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If Tesla does make 20 million cars that sell for an average of $50k and have net margins of 20%, their annual revenue would be $200 billion. If at that point th
by njarboe 4y ago
If Tesla does make 20 million cars that sell for an average of $50k and have net margins of 20%, their annual revenue would be $200 billion. If at that point they have the same PE as Apple has now (~25), that would be a market cap of $5 trillion. That would be a 6x gain from today just on regular auto sales. If the only side project that works out is Full Self Driving (which is the major focus of Tesla and occupies most of Musk's Tesla time) comes to pass, double that revenue would not be unreasonable. There are many things that could go wrong, but lots up possible upside.
- tsimionescu 4y ago> If Tesla does make 20 million cars that sell for an average of $50k and have net margins of 20%, their annual revenue would be $200 billion And if they make a hundred trillion cars and sell each for 50$, they will be even richer. But both of these assumptions are absurd, so why discuss them? There is no market for selling 20M $50k cars every year, especially of the same make.
- njarboe 4y agoThe key is Full Self Driving. Elon Musk has stated that without it, Tesla won't grow like they are planning. Who know if it is possible, but I think Tesla has the best chance with their access to top talent, no spending limits at this point, and a leader that is willing to put and keep the cars out on the road even with the bad PR of the inevitable crashes and deaths. Full Self Driving will save so many lives.
- tsimionescu 4y agoThat doesn't make a lick of difference: there aren't 20M customers willing to pay $50k every year on cars. Also, Tesla is far behind other players on self-driving, and they are losing talent, not attracting.