4 ms·

I like Tesla and I want it to succeed, but I don't see how it can possibly be justifiable for Tesla to have a market cap anywhere near that of Ford and GM. They

I like Tesla and I want it to succeed, but I don't see how it can possibly be justifiable for Tesla to have a market cap anywhere near that of Ford and GM. They manufacture and sell several million cars a year and could easily start cranking out electric cars if the consumer demand is there. I'm sure they'll be grateful to Elon for creating consumer demand for electric cars, but they, not Tesla, will be the ones who sell millions of them.

ericb 8y ago
I think your prediction ignores the historical trend of incumbents ignoring incoming paradigm shifts to their peril.
- twblalock 8y ago
  In this case the incumbents are investing heavily in electric cars and various forms of autonomous driving.
  - ericb 8y ago
    In terms of the electrification, in each case I keep seeing that the dealers are using it to check a box, but sales will push you away from them. They mostly seem to look like compliance cars. If you're seeing differently, I'm interested in links.
    - twblalock 8y ago
      Most compliance cars are made by taking an existing model and shoving an electric motor under the hood and a battery in the trunk, e.g. the Fiat 500e, or those electric Toyota RAV4s that are owned by pretty much every public university's maintenance department in California. They generally have poor range and very attractive monthly lease payments. The Chevy Bolt was designed from the ground up to be an electric car. It competes favorably with the Tesla Model 3 in most areas (except styling...) and you can go buy one today instead of joining a waiting list. The Honda Clarity and Nissan Leaf are other examples of cars specifically designed to be electric.
xigency 8y ago
Uber basically makes a navigation app and has a higher valuation (not on the public market) than any of those companies. Why couldn't a car manufacturer have greater market value than another manufacturer even if they sell fewer cars?
xapata 8y ago
Where will they buy their batteries from? I'm sure Musk would like to get more focused on batteries and leave the mass-market cars to someone else.
- mhermher 8y ago
  Maybe from Panasonic, the same company Tesla gets theirs from.
martythemaniak 8y ago
Simply put, Tesla has high expectations built into their current price. These expectations exist because they are several years ahead of their competitors in key components and they have lines of business available to them that are not available to GM or Ford. TSLA is the most (or amongst the most) shorted stock on the market, so a lot of people have a lot of money riding on being able to convince people that they can never meet those expectations. So we hear a lot about Tesla having trouble ramping up to 20,000 units/month, but we don't hear very much about GM having trouble selling 2000 units per month.

ericb 8y ago

I think your prediction ignores the historical trend of incumbents ignoring incoming paradigm shifts to their peril.

twblalock 8y ago
In this case the incumbents are investing heavily in electric cars and various forms of autonomous driving.
- ericb 8y ago
  In terms of the electrification, in each case I keep seeing that the dealers are using it to check a box, but sales will push you away from them. They mostly seem to look like compliance cars. If you're seeing differently, I'm interested in links.
  - twblalock 8y ago
    Most compliance cars are made by taking an existing model and shoving an electric motor under the hood and a battery in the trunk, e.g. the Fiat 500e, or those electric Toyota RAV4s that are owned by pretty much every public university's maintenance department in California. They generally have poor range and very attractive monthly lease payments. The Chevy Bolt was designed from the ground up to be an electric car. It competes favorably with the Tesla Model 3 in most areas (except styling...) and you can go buy one today instead of joining a waiting list. The Honda Clarity and Nissan Leaf are other examples of cars specifically designed to be electric.

xigency 8y ago

Uber basically makes a navigation app and has a higher valuation (not on the public market) than any of those companies. Why couldn't a car manufacturer have greater market value than another manufacturer even if they sell fewer cars?

xapata 8y ago

Where will they buy their batteries from? I'm sure Musk would like to get more focused on batteries and leave the mass-market cars to someone else.

mhermher 8y ago
Maybe from Panasonic, the same company Tesla gets theirs from.

martythemaniak 8y ago

Simply put, Tesla has high expectations built into their current price. These expectations exist because they are several years ahead of their competitors in key components and they have lines of business available to them that are not available to GM or Ford. TSLA is the most (or amongst the most) shorted stock on the market, so a lot of people have a lot of money riding on being able to convince people that they can never meet those expectations. So we hear a lot about Tesla having trouble ramping up to 20,000 units/month, but we don't hear very much about GM having trouble selling 2000 units per month.