With $100 million in net assets, how is TSLA really going to compete long term with GM F Nissan Porshe if this segment is really worth to justify a $7 billion market cap?? That is my concern long term. Short term, can these guys get to 40,000 annual units? I think not. I think all the novelty people are buying up right now. Then who will buy? Average person would rather get a real car for $90,000. I think. I'm just speculating. What do you all think. At current run rate they can only earn about 60 centts a year and that is before taxes. That doesn't make the company worth $60.
BEV could the new megatrend. Those start slow and then accelerate and last for a long time. The key enabling technology is the Li-ion battery as it improves to reach the take off point. Yes, initially the prices will be hi just like the PC was initially expensive, or the cell phone.
Tesla has proprietary battery management tech that give it the long range of BEV and range sells. Add to it a very efficient induction motor, computer controlled inverter and ground up BEV design. Plus great design, table controls and brand. Yes, brand. Equally important is their Supercharger network that will go nationwide. Anybody trying to get in will have to build another network. Do not see anybody close.
There is too much skepticism about company. No wonder the short interest was so hi. Shorts thought Tesla failure was a sure shot. Shorts are hanging to their positions till the bitter end. Sounds like the Fall of Berlin... May-1-1945. Denial till the end.
(( At current run rate they can only earn about 60 centts a year and that is before taxes. That doesn't make the company worth $60.)))
Here are the rules
1.) Say Apple 100 times and then give Tesla your money to Tesla.
2.) Do not say Compu-add, Northgate, Osborne, Zeos, Alliant, Commodore, K-Pro, Apricot Computers, CDC, Corona, Multiflow, Radio Shack, Stardent, or any of the other personal computer makers who are now gone.
Ive thought about that very topic and here is my personal experience in corporate America. Large corporations are often risk adverse and slow to change. Especially in such a highly competative market as cars. If you look at the truck world. Is there a big difference between a dodge, ford, chevy, tundra....? Is there a huge difference between a BMW, Mercedes, Lexus, Infinite...? Im a BMW, Ford, Old jeep guy, but I admit all the competing brands are so close its almost a wash.
So my thesis, knowing managers, executives, etc. looking at the car industry I believe they are sitting back and watching. I think they risk getting caught WAY off guard and not being intune (Pune intended for ICE car guys) with a large segment of car buyers. I also think it will be hard to catch Tesla. Not impossible, but difficult because as Elon points out an all EV car effectively undermines the dealer and parts infrastructure. Thus I dont see them (except maybe Nissan) jumping on soon.
If Tesla fails I believe it will be from within and not external.
Why did JCPenny, Sears, Walmart, etc. not buy Amazon 10 yrs ago? Why did Visa/MC not start or buy Pay Pal? Why did Comcast, Time Warner not buy Netflix? Why did Bellsouth, Pacific Bell or whoever not see Verizon coming..? And how has the paper magazine, news print world been so blind sided by the internet? Corporations are often not as visionary or as nibble ad we think. Change can be uncomfortable.
You guys who knock the market cap of a visionary company are silly. MIcrosoft and Apple were all small cap companies at one point - imagine the idiot who said 7b market cap was too much to pay for MSFT in the 80s. The market is forward looking, and whether or not Tesla is deserving of it's valuation has little to do with it's current assets / sales and everything to do with it's patents, tech, talent, and potential. Only time will tell, right? If you are a trader then perhaps you will make money shorting - I think Tesla will go up and down many times and you will make money both short and long if you play it right (AAPL went from 60 to 200 back to 60 three times before rocketing), but long term investors consider 7b to still be cheap.