4 ms·

You need to factor in future profits, where Tesla is the strongest player for electric cars, autonomous driving (the first multitrillion dollar market) and bene

You need to factor in future profits, where Tesla is the strongest player for electric cars, autonomous driving (the first multitrillion dollar market) and benefits of the Musk ecosystem (Boring company, SolarCity, Hyperloop) Ford isn't really one of the car companies that looks like it will remain relevant in 10 years time.

patentatt 9y ago
Maybe it's more accurate to say that Tesla is the strongest for electric car technology development (and mindshare?), but is the weakest at manufacturing cars? Whereas a player like Ford may be excellent at manufacturing cars (personal opinions aside) but is not perceived to have the same electric car technology. Maybe the battery capacity alone is the differentiator? If Ford wanted to start rolling out electric cars, they'd need a lot of batteries, and from what I understand Tesla may be the front-runner in high capacity, low price batteries. That is, until the requisite rare-earth metals are monopolized by a hostile (economically or otherwise) nation and squeeze rent-seeking profits from the electric car boom (fad?).
- wellboy 9y ago
  That's an accurate description. Though acquiring the best electric car and autonomous driving technology is probably a magnitude harder than ramping up manufacturing. Manufacturing also isn't easy, but it also isn't super hard compared to electric cars and autonomous driving. Dozens of car companies have managed to do it, while none have managed to build electric cars and AD well yet.
  - notfromhere 9y ago
    Tesla has shown itself to be really bad at scaling manufacturing, even when it has large backorders for its cars.
    - wellboy 9y ago
      Probably because they are a new company and want to innovate on manufacturing to make it 5x better than the industry standard like with everything they do.
      - patentatt 9y ago
        Well, fanboyism aside, if that's the goal, and it no-doubt is, then it appears that they are currently failing at that goal, objectively speaking. That might change in the future, but for now, it's just not reality. Give 'em credit for trying, but a rational market doesn't really reward trying as much as succeeding.
  - patentatt 9y ago
    But Tesla didn't 'invent' electric cars, or electric motors, or motor controllers, or batteries, etc. I'm sure they have put lots of R&D effort and money into their implementations and execution of these things, but the fundamentals are pretty basic stuff that's been around for a while. At least since the Prius, or the GM electric car in the 90's, or any of the much earlier stuff. I'm not an expert in the area, but I am not aware of a game-changing implementation that Tesla has made, is there one? Like, did they make electric motors better in some fundamental, un-reproducable way? That would be a 'moat' they could use to stave off competitors. Or is their battery tech a game changer? From my lay perspective, it appears that their battery manufacturing capacity (i.e., gigafactory) may be, but the battery tech itself is more or less industry-standad stuff. I guess the big question is what is their competitive advantage compared to Ford, GM, Honda, Toyota, etc.? I ask that not as an attack, but a genuine question to ponder. Nissan has the Leaf in production today, they have all the tech necessary to develop and manufacture and bring to market an electric vehicle. What's stopping them from launching a 'Tesla-killer' under their Infinity brand aimed at the same market as Tesla? It appears nothing is, at least nothing technological. It's probably just a product-market fit question, and as soon as the market for a high end electric vehicle is big enough (thanks to Tesla) then they probably will. And at that point, what Tesla is just another car manufacturer, but one that seems to suck at manufacturing and bringing cars to market. Those kinks may be ironed out, but in the long term it seems that they should be expected to settle into a position as one of many car maker options, where consumers choose a Tesla for similar reasons as one would choose any other car. So, from that perspective, the valuation seems spurious. Is the play all about self-driving cars? Is the promise of self-driving cars the only thing behind Tesla and Uber? Then again, I ask what advantage these players have, if any. The incumbents may be slow, but do you really think Toyota, GM, Ford, etc. aren't working on this stuff too? They are. Every major car manufacturer has a self-driving car program in the works. Heck, Mercedes has been working on it since at least the late 90's when they brought to market the first radar-assisted cruise controls. I don't mean to shit all over Tesla here, as surely their existence has sped up the development and public perception of electric vehicles in a major way. And I get the Musk fanboy-ism, he's totally cool and his portfolio of companies is equally totally cool (even though, contrary to perception, he did not in fact 'found' Tesla, Martin Eberhard and Marc Tarpenning did, Elon came in at the series A round of funding). And their cars are totally awesome, and that's something to admire. But as far as their current market valuation, from a totally dispassionate analysis, it seems irrational. Long-term it's hard to see them as justifying a valuation at multiples that much higher than the incumbents. I just don't see the logic. But maybe it doesn't have to be 'logical,' maybe financial markets aren't entirely rational, and maybe that's OK.
gottabkidding 9y ago
Ford was founded in 1903. It’s 115 years old. They seem to be doing okay so far...
- some_random 9y ago
  Devil's advocate; Past performance doesn't necessarily correspond to future success. Typewriter manufacturers were still doing pretty well in 1960. That said, IBM certainly did well in that particular transition.
  - nopriorarrests 9y ago
    In auto industry, past performance matters a lot. You do not see new car companies popping up left and right, because profitable manufacturing at scale is insanely hard, and profit margins are not that great. So companies who acquired that knowledge tend to stick around. Unseating them is tricky, as Tesla M3 scale up illustrates.
- wellboy 9y ago
  Only that they would have gone bankrupt if it hadn't been for the government in 2008 when it was around 105 years, next to a few other large car manufacturers.

