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Their current price is silly. But will they _ever_ make more cars than the current incumbents? Gimme odds and I'd place a bet - they dominate the top 2-3 grow
by curiousllama 6y ago
Their current price is silly. But will they _ever_ make more cars than the current incumbents?
Gimme odds and I'd place a bet - they dominate the top 2-3 growing niches in auto (Battery tech & recycling, software/experience, and EV mass production). As long as their sales are constrained more by production than demand, it's unclear where their ceiling is.
You also need to consider they may just sell inputs to their competitors. Toyota may sell 10x the cars, but if Toyota must rely on Tesla battery factories, then Tesla can just eat their margin: Toyota sales feed Tesla's bottom line.
- rsynnott 6y ago> Toyota may sell 10x the cars, but if Toyota must rely on Tesla battery factories, then Tesla can just eat their margin: Toyota sales feed Tesla's bottom line. That would assume that Tesla somehow had a lasting monopoly on lithium ion batteries, which are ultimately a pretty generic product. In practice, you'd expect margins on batteries to be very, very low in the long term.
- tankenmate 6y agoTesla has the lead on producing top notch batteries at very low prices (mainly through automation which also helps with scale). Their battery / motor / generator controllers also appear to be pretty good. And their reluctance motors.