makes zero sense (there was a very non-zero chance of them going bust this year).
I actually knew one of the biggest active shareholders here, and the logic is really "hit and hope". Iirc, they have said publicly that they can see this going bust quite easily but they think the upside will pay off...well, I don't get it either. The upside is whatever Ford or GM is now...and they are worth more than that. As an investor, it isn't worth losing brain cells on this...easier ways to make money, way easier.
Part of Telsa makes sense, they are staking out a corner of the market that isn't big now but will be in the future. But the price you are getting for this risk makes zero sense (there was a very non-zero chance of them going bust this year).
I actually knew one of the biggest active shareholders here, and the logic is really "hit and hope". Iirc, they have said publicly that they can see this going bust quite easily but they think the upside will pay off...well, I don't get it either. The upside is whatever Ford or GM is now...and they are worth more than that. As an investor, it isn't worth losing brain cells on this...easier ways to make money, way easier.
> The upside is whatever Ford or GM is now...and they are worth more than that.
I like Tesla as a car company and agree with this sentiment as an investor. There's a reason that I sold my shares, and also a reason that I never had very many. :)
Having said that, I'd like to add Toyota and BMW to your list of comps. BMW in particular demonstrates that there may be at least some potential for upside, IMO.
I like Tesla as a car company and agree with this sentiment as an investor. There's a reason that I sold my shares, and also a reason that I never had very many. :)
Having said that, I'd like to add Toyota and BMW to your list of comps. BMW in particular demonstrates that there may be at least some potential for upside, IMO.
BMW are valuable because their labour is priced in a currency that is very weak (same is true of Toyota but to a far lesser extent). I don't think any of these companies are worth owning (again, there are just far easier games to play than megacaps).
Would you invest in Taxi cab companies or App based car rides?
Given the Quarterly losses of App based car rides, there is no cut and dry answer to this. May be this is a right time to buy a Cab company.
Because sooner or later - Uber and Lyft want to turn profitable, then there is a margin in certain markets where Taxis will not only be competitive but probably cheaper.
Because sooner or later - Uber and Lyft want to turn profitable, then there is a margin in certain markets where Taxis will not only be competitive but probably cheaper.
SV companies have made showing losses an art form.
My main point is that the market cap seems a bit excessive. I can see Tesla having a competitive advantage, and I also see the bet some investors are making on it disrupting the car industry. But after reading those numbers, it just shocked me a little.
Suppose it depends if you are pre IPO investor that is in on the scam or a sucker retail investor post IPO who will be stuck with the bag.
depends on the price
I do wish people wouldn't say "valuable" when they mean "expensive".
Tesla also has a residential energy company inside it. Not saying that should make up the difference in valuation, but it’s a nice compliment to the car business.
[deleted]
> Oh, and Tesla lost almost a billion dollars over the past year
How do you know this? Q4 results aren't out.
How do you know this? Q4 results aren't out.
I assume OP meant "last 4 reported financial quarters":
[1] https://www.marketwatch.com/investing/stock/tsla/financials/...
2019 Q3 139.48M
2019 Q2 (702.14M)
2019 Q1 (408.33M)
2018 Q4 143.00M
[1] https://www.marketwatch.com/investing/stock/tsla/financials/...
It appears extreme only when you think of Tesla as an alternative to one of those car companies. Tesla is as much a car as iPhone is a rotary phone.
I have an inkling that Tesla has now gained long-term credibility, and we're on the cusp of seeing much broader adoption by a mass of non-early adopters -- people who will evaluate buying a Tesla the same way they would evaluate any other brand, based on boring criteria like long-term quality, day-to-day reliability, service convenience, overall reputation, interior features, exterior design, and resale value. The stock market appears to be pricing this scenario.
Conversely, the worst-case scenario for Tesla as a business, at this juncture, may be that it finds itself unable to remain financially sustainable over time... and ends up getting acquired by another car marker salivating over the prospects of getting its hands on the company's technology and infrastructure.
PS. I write this as someone who has purchased and owned multiple luxury European vehicles (mainly BMW and Mercedes) for the past 20+ years; for the first time, I'm seriously considering switching over to a Tesla when I replace my current vehicle.
Conversely, the worst-case scenario for Tesla as a business, at this juncture, may be that it finds itself unable to remain financially sustainable over time... and ends up getting acquired by another car marker salivating over the prospects of getting its hands on the company's technology and infrastructure.
PS. I write this as someone who has purchased and owned multiple luxury European vehicles (mainly BMW and Mercedes) for the past 20+ years; for the first time, I'm seriously considering switching over to a Tesla when I replace my current vehicle.
How do Tesla owners feel about the quality of their cars? I'm genuinely curious.
This is merely an anecdote, but in my experience it seems like the overall quality of similarly priced automobiles from more traditional luxury carmakers is much higher. The only significant advantage of the Tesla is the fact that it's 100% electric.
Also, this is merely a subjective personal preference, but I just don't like the style of Teslas very much. The lack something, and the style has a cheapness to it.
With that said, TSLA has been helping my portfolio, so I appreciate that.
This is merely an anecdote, but in my experience it seems like the overall quality of similarly priced automobiles from more traditional luxury carmakers is much higher. The only significant advantage of the Tesla is the fact that it's 100% electric.
Also, this is merely a subjective personal preference, but I just don't like the style of Teslas very much. The lack something, and the style has a cheapness to it.
With that said, TSLA has been helping my portfolio, so I appreciate that.
TM3 owner, August 2018 delivery date.
I have had no issues for which I have had to take my car to Tesla other than when I had them do a tire rotation as my first service.
I have no annoying rattles or squeaks though road noise tends to be Honda levels (louder) than I have experienced in other cars (Murano or even 17 Chevrolet Volt).
Not to say it is perfect, there are some issues when you look below the surface that shows they were still getting up to speed making mass production cars. I have a few pieces where I just scratch my head, they do what they are supposed to but are not as elegant.
The initial advantage one sees is they are electric. that is a given. the real long term advantage is OTA and Tesla's repeatedly adding features to cars they sold years ago. This is the real game changer in the industry. Need improvements to voice commands or even navigation, previously you bought a newer model.
The interior can be off putting but why? Do you need layers of dead animals to feel luxury? Luxury to me is driving something I just get in and it goes. Luxury is simplicity in design. Compared to my previous Z4 the interior is just fine, the only change for me would be to change the piano black surfacing of some pieces to something else.
Lack of buttons is awesome because in makes you realize how little you ever used the vast majority of them. On that note, my Volt had fourteen separate buttons on the steering wheel, forty plus buttons over all once you rolled in the center stack and dash. Want to try this at home, put a yellow sticker on each button then remove if you use it. Might take weeks in not months.
I am really looking forward to EVs from everyone else but one thing matters most. If you want 50k or more from me it damn well best have three hundred miles EPA range.
I have had no issues for which I have had to take my car to Tesla other than when I had them do a tire rotation as my first service.
I have no annoying rattles or squeaks though road noise tends to be Honda levels (louder) than I have experienced in other cars (Murano or even 17 Chevrolet Volt).
Not to say it is perfect, there are some issues when you look below the surface that shows they were still getting up to speed making mass production cars. I have a few pieces where I just scratch my head, they do what they are supposed to but are not as elegant.
The initial advantage one sees is they are electric. that is a given. the real long term advantage is OTA and Tesla's repeatedly adding features to cars they sold years ago. This is the real game changer in the industry. Need improvements to voice commands or even navigation, previously you bought a newer model.
The interior can be off putting but why? Do you need layers of dead animals to feel luxury? Luxury to me is driving something I just get in and it goes. Luxury is simplicity in design. Compared to my previous Z4 the interior is just fine, the only change for me would be to change the piano black surfacing of some pieces to something else.
Lack of buttons is awesome because in makes you realize how little you ever used the vast majority of them. On that note, my Volt had fourteen separate buttons on the steering wheel, forty plus buttons over all once you rolled in the center stack and dash. Want to try this at home, put a yellow sticker on each button then remove if you use it. Might take weeks in not months.
I am really looking forward to EVs from everyone else but one thing matters most. If you want 50k or more from me it damn well best have three hundred miles EPA range.
It was -5C in Toronto last night. This morning, I couldn't get into my Model 3 because the door glass was frozen. I got some hot water from the washroom and poured it over the glass and got it unstuck. Then I couldn't drive because the sideview mirrors were stuck folded. Got some more hot water and got them unstuck. Maybe the car is designed for California weather only, but in the winter i've had these types of issues. Other than that, its a joy to drive :)
I had this issue the first freezing episode of the year.
I applied silicon lube on the rubbers and on the lowest part of the window where it get into the door as well as on door handles. Hasn't been an issue since. Warming up the car before use with the phone app also helps but I always forget to do it myself.
I live in Toronto too -- just use the app to turn on climate control 5 - 10 mins before driving. Works like a charm!
Tesla's were designed to function from Norway to DRC; here's an interesting design question:
How do you keep the heater from decreasing your range too greatly in cold environments? No passive heat source on EVs.
How do you keep the heater from decreasing your range too greatly in cold environments? No passive heat source on EVs.
I'm joking but.. This Citroen has the answer! A petrol powered heater
https://en.m.wikipedia.org/wiki/Citro%C3%ABn_Berlingo_%C3%A9...
"Heating
In order to minimise battery usage, a petrol driven heater is fully integrated to vehicle. It typically takes 5 to 10 minutes to warm and provides excellent cabin heating."
https://en.m.wikipedia.org/wiki/Citro%C3%ABn_Berlingo_%C3%A9...
"Heating
In order to minimise battery usage, a petrol driven heater is fully integrated to vehicle. It typically takes 5 to 10 minutes to warm and provides excellent cabin heating."
It's an issue with all frame less car doors. Last year I read some car blogs and many people apply a silicone layer that makes freezing much harder. Between that and pre warming the car, I haven't had freezing issues. Also, if the door handles freeze up, a small tap with the palm of your hand does the trick.
The one I got is "gummi pflege"
The one I got is "gummi pflege"
Did you have time to try to use the remote app to turn the internal heat way up for a while to loosen the ice on the glass?
I did start the car before hand - it sometimes helps. Depends on how severe the freezing is. The sideview mirrors are still an issue though
I've had these issues on my Seat Leon in the past, ie not a Tesla. I am based in the UK and its pretty rare for temperatures to drop below 0 and it still happens.
My dad owns a Civic and a Lexus, this has never happened in the past 25 years of living in Canada (and temperatures keep rising over the years). It's happening due to the door design of Tesla where the glass does not have a frame around it. I made the purchase knowing these issues could arise - but let's not try to make it seem like these issues happen to all cars.
