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I'm worried about whether or not Tesla will still be a company in 5 years. I think I would love to have a model S, but not having confidence in whether or not i

I'm worried about whether or not Tesla will still be a company in 5 years. I think I would love to have a model S, but not having confidence in whether or not if be able to get it serviced is a huge impediment.

giancarlostoro 8y ago
It may be worse once we see other manufacturers producing all-electric (mostly) self-driving (capable) cars. For example I know Toyota intends to have an all electric lineup in the next few years[0]. However, I think it's possible for Tesla to remain despite all this. They seem to be quite ahead of the competition in having both all-electric and useful self-driving capabilities at least from my limited viewpoint. Disclaimer: I drive Toyota, but I don't work for any car companies. [0]: https://www.cnet.com/roadshow/news/toyota-to-introduce-10-electric-cars-by-mid-2020s/ https://www.cnet.com/roadshow/news/toyota-to-introduce-10-el...
- moron4hire 8y ago
  Yeah, it's definitely worth waiting to see what happens in at least the next year or two.
- Ambroos 8y ago
  Tesla has been very fast to release their self-driving capabilities (navigate on autopilot is pretty spooky), but in general the VW/Audi group shouldn't be too far off. The e-tron that was just released isn't as efficient as Tesla's because it's a traditional SUV design-wise, but a lot of the electric tech is there. On highways they even have L3 self-driving in traffic jams, in that the driver is no longer required to constantly pay attention, just being able to take over when the car indicates is enough. Looking at the Geneva Motor Show, almost every manufacturer is really moving towards EVs (Toyota being one of the slower ones to make this move). Tesla is just going to have to deal with actual competitors very soon.
  - deelowe 8y ago
    Doesn't the new x7 have self driving capabilities?
  - rcMgD2BwE72F 8y ago
    We've heard this since 2009! Nothing has changed expect that Tesla's lead is even greater. Other auto-manufacturer are all talk – except VW, these days (surprisingly). If you think one company is finally getting serious about actually making EV "en masse", look for their plans to build battery gigafactories: if there's none, then they will not have the production capacity to make the EV they're talking about (but they'll certainly green-wash consumers with big time ads)... unless we start to hear about gargantuan plans from LG, Samsung and the like. But we're still waiting.
    - Ambroos 8y ago
      VW has a massive battery order spread between Samsung, LG and CATL, but yeah, I agree Tesla will have a solid lead on battery production for a while. I wonder if Tesla/Panasonic will at some point start selling mass produced batteries to the traditional car manufacturers. Once EVs become mainstream, consumers will start expecting choice.
      - rcMgD2BwE72F 8y ago
        > VW has a massive battery order spread between Samsung, LG and CATL, but yeah, I agree Tesla will have a solid lead on battery production for a while. Tesla have much bigger contracts with Panasonic, and already supplies cells from Samsung and LG for stationary storage and is inquiring CATL as the main supplier of the Shanghai factory. Since Tesla is crushing them in EV volume and should continue to do so for years to come, I don't see how VW can compete in cost and even in tech. >I wonder if Tesla/Panasonic will at some point start selling mass produced batteries to the traditional car manufacturers. Once EVs become mainstream, consumers will start expecting choice. I doubt it, at least until Tesla is demand-constrained. By then, they'll keep all the batteries for their car and energy storage business and let the competition fight for the leftover.
- martin_drapeau 8y ago
  Comparing a Toyota to a Tesla is comparing oranges and apples. Tesla is a computer on wheels. Capabilities are delivered continuously over software updates. From self-driving capabilities to faster charging. Toyota and others do not have that capability.
  - bestnameever 8y ago
    Basically every car manufactured today can be called a computer on wheels. Whether Toyota will mimic Tesla's update process remains to be seen but I wouldn't rule it out once Toyota releases an all electric self driving vehicle.
    - TheSpiceIsLife 8y ago
      Call me old fashioned, but I think it is a mistake to allow a software update to modify the functionality of car remotely. Barring some kind of failure, whether mechanical, electrical, or electronic, I know with certainty the cars I own will perform tomorrow fairly well exactly as they did today.
  - tawaywhynot 8y ago
    >Capabilities are delivered continuously over software updates. Until your hardware is obsolete. There are severe restrictions to what can actually be improved over the air. As it stands, certain Model S and X can't use the next generation chargers. And if you believe Elon is going to upgrade all the hardware on every car for free, forever, well I have a bridge to sell you.
