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I am paraphrasing a quote I have heard before, "Pioneers get the bullets and settlers get the land." Might not be actual bullets but pioneers today have to deal

I am paraphrasing a quote I have heard before, "Pioneers get the bullets and settlers get the land." Might not be actual bullets but pioneers today have to deal with legislators, put up charging stations, develop most components from scratch and so on. These are the modern day bullets. If they don't get bought by a larger company the larger company launches a competing product with the benefit of the experiences of the pioneer.

glitchc 4y ago
Can't argue that Tesla's smaller than Mercedes when Tesla's market cap is so much larger. In 2021, at it's peak Tesla's market cap crossed $1.2 Trillion. Daimler at it's peak this year only reached $81 Billion (although climbing). Why couldn't Tesla just buy out Daimler? Even now Tesla sitting at a valuation of $372 Billion. It could happen tomorrow. Tell me Elon's the savvy businessman you claim him to be. If Gates were running the company, he would have acquired half the auto industry by now.
- jmole 4y ago
  Buying a major car company is buying a whole heap of liabilities and depreciating assets. The major value drivers (contributors to market cap) are brand, patent portfolio, and future revenues from existing capex. Tesla doesn't want to support the supply chain of new and used parts for a legacy car company, they can barely keep up with their own (and they only make 4 models!).
  - glitchc 4y ago
    Well, you know, you also get an established luxury brand, a cadre of brand-loyal customers, a significant increase in the manufacturing base and tons of proprietary tech. Are you telling me Mr. Musk would have bothered to create his own brand if he had enough capital to buy an existing brand to start with? The latter is a much safer strategy in bringing a car to market. He took big risks creating his own brand because he lacked the initial capital to buy one outright.
    - bobthepanda 4y ago
      you inherit all the politics that comes with an existing company as well. owners and CEOs are powerful but not infallible; Carlos Ghosn got thrown in jail when he got too big for his britches as CEO of Nissan (in Japan Inc.'s view, at least).
    - ultrarunner 4y ago
      Well, technically Musk bought an ownership stake in Tesla
    - deleted 4y ago
      [deleted]
  - oblio 4y ago
    > legacy car company Let's drop the BS, please. Mercedes is a car company. They are not legacy anything. They're the inventor of the car and a myriad other innovations. They're making a ton of EVs and will sell a ton more next year and the year after that. They have AR navigation and now are close to L3 self driving.
    - bookofjoe 4y ago
      Also, unlike the well-publicized issues re: Tesla repair difficulties, you can take a Mercedes in anywhere and get it fixed by authorized mechanics.
    - jmole 4y ago
      “Legacy” is not a pejorative term, it’s descriptive. They have a dealer network. They have a parts counter. Their operations are the result of a 120 year legacy. Their valuation is based on longstanding economics of the automobile industry. I’m saying all this to draw a comparison against Tesla. Tesla doesn’t want a dealer network, or a parts counter, or a typical car company valuation. Buying a legacy car company is not in Tesla’s interest, because they don’t want to play by the rules (unwritten or written) that every other auto manufacturer plays by.
      - oblio 4y ago
        > “Legacy” is not a pejorative term, it’s descriptive. 99% of the time I see "legacy" used for established car companies is when it's an article or comment about Tesla. And it is meant as a pejorative. Maybe you're the exception:-)
- sockaddr 4y ago
  As an owner who experiences the “joy” of dealing with a tesla on a daily basis it’s simple: Tesla is over-valued. There’s so many little gotchas and shortcuts taken that I find it impossible to believe this company is worth what people claim it is on paper. The theoretical wealth of this company stems from consumer/investor ignorance in my opinion. That’s why he hasn’t acquired more of his competitors, the value can’t be realized, it needs to stay bottled up as “potential” for lack of better words.
  - glitchc 4y ago
    Umm that's not how mergers and takeovers work. He bought Twitter on a bully offer, half of which was paid with Tesla stock. If anything, this is the best way to convert overhyped stock into real value.
    - isomorphic 4y ago
      Real value to the people that sold Twitter, certainly.
- sonofhans 4y ago
  > If Gates were running the company, he would have acquired half the auto industry by now. I love this. I haven’t heard it put this way before. I’m tempted to agree with you. Gates was one of the most aggressive, cutthroat, successful empire builders of this century.
- foepys 4y ago
  Does nobody remember that Daimler was an early investor in Tesla? They sold their 10% share a few years ago. https://ir.tesla.com/press-release/strategic-partnership-daimler-acquires-stake-tesla https://ir.tesla.com/press-release/strategic-partnership-dai...
- seadan83 4y ago
  Market cap does not equate to cash on hand. Let's say I give you a banana for $1. You bring that banana to a marathon where someone will pay you $5 for it. That does not mean I now have $5. Tesla could dilute their stock and sell more, but that is quite the dilution. Further, the sell price might not be just the market cap value, particularly for a profitable company. Though, exactly those kind of take overs do happen (and with tesla's numbers, not too hard to imagine)
- chmod775 4y ago
  Falsehoods HN believes about market cap... Market cap has little to do with actual size of a company (employees, manufacturing capacity, ...), nor can a company with a larger market cap automatically buy a smaller one. Especially the latter completely ignores how markets work. These mistakes are particularly egregious when you bring meme stocks like Tesla into it.
  - DwnVoteHoneyPot 4y ago
    Especially egregious when the HN posters could take a second to look up financials on Yahoo Finance. Revenues: Tesla $75B. Mercedes $144B. Op Income: Tesla $12B. Mercedes $18B. Assets: Tesla $62B. Mercedes $260B. But according to this guy, "it could happen tomorrow".