In my experience the doors on my 2006 civic used to freeze shut all the time in UK winters (not hugely cold either: 0 to low negatives degrees-C). Also happens on my current 2010 Toyota if it gets cold enough. These have traditional door frames but the ice often builds up between the frames and seals I guess.
Bit of brute force was enough to pull them open. Windows need to be defrosted before you can open them too.
Bit of brute force was enough to pull them open. Windows need to be defrosted before you can open them too.
Rub talcum powder on the black isolation and your door should not freeze shut anymore.
I agree that basic build quality is probably worse than a similarly priced BMW, Audi, etc.
I haven't had any quality issues with mine but I know if I started measuring panel gaps it won't measure up to others in the price range. Noise insulation at highway speeds, door closing sounds, etc. don't quite measure up with the price either.
Mostly I prefer the simplicity of the vehicle and drivetrain. Alternatives from other companies are getting more complex both in interior (3 touchscreens + buttons + weird electronic shifter knobs) and drivetrain (auto start/stop, hybrid, plugin hybrid, 48v mild hybrid, turbo + supercharger, etc.)
A basic standard un-complicated ICE setup is becoming obsolete due to emissions, fuel economy, and power targets.
The biggest change I would make to the Model 3 design is ditching the frameless windows and using normal door frames which are less complex (no need for the window to move each time you open a door) and easier to seal up.
I haven't had any quality issues with mine but I know if I started measuring panel gaps it won't measure up to others in the price range. Noise insulation at highway speeds, door closing sounds, etc. don't quite measure up with the price either.
Mostly I prefer the simplicity of the vehicle and drivetrain. Alternatives from other companies are getting more complex both in interior (3 touchscreens + buttons + weird electronic shifter knobs) and drivetrain (auto start/stop, hybrid, plugin hybrid, 48v mild hybrid, turbo + supercharger, etc.)
A basic standard un-complicated ICE setup is becoming obsolete due to emissions, fuel economy, and power targets.
The biggest change I would make to the Model 3 design is ditching the frameless windows and using normal door frames which are less complex (no need for the window to move each time you open a door) and easier to seal up.
> The biggest change I would make to the Model 3 design is ditching the frameless windows and using normal door frames which are less complex (no need for the window to move each time you open a door) and easier to seal up.
It'd be interesting to understand why the window needs to move down to open the door. I had a 90's acura integra that also had frameless windows, and the door seal was engineered such that it flexed enough to allow you to open/close the door with the window all the way up, but (as far as I can remember) road noise and weather sealing wasn't a problem.
It'd be interesting to understand why the window needs to move down to open the door. I had a 90's acura integra that also had frameless windows, and the door seal was engineered such that it flexed enough to allow you to open/close the door with the window all the way up, but (as far as I can remember) road noise and weather sealing wasn't a problem.
Most frameless window cars now have a drip edge around the window that's supposed to keep moisture away from the door seals. The window goes down a bit in order for the window to clear the drip edge. If your battery goes dead in one, then the window will catch a little and pull. It's okay if it happens a few times, but over time it will probably pull the window off of the tracks.
I thought bmw and mercs do the window thing too.
Some do, some don't. It's definitely a common thing in higher end cars, I just think it's probably over-extending for Tesla to implement this more complex system in a car that's supposed to be cheaper as well as their first real high-volume production vehicle.
Other decisions (single center screen, recessed air vents, lack of physical controls) all seem to be about simplicity and reducing parts in favor of software.
Frameless doors and window seals kind of goes against that in favor of fashion.
Other decisions (single center screen, recessed air vents, lack of physical controls) all seem to be about simplicity and reducing parts in favor of software.
Frameless doors and window seals kind of goes against that in favor of fashion.
My VW CC has frameless windows that drop a centimeter when you unlock the doors. While I like the look, I think this increases road/wind noise.
Owner of a 3 (performance, all options) built in July 2018. I was also nervous about build quality. My personal experience has been pretty great, however. Only a minor issue which the mobile repair truck came out and fixed in my company's parking lot. I didn't even have to go to a service center.
Style is all subjective however there is a real minimalist chic to the 3 interior which I have come to love. In my wife's Merc (similar price to what I paid in 2018) things just feel "cluttered." To each it's own, though. Zero regrets and would buy again!
Style is all subjective however there is a real minimalist chic to the 3 interior which I have come to love. In my wife's Merc (similar price to what I paid in 2018) things just feel "cluttered." To each it's own, though. Zero regrets and would buy again!
Mobile repair sounds pretty awesome. I don't own a car, but when I did I always felt like dealing with service was a huge waste of my time. I would avoid getting it serviced simply because I didn't care about it. To me at least, a car is just a way to go from A to B when there's no better way.
My P3d is also from July 18 and is the lowest VIN of any that I know about, less than 55500, any chance yours is lower?
On topic, I've had a few trim issues fixed at the SC which was no cost and not much bother. Otherwise it's amazing, I really would not trade it for any other car.
On topic, I've had a few trim issues fixed at the SC which was no cost and not much bother. Otherwise it's amazing, I really would not trade it for any other car.
My wife has a model 3. I have a BMW 535i. I used to love my BMW. Now I beg my wife to drive the Tesla, because the BMW feels like a clunky dinosaur. I agree that Teslas are generally not the most beautiful cars, but the torque, the handling, the software-driven features, and the lack of gas station stops makes up for it, and more. Oh, and as a software guy, the self-driving stuff is really fun to watch evolve.
To be fair, European automotive is the most behind out of any.
We just got a model 3 a few weeks ago.
ALL gasoline cars now feel like dinosaurs. Even hybrids.
ALL gasoline cars now feel like dinosaurs. Even hybrids.
I have had 3 electric cars: Chevy Volt, Tesla Model 3, and Jaguar IPace.
The Volt was the worst quality, but a total cost of ownership over 3 years of around $11K, including lease payments, insurance, and gas, but excluding charging.
The IPace is worse than the Tesla at around the same cost. It's worse range is really difficult if you don't have a fast charging setup. The software is obviously not built by a software company.
The Model 3 feels light, and goes far. The lack of physical controls make for a clean design. It can move like a muscle car but is obviously completely silent.
The Tesla sales and support has been terrible. There are obvious growing pains, and it's one reason we got the IPace. Long term those rough edges will smooth out.
The Volt was the worst quality, but a total cost of ownership over 3 years of around $11K, including lease payments, insurance, and gas, but excluding charging.
The IPace is worse than the Tesla at around the same cost. It's worse range is really difficult if you don't have a fast charging setup. The software is obviously not built by a software company.
The Model 3 feels light, and goes far. The lack of physical controls make for a clean design. It can move like a muscle car but is obviously completely silent.
The Tesla sales and support has been terrible. There are obvious growing pains, and it's one reason we got the IPace. Long term those rough edges will smooth out.
How come you decided to buy the IPace? By all accounts it seems to be a terrible car.
I bought a Model 3 a year ago (Dec '18). I liked it so much that, when my wife's Audi lease expired in July, she also got a Model 3 (at least they're different colors...)
The only issue either of us has had is one of the license plate screws stripped the rubber bushing and I had to get a replacement bushing.
Would definitely buy another car from them. In fact, the thing I hate most about the business travel I have to do is renting non-Tesla cars and having to drive something that feels so antiquated.
The only issue either of us has had is one of the license plate screws stripped the rubber bushing and I had to get a replacement bushing.
Would definitely buy another car from them. In fact, the thing I hate most about the business travel I have to do is renting non-Tesla cars and having to drive something that feels so antiquated.
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I sold a BMW 3 series to buy a Tesla Model 3 (performance model). Overall build quality of the Tesla is good but slightly below the BMW. Little things like the sound & feel of doors closing, the way the boot lid feels when opening/closing, etc. A couple of weeks ago it froze overnight and the next morning two of the doors were a bit difficult to open because the windows got stuck (the windows lower a few mm automatically so that the doors can open).
But those little issues aside, I couldn't be happier. Interior quality is actually better than expected and I think on par with the BMW. I personally love the fact that there are hardly any switches and buttons. Just looks very clean and modern.
Handling and ride comfort is absolutely on par with the BMW.
But those little issues aside, I couldn't be happier. Interior quality is actually better than expected and I think on par with the BMW. I personally love the fact that there are hardly any switches and buttons. Just looks very clean and modern.
Handling and ride comfort is absolutely on par with the BMW.
I would never consider purchasing a competing luxury car (BMW, Mercedes, Lexus, etc) but I bought a Tesla. Tesla has a far lower TCO due to the greatly reduced maintenance. Electric is way more fun to drive than ICE. I feel like the quality is great but again this is coming from someone who has never owned a luxury car, and only ever owned/driven Hondas, Toyotas, and Subarus.
TCO is something I haven't thought about. My 4runner needs an oil change, and maybe an air filter, every so often but that's about it. What other maintenance is required for ICE that isn't required for electric?
The list is actually quite long!
Oil, oil filter, transmission fluid, coolant, power steering fluid, radiator, hoses, belts/chains, spark plugs, ignition system, exhaust system. I'm sure there more that I have forgotten.
You can even consider that brake pads will last way longer due to regenerative braking.
Oil, oil filter, transmission fluid, coolant, power steering fluid, radiator, hoses, belts/chains, spark plugs, ignition system, exhaust system. I'm sure there more that I have forgotten.
You can even consider that brake pads will last way longer due to regenerative braking.
EV's definitely have an advantage in terms of maintenance, but I suspect it's a bit overstated. Most of the things you listed get checked during normal maintenance and might require replacement or adjustment once or twice during the car's lifetime. The big elephant in the room (and possibly an equalizer) is battery lifetime. How long will the battery really last, and how much will replacements cost?
Except for oil and oil filter, those things are "lifetime" on most cars built today. So the service life is >120k miles, 20 years, or needs to be replaced as part of a separate repair. Power steering units are all electric now; outside of trucks, I don't think GM products have drain plugs on their automatics; ignition systems are all solid state. Even oil change intervals are inching up past 10k miles. Modern ICEs are surprisingly light on maintenance.
Tires are the biggest maintenance costs for cars, by a pretty healthy margin. I'm sure all Teslas are hard on tires. The amount of torque those motors put out is crazy, and they have an undersized tire relative to the weight of the car. Primacy MXM4 aren't cheap either, at $300 each for the smallest size offered on a TM3.