- freerobby 8y ago
  Prediction: In ten years it's going to be very funny to look back at Tesla as the supposed bankruptcy risk and not Toyota. We've heard variants on the parent-comments line of thinking ever since the Model S came out in 2012. Yet, fast forward to 2019, and the gap between Tesla and traditional automakers has only widened (to name a few axes: EV sales, EV margins, rate of software improvements/OTA updates, Supercharger network, battery production). This is what should terrify big automakers: it's not that Tesla's gap is per se insurmountable; it's that the pace at which Tesla is improving and innovating is far greater than the pace at which any other automaker is doing it. Most comparative analyses between Tesla and other auto companies suffer from a fallacy that relates to this: they compare the Tesla of today to the ___ of tomorrow. Perhaps some day a traditional auto manufacturer will offer an all-electric, self-driving car. But how long is it going to take them to get there? Not to announce something, or to design a concept car, but to actually build them and sell them at scale and with positive margins? And what will Tesla offer by the time they do? My wager is that by the time Toyota offers a compelling all-electric car (by today's standards), the feature gap between a $x Tesla and a $x Toyota will be so great that the Toyota will no longer be compelling to the market. Throw in lower margins as companies build their first EVs, the baggage of dealerships, a likely recession some time in the next decade, and it's not at all clear to me how traditional manufacturers like Toyota will survive the transition.
  - TheSpiceIsLife 8y ago
    > the pace at which Tesla is improving and innovating is far greater than the pace at which any other automaker is doing it. What portion of Telsa's pace of improvements and innovation would you say is due to Telsa only recently having got started at this, 16 years ago, compared to Toyota 86 year history of automobile manufacturing, or Ford's 116 years.
    - HeadsUpHigh 8y ago
      Their ability to iterate fast for one thing. The fact that their structures are built around an all EV company. Toyota will have pressure from other departments to build and fund ICE research at the same time. Tesla is 100% focused on one thing. Plus they have the lowest cost batteries which plays a huge role. I think what the other car manufacturers are waiting for is to jump straight into solid state batteries once that train is going. That should at least reduce the advantage Tesla has right now.
MrQuincle 8y ago
A perfect "late majority" point of view. Just wait them out. No need to hurry. Electric cars are here to stay. I don't think you benefit in any way in jumping on the bandwagon too soon.
- rcMgD2BwE72F 8y ago
  https://en.wikipedia.org/wiki/History_of_Nokia#Loss_of_smartphone_market_share https://en.wikipedia.org/wiki/History_of_Nokia#Loss_of_smart...
dalbasal 8y ago
I think you inevitably take some risk. Tesla is, and has been since founding, a risk taking company. They bet the house on whatever they're doing next, and that means they may not exist later. Also, electric cars are new, Tesla is new. So, the value of your 5 yr old tesla could (probably will) suffer more competition from newer models than an average ICE car, like the resale hit last year's model 3s just shouldered. ... Even if the companny is doing fine, servicing cars and the cars themselves age well... resale value is riskier than average. This is just the cost of being an early-ish adopter. You could lease, or buy used to limit risk, but these have implications too. The low risk, high resale value option is still (eg) an ICE toyota. You can't have everything. :)
- moron4hire 8y ago
  There is risk, and then there is risk. A car isn't an investment. I'm a VR and AR headset early adopter, but there it is clear that A) newer, better models will come out long before my current units die, and B) I'm investing in my knowledge of VR/AR software development. I wouldn't be where I am today, with the job I have today, if I hadn't bought an Oculus Rift DK2 when they first became generally available. I don't have any skin in the game for electric cars, so an electric car purchase is not going to have the same impact on my life, it's purely a consumptive object. So the math becomes "will this save me money or give me more enjoyment than a similar purchase from another company".
  - rcMgD2BwE72F 8y ago
    >I don't have any skin in the game for electric cars Are you living on Mars already? Here on Earth, we've got something called global warming that is threatening the future of society and the biosphere in general https://en.wikipedia.org/wiki/Effects_of_global_warming#Social_systems https://en.wikipedia.org/wiki/Effects_of_global_warming#Soci...
    - moron4hire 8y ago