patentatt 9y ago

Maybe it's more accurate to say that Tesla is the strongest for electric car technology development (and mindshare?), but is the weakest at manufacturing cars? Whereas a player like Ford may be excellent at manufacturing cars (personal opinions aside) but is not perceived to have the same electric car technology. Maybe the battery capacity alone is the differentiator? If Ford wanted to start rolling out electric cars, they'd need a lot of batteries, and from what I understand Tesla may be the front-runner in high capacity, low price batteries. That is, until the requisite rare-earth metals are monopolized by a hostile (economically or otherwise) nation and squeeze rent-seeking profits from the electric car boom (fad?).

wellboy 9y ago
That's an accurate description. Though acquiring the best electric car and autonomous driving technology is probably a magnitude harder than ramping up manufacturing. Manufacturing also isn't easy, but it also isn't super hard compared to electric cars and autonomous driving. Dozens of car companies have managed to do it, while none have managed to build electric cars and AD well yet.
- notfromhere 9y ago
  Tesla has shown itself to be really bad at scaling manufacturing, even when it has large backorders for its cars.
  - wellboy 9y ago
    Probably because they are a new company and want to innovate on manufacturing to make it 5x better than the industry standard like with everything they do.
    - patentatt 9y ago
      Well, fanboyism aside, if that's the goal, and it no-doubt is, then it appears that they are currently failing at that goal, objectively speaking. That might change in the future, but for now, it's just not reality. Give 'em credit for trying, but a rational market doesn't really reward trying as much as succeeding.
- patentatt 9y ago
  But Tesla didn't 'invent' electric cars, or electric motors, or motor controllers, or batteries, etc. I'm sure they have put lots of R&D effort and money into their implementations and execution of these things, but the fundamentals are pretty basic stuff that's been around for a while. At least since the Prius, or the GM electric car in the 90's, or any of the much earlier stuff. I'm not an expert in the area, but I am not aware of a game-changing implementation that Tesla has made, is there one? Like, did they make electric motors better in some fundamental, un-reproducable way? That would be a 'moat' they could use to stave off competitors. Or is their battery tech a game changer? From my lay perspective, it appears that their battery manufacturing capacity (i.e., gigafactory) may be, but the battery tech itself is more or less industry-standad stuff. I guess the big question is what is their competitive advantage compared to Ford, GM, Honda, Toyota, etc.? I ask that not as an attack, but a genuine question to ponder. Nissan has the Leaf in production today, they have all the tech necessary to develop and manufacture and bring to market an electric vehicle. What's stopping them from launching a 'Tesla-killer' under their Infinity brand aimed at the same market as Tesla? It appears nothing is, at least nothing technological. It's probably just a product-market fit question, and as soon as the market for a high end electric vehicle is big enough (thanks to Tesla) then they probably will. And at that point, what Tesla is just another car manufacturer, but one that seems to suck at manufacturing and bringing cars to market. Those kinks may be ironed out, but in the long term it seems that they should be expected to settle into a position as one of many car maker options, where consumers choose a Tesla for similar reasons as one would choose any other car. So, from that perspective, the valuation seems spurious. Is the play all about self-driving cars? Is the promise of self-driving cars the only thing behind Tesla and Uber? Then again, I ask what advantage these players have, if any. The incumbents may be slow, but do you really think Toyota, GM, Ford, etc. aren't working on this stuff too? They are. Every major car manufacturer has a self-driving car program in the works. Heck, Mercedes has been working on it since at least the late 90's when they brought to market the first radar-assisted cruise controls. I don't mean to shit all over Tesla here, as surely their existence has sped up the development and public perception of electric vehicles in a major way. And I get the Musk fanboy-ism, he's totally cool and his portfolio of companies is equally totally cool (even though, contrary to perception, he did not in fact 'found' Tesla, Martin Eberhard and Marc Tarpenning did, Elon came in at the series A round of funding). And their cars are totally awesome, and that's something to admire. But as far as their current market valuation, from a totally dispassionate analysis, it seems irrational. Long-term it's hard to see them as justifying a valuation at multiples that much higher than the incumbents. I just don't see the logic. But maybe it doesn't have to be 'logical,' maybe financial markets aren't entirely rational, and maybe that's OK.

gottabkidding 9y ago

Ford was founded in 1903. It’s 115 years old. They seem to be doing okay so far...

some_random 9y ago
Devil's advocate; Past performance doesn't necessarily correspond to future success. Typewriter manufacturers were still doing pretty well in 1960. That said, IBM certainly did well in that particular transition.
- nopriorarrests 9y ago
  In auto industry, past performance matters a lot. You do not see new car companies popping up left and right, because profitable manufacturing at scale is insanely hard, and profit margins are not that great. So companies who acquired that knowledge tend to stick around. Unseating them is tricky, as Tesla M3 scale up illustrates.
wellboy 9y ago
Only that they would have gone bankrupt if it hadn't been for the government in 2008 when it was around 105 years, next to a few other large car manufacturers.