Tires are the biggest maintenance costs for cars, by a pretty healthy margin. I'm sure all Teslas are hard on tires. The amount of torque those motors put out is crazy, and they have an undersized tire relative to the weight of the car. Primacy MXM4 aren't cheap either, at $300 each for the smallest size offered on a TM3.
The gp was comparing to luxury performance cars, which typically eat through brakes, tires and suspension equipment 2 - 4x as quickly as a non-lux/performance car like your Toyota. They also typically require premium fuel and have unimpressive gas mileage. I'm skeptical of Electrek claims that they're a better value than an Accord or Civic, but for a performance car/status symbol, they really do look to be a solid value.
In theory, the electric car should require less long term maintenance as well, as there are dramatically fewer moving parts. These items wouldn't emerge in the first five years (and you probably have less to worry about in a Toyota) but eventually things just start going a little wrong, even with a healthy maintenance schedule. These mechanical failures are less likely in a simpler vehicle.
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I've had a model X long range raven for six months and it's fantastic.
When I bought it I was seriously considering e-tron but it doesn't stack up in features (both inside and in the drive train / battery). The panels might be a mm off some places but there is not a squeak from it when driving and it's very comfortable.
Personally it will take a lot to persuade me to buy another brand in the future.
Edit: forgot about the supercharger network as it's just so natural. That alone makes it worth every penny.
When I bought it I was seriously considering e-tron but it doesn't stack up in features (both inside and in the drive train / battery). The panels might be a mm off some places but there is not a squeak from it when driving and it's very comfortable.
Personally it will take a lot to persuade me to buy another brand in the future.
Edit: forgot about the supercharger network as it's just so natural. That alone makes it worth every penny.
My experience with highly priced BMW left me with the impression there is no real difference anymore unless someone thinks having knobs and buttons everywhere is a sign of quality. BMWs can be nice, but they (at least mine) have had some persistent issues.
Sometimes I get the feeling, people think e.g BMWs are better because they are BMWs. Audi fans are also especially fond of their 'quality' even though this is highly subjective.
Sometimes I get the feeling, people think e.g BMWs are better because they are BMWs. Audi fans are also especially fond of their 'quality' even though this is highly subjective.
When they can get drive by wire to match the feedback that I get through my entirely mechanically linked '09 135i BMW I'll happily test drive another Model 3.
Model 3 is a great way to achieve mobility, but it's not a great driving experience.
Model 3 is a great way to achieve mobility, but it's not a great driving experience.
A company with real time telemetry from all cars all the time ought to blow a traditional automaker out of the water with reliability.
They can do things like measure vibration of a particular circuit board across the fleet, compare that to the design specs, and be able to predict failure probability a long time ahead of real failures. In turn, they can then revise designs to avoid a failure mode that hasn't even occurred yet. A failure that would have affected millions of cars now only affects thousands.
Lots of things can be mitigated with firmware changes - for example, if you see a specific MOSFET getting hotter than expected during regen braking in cold climates, you can adjust the drive parameters to avoid shootthrough, preventing it failing 10 years down the line.
Couple that with tesla employing service personnel ought to mean they can get photos from a failed part direct to an engineer within a few hours to see if a redesign is warranted. You can't easily get that through third party repair shops.
Overall, Tesla seems to have so many advantages in the reliability/quality department, yet news articles don't seem to match. I wonder why?
They can do things like measure vibration of a particular circuit board across the fleet, compare that to the design specs, and be able to predict failure probability a long time ahead of real failures. In turn, they can then revise designs to avoid a failure mode that hasn't even occurred yet. A failure that would have affected millions of cars now only affects thousands.
Lots of things can be mitigated with firmware changes - for example, if you see a specific MOSFET getting hotter than expected during regen braking in cold climates, you can adjust the drive parameters to avoid shootthrough, preventing it failing 10 years down the line.
Couple that with tesla employing service personnel ought to mean they can get photos from a failed part direct to an engineer within a few hours to see if a redesign is warranted. You can't easily get that through third party repair shops.
Overall, Tesla seems to have so many advantages in the reliability/quality department, yet news articles don't seem to match. I wonder why?
You seem to be suggesting there's a media bias here. I think probably an honest answer to your question is "Tesla has all of these advantages in data gathering, but is not operationally equipped to use them."
Changes to circuit board vibration, to pick one of your examples, relies on tight control of manufacturing as a process. Model 3s had such basic issues as leaks in door seals--does it seem like they have tight control of manufacturing?
Manufacturing prowess aside, this forum has a pretty big collective eye roll at management and consultants and business 101 topics generally, but when you talk about things like "getting photos from a failed part direct to an engineer" you need to be asking whether those departments are set up to communicate with one another.
Changes to circuit board vibration, to pick one of your examples, relies on tight control of manufacturing as a process. Model 3s had such basic issues as leaks in door seals--does it seem like they have tight control of manufacturing?
Manufacturing prowess aside, this forum has a pretty big collective eye roll at management and consultants and business 101 topics generally, but when you talk about things like "getting photos from a failed part direct to an engineer" you need to be asking whether those departments are set up to communicate with one another.
Are boards actually this instrumented? Does each MOSFET have a temperature sensor onboard?
MOSFET on-resistance is highly dependant on temperature. They will certainly be able to measure that, even if they don't have sensors on the MOSFETs themselves. They will probably have both current and voltage measurement, so even have two ways to measure it! Even $2 China motor controllers have the hardware for it (although not the software)
I'd expect them to have sensors on the individual MOSFETs though - there is per-component variation, and software changes can benefit per-component efficiency. I could totally believe a gain of +1% efficiency from such tuning, and probably more like +30% peak performance, since components can be pushed far closer to their limits when you know the exact temperatures.
I'd expect them to have sensors on the individual MOSFETs though - there is per-component variation, and software changes can benefit per-component efficiency. I could totally believe a gain of +1% efficiency from such tuning, and probably more like +30% peak performance, since components can be pushed far closer to their limits when you know the exact temperatures.
No they are not. Maybe one temp sensor per ECU.
I'm on my second Tesla. Model S (2016 facelift) and now a 2019 Model 3.
Love them. The Model 3 interior is amazing. So simple and elegant. But that is a personal taste.
The only thing I've really noticed on the Model 3 is the road noise. I've owned a BMW before, and it is a bit louder in the Model 3. Some of it is due to not having an "engine noise" to cover some of the road noise up. But it is not a big issue at all with music/radio playing. Sometimes if I'm trying to have a phone call and I'm going over 75/80 Mph (yes, within the speed limit where I live), I'll have to talk louder for sure.
In the end, I would not trade my Tesla for anything. Last year, I rented a Porsche Turbo S for two days because it was something I had always wanted to drive. It was fun, but I wanted my Tesla back afterwards.
Love them. The Model 3 interior is amazing. So simple and elegant. But that is a personal taste.
The only thing I've really noticed on the Model 3 is the road noise. I've owned a BMW before, and it is a bit louder in the Model 3. Some of it is due to not having an "engine noise" to cover some of the road noise up. But it is not a big issue at all with music/radio playing. Sometimes if I'm trying to have a phone call and I'm going over 75/80 Mph (yes, within the speed limit where I live), I'll have to talk louder for sure.
In the end, I would not trade my Tesla for anything. Last year, I rented a Porsche Turbo S for two days because it was something I had always wanted to drive. It was fun, but I wanted my Tesla back afterwards.
The issue is the lack of sound dampening. It happens with any car. You can fix this retroactively with sound dampening products in any car that you feel is excessively loud inside. Some cars are worse than others. Model 3 probably just cheaps out with their use of interior dampening foam.
Fit and finish is worse (e.g, fit noises, panel gaps, quality of materials) and sound insulation is much worse (i.e., traditional luxury brands are much better at highway speeds). You can't beat electric for drive train smoothness and performance, and the Tesla infotainment is on another level. Depending on how you balance these things you may prefer a Mercedes/BMW/Audi once they deliver an electric range worth considering.
I have a May 2018 build, and the quality is better than my wife's last Audi, but there are still things that could be improved, mostly the interior rattles. At the same time, most of those would be covered up if there was an ICE droning on, so for all I know those were present in her car too and we never noticed them.
I drove my friends Model S and the performance felt like a Ferrari but the cabin interior felt like a Hyundai. I find that OK, since a company needs to specialize when building a brand and Tesla seems to have focused on driving experience and safety. When I’m done with my current car I’ll be buying a 3 or an S.
I love my Model 3, but dealing with Tesla is like dealing with any other startup running on hot air. Sometimes the employees don't have good accountability, and sometimes the company runs so fast they don't realize that they dropped customers in the shuffle.
(Basically, Tesla needs better-defined internal processes and better customer feedback loops. Common problems when startups are moving so fast that their rear view mirror is a blur.)
How does that relate to quality? Overall, it's a great car. Most of my problems are software-related, and trying to get Tesla service to even acknowledge the problem requires a few rain dances and magic tweets to the divine Elon Musk god.
That being said, I've had a few other "real" quality problems with other cars. So far, nothing major with my Model 3.
For example, my Chrysler plug-in hybrid randomly stops charging on a 30-amp charger. Chrysler service just blames my equipment instead of fixing the problem. If I had a similar problem with Tesla, I'm quite confident that they would fix it without any hassle.
(Basically, Tesla needs better-defined internal processes and better customer feedback loops. Common problems when startups are moving so fast that their rear view mirror is a blur.)
How does that relate to quality? Overall, it's a great car. Most of my problems are software-related, and trying to get Tesla service to even acknowledge the problem requires a few rain dances and magic tweets to the divine Elon Musk god.
That being said, I've had a few other "real" quality problems with other cars. So far, nothing major with my Model 3.
For example, my Chrysler plug-in hybrid randomly stops charging on a 30-amp charger. Chrysler service just blames my equipment instead of fixing the problem. If I had a similar problem with Tesla, I'm quite confident that they would fix it without any hassle.
Being 100% electric is a pretty huge advantage, I wouldn't underestimate it. While I don't own a Tesla myself I have only heard good things from people who do.
I got a used one (now ~4 years old) about a year ago. I've mostly liked it.
It's true that interior quality isn't as good as traditional car makers at the same price point. The leather surfaces are kinda plastic looking. The previous owner also decided to add a bunch of fake carbon fiber to the dashboard, which looks goofy but eh. Newer models apparently look better inside.
Agreed that the exterior styling is boring. That said, I don't find any sedan made in the last 10 years is particularly good looking.
Being electric allows some features that are really nice to have. Cabin overheat prevention is a really good safety feature. It's also safe to run all the vehicle systems in an enclosed space, so you can run the heat or AC in a garage, which is great during cold/hot days.