      My single purchase is not going to make an effect on global warming. But if I were to buy an electric car for the purpose of doing my part to stem global warming, I might want to put my money towards a company that has a chance at surviving the next decade.
dTal 8y ago
It's worse than that. Tesla has embraced the modern concept of embedded computers - OTA updates, constant phoning home, user prevented from even attempting to gain root. It's a valid concern as to how long a Tesla car can survive the death of its company even with perfect mechanical servicing.
te_chris 8y ago
They're a plum acquisition target, surely.
- swarnie_ 8y ago
  Barely profitable, staring down growing competition from industry veterans and built around Musk's cult of personality. I love Telsa and what their doing but investing/acquiring them is such a risky move imo.
  - TheSpiceIsLife 8y ago
    If Telsa goes belly up, is it possible creditors will want to sell the business as a going concern? One of the other vehicle manufacturers make be able to buy Telsa's manufacturing facilities and branding for cents in the dollar.
    - JumpCrisscross 8y ago
      > If Telsa goes belly up, is it possible creditors will want to sell the business as a going concern? If it goes belly up, it’s no longer a going concern. Moreover, liquidation value of manufacturing facilities is pennies on the dollar. (Before legal fees, creditors’ claims, et cetera.) Supply chains are too tightly integrated; it’s expensive to swap in someone else’s kit.
      - TheSpiceIsLife 8y ago
        Thanks for you response. I do apologies for my lack of understanding with regard to the correct use of financial terms. I guess what I meant was, is there a future were, say, the Volkswagen Group owns Telsa?
        dragontamer 8y ago
        Of course. Patents and other IP will be sold off to the highest bidder. The factories will be closed down, but there's still railroads and other infrastructure that have been built to support the site. A new company will inevitably purchase the old site and recycle the infrastructure.
martin_drapeau 8y ago
Look at the numbers to convince you otherwise. The Model 3 is the best selling mid-side luxury car (https://cleantechnica.com/2018/12/08/tesla-model-3-completely-crushing-us-luxury-car-competition-10-cleantechnica-charts/ https://cleantechnica.com/2018/12/08/tesla-model-3-completel...). The demand is there and as long as it remains, Tesla will thrive. The company is victim of its own success. It can't produce enough vehicles to supply the demand. At the same time, its trying to make it more accessible. Tesla is reinventing the car industry with their product, sales and service. Of course this is risky and creates a lot of unknowns.
- FireBeyond 8y ago
  I'd love to see those numbers in a couple of months. All those other models are established and have churn. Tesla has a backlog of multiple years of M3 pre-orders, of course it's going to be selling at capacity. How about we take those numbers, and divide them along the lines of "how long has it been since pre-ordering"? That would look a lot less impressive (but still a very good effort).
linuxftw 8y ago
You're right to be worried. They're not profitable, have never been profitable, don't look like they're ever going to be profitable. Be smart with your money.
- dragontamer 8y ago
  You are correct on a yearly basis. But Q3 and Q4 of 2018 were profitable. So TSLA has made a quarterly profit. They've never made a yearly profit. Some would argue the last two quarters of profit is a turning point for the company. Q1 2019 looks like they will lose money though. Jury is still out on whether or not 2019 will be a profitable year.
  - gamblor956 8y ago
    Tesla was not profitable in Q3 or Q4 2018 on a GAAP basis. They were profitable on a very specific "unicorn accounting" metric that eliminates most of the expenses that other auto companies include in their financial reporting metrics. GAAP (and IFRS, the international version of GAAP) is industry-specific, so please none of the arguments about how it doesn't reflect the "true" state of Tesla's financial situation. It works just fine for every other carmaker.
    - dragontamer 8y ago
      Interesting. Do you have any good links that goes into the details of this? I'm always interested in learning how to read financial sheets better. Its outside my field of computers, but I'd love to learn the skill. I've got a general idea of how GAAP works and other such cash-flow matters, but no official training in the subject. EDIT: I did some searching... and it appears that Tesla was GAAP profitable in Q3 and Q4 2018, according to their quarterly filings. I'm very curious how and why you don't consider it GAAP. Is there something in the financial statement that is a red flag to you?
    - dmode 8y ago
      Literally every company report GAAP and non-GAAP numbers. And you publish a reconciliation report. non-GAAP profitability is as valid as GAAP profitability, otherwise you will get dinged by SEC as you are publishing those numbers in your annual report.

