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Honestly seems like absolute complete madness. Cars, batteries, and solar panels are all basically commodities. There is a certain value to a car brand, of cour

by tormeh 6y ago

Honestly seems like absolute complete madness. Cars, batteries, and solar panels are all basically commodities. There is a certain value to a car brand, of course, but still. The only way this valuation makes any sort of sense is if Tesla manages to pull off 100% self-driving, as that field will have few competitors for a long time. The guy in the article should definitely sell half his shares and put them into an ACWI index fund or something. Super scary seeing these people apparently not hedging.

bfieidhbrjr 6y ago
The value is really in the inept cluelessness of the legacy automakers. If any of them woke up and got a Clue(TM) then, after they build a car that isn't crappy, and a charging network, and self-driving... Then TSLA stock might drop.
- davewritescode 6y ago
  GM arguably has a better self driving solution than Tesla at the moment. At least it’s safer. Ford has the Mach-E which is getting really favorable press from the “car guy” world (i.e people who are a little more skeptical of Tesla) which supposedly is getting self driving and is $7k less with tax credit than the Model Y. https://youtu.be/c4n5iPqxpaw https://youtu.be/c4n5iPqxpaw Honestly, given Tesla’s quality issues and how they address them, I wouldn’t mind seeing what the more risk-averse, mature automakers come up with. The way Tesla has handled design flows in the Model S front suspension is downright disgraceful. https://www.reuters.com/article/us-tesla-safety-investigation/u-s-agency-opens-probe-into-115000-tesla-vehicles-over-suspension-issue-idUSKBN287172 https://www.reuters.com/article/us-tesla-safety-investigatio...
  - bfieidhbrjr 6y ago
    Mach-E looks ok but there's no way I'm driving long distance on J1772. You might convince people ChaDeMo is okay... but not if they've done a v3 supercharger. Like I said, its not just the car. You may be right about SuperCruise, I have a small amount of experience with it, but I'm skeptical. As for cars having design faults and the manufacturer being disgraceful... That's a pretty long list? We could start with the Pinto exploding? Or the Bronco roof collapsing?
    - maxerickson 6y ago
      It's not likely that charging will represent a durable advantage. (Tesla has a significant lead, but ultimately still has a small number of locations)
    - garyrichardson 6y ago
      That's the thing. If you're in the market for a Tesla priced car today, buy a Tesla. It's amazing. In 3+ years re-evaluate the DC charging networks when you're ready for your next car.
- deleted 6y ago
  [deleted]
- MrRiddle 6y ago
  All Toyota has to do is build fine Corolla EV. Then all they have to do is install fast chargers at their dealerships, which I can only imagine the number of.
newacct583 6y ago
> Cars, batteries, and solar panels are all basically commodities. That is only true, and arguably so, for solar panels. Cars are absolutely brand-dominated, and famously so. If they were really commoditized we'd be seeing consolidation of providers, where (c.f. the very company we're talking about!) we're seeing the opposite. And batteries are legitimately high tech devices. No one can "just open a battery factory" without stealing someone else's chemistry process first, and probably a ton of industry knowledge about suppliers and chain management. An enormous amount of money is still being dumped into battery R&D. They are basically the polar opposite of a commoditized product.
- tormeh 6y ago
  Fair point about the batteries. Or, at least I have no grounded criticism. It's not a natural monopoly, though. It's not an OS. As for cars, there are way fewer manufacturers than you'd think. Check out the Volkswagen Group, for example. Usually many brands share the same technical platform, and the parts are made by suppliers like Bosch, which serve all manufacturers that will pay.
leppr 6y ago
The crazy valuation of TESLA has more to do with the flight-to-stocks caused by the unprecedented dollar printing of 2020, combined with the "memeability" of the brand and its CEO, than the fundamentals of the company.
- tinco 6y ago
  If that were true, that would mean all the rational (hedge funds?) are holding their TSLA stocks despite knowing that their value is largely based on fickle investors. Big serious investors must still own TSLA stock.. right? Why aren't they selling?
  - est31 6y ago
    Nobody wants to leave the party before it's over.
  - leppr 6y ago
    "Big serious investors" are also putting hundreds of millions into bitcoin. These are crazy times. There is already over 20% more dollars now than there was last year[1]. If you follow the news you can see the dollar devaluation is likely not going to stop. Lockdowns kept inflation under control by reducing money velocity, but eventually inflation will come and funds are preparing for it however they can. Rationality based on outdated models doesn't work when the environment is changing. [1]: https://fred.stlouisfed.org/series/M2 https://fred.stlouisfed.org/series/M2
    - tinco 6y ago
      Bitcoin do not represent shares of an actual operating company though. Bitcoin's value lies in how many people want to link their net worth together. Tesla actually has some sort of future final value, at some point it's going to be clear how many cars they're going to sell, how many engines and batteries and solar panels and AI modules and whatnot. At that point they're gonna pay dividends, and that's gonna decide a reasonable price point. And its current share price just doesn't make sense. What are people going to do when they receive 7 cents dividend per year on their 700 dollar stocks? Or is TSLA going to pull an Apple and constantly come up with different types of devices to sell? Forever?
nicoburns 6y ago
It doesn't make much sense from a "return on investment" perspective. But it makes a lot more sense than the markets usually do from an "efficient allocation of capital" perspective...
lanevorockz 6y ago
Tesla is basically unparalleled in the electronic cars and their self driving is already passing certifications. Don’t come with this oil lobby, Tesla is just another manufacturer... you will keep loosing money and won’t know why
srwx 6y ago
Maybe he is like me, I put money into TSLA that I was happy to lose simply because I want to invest in things that make the world better. That hasn't changed just because on paper I'm rich. The mission isn't over.
- tormeh 6y ago
  Might be. I do the same in biotech.