Beyond just being electric, I'd throw in:
- The on-board software is easily the least bad of any car I've touched
- Remote control via phone is strangely nice to have
- The sedans have wagon-like cargo capacity
- I've heard service horror stories, and I don't doubt that it happens, but the two service appointments I've had were fine. For a part recall they actually came to my home and did the service on-site. For a broken sunroof (my fault) total turnaround time was about 48 hours and I could book the service directly from the app, which was cool. It's also nice you don't have to change oil or do other engine maintenance.
It's true that interior quality isn't as good as traditional car makers at the same price point. The leather surfaces are kinda plastic looking. The previous owner also decided to add a bunch of fake carbon fiber to the dashboard, which looks goofy but eh. Newer models apparently look better inside.
Agreed that the exterior styling is boring. That said, I don't find any sedan made in the last 10 years is particularly good looking.
Being electric allows some features that are really nice to have. Cabin overheat prevention is a really good safety feature. It's also safe to run all the vehicle systems in an enclosed space, so you can run the heat or AC in a garage, which is great during cold/hot days.
Beyond just being electric, I'd throw in:
- The on-board software is easily the least bad of any car I've touched
- Remote control via phone is strangely nice to have
- The sedans have wagon-like cargo capacity
- I've heard service horror stories, and I don't doubt that it happens, but the two service appointments I've had were fine. For a part recall they actually came to my home and did the service on-site. For a broken sunroof (my fault) total turnaround time was about 48 hours and I could book the service directly from the app, which was cool. It's also nice you don't have to change oil or do other engine maintenance.
It feels different and I was prepared to not like it. My previous car and wife's current car is BMW (leather seats, wood dash etc.). I loved the BMW feel. But these days I try to avoid ending up in my wife's BMW as much as possible.
Whenever I'm in any luxury car it feels nice, but also feels dated. Hard to explain. Kind of like you might enjoy your AirBnb stay in an old chateau but won't want to live there for good.
Whenever I'm in any luxury car it feels nice, but also feels dated. Hard to explain. Kind of like you might enjoy your AirBnb stay in an old chateau but won't want to live there for good.
Model X owner for 1.5 years.
I had one issue soon after delivery, the passenger-side mirror didn't adjust properly when it had been sitting out in the sun. Tesla sent a guy to my house to replace it under warranty. Took him about an hour and no cost to me.
Last year I thought I had a serious issue that turned out to just be a (very) poorly documented software limitation that I was unlucky enough to run into. The private street my building was on was on a navigation blacklist for some reason, which caused issues when navigating to or from that street. The service center staff knew this blacklist existed but had never heard of it actually affecting anyone.
Anyway, I started setting destination to the corner before I turned onto that street, and not starting navigation when I was leaving work until after I turned off the street, and everything was fine. Mildly annoying but I was relieved that it wasn't actually an issue with the car.
I had one issue soon after delivery, the passenger-side mirror didn't adjust properly when it had been sitting out in the sun. Tesla sent a guy to my house to replace it under warranty. Took him about an hour and no cost to me.
Last year I thought I had a serious issue that turned out to just be a (very) poorly documented software limitation that I was unlucky enough to run into. The private street my building was on was on a navigation blacklist for some reason, which caused issues when navigating to or from that street. The service center staff knew this blacklist existed but had never heard of it actually affecting anyone.
Anyway, I started setting destination to the corner before I turned onto that street, and not starting navigation when I was leaving work until after I turned off the street, and everything was fine. Mildly annoying but I was relieved that it wasn't actually an issue with the car.
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I have been very happy with the quality of mine!
Due to software updates, my car is faster, safer, and more efficient than when I bought it 9 months ago. That's pretty wild, and something I've never seen with another car.
Due to software updates, my car is faster, safer, and more efficient than when I bought it 9 months ago. That's pretty wild, and something I've never seen with another car.
I recently rented 2 different Model S cars (through Turo), one 4 years old, the other 6. The 4-year old car was in great shape, and worked perfectly, but it also needed some software updates. The 6-year old car was a bit worn inside and had some technical issues, but mechanically solid on a 1500-mile road trip (including one 500-mile day with 3 charger stops).
The issues with the older car were rear door handles that didn't work (they would not present from the outside), and the central display getting glitchy. "Rebooting" the car fixed the display, and the owner said that it needed rebooting about once a week. The door-handle issue never went away, and it wasn't clear if it was software or a mechanical issue. Software is more likely because both were not working in the same way (doors could be open from the inside).
Those problems aside, we had 4 adults and one teenager in the car for hours on end, also carrying 5 suitcases and 5 small backpacks, along with bags of food, etc--the frunk is really big. That is easily 1000 lbs of payload. We drove freeways and small paved roads for miles, and the weather was cold, from 50 to 5 Fahrenheit (10 to -15 C). We didn't have any stuck windows, and other than some range impact[1], the cold was not a factor. So we were really happy with the car, the drivetrain and road handling were rock solid in all cases.
I know Teslas can have mechanical problems, and they can go into the shop for days/weeks (just like BMWs I hear), but having a reliable electric drive-train to drive my family through the winter weather was somehow reassuring.
Edited to add: people are saying Teslas only have the price of a luxury car, but they have one other critical thing: the power. In our fully loaded rental S, I had no problem getting up hills or "dealing" with traffic (heh), including huge trucks on small roads.
[1] Note that cold reduces range in 2 separate ways: it affects the battery chemistry so there is less charge available (about 10% less), and it requires some of the available energy to heat the cabin (no waste heat from an inefficient ICE). Seat heaters make you warmer with less energy than heating the air, but the model we had didn't have back-seat heaters, so we used the cabin heat (probably created by a heat pump).
The issues with the older car were rear door handles that didn't work (they would not present from the outside), and the central display getting glitchy. "Rebooting" the car fixed the display, and the owner said that it needed rebooting about once a week. The door-handle issue never went away, and it wasn't clear if it was software or a mechanical issue. Software is more likely because both were not working in the same way (doors could be open from the inside).
Those problems aside, we had 4 adults and one teenager in the car for hours on end, also carrying 5 suitcases and 5 small backpacks, along with bags of food, etc--the frunk is really big. That is easily 1000 lbs of payload. We drove freeways and small paved roads for miles, and the weather was cold, from 50 to 5 Fahrenheit (10 to -15 C). We didn't have any stuck windows, and other than some range impact[1], the cold was not a factor. So we were really happy with the car, the drivetrain and road handling were rock solid in all cases.
I know Teslas can have mechanical problems, and they can go into the shop for days/weeks (just like BMWs I hear), but having a reliable electric drive-train to drive my family through the winter weather was somehow reassuring.
Edited to add: people are saying Teslas only have the price of a luxury car, but they have one other critical thing: the power. In our fully loaded rental S, I had no problem getting up hills or "dealing" with traffic (heh), including huge trucks on small roads.
[1] Note that cold reduces range in 2 separate ways: it affects the battery chemistry so there is less charge available (about 10% less), and it requires some of the available energy to heat the cabin (no waste heat from an inefficient ICE). Seat heaters make you warmer with less energy than heating the air, but the model we had didn't have back-seat heaters, so we used the cabin heat (probably created by a heat pump).
I'd say the car's build feels much better than the other similarly priced EVs or better than a Camry.
It's probably under what you would find for similarly prices gas car. I don't see entry level Tesla's as luxury cars per se, but the driving experience is definitely luxury.
As far as I can tell teslas are good cars, but more important than that they are status symbols.
I've had my 3 for a month. You can tell it was built "minimally" so that it can be affordable, but the interior doesn't feel cheap. The driving experience is amazing, I never want to go back to gas cars now.
I'm curious as well. I'm mostly curious about the build quality of simple mechanical features like the doors. Why do the model 3 doors feel so cheap compared to a BMW. Is it a weight thing or just an oversight?
As a followup for those who gave feedback, did you ever have a problem with parts availability after being involved in an accident?
I do not own one, but I had a Lyft driver show up in a Model S once.
The interior was nice but spartan. The ride quality was absolute garbage. I felt every single bump, crack, and pothole in the road. Tesla does not compete in the luxury space, only in the luxury price range.
The interior was nice but spartan. The ride quality was absolute garbage. I felt every single bump, crack, and pothole in the road. Tesla does not compete in the luxury space, only in the luxury price range.
I don't own a Tesla but listen to a lot of podcasts that feature car enthusiasts. The reviews are pretty positive across the board. Regarding the cheapness, people almost universally agree the interiors feel cheap at the price you're paying. I sat in one recently and have to agree.
I've been a big Tesla fan for a while now.
Certainly a big part of me is happy, perhaps even a bit smug, to see the share price so high.
Even though I'm pretty sure electric vehicles are the future, and that Tesla has, at a minimum, brought that future closer to the now, I still think its share price is borderline insane, and, in the end, doesn't serve the company or the vision as well as a more moderate, stable price.
I also acknowledge that its CEO has not only not taken reasonable steps to 'calm things down', but has done the opposite.
Having said all that, I could be wrong, and perhaps Tesla's sales are substantially driven by all of this crazy energy, positive and negative.
Certainly a big part of me is happy, perhaps even a bit smug, to see the share price so high.
Even though I'm pretty sure electric vehicles are the future, and that Tesla has, at a minimum, brought that future closer to the now, I still think its share price is borderline insane, and, in the end, doesn't serve the company or the vision as well as a more moderate, stable price.
I also acknowledge that its CEO has not only not taken reasonable steps to 'calm things down', but has done the opposite.
Having said all that, I could be wrong, and perhaps Tesla's sales are substantially driven by all of this crazy energy, positive and negative.
The correction will be precipitous. There is no reason to believe that even at the 1M vehicle level, they can be so profitable, when engaged with direct competition with other experienced producers, to justify such a market capitalization. The same cost issues will affect all companies, and I believe some Tesla technical advantages will erode.
I think the reason why Tesla is valued highly is that they won't stop growing at 1M vehicle production rate. (Whereas GM and others like it are stagnating or even declining in vehicle production: https://www.statista.com/statistics/225326/amount-of-cars-so... )
They're selling mostly cars in their home market which is dominated by trucks and crossovers. They have a mass market crossover coming to market this year and a truck soon after. Overseas, they just built their first new factory in the biggest EV market in the world (China) that seems to already be doing well, and they're already starting to clear land on their European factory (whose market ought to be bigger than the North American market as well).