giancarlostoro 8y ago

It may be worse once we see other manufacturers producing all-electric (mostly) self-driving (capable) cars. For example I know Toyota intends to have an all electric lineup in the next few years[0]. However, I think it's possible for Tesla to remain despite all this. They seem to be quite ahead of the competition in having both all-electric and useful self-driving capabilities at least from my limited viewpoint. Disclaimer: I drive Toyota, but I don't work for any car companies. [0]: https://www.cnet.com/roadshow/news/toyota-to-introduce-10-electric-cars-by-mid-2020s/ https://www.cnet.com/roadshow/news/toyota-to-introduce-10-el...

moron4hire 8y ago
Yeah, it's definitely worth waiting to see what happens in at least the next year or two.
Ambroos 8y ago
Tesla has been very fast to release their self-driving capabilities (navigate on autopilot is pretty spooky), but in general the VW/Audi group shouldn't be too far off. The e-tron that was just released isn't as efficient as Tesla's because it's a traditional SUV design-wise, but a lot of the electric tech is there. On highways they even have L3 self-driving in traffic jams, in that the driver is no longer required to constantly pay attention, just being able to take over when the car indicates is enough. Looking at the Geneva Motor Show, almost every manufacturer is really moving towards EVs (Toyota being one of the slower ones to make this move). Tesla is just going to have to deal with actual competitors very soon.
- deelowe 8y ago
  Doesn't the new x7 have self driving capabilities?
- rcMgD2BwE72F 8y ago
  We've heard this since 2009! Nothing has changed expect that Tesla's lead is even greater. Other auto-manufacturer are all talk – except VW, these days (surprisingly). If you think one company is finally getting serious about actually making EV "en masse", look for their plans to build battery gigafactories: if there's none, then they will not have the production capacity to make the EV they're talking about (but they'll certainly green-wash consumers with big time ads)... unless we start to hear about gargantuan plans from LG, Samsung and the like. But we're still waiting.
  - Ambroos 8y ago
    VW has a massive battery order spread between Samsung, LG and CATL, but yeah, I agree Tesla will have a solid lead on battery production for a while. I wonder if Tesla/Panasonic will at some point start selling mass produced batteries to the traditional car manufacturers. Once EVs become mainstream, consumers will start expecting choice.
    - rcMgD2BwE72F 8y ago
      > VW has a massive battery order spread between Samsung, LG and CATL, but yeah, I agree Tesla will have a solid lead on battery production for a while. Tesla have much bigger contracts with Panasonic, and already supplies cells from Samsung and LG for stationary storage and is inquiring CATL as the main supplier of the Shanghai factory. Since Tesla is crushing them in EV volume and should continue to do so for years to come, I don't see how VW can compete in cost and even in tech. >I wonder if Tesla/Panasonic will at some point start selling mass produced batteries to the traditional car manufacturers. Once EVs become mainstream, consumers will start expecting choice. I doubt it, at least until Tesla is demand-constrained. By then, they'll keep all the batteries for their car and energy storage business and let the competition fight for the leftover.
martin_drapeau 8y ago
Comparing a Toyota to a Tesla is comparing oranges and apples. Tesla is a computer on wheels. Capabilities are delivered continuously over software updates. From self-driving capabilities to faster charging. Toyota and others do not have that capability.
- bestnameever 8y ago
  Basically every car manufactured today can be called a computer on wheels. Whether Toyota will mimic Tesla's update process remains to be seen but I wouldn't rule it out once Toyota releases an all electric self driving vehicle.
  - TheSpiceIsLife 8y ago
    Call me old fashioned, but I think it is a mistake to allow a software update to modify the functionality of car remotely. Barring some kind of failure, whether mechanical, electrical, or electronic, I know with certainty the cars I own will perform tomorrow fairly well exactly as they did today.
- tawaywhynot 8y ago
  >Capabilities are delivered continuously over software updates. Until your hardware is obsolete. There are severe restrictions to what can actually be improved over the air. As it stands, certain Model S and X can't use the next generation chargers. And if you believe Elon is going to upgrade all the hardware on every car for free, forever, well I have a bridge to sell you.
freerobby 8y ago
Prediction: In ten years it's going to be very funny to look back at Tesla as the supposed bankruptcy risk and not Toyota. We've heard variants on the parent-comments line of thinking ever since the Model S came out in 2012. Yet, fast forward to 2019, and the gap between Tesla and traditional automakers has only widened (to name a few axes: EV sales, EV margins, rate of software improvements/OTA updates, Supercharger network, battery production). This is what should terrify big automakers: it's not that Tesla's gap is per se insurmountable; it's that the pace at which Tesla is improving and innovating is far greater than the pace at which any other automaker is doing it. Most comparative analyses between Tesla and other auto companies suffer from a fallacy that relates to this: they compare the Tesla of today to the ___ of tomorrow. Perhaps some day a traditional auto manufacturer will offer an all-electric, self-driving car. But how long is it going to take them to get there? Not to announce something, or to design a concept car, but to actually build them and sell them at scale and with positive margins? And what will Tesla offer by the time they do? My wager is that by the time Toyota offers a compelling all-electric car (by today's standards), the feature gap between a $x Tesla and a $x Toyota will be so great that the Toyota will no longer be compelling to the market. Throw in lower margins as companies build their first EVs, the baggage of dealerships, a likely recession some time in the next decade, and it's not at all clear to me how traditional manufacturers like Toyota will survive the transition.
- TheSpiceIsLife 8y ago
  > the pace at which Tesla is improving and innovating is far greater than the pace at which any other automaker is doing it. What portion of Telsa's pace of improvements and innovation would you say is due to Telsa only recently having got started at this, 16 years ago, compared to Toyota 86 year history of automobile manufacturing, or Ford's 116 years.
  - HeadsUpHigh 8y ago
    Their ability to iterate fast for one thing. The fact that their structures are built around an all EV company. Toyota will have pressure from other departments to build and fund ICE research at the same time. Tesla is 100% focused on one thing. Plus they have the lowest cost batteries which plays a huge role. I think what the other car manufacturers are waiting for is to jump straight into solid state batteries once that train is going. That should at least reduce the advantage Tesla has right now.