by tormeh 6y ago

bfieidhbrjr 6y ago

The value is really in the inept cluelessness of the legacy automakers. If any of them woke up and got a Clue(TM) then, after they build a car that isn't crappy, and a charging network, and self-driving... Then TSLA stock might drop.

davewritescode 6y ago
GM arguably has a better self driving solution than Tesla at the moment. At least it’s safer. Ford has the Mach-E which is getting really favorable press from the “car guy” world (i.e people who are a little more skeptical of Tesla) which supposedly is getting self driving and is $7k less with tax credit than the Model Y. https://youtu.be/c4n5iPqxpaw https://youtu.be/c4n5iPqxpaw Honestly, given Tesla’s quality issues and how they address them, I wouldn’t mind seeing what the more risk-averse, mature automakers come up with. The way Tesla has handled design flows in the Model S front suspension is downright disgraceful. https://www.reuters.com/article/us-tesla-safety-investigation/u-s-agency-opens-probe-into-115000-tesla-vehicles-over-suspension-issue-idUSKBN287172 https://www.reuters.com/article/us-tesla-safety-investigatio...
- bfieidhbrjr 6y ago
  Mach-E looks ok but there's no way I'm driving long distance on J1772. You might convince people ChaDeMo is okay... but not if they've done a v3 supercharger. Like I said, its not just the car. You may be right about SuperCruise, I have a small amount of experience with it, but I'm skeptical. As for cars having design faults and the manufacturer being disgraceful... That's a pretty long list? We could start with the Pinto exploding? Or the Bronco roof collapsing?
  - maxerickson 6y ago
    It's not likely that charging will represent a durable advantage. (Tesla has a significant lead, but ultimately still has a small number of locations)
  - garyrichardson 6y ago
    That's the thing. If you're in the market for a Tesla priced car today, buy a Tesla. It's amazing. In 3+ years re-evaluate the DC charging networks when you're ready for your next car.
deleted 6y ago
[deleted]
MrRiddle 6y ago
All Toyota has to do is build fine Corolla EV. Then all they have to do is install fast chargers at their dealerships, which I can only imagine the number of.

newacct583 6y ago

> Cars, batteries, and solar panels are all basically commodities. That is only true, and arguably so, for solar panels. Cars are absolutely brand-dominated, and famously so. If they were really commoditized we'd be seeing consolidation of providers, where (c.f. the very company we're talking about!) we're seeing the opposite. And batteries are legitimately high tech devices. No one can "just open a battery factory" without stealing someone else's chemistry process first, and probably a ton of industry knowledge about suppliers and chain management. An enormous amount of money is still being dumped into battery R&D. They are basically the polar opposite of a commoditized product.

tormeh 6y ago
Fair point about the batteries. Or, at least I have no grounded criticism. It's not a natural monopoly, though. It's not an OS. As for cars, there are way fewer manufacturers than you'd think. Check out the Volkswagen Group, for example. Usually many brands share the same technical platform, and the parts are made by suppliers like Bosch, which serve all manufacturers that will pay.

leppr 6y ago

The crazy valuation of TESLA has more to do with the flight-to-stocks caused by the unprecedented dollar printing of 2020, combined with the "memeability" of the brand and its CEO, than the fundamentals of the company.

tinco 6y ago
If that were true, that would mean all the rational (hedge funds?) are holding their TSLA stocks despite knowing that their value is largely based on fickle investors. Big serious investors must still own TSLA stock.. right? Why aren't they selling?
- est31 6y ago
  Nobody wants to leave the party before it's over.
- leppr 6y ago
  "Big serious investors" are also putting hundreds of millions into bitcoin. These are crazy times. There is already over 20% more dollars now than there was last year[1]. If you follow the news you can see the dollar devaluation is likely not going to stop. Lockdowns kept inflation under control by reducing money velocity, but eventually inflation will come and funds are preparing for it however they can. Rationality based on outdated models doesn't work when the environment is changing. [1]: https://fred.stlouisfed.org/series/M2 https://fred.stlouisfed.org/series/M2
  - tinco 6y ago
    Bitcoin do not represent shares of an actual operating company though. Bitcoin's value lies in how many people want to link their net worth together. Tesla actually has some sort of future final value, at some point it's going to be clear how many cars they're going to sell, how many engines and batteries and solar panels and AI modules and whatnot. At that point they're gonna pay dividends, and that's gonna decide a reasonable price point. And its current share price just doesn't make sense. What are people going to do when they receive 7 cents dividend per year on their 700 dollar stocks? Or is TSLA going to pull an Apple and constantly come up with different types of devices to sell? Forever?

nicoburns 6y ago

It doesn't make much sense from a "return on investment" perspective. But it makes a lot more sense than the markets usually do from an "efficient allocation of capital" perspective...

lanevorockz 6y ago

Tesla is basically unparalleled in the electronic cars and their self driving is already passing certifications. Don’t come with this oil lobby, Tesla is just another manufacturer... you will keep loosing money and won’t know why

srwx 6y ago

Maybe he is like me, I put money into TSLA that I was happy to lose simply because I want to invest in things that make the world better. That hasn't changed just because on paper I'm rich. The mission isn't over.

tormeh 6y ago
Might be. I do the same in biotech.