The wild card is climate action. If the world has to severely cut back on fossil fuels, electric vehicles will be enormous, and Tesla's are the most compelling by a large margin, in spite of several attempts by large carmakers. There's also the storage market, the solar roof market (granted, mostly a California thing for now for Tesla), grid storage market (fairly large and likely to get much larger if climate action becomes critical), and the Semi truck (which is MUCH more compelling than other electric trucks, by an even larger margin than, say, the X is versus the e-tron).
So I think long-term they have a decent chance of producing millions of vehicles and with significant revenue from non-passenger-vehicles like grid storage and long-haul trucking. If there's a 50:50 chance of global climate mobilization, that's a 50:50 chance of market conditions basically perfect for Tesla... and even without that (as in right now), they seem to be capable of being marginally profitable and still growing. So the upside is high and the downside is low.
I haven't mentioned autopilot or self-driving because I think the case for Tesla's value is strong without that more questionable argument.
I hold no individual stock.
They're selling mostly cars in their home market which is dominated by trucks and crossovers. They have a mass market crossover coming to market this year and a truck soon after. Overseas, they just built their first new factory in the biggest EV market in the world (China) that seems to already be doing well, and they're already starting to clear land on their European factory (whose market ought to be bigger than the North American market as well).
The wild card is climate action. If the world has to severely cut back on fossil fuels, electric vehicles will be enormous, and Tesla's are the most compelling by a large margin, in spite of several attempts by large carmakers. There's also the storage market, the solar roof market (granted, mostly a California thing for now for Tesla), grid storage market (fairly large and likely to get much larger if climate action becomes critical), and the Semi truck (which is MUCH more compelling than other electric trucks, by an even larger margin than, say, the X is versus the e-tron).
So I think long-term they have a decent chance of producing millions of vehicles and with significant revenue from non-passenger-vehicles like grid storage and long-haul trucking. If there's a 50:50 chance of global climate mobilization, that's a 50:50 chance of market conditions basically perfect for Tesla... and even without that (as in right now), they seem to be capable of being marginally profitable and still growing. So the upside is high and the downside is low.
I haven't mentioned autopilot or self-driving because I think the case for Tesla's value is strong without that more questionable argument.
I hold no individual stock.
Agree. Their customers are those who are making bank on the bull market run we've been riding. If the market should fall, Tesla will fall hardest.
For a while TSLA had an absurd amount of short positions against it, IIRC something like an order of magnitude more than other companies. Perhaps we are seeing a short squeeze? I'd love to see data (and interpretation) on how this has changed.
The short interest is roughly the same it has been[0]. This has astonished many of us longs and people that specialize in short selling[1].
The fact that the price has risen substantially with little short covering means new long buyers have driven the stock price higher and shorts have held firm.
0: https://twitter.com/ihors3/status/1216756156821057538?s=20 1: https://twitter.com/ihors3/status/1215383701053476875?s=20
The fact that the price has risen substantially with little short covering means new long buyers have driven the stock price higher and shorts have held firm.
0: https://twitter.com/ihors3/status/1216756156821057538?s=20 1: https://twitter.com/ihors3/status/1215383701053476875?s=20
Doesnt that chart show that short interest has decreased quite a bit since June?
There are still plenty of shorts though.
There are still plenty of shorts though.
You can't fight meme magic. Old skool investors don't understand this yet. They see Elon smoking pot and they short. They see him dancing, they short again. They see his bumbling presentation skills and smashed CyberTruck windows, have a laugh and put one more billion against him. And then they open his twitter and you can imagine what they do when they see him posting absolute units of a sheep...
https://fortune.com/2020/01/10/elon-musk-tesla-stock-short-s...
https://fortune.com/2020/01/10/elon-musk-tesla-stock-short-s...
I feel this is a very small part of it. There are many legitimate reasons to short Tesla, including execution problems, car maintenance support, increasing competition, their poor self-driving software. And it could go on and on. Tesla, lets face it, is a cult stock. If you believe in the valuation, that's fine, but there have been plenty of bubbles over the years and especially recently (bitcoin and weedstocks come to mind), and Tesla would not be the first item driven to loft valuations based on unrealistic expectations.
> There are many legitimate reasons to short Tesla, including execution problems, car maintenance support, increasing competition, their poor self-driving software.
The problem is that those issues are exaggerated for Tesla and understated for other makes. This leads to weird volatility with Tesla, IMO, and I think this latest exaggerated surge to a high valuation is a part of that.
Execution problems? You mean like the delayed VW ID.3? These problems happen all the time. Reliability issues... hmm Ford had major transmission problems on the Focus, Honda had transmission problems on the Accord a few years back and Nissan has struggled with CVT issues for years. But these don't make the press all that much, because they are boring.
But Cybertrucks and an occasional battery fire? Those are front page news, and each creates wild exaggerated swings.
Overall the extra attention helps Tesla, of course.
The problem is that those issues are exaggerated for Tesla and understated for other makes. This leads to weird volatility with Tesla, IMO, and I think this latest exaggerated surge to a high valuation is a part of that.
Execution problems? You mean like the delayed VW ID.3? These problems happen all the time. Reliability issues... hmm Ford had major transmission problems on the Focus, Honda had transmission problems on the Accord a few years back and Nissan has struggled with CVT issues for years. But these don't make the press all that much, because they are boring.
But Cybertrucks and an occasional battery fire? Those are front page news, and each creates wild exaggerated swings.
Overall the extra attention helps Tesla, of course.
> The problem is that those issues are exaggerated for Tesla and understated for other makes
Execution problems doesn't mean bad cars, it means not delivering on margins, deliveries, ect. No one is saying Telsa is not a good company. They are saying that its not worth more than GM and Ford combined. I remember when I was investing in weedstocks when Canopy (who made no money) passed in valuation one of the largest banks in Canada who had a net income of like $11 billion. This feels the same way to me. Telsa's market cap is close to $100 billion.
Tesla delivered ~1 million cars. It sells a very specialty product (luxury cars) to people who have the money and ability purchase and maintain such a car. Its a very niche product. GM on the other hand sold over 3 million cars in just China, and it has BETTER self driving tech than Telsa. Aside from that, there are a lot of people for whom a Telsa is just offlimits (such as people like myself who live in urban apartments), or people who don't have the money (such as most of the America and the world). Its not an $1k iPhone its a 40k luxury vehicle.
Execution problems doesn't mean bad cars, it means not delivering on margins, deliveries, ect. No one is saying Telsa is not a good company. They are saying that its not worth more than GM and Ford combined. I remember when I was investing in weedstocks when Canopy (who made no money) passed in valuation one of the largest banks in Canada who had a net income of like $11 billion. This feels the same way to me. Telsa's market cap is close to $100 billion.
Tesla delivered ~1 million cars. It sells a very specialty product (luxury cars) to people who have the money and ability purchase and maintain such a car. Its a very niche product. GM on the other hand sold over 3 million cars in just China, and it has BETTER self driving tech than Telsa. Aside from that, there are a lot of people for whom a Telsa is just offlimits (such as people like myself who live in urban apartments), or people who don't have the money (such as most of the America and the world). Its not an $1k iPhone its a 40k luxury vehicle.
I think the recent bump is because (some) investors are starting to understand that CyberTruck will not be a flop as widely predicted on it's launch. Again, meme-magic. If the CyberTruck was unveiled by BMW or Ford, the response would have been much more muted.
In the long term, you can’t fight the balance sheet and income statement either. As in a Ponzi scheme, you simply run out of “greater fools.”
my friends and I were talking about all the shorts on Tesla back when it was really in full swing. My opinion was there's easier ways to make money than betting Elon Musk is going to fail.
Short interest was highest at the bottom, and is much lower now (just generally, changes are going to correlate with price)...~45m in July, and is now ~25m (which is where it was at the start of the year).
So 20m shares have been called in...daily volume is about ~9-10m so no short squeeze (afaik, TSLA is pretty easy to short because it is owned by so many retail investors...total shares outstanding is ~175m so turning over ~10m/day is a lot of volume).
So 20m shares have been called in...daily volume is about ~9-10m so no short squeeze (afaik, TSLA is pretty easy to short because it is owned by so many retail investors...total shares outstanding is ~175m so turning over ~10m/day is a lot of volume).
> afaik, TSLA is pretty easy to short because it is owned by so many retail investors...
i didn't think retail investor held stock was normally loaned out. in fact, i thought it was only loaned when you had it in a margin account, and had gone negative?
whereas the big index funds report how much extra they earn by loaning out stocks.
(probably hand-waving over terminology. apologies.)
i didn't think retail investor held stock was normally loaned out. in fact, i thought it was only loaned when you had it in a margin account, and had gone negative?
whereas the big index funds report how much extra they earn by loaning out stocks.
(probably hand-waving over terminology. apologies.)
Nope. The exact case is going to depend on your situation (some brokers have stock loan programs, some put you in these programs automatically, some don't). But yes, it is easy to borrow shares with more retail investors (I think the borrow for Tesla is like 2% or something).
In the US, what sells the most (sadly) are pickup trucks and SUVs. The numbers aren't even close. The big automakers here know this, and have tailored their product lines accordingly. Ford is basically kept afloat singularly by F-series pickup sales, and have cancelled many sedans entirely. They have an entire range of different sized trucks and SUVs for every market segment. Same with Chevrolet. Now pan over to Tesla. Tesla has one single SUV offering, and sales of that SUV are dismal. They just teased a pickup truck release with their 'cybertruck' product, but the design was purposely off-putting, and it only served to make a mockery of the market segment. So with one SUV that doesn't sell, and a parody of what is currently the highest selling platform in the US, I'm not sure why anyone speculates Tesla is in a place of upward trajectory. I don't buy the argument that other car companies can't/won't pivot to counter either. Porsche reverse engineered one of their Model S vehicles, admitted it was quite well-constructed, and then countered with the Taycan (by all reviews a better car) a mere 3-4 years later. I'm glad a company like Tesla exists to force the market to the EV concept, but most people will buy an EV when they know it's supported by a long established and trusted automaker like Toyota, Ford, Chevy, or Honda. Tesla then exists as a proof-of-concept model for the bigger players to follow, not as a displacement.
It should also be noted, many motor companies are also investing quite a bit of money into alternative fuels like synthetic petrol and hydrogen, and don't want to rely on an energy source which is primarily derived from conflict zones. They aren't 100% sold yet that the EV platform is indeed the way forward.
It should also be noted, many motor companies are also investing quite a bit of money into alternative fuels like synthetic petrol and hydrogen, and don't want to rely on an energy source which is primarily derived from conflict zones. They aren't 100% sold yet that the EV platform is indeed the way forward.
