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Tesla is valued at nearly 2x that of Toyota and nearly 10x that of Ford, while struggling to produce a fraction of the cars. It is valued on the idea of growth

Tesla is valued at nearly 2x that of Toyota and nearly 10x that of Ford, while struggling to produce a fraction of the cars. It is valued on the idea of growth but it has proven that growth isn’t happening. Also economic downturn. Also other manufacturers are introducing more sensible electric vehicles than they used to. Also Tesla has repeatedly had issues with build quality. It’s starting to catch up with them. Tesla is the My Space of electric cars. It’s necessary to get us over the hump but has no staying power of its own. Meta has a huge generational problem. Their flagship products are Facebook and Instagram. Facebook is not used by gen Z at all. The writing is on the wall that FB will be a ghost town once millennials turn into ghosts. Instagram is maybe 10 years behind. So Meta is chasing TikTok without realizing that gen Z isn’t using that either and also without realizing what TikTok actually is. Also Meta is bizarrely chasing virtual reality stuff and failing so far to provide any kind of value prop.

jerrytsai 4y ago
Like with anything publicly traded, the price of a share is principally derived from belief. Much of this belief comes from a person projecting where the price will be in the future. With Tesla, many people and institutions projected that that price would increase in the future. Now many of them do not. Belief in the direction of the price can come from examining the financial fundamentals of a company and the perceived value that it may increasingly generate ("fundamental analysis'). Or it can be speculative, where people believe other people will buy (or sell) more based on observed buying/selling activity ("technical analysis"). With Tesla, many investors were using their own version of technical analysis that far surpassed the valuation that a reasonable fundamental analysis would have derived and even derive today. There was and is a mania, much like there has been and there is for many forms of cryptocurrency. The recently declining price is likely due to a collective perception that Tesla has been overpriced and, due to recent factors, that the fundamentals that justify the pricing for a share will diverge even further from its recent pricing. From a fundamental level, Tesla was unlikely to justify its recent pricing. An irony is that the earlier mania was so intense even today, after such a pronounced plunge from the start of the year, it likely remains seriously overvalued.
paulcole 4y ago
What do you believe TikTok “actually is”?
- IgorPartola 4y ago
  TikTok absolutely nailed two things. First, it is just video. Facebook tried to shoehorn video shorts into two existing platforms (FB and Instagram) but that just breaks up the flow. People expect to read things on FB and look at photos on Instagram. Having a video suddenly playing in full screen sucks when those are your expectations. Second, TikTok has an absolutely amazing recommendations algorithm. This is the core of the product: an algorithm that has a great mix of showing you things that have to do with your interests while also showing you things that are just slightly outside of them to expand your horizons. It feels cohesive and custom tailored. FB shorts are awful. They show you cheesy bullshit videos that have nothing to do with you or each other. Until you watch one and then they assume that’s all you ever want.
tjansen 4y ago
> chasing TikTok without realizing that gen Z isn’t using that either So what is Gen Z using?
- danaris 4y ago
  While I'm not sure I agree with the GP's premise... ...Gen Z doesn't have to be "using" anything particular. Just because, for some years, "everybody had to be on Facebook" doesn't mean that the decline of that means something will necessarily replace it. There was no "previous Facebook", and there doesn't have to be a "next Facebook".
  - 4RealFreedom 4y ago
    IgorPartola mentioned MySpace. When Facebook came out, I wondered why anyone would make a MySpace clone. I think there's an argument that there was a previous Facebook.
    - evanelias 4y ago
      Absolutely yes regarding MySpace. Per Wikipedia: "in June 2006, it surpassed Yahoo! and Google to become the most visited website in the United States" https://en.wikipedia.org/wiki/Myspace https://en.wikipedia.org/wiki/Myspace
  - igetspam 4y ago
    There were a half a dozen or more "previous Facebook." MySpace, Friendster, LiveJournal, DeadJournal, etc. There were so many during the MySpace era that I've forgotten most and barely recall the bigger ones. There will be a replacement but hopefully it will look different.
    - danaris 4y ago
      Hah, should've known I could count on HN to be super pedantic about offhand statements like that... MySpace was founded in 2003, Facebook in 2004. Yes, there was a brief period where MySpace was more "the place to be" than Facebook, but that was essentially a flash in the pan, given that Facebook has held that crown now for so many people for over a decade. To expand a bit on what I said in the GP post: In 2002-4, the early social networks all started to come online. Facebook was the only one of those to survive with any relevance. It has now existed for 18 years, and its relevance among young people is definitely on the wane. There was nothing like it before that time: Usenet, forums, AOL chatrooms, and BBSes didn't give anywhere near the same kind of connection or experience that Facebook circa 2008 did. There is no inherent reason that there must be something like it afterward. TikTok isn't really comparable to Facebook; it doesn't lend itself to the same kind of communication or connection. Twitter (which may now be dying) and its decentralized imitator Mastodon may come closest, but they don't encourage the kind of long-form posts that Facebook does, nor do they have the same ability to build out your IRL social network in the digital space that was the hallmark of early Facebook. There may, at some point, be some new company, service, or protocol that can to some meaningful extent replicate the experience of Facebook in its heyday; or that can, at least, command the attention and interest of as many people...but there's no guarantee that that will be the case, and everyone looking for X, Y, or Z to be "the next Facebook" are begging the question by assuming that there will be.
stanislavb 4y ago
Don't you think that Elon Musk's stupidity and political tendencies to side with Trump and Russia is affecting Tesla as well? I've close friends/relatives that are never buying a Tesla because of him and I know of people trying to sell their Teslas too. I'm sure that drives the price down too.
- HellDunkel 4y ago
  I think this is a huge problem.
  - HellDunkel 4y ago
    For Tesla.

