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There's a difference in not having a profit due to (a) reinvestment; (b) poor unit economics. (a) is much less worrying for an investor, e.g. Amazon (b) sugges

• jmpman 7y ago
  Is it possible that Tesla is driving down the cost curve faster than any other electric vehicle manufacturer, and once they hit a tipping point, they will disrupt the entire automotive industry and be worth 10x their current price? I may not believe Musk’s self driving car vision is attainable in the gritty real world in under 10 years, so I’ll discount that... but driving down battery cost, while making a better electric vehicle than Audi/Mercedes/Porsche.. that’s exciting.
• mcv 7y ago
  But Tesla is reinvesting a lot. And it's growing the market for electric cars, setting up infrastructure, etc. He might be selling at a loss initially in order to create the volume that will eventually drive down the cost so he can generate a profit. From what I understand, the big reason he keeps losing money on selling cars is that by the time the previous car starts making a profit, he's already already started selling the next one at greater volume, creating new loss that drowns the fresh profit from that previous car.
  • somerandomness 7y ago
    That was true with model S but not with model 3. The latter is the main product, bread and butter, whose purpose is not funding other future products.