People have been saying this for years. However, none of the other players have built a compelling product with widespread appeal or adoption. The E-Tron? iPace? Taycan? All have been more or less dead on arrival from an adoption and sales standpoint.
Honda announced recently that they will be focusing on hybrid technology, not full electric. Toyota is backing their Hydrogen Fuel Cell technology. GM has the Bolt, a single full-electric offering. The Model 3 doesn't really have any meaningful competition at the moment IMO. Tesla has forced the industry to change and from where I'm standing no competing product has managed to holistically match the value proposition Tesla brings.
Honda announced recently that they will be focusing on hybrid technology, not full electric. Toyota is backing their Hydrogen Fuel Cell technology. GM has the Bolt, a single full-electric offering. The Model 3 doesn't really have any meaningful competition at the moment IMO. Tesla has forced the industry to change and from where I'm standing no competing product has managed to holistically match the value proposition Tesla brings.
"As it turns out, through October 2019, Audi has sold about 17,500 e-Trons globally, compared to about 21,600 for the Tesla."[1]
"With clients able to register their interest, Porsche has collected almost as many pre-orders as they plan to produce electric vehicles. The Handelsblatt quotes Porsches HR Director Andreas Haffner on the status of registrations to order the manufacturer’s first electric model. Says Haffner: 'There are 30,000 orders for the Taycan.'"[2]
Right, clearly all DOA. The model 3 has no competition because the major auto manufacturers are moving away from the sedan platform entirely to SUVs and trucks. It fills a small market niche, but one that's quickly slowing as a percentage of total vehicle sales.
> However, none of the other players have built a compelling product with widespread appeal or adoption
Neither has Tesla if we're honest.
[1] https://www.forbes.com/sites/samabuelsamid/2019/11/29/audi-w...
[2] https://www.electrive.com/2019/07/29/porsche-reveals-number-...
"With clients able to register their interest, Porsche has collected almost as many pre-orders as they plan to produce electric vehicles. The Handelsblatt quotes Porsches HR Director Andreas Haffner on the status of registrations to order the manufacturer’s first electric model. Says Haffner: 'There are 30,000 orders for the Taycan.'"[2]
Right, clearly all DOA. The model 3 has no competition because the major auto manufacturers are moving away from the sedan platform entirely to SUVs and trucks. It fills a small market niche, but one that's quickly slowing as a percentage of total vehicle sales.
> However, none of the other players have built a compelling product with widespread appeal or adoption
Neither has Tesla if we're honest.
[1] https://www.forbes.com/sites/samabuelsamid/2019/11/29/audi-w...
[2] https://www.electrive.com/2019/07/29/porsche-reveals-number-...
> The E-Tron? iPace? Taycan? All have been more or less dead on arrival from an adoption and sales standpoint.
These are expensive luxury cars. They're never going to see high volume.
Jaguar sells about 76,000 cars a year in total across all of their models. Porsche expects to sell about 20,000 Taycans a year. Both the Audi e-tron and the Jaguar I-Pace outsell the Model X and the Model S in Europe:
https://ev-sales.blogspot.com/2019/12/europe-november-2019.h...
If you want volume then have a look at Volkswagen ID.3 sales at the end of this year in Europe. It may well end up being the top selling EV in Europe even though it'll only be on sale for half the year at best.
These are expensive luxury cars. They're never going to see high volume.
Jaguar sells about 76,000 cars a year in total across all of their models. Porsche expects to sell about 20,000 Taycans a year. Both the Audi e-tron and the Jaguar I-Pace outsell the Model X and the Model S in Europe:
https://ev-sales.blogspot.com/2019/12/europe-november-2019.h...
If you want volume then have a look at Volkswagen ID.3 sales at the end of this year in Europe. It may well end up being the top selling EV in Europe even though it'll only be on sale for half the year at best.
To the degree that some major motor companies are still investing in hydrogen for passenger vehicles, Tesla might actually be undervalued. Hydrogen makes no sense for cars. Zero sense whatsoever when we have decent BEVs.
Synthetic petrol makes more sense technically than hydrogen but has all the non-climate drawbacks of fossil fuels and is twice as expensive (with extremely low round-trip efficiency compared to a true electric car... like maybe a factor of 5 to 10 worse?) as regular fossil fuels.
Taycan is not a better vehicle "by all reviews," but it is a decent vehicle, the only electric car by a non-startup manufacturer other than Tesla that is compelling. Its very low efficiency strongly limits its mass market uptake (low range, expensive charge, slow charge even with the 800V, expensive battery, etc) vs Tesla's vehicles, although might be okay for high margin vehicles.
Synthetic petrol makes more sense technically than hydrogen but has all the non-climate drawbacks of fossil fuels and is twice as expensive (with extremely low round-trip efficiency compared to a true electric car... like maybe a factor of 5 to 10 worse?) as regular fossil fuels.
Taycan is not a better vehicle "by all reviews," but it is a decent vehicle, the only electric car by a non-startup manufacturer other than Tesla that is compelling. Its very low efficiency strongly limits its mass market uptake (low range, expensive charge, slow charge even with the 800V, expensive battery, etc) vs Tesla's vehicles, although might be okay for high margin vehicles.
> Its very low efficiency strongly limits its mass market uptake
The Taycan is an expensive sports car. It will never have mass market uptake regardless of its efficiency.
The Macan is Porsche's best selling model because it's the cheapest Porsche you can buy and it's a compact SUV which is a popular body style.
> expensive charge, slow charge even with the 800V
The Taycan comes with three years of free charging on some charging networks. In any case, charging costs are the least of your worries relative to the cost of the car.
The Taycan achieves 80% state of charge in 22.5 minutes. That's hardly slow.
The Taycan is an expensive sports car. It will never have mass market uptake regardless of its efficiency.
The Macan is Porsche's best selling model because it's the cheapest Porsche you can buy and it's a compact SUV which is a popular body style.
> expensive charge, slow charge even with the 800V
The Taycan comes with three years of free charging on some charging networks. In any case, charging costs are the least of your worries relative to the cost of the car.
The Taycan achieves 80% state of charge in 22.5 minutes. That's hardly slow.
Hey, Taycan isn't a terrible vehicle. I like the direction Porsche is going; almost all other conventional car makers completely don't understand EV (but Porsche does).
But it ain't a whooping for the Model S, particularly when it is refreshed this year. And the low powertrain efficiency is part of the reason it's no Tesla killer.
But it ain't a whooping for the Model S, particularly when it is refreshed this year. And the low powertrain efficiency is part of the reason it's no Tesla killer.
The Taycan out accelerates, out manoeuvres, and out performs the Model S on track. You don't need to believe me on that, just see the results:
https://www.thedrive.com/news/30467/watch-a-porsche-taycan-t...
The Taycan has a two speed gearbox to help with both phases of acceleration:
https://www.youtube.com/watch?v=Uum9nffLasQ
The Taycan is a performance sports car and the Model S isn't. The Taycan is doing what it is built to do. What do you think the Taycan is built to do?
https://www.thedrive.com/news/30467/watch-a-porsche-taycan-t...
The Taycan has a two speed gearbox to help with both phases of acceleration:
https://www.youtube.com/watch?v=Uum9nffLasQ
The Taycan is a performance sports car and the Model S isn't. The Taycan is doing what it is built to do. What do you think the Taycan is built to do?
They used an old version of the Model S, the P100D, not the current Performance version which is available today. Not a like-for-like test. (And if you want to compare not-yet-available versions with a similar price, you really should be comparing to the trimotor Model S.)
And yeah, Model S is a more practical car than the Taycan yet still holds its own (in spite of Porsche's complex gearing system due to Tesla's electric powertrain advantage).
I'm glad a worthy challenger to the Model S has finally been produced. Tesla is having to up their game to stay ahead, which is good. Competition between these two will push electric cars far ahead of fossil cars even at the highest levels of performance.
And yeah, Model S is a more practical car than the Taycan yet still holds its own (in spite of Porsche's complex gearing system due to Tesla's electric powertrain advantage).
I'm glad a worthy challenger to the Model S has finally been produced. Tesla is having to up their game to stay ahead, which is good. Competition between these two will push electric cars far ahead of fossil cars even at the highest levels of performance.
Ugh, please. The results are right in front of you. Don't cling to these articles of faith that they somehow didn't use the "true" or the "proper" Tesla.
Porsche planned to build 30k to 50k Taycans. It is a market test by Porsche, not a real competitor to the model S.
That's roughly four times the number of 911's they sell every year, and they're all back ordered. Sounds like a successful test to me. How many Tesla Model S's are sold each year?
Technology sharing is very important to the modern car industry. Cars are incredibly complicated and if you follow news in the industry, in many cases brands will make technology sharing agreements so that they aren’t duplicating efforts.
That’s where Tesla is well-positioned for the future compared to Ford and GM. They have a whole platform and a battery manufacturing facility where other car brands may become Tesla customers in the future. Disregarding things like build quality or fit and finish, my understanding is that Tesla’s battery platform and powertrain is the industry leader.
If investors think that gas cars will essentially be irrelevant 20 years, I could see why Tesla is so valuable.
That’s where Tesla is well-positioned for the future compared to Ford and GM. They have a whole platform and a battery manufacturing facility where other car brands may become Tesla customers in the future. Disregarding things like build quality or fit and finish, my understanding is that Tesla’s battery platform and powertrain is the industry leader.
If investors think that gas cars will essentially be irrelevant 20 years, I could see why Tesla is so valuable.
The irony is that its actually not that well positioned in autonomous driving, which could be the only thing that could really driving the incredibly valuations it has now. GM, for instance, by most reports is significantly ahead of Telsa.
The horror stories about 3 month wait for parts and the videos of water intruding into new vehicles, are keeping me away.
I love Tesla for its effect of pushing the EV industry forward. And I love Tesla early adopters for largely funding and justifying investment in this.
But yeah, every time I daydream about owning a Tesla, I realise that it's my daydream about owning an Apple Newton.
But yeah, every time I daydream about owning a Tesla, I realise that it's my daydream about owning an Apple Newton.
This.
Tesla has always had body alignment issues since their first attempt, the Model S. It’s honestly quite unfortunate because these models are suppose to be a shiny example of American manual labor pushing out the new luxury model that would set Tesla up to enter the mid level market with a Model 3. Sadly, technological advances, a backlog of orders, and minimal factory space, all contributed to a decline in quality. Don’t get me wrong, these are absolutely beautiful cars, but in terms of actual construction of the vehicles, GM and Ford has nailed this to perfection with their automatic + human labor assembly lines. They’re able to produce numbers right now that Tesla can only dream about with a much higher satisfaction rate, I would think.