MrQuincle 8y ago

A perfect "late majority" point of view. Just wait them out. No need to hurry. Electric cars are here to stay. I don't think you benefit in any way in jumping on the bandwagon too soon.

rcMgD2BwE72F 8y ago
https://en.wikipedia.org/wiki/History_of_Nokia#Loss_of_smartphone_market_share https://en.wikipedia.org/wiki/History_of_Nokia#Loss_of_smart...

dalbasal 8y ago

I think you inevitably take some risk. Tesla is, and has been since founding, a risk taking company. They bet the house on whatever they're doing next, and that means they may not exist later. Also, electric cars are new, Tesla is new. So, the value of your 5 yr old tesla could (probably will) suffer more competition from newer models than an average ICE car, like the resale hit last year's model 3s just shouldered. ... Even if the companny is doing fine, servicing cars and the cars themselves age well... resale value is riskier than average. This is just the cost of being an early-ish adopter. You could lease, or buy used to limit risk, but these have implications too. The low risk, high resale value option is still (eg) an ICE toyota. You can't have everything. :)

moron4hire 8y ago
There is risk, and then there is risk. A car isn't an investment. I'm a VR and AR headset early adopter, but there it is clear that A) newer, better models will come out long before my current units die, and B) I'm investing in my knowledge of VR/AR software development. I wouldn't be where I am today, with the job I have today, if I hadn't bought an Oculus Rift DK2 when they first became generally available. I don't have any skin in the game for electric cars, so an electric car purchase is not going to have the same impact on my life, it's purely a consumptive object. So the math becomes "will this save me money or give me more enjoyment than a similar purchase from another company".
- rcMgD2BwE72F 8y ago
  >I don't have any skin in the game for electric cars Are you living on Mars already? Here on Earth, we've got something called global warming that is threatening the future of society and the biosphere in general https://en.wikipedia.org/wiki/Effects_of_global_warming#Social_systems https://en.wikipedia.org/wiki/Effects_of_global_warming#Soci...
  - moron4hire 8y ago
    My single purchase is not going to make an effect on global warming. But if I were to buy an electric car for the purpose of doing my part to stem global warming, I might want to put my money towards a company that has a chance at surviving the next decade.