jerrytsai 4y ago

Like with anything publicly traded, the price of a share is principally derived from belief. Much of this belief comes from a person projecting where the price will be in the future. With Tesla, many people and institutions projected that that price would increase in the future. Now many of them do not. Belief in the direction of the price can come from examining the financial fundamentals of a company and the perceived value that it may increasingly generate ("fundamental analysis'). Or it can be speculative, where people believe other people will buy (or sell) more based on observed buying/selling activity ("technical analysis"). With Tesla, many investors were using their own version of technical analysis that far surpassed the valuation that a reasonable fundamental analysis would have derived and even derive today. There was and is a mania, much like there has been and there is for many forms of cryptocurrency. The recently declining price is likely due to a collective perception that Tesla has been overpriced and, due to recent factors, that the fundamentals that justify the pricing for a share will diverge even further from its recent pricing. From a fundamental level, Tesla was unlikely to justify its recent pricing. An irony is that the earlier mania was so intense even today, after such a pronounced plunge from the start of the year, it likely remains seriously overvalued.

paulcole 4y ago

What do you believe TikTok “actually is”?

IgorPartola 4y ago
TikTok absolutely nailed two things. First, it is just video. Facebook tried to shoehorn video shorts into two existing platforms (FB and Instagram) but that just breaks up the flow. People expect to read things on FB and look at photos on Instagram. Having a video suddenly playing in full screen sucks when those are your expectations. Second, TikTok has an absolutely amazing recommendations algorithm. This is the core of the product: an algorithm that has a great mix of showing you things that have to do with your interests while also showing you things that are just slightly outside of them to expand your horizons. It feels cohesive and custom tailored. FB shorts are awful. They show you cheesy bullshit videos that have nothing to do with you or each other. Until you watch one and then they assume that’s all you ever want.

tjansen 4y ago

> chasing TikTok without realizing that gen Z isn’t using that either So what is Gen Z using?

danaris 4y ago
While I'm not sure I agree with the GP's premise... ...Gen Z doesn't have to be "using" anything particular. Just because, for some years, "everybody had to be on Facebook" doesn't mean that the decline of that means something will necessarily replace it. There was no "previous Facebook", and there doesn't have to be a "next Facebook".
- 4RealFreedom 4y ago
  IgorPartola mentioned MySpace. When Facebook came out, I wondered why anyone would make a MySpace clone. I think there's an argument that there was a previous Facebook.
  - evanelias 4y ago
    Absolutely yes regarding MySpace. Per Wikipedia: "in June 2006, it surpassed Yahoo! and Google to become the most visited website in the United States" https://en.wikipedia.org/wiki/Myspace https://en.wikipedia.org/wiki/Myspace
- igetspam 4y ago
  There were a half a dozen or more "previous Facebook." MySpace, Friendster, LiveJournal, DeadJournal, etc. There were so many during the MySpace era that I've forgotten most and barely recall the bigger ones. There will be a replacement but hopefully it will look different.
  - danaris 4y ago
    Hah, should've known I could count on HN to be super pedantic about offhand statements like that... MySpace was founded in 2003, Facebook in 2004. Yes, there was a brief period where MySpace was more "the place to be" than Facebook, but that was essentially a flash in the pan, given that Facebook has held that crown now for so many people for over a decade. To expand a bit on what I said in the GP post: In 2002-4, the early social networks all started to come online. Facebook was the only one of those to survive with any relevance. It has now existed for 18 years, and its relevance among young people is definitely on the wane. There was nothing like it before that time: Usenet, forums, AOL chatrooms, and BBSes didn't give anywhere near the same kind of connection or experience that Facebook circa 2008 did. There is no inherent reason that there must be something like it afterward. TikTok isn't really comparable to Facebook; it doesn't lend itself to the same kind of communication or connection. Twitter (which may now be dying) and its decentralized imitator Mastodon may come closest, but they don't encourage the kind of long-form posts that Facebook does, nor do they have the same ability to build out your IRL social network in the digital space that was the hallmark of early Facebook. There may, at some point, be some new company, service, or protocol that can to some meaningful extent replicate the experience of Facebook in its heyday; or that can, at least, command the attention and interest of as many people...but there's no guarantee that that will be the case, and everyone looking for X, Y, or Z to be "the next Facebook" are begging the question by assuming that there will be.

stanislavb 4y ago

Don't you think that Elon Musk's stupidity and political tendencies to side with Trump and Russia is affecting Tesla as well? I've close friends/relatives that are never buying a Tesla because of him and I know of people trying to sell their Teslas too. I'm sure that drives the price down too.

HellDunkel 4y ago
I think this is a huge problem.
- HellDunkel 4y ago
  For Tesla.