If Musk wants to really compete with the Big 3, he has to focus on quality all the way around and not just the ability to slap bigger batteries in and more speed through firmware updates. If you want to make a car, focus on the basics of it—the actual body, making sure my door lines up with my front fenders. Such basic cosmetic issues that are overlooked constantly on the cars coming from the Tesla factory.
If Musk wants to really compete with the Big 3, he has to focus on quality all the way around and not just the ability to slap bigger batteries in and more speed through firmware updates. If you want to make a car, focus on the basics of it—the actual body, making sure my door lines up with my front fenders. Such basic cosmetic issues that are overlooked constantly on the cars coming from the Tesla factory.
The quality on the 3 is fine. I've heard so many panel gap anecdotes and "fit and finish" problem that I was a bit excessive in my inspection of my Model 3 before I took delivery (November 2018). It was fine. There are no quality problems that I've been able to ascertain. The only real kind of weird thing is the polarized glass on the roof turns a really strange but beautiful color when it gets wet.
The car drives like nothing I've ever driven, not even a higher end mercedes.
The car drives like nothing I've ever driven, not even a higher end mercedes.
so i have an x and when it rains we do sometimes get some water into the back seat when raising the trunk... but to keep this in perspective... the car is like an iphone compared to your flip phone. 2007 was a long time ago so maybe people forget just how impactful that phone was when people first tried it out. That is the exact same experience I have had when first owning and S and now an X. A minor issue like water when raising the trunk on an exceptionally rainy day is just that minor when you compare it to the amazing feeling you get when the over the air update alert hits your phone and you start to wonder whether you'll get the latest update to detect stop signs. Or as I recall in 2014 - an audio up/down control near the passenger seat. Imagine if you were annoyed at the UI in your current car. With all of it's physical buttons that is it. You have no luck unless you buy a different car. In a Tesla if the UI is an issue they'll push an update and you'll have a new car without buying one. Let alone the buying experience of a Tesla vs anything else. Go online swipe your credit card... wait sometime and show up at a Tesla store and drive away with your car or they deliver it to your house. No haggling, no sleazy car salesman just a new car that gives you that feeling of an iphone in 2007 vs the old flip phone.... I am sure i sound like a fan boy... and I know my wife wishes i'd stop talking about it but it's pretty freaking worth it and nice.
I'll weigh in on the curmudgeon side. The knobs in my car were perfect from the day I bought it because they were optimized by engineers over decades. If there was ever a UI issue, it was corrected before I was born. Because the controls are physical I can operate them by touch and habit while focusing on the road. Years of driving have resulted in mental circuits that automatically detect stop signs and manage lane-keeping with zero conscious attention, just as easy as walking.
No-haggle direct manufacturer purchases are good, though. I can only agree with that.
No-haggle direct manufacturer purchases are good, though. I can only agree with that.
> Years of driving have resulted in mental circuits that automatically detect stop signs and manage lane-keeping with zero conscious attention, just as easy as walking
I thought the same thing when I had an S a few years back. This was just the adaptive cruise control + lane holding days, and I figured it'd be nice for sure but not game changing.
I was entirely wrong. Sure, driving without AP on wasn't hard, but turning AP on made road trips and commuting 1000x more pleasant for me. Driving without AP may be habitual and ingrained, but it still occupies a certain amount of mental capacity to hold the line.
Being freed from that wasn't just about getting more time to look at scenery, either. With fewer brain cycles spent on mechanically maneuvering the car, I could spend those cycles better monitoring other vehicles for potential hazards (crazy drivers, etc.)
I thought the same thing when I had an S a few years back. This was just the adaptive cruise control + lane holding days, and I figured it'd be nice for sure but not game changing.
I was entirely wrong. Sure, driving without AP on wasn't hard, but turning AP on made road trips and commuting 1000x more pleasant for me. Driving without AP may be habitual and ingrained, but it still occupies a certain amount of mental capacity to hold the line.
Being freed from that wasn't just about getting more time to look at scenery, either. With fewer brain cycles spent on mechanically maneuvering the car, I could spend those cycles better monitoring other vehicles for potential hazards (crazy drivers, etc.)
Lots of things have changed in cars since you born and their interfaces have hardly been perfected.
Namely things to do with phones like navigation, music, or phone calls. Not to mention things like improved climate control or safety (like the sentry system.)
Namely things to do with phones like navigation, music, or phone calls. Not to mention things like improved climate control or safety (like the sentry system.)
The knobs in the car represent a local maxima and your muscle memory is a sunk cost.
Why should I have to do most of the things that those knobs do? I’d prefer to let Tesla write the automotive software instead of trying to embed it in my hands via years of practice.
Why should I have to do most of the things that those knobs do? I’d prefer to let Tesla write the automotive software instead of trying to embed it in my hands via years of practice.
Imagine if you were annoyed at the UI in your current car.
Don’t have to, the UI in the Leaf (at least in the first gen), sucks. But you know what would annoy me more? If my $50K+ car leaked water. That’s something the industry figured out over fifty years ago. I’ll take a shitty UI over over water invading spaces I won’t find out about until the rust and bad wiring show up.
Don’t have to, the UI in the Leaf (at least in the first gen), sucks. But you know what would annoy me more? If my $50K+ car leaked water. That’s something the industry figured out over fifty years ago. I’ll take a shitty UI over over water invading spaces I won’t find out about until the rust and bad wiring show up.
Depends on the vehicle...Our C5 Corvette didn't get teh last minute deflectors and used to spill water on the rear speakers when opening in the wet.
They fix a lot of problems, but the customers demanding new designs every few years means we still keep fixing some of the same problems over and over.
They fix a lot of problems, but the customers demanding new designs every few years means we still keep fixing some of the same problems over and over.
I’m talking about water pouring out of the sunroof, and coming out of the dashboard
thanks but no thanks, software is a disaster. I'm in no rush to be the first set of guinea pigs to have a software update cause a car crash
I personally would buy one if I could. But if I'm not allowed to get parts for it and work on it then its not a viable vehicle to me. I can't be beholden on whatever schedule the service department has or how fast they can get parts. Which sounds like not very fast.
Once Tesla's operations are running smoothly, most of these issues should fix themselves.
We’ve been hearing that for years. What keeps holding it back? Why aren’t things smooth yet?
Because they are ramping up rapidly?
It’s just that every time it seems like they might be about to start to get stable they launch some new vehicle and we go through another period of ‘ramping up’. The older vehicles don’t seem to get stable even though the S has been out for years now. People use the 3 (or truck or...) as the excuse for why things are still a bit rough.
To me ramp up is more a function of org. grows than specifically new model.
For a company breaking new grounds and pushing EVs, I would give them at least another 10 years. It is not ideal, but you have to take into account that it takes time to build your network (charging/service centers etc.). That's why if the money comes, the rest will fall into place (in time of course!).
So if I were to buy a Tesla today I should expect their service department to be problematic for possibly 10 years?
That doesn’t sound odd to you?
I get when they were selling the roadster or early S. But 10 years from now?
That doesn’t sound odd to you?
I get when they were selling the roadster or early S. But 10 years from now?
And parent will finally feel good to buy TSLA at $1000.
Anyone remember Volkswagen shares at 1000€ in October 2008? This was a textbook example of a shortsqueeze. One German billionaire saw that the share value was at a ridiculous high level, so he shorted it. He was correct, but too early, so he lost all his money and committed suicide.
https://ftalphaville.ft.com/2018/10/31/1540962002000/The-day...
https://ftalphaville.ft.com/2018/10/31/1540962002000/The-day...
"markets can remain irrational longer than you can remain solvent"
That's what I told a friend last summer when he talked about Tesla being the perfect short opportunity.
Tesla stock is an extremely hot iron. You can tell by the huge daily swings that it is being played in some way, and as an amateur you are usually the one paying the pros in these scenarios.
Just to provide some context, most indexes and large tech companies are at an all-time-high. It’s not just Tesla ‘doing great’.
Uh Tesla was $180 six months ago. That's a 185% gain. Far more than the S&P. Few large cap companies have gained that much in such a short amount of time.
Don't rain on the Tesla parade. Or discount the price movement as "in line".
Don't rain on the Tesla parade. Or discount the price movement as "in line".
Sure, but you’re kind of cherry-picking, as it was $300+ in January. Tesla has always been more volatile than peer tech stocks, having crashed about 40% before this surge.
Either way it's a story about the short term spike since roughly a month ago. The price movement is not in line with the broader market or all tech stocks. It's well above it.
Apple is up 100% in the last year for no good reason.
Apple is up 100% because it's kind of the safe haven among tech companies. It actually has the earnings to justify its market value even when using conventional P/E ratio evaluations. This means that if the current oversupply of "fantasy" in the stock markets, especially the tech markets, should ever run out, Apple will most likely be much less affected than most other companies.
Lots of tech-interested investors realized this and decided to take some of the gains made with more risky bets into this "safe haven", because this lets them continue to invest in a tech company at least. And that's why the stock is up regardless of any new groundbreaking product from Apple.
Lots of tech-interested investors realized this and decided to take some of the gains made with more risky bets into this "safe haven", because this lets them continue to invest in a tech company at least. And that's why the stock is up regardless of any new groundbreaking product from Apple.
A luxury product company becoming a safe haven pretty much speaks for itself on how distorted things are.
Warren Buffet indicator explains it all
that's a good point. At the moment, it's kind of hard for a tech stock symbol to not do great.
Apart from IBM.
How close are they to figuring out how to handle holding a battery charge in colder temperatures? A few owners around here I've spoken with have said they are experiencing nearly half the mileage this winter season and it's been a struggle for longer daily commutes. They also need to preheat the battery and some have resorted to using another vehicle.
Been on the fence for a while and since we operate with one car that would troublesome.
Been on the fence for a while and since we operate with one car that would troublesome.
This is a big reason I avoided a Tesla this time around. If you live in Colorado and ski, you'll not only often be parking your car in extremely cold temperatures overnight, but also know that blockages on I-70 during sub-freezing temperatures are relatively common, and those blockages can add anywhere from half an hour to 6 hours to a commute. There's already a high enough risk that the battery range will be reduced in that weather, that my destination won't have a fast-charger, and that I won't be able to fully charge the vehicle overnight; but, the risk of me being unable to start the car on the highway in that weather were too much for it to be a useful option.
To be fair, Tesla is much more of a viable to me than any other EV, but as someone who works from home and only uses their car for excursions rather than daily commuting, it's not for me.
To be fair, Tesla is much more of a viable to me than any other EV, but as someone who works from home and only uses their car for excursions rather than daily commuting, it's not for me.