dTal 8y ago

It's worse than that. Tesla has embraced the modern concept of embedded computers - OTA updates, constant phoning home, user prevented from even attempting to gain root. It's a valid concern as to how long a Tesla car can survive the death of its company even with perfect mechanical servicing.

te_chris 8y ago

They're a plum acquisition target, surely.

swarnie_ 8y ago
Barely profitable, staring down growing competition from industry veterans and built around Musk's cult of personality. I love Telsa and what their doing but investing/acquiring them is such a risky move imo.
- TheSpiceIsLife 8y ago
  If Telsa goes belly up, is it possible creditors will want to sell the business as a going concern? One of the other vehicle manufacturers make be able to buy Telsa's manufacturing facilities and branding for cents in the dollar.
  - JumpCrisscross 8y ago
    > If Telsa goes belly up, is it possible creditors will want to sell the business as a going concern? If it goes belly up, it’s no longer a going concern. Moreover, liquidation value of manufacturing facilities is pennies on the dollar. (Before legal fees, creditors’ claims, et cetera.) Supply chains are too tightly integrated; it’s expensive to swap in someone else’s kit.
    - TheSpiceIsLife 8y ago
      Thanks for you response. I do apologies for my lack of understanding with regard to the correct use of financial terms. I guess what I meant was, is there a future were, say, the Volkswagen Group owns Telsa?
      - dragontamer 8y ago
        Of course. Patents and other IP will be sold off to the highest bidder. The factories will be closed down, but there's still railroads and other infrastructure that have been built to support the site. A new company will inevitably purchase the old site and recycle the infrastructure.

martin_drapeau 8y ago

Look at the numbers to convince you otherwise. The Model 3 is the best selling mid-side luxury car (https://cleantechnica.com/2018/12/08/tesla-model-3-completely-crushing-us-luxury-car-competition-10-cleantechnica-charts/ https://cleantechnica.com/2018/12/08/tesla-model-3-completel...). The demand is there and as long as it remains, Tesla will thrive. The company is victim of its own success. It can't produce enough vehicles to supply the demand. At the same time, its trying to make it more accessible. Tesla is reinventing the car industry with their product, sales and service. Of course this is risky and creates a lot of unknowns.

FireBeyond 8y ago
I'd love to see those numbers in a couple of months. All those other models are established and have churn. Tesla has a backlog of multiple years of M3 pre-orders, of course it's going to be selling at capacity. How about we take those numbers, and divide them along the lines of "how long has it been since pre-ordering"? That would look a lot less impressive (but still a very good effort).

linuxftw 8y ago

You're right to be worried. They're not profitable, have never been profitable, don't look like they're ever going to be profitable. Be smart with your money.

dragontamer 8y ago
You are correct on a yearly basis. But Q3 and Q4 of 2018 were profitable. So TSLA has made a quarterly profit. They've never made a yearly profit. Some would argue the last two quarters of profit is a turning point for the company. Q1 2019 looks like they will lose money though. Jury is still out on whether or not 2019 will be a profitable year.
- gamblor956 8y ago
  Tesla was not profitable in Q3 or Q4 2018 on a GAAP basis. They were profitable on a very specific "unicorn accounting" metric that eliminates most of the expenses that other auto companies include in their financial reporting metrics. GAAP (and IFRS, the international version of GAAP) is industry-specific, so please none of the arguments about how it doesn't reflect the "true" state of Tesla's financial situation. It works just fine for every other carmaker.
  - dragontamer 8y ago
    Interesting. Do you have any good links that goes into the details of this? I'm always interested in learning how to read financial sheets better. Its outside my field of computers, but I'd love to learn the skill. I've got a general idea of how GAAP works and other such cash-flow matters, but no official training in the subject. EDIT: I did some searching... and it appears that Tesla was GAAP profitable in Q3 and Q4 2018, according to their quarterly filings. I'm very curious how and why you don't consider it GAAP. Is there something in the financial statement that is a red flag to you?
  - dmode 8y ago
    Literally every company report GAAP and non-GAAP numbers. And you publish a reconciliation report. non-GAAP profitability is as valid as GAAP profitability, otherwise you will get dinged by SEC as you are publishing those numbers in your annual report.