While this is great for a variety of reasons... I'm lamenting on the cybrtrck. Initially after the release I was kinda excited. Lately I have been wishing it just looked like a regular truck and did things that regular trucks can do - especially since I'm big on RVs: Cab over (fuck out of luck there). Fifth wheel? (Bed is probably not standard and probably no one will have the knowledge of putting in the rails or a puck system.
In other words we're looking at best travel trailers. I'm also sceptical they're going to the enough standard tow package equipment. I just have this feeling that no one that works at Tesla owns trucks and tows things. (And when I say no one, I just feel like if 10% of the staff owns a dually that's not enough).
If they don't put up a standard compete like Rivian, they're going to lose HUGE in this category.
One last secondary gripe here - they keep saying it has more utility than a regular truck but here I am pointing out all the things it can't do that a typical truck can. Beyond that, can you even ATTACH a snow plow?
In other words we're looking at best travel trailers. I'm also sceptical they're going to the enough standard tow package equipment. I just have this feeling that no one that works at Tesla owns trucks and tows things. (And when I say no one, I just feel like if 10% of the staff owns a dually that's not enough).
If they don't put up a standard compete like Rivian, they're going to lose HUGE in this category.
One last secondary gripe here - they keep saying it has more utility than a regular truck but here I am pointing out all the things it can't do that a typical truck can. Beyond that, can you even ATTACH a snow plow?
A lot comes down to whether the market views Tesla as a car company, or a technology company. The pessimistic view is that they’re a car company and the valuation makes no sense compared to GM, Toyota, or VW. The optimistic view is that they’re a technology company that — if they manage to stay alive — will produce value from both their core offering and the edges of their business, much the way Amazon has with AWS, or Apple is doing in Services.
Personally, I own a nominal number of shares and root for their success. But at the end of the day, it’s a Random Walk on Wall Street and predictions (good or bad) are largely speculation.
Personally, I own a nominal number of shares and root for their success. But at the end of the day, it’s a Random Walk on Wall Street and predictions (good or bad) are largely speculation.
Believe people are betting on its future. (Shanghai Mega-Factory seems doing pretty smoothly is probably one of the factor as well)
Plainsite recently published a 100-page report summarizing all the key findings from the tesla short or $TESLAQ community... some of the allegations around corporate governance, self-dealing, and outright lies are pretty damning if true:
https://www.plainsite.org/realitycheck/tesla.html
Not endorsing their findings, merely saying it's an interesting read to understand the other side. Its allegations are well referenced with sources.
https://www.plainsite.org/realitycheck/tesla.html
Not endorsing their findings, merely saying it's an interesting read to understand the other side. Its allegations are well referenced with sources.
Does anyone else feel like HN is somewhat ironically a highly risk adverse community? (I say ironically because you'd think a community of those working in new tech would be more risk seeking than your average person)
Seems like every time an individual stock is brought up there's 10 people claiming you're "gambling" with a disproportional amount of risk if you do anything but buy the index for every person that dares buy a company stock.
Seems like every time an individual stock is brought up there's 10 people claiming you're "gambling" with a disproportional amount of risk if you do anything but buy the index for every person that dares buy a company stock.
The comments here seem to be lacking one perspective: Global climate change is going to force governments to ban the sale of internal combustion engines for consumer use. The markets are pricing in the expected regulations, which is why Tesla is getting such a premium since they are the most mature in the coming regulatory environment.
I don't think anyone has a sustainable business model right now for the root cause ( climate change).
Although Tesla seems to be the best option right now. I think the future will be a combination of electric bikes and greatly improved public transportation + reduced cost price.
An electric car is still too resource heavy too make.
I know a lot of people here who won't agree with me. But I'm pretty sure that they don't live in the Netherlands or Belgium ( where a lot of people cycle) or that this alternative is not viable there ( too cold or too wide).
I also didn't say it was a perfect solution for all ( ev. The edge cases I gave here) and that people will easily adjust when they don't have the habit of cycling ( eg. No adjusted roads)
Although Tesla seems to be the best option right now. I think the future will be a combination of electric bikes and greatly improved public transportation + reduced cost price.
An electric car is still too resource heavy too make.
I know a lot of people here who won't agree with me. But I'm pretty sure that they don't live in the Netherlands or Belgium ( where a lot of people cycle) or that this alternative is not viable there ( too cold or too wide).
I also didn't say it was a perfect solution for all ( ev. The edge cases I gave here) and that people will easily adjust when they don't have the habit of cycling ( eg. No adjusted roads)
[deleted]
Really incredible. I remember when it was trading at $18.
My gut feeling is that this is a short spike because of all the people who wants to take a bite at rising stock price. At some point people will realize that this is a ridiculous amount of money for a share of a company which is yet to prove that the company is massively profitable. When the price collapse, it will be a steep down curve.
My take as well. At the end of 2019 the financial spam changed from "TESLA IS SINKING! SELL!" to "TESLA IS AWESOME! BUY!".
I think this highlights the value of the brand, the tangible counterpart of “hype”. What the sceptics call starry-eyed fundamentalism is a valuable revenue stream, for whatever reason. Tesla successfully created a story of being the only cool kid in a room full of dinosaurs.
All other points good too, but didn’t see this mentioned.
All other points good too, but didn’t see this mentioned.
I sold my car and now drive one of those Zebra mopeds in SD. Next time I buy a car, it will be electric.
Enron looked great, right before it didn't. House prices will only continue to rise. All it takes is one drop of blood.
Maybe that will be Tesla's fate, maybe it won't but it's naive to think that can't happen.
Maybe that will be Tesla's fate, maybe it won't but it's naive to think that can't happen.
Here is another possibility: https://www.bloomberg.com/quote/CCMP:IND
The whole market was up 25-30% (Nasdaq). Now, as a trader, you know that there are companies that follow the market return, or accentuate it (from both directions).
TSLA being a tech company meant that you got better returns (50%) which are not too far from the Nasdaq returns. Apple returns were even crazier for a company its size: +100%!
tl;dr: We are in a bull-market.
The whole market was up 25-30% (Nasdaq). Now, as a trader, you know that there are companies that follow the market return, or accentuate it (from both directions).
TSLA being a tech company meant that you got better returns (50%) which are not too far from the Nasdaq returns. Apple returns were even crazier for a company its size: +100%!
tl;dr: We are in a bull-market.
Can't read the article but I'm thinking maybe they don't need to worry about convertible bonds anymore?
California law as of Jan 1 requires all new houses to have solar panels, EV charging port, no natural gas allowed. This 100% electric future being forced is attractive to Wall Street as it forces change, despite adding ~300k to the house price.
Wall Street bares no relation to the street where cars are powered by gasoline or diesel with few exceptions. It takes 75 minutes to charge a Tesla EV, much longer in cold climates (I have a Tesla owning acquaintance in Denver who confirms this).
We are n a giant stock market bubble. Tesla is a good example if this aspirational earnings exuberance IMO
There is no way this adds 300K to the price of a house, and it does not take 75 minutes to charge a Tesla, more like 15-30 minutes at a supercharger depending on your state of charge. Stop the FUD.
Supercharger technology
Tesla logo at Supercharger station Tesla supercharging stations charge with up to 150 kW of power distributed between two cars with a maximum of 150[13][14] kW per car, depending on version.[15][6][16] They take about 20 minutes to charge to 50%, 40 minutes to charge to 80%, and 75 minutes to 100% on the original 85 kWh Model S. The charging stations provide high-power direct-current (DC) charging power directly to the battery, bypassing the internal charging power supply.[1] The next version of Supercharging was expected to charge with more than 350 kW.[17][18]
https://en.wikipedia.org/wiki/Tesla_Supercharger
Tesla logo at Supercharger station Tesla supercharging stations charge with up to 150 kW of power distributed between two cars with a maximum of 150[13][14] kW per car, depending on version.[15][6][16] They take about 20 minutes to charge to 50%, 40 minutes to charge to 80%, and 75 minutes to 100% on the original 85 kWh Model S. The charging stations provide high-power direct-current (DC) charging power directly to the battery, bypassing the internal charging power supply.[1] The next version of Supercharging was expected to charge with more than 350 kW.[17][18]
https://en.wikipedia.org/wiki/Tesla_Supercharger
1. You will never be at 0% when you hit the supercharger.
2. You don't necessarily need to charge up to 100%
3. Supercharger V3 can reach 250KW, and the Tesla Model 3 supports this. The next gen Model S will as well.
2. You don't necessarily need to charge up to 100%
3. Supercharger V3 can reach 250KW, and the Tesla Model 3 supports this. The next gen Model S will as well.
At least in Germany it costs more like 15k for the roof of a big house.
300k is too much; 16k can cover half of your roof with panels, even in the SF Bay Area.
I was told this by a contractor friend in Ukiah California this weekend, he is now building these 2020 units and said TCI for abiding by the new laws was 300k on price of house to buyer
Current valuations, Tesla and Apple among the most prominent, are so far disconnected from reality that it echoes the dot com bubble. But this time, the cause is not dot com mania -- but buybacks, driven by reckless financial policy.
https://pbs.twimg.com/media/ENmRB6aVAAEziTn?format=jpg&name=...
https://pbs.twimg.com/media/ENmRB6aVAAEziTn?format=jpg&name=...
As is the case with Apple, Tesla is a cult and obviously Musk learned from Steve Jobs that cults beat facts, cults create empires and make bad as equal as good and sane people can do nothing about it. That's how the great empires and religions were built in the old days and that's how "great" companies are being built today.
Or: it's just the only company that makes a compelling product line for the biggest global market (energy and auto) while the rest of the industry keep selling fossil fuel and internal combustion engines, both of which are destroying our habitat an ever faster pace.
The cult is believing we can keep marketing ICE cars and pumping CO2 in the atmosphere and still expect to make money. https://i.redd.it/xobkagxotot01.jpg
The market cap of TSLA remains tiny compared to trillions $ of stranded assets of the oil and ICE industry.
The cult is believing we can keep marketing ICE cars and pumping CO2 in the atmosphere and still expect to make money. https://i.redd.it/xobkagxotot01.jpg
The market cap of TSLA remains tiny compared to trillions $ of stranded assets of the oil and ICE industry.
I still don’t get it. You may think it’s the future, but to justify such a valuation over all other car companies which have been operating for years, and who can compete with Tesla, it seems a little extreme IMO.
EDIT: after reading some comments it seems my conclusions might be inaccurate. All I wanted to point out was that the numbers were shocking at first sight.