glitchc 4y ago

Can't argue that Tesla's smaller than Mercedes when Tesla's market cap is so much larger. In 2021, at it's peak Tesla's market cap crossed $1.2 Trillion. Daimler at it's peak this year only reached $81 Billion (although climbing). Why couldn't Tesla just buy out Daimler? Even now Tesla sitting at a valuation of $372 Billion. It could happen tomorrow. Tell me Elon's the savvy businessman you claim him to be. If Gates were running the company, he would have acquired half the auto industry by now.

jmole 4y ago
Buying a major car company is buying a whole heap of liabilities and depreciating assets. The major value drivers (contributors to market cap) are brand, patent portfolio, and future revenues from existing capex. Tesla doesn't want to support the supply chain of new and used parts for a legacy car company, they can barely keep up with their own (and they only make 4 models!).
- glitchc 4y ago
  Well, you know, you also get an established luxury brand, a cadre of brand-loyal customers, a significant increase in the manufacturing base and tons of proprietary tech. Are you telling me Mr. Musk would have bothered to create his own brand if he had enough capital to buy an existing brand to start with? The latter is a much safer strategy in bringing a car to market. He took big risks creating his own brand because he lacked the initial capital to buy one outright.
  - bobthepanda 4y ago
    you inherit all the politics that comes with an existing company as well. owners and CEOs are powerful but not infallible; Carlos Ghosn got thrown in jail when he got too big for his britches as CEO of Nissan (in Japan Inc.'s view, at least).
  - ultrarunner 4y ago
    Well, technically Musk bought an ownership stake in Tesla
  - deleted 4y ago
    [deleted]
- oblio 4y ago
  > legacy car company Let's drop the BS, please. Mercedes is a car company. They are not legacy anything. They're the inventor of the car and a myriad other innovations. They're making a ton of EVs and will sell a ton more next year and the year after that. They have AR navigation and now are close to L3 self driving.
  - bookofjoe 4y ago
    Also, unlike the well-publicized issues re: Tesla repair difficulties, you can take a Mercedes in anywhere and get it fixed by authorized mechanics.
  - jmole 4y ago
    “Legacy” is not a pejorative term, it’s descriptive. They have a dealer network. They have a parts counter. Their operations are the result of a 120 year legacy. Their valuation is based on longstanding economics of the automobile industry. I’m saying all this to draw a comparison against Tesla. Tesla doesn’t want a dealer network, or a parts counter, or a typical car company valuation. Buying a legacy car company is not in Tesla’s interest, because they don’t want to play by the rules (unwritten or written) that every other auto manufacturer plays by.
    - oblio 4y ago
      > “Legacy” is not a pejorative term, it’s descriptive. 99% of the time I see "legacy" used for established car companies is when it's an article or comment about Tesla. And it is meant as a pejorative. Maybe you're the exception:-)
sockaddr 4y ago
As an owner who experiences the “joy” of dealing with a tesla on a daily basis it’s simple: Tesla is over-valued. There’s so many little gotchas and shortcuts taken that I find it impossible to believe this company is worth what people claim it is on paper. The theoretical wealth of this company stems from consumer/investor ignorance in my opinion. That’s why he hasn’t acquired more of his competitors, the value can’t be realized, it needs to stay bottled up as “potential” for lack of better words.
- glitchc 4y ago
  Umm that's not how mergers and takeovers work. He bought Twitter on a bully offer, half of which was paid with Tesla stock. If anything, this is the best way to convert overhyped stock into real value.
  - isomorphic 4y ago
    Real value to the people that sold Twitter, certainly.
sonofhans 4y ago
> If Gates were running the company, he would have acquired half the auto industry by now. I love this. I haven’t heard it put this way before. I’m tempted to agree with you. Gates was one of the most aggressive, cutthroat, successful empire builders of this century.
foepys 4y ago
Does nobody remember that Daimler was an early investor in Tesla? They sold their 10% share a few years ago. https://ir.tesla.com/press-release/strategic-partnership-daimler-acquires-stake-tesla https://ir.tesla.com/press-release/strategic-partnership-dai...
seadan83 4y ago
Market cap does not equate to cash on hand. Let's say I give you a banana for $1. You bring that banana to a marathon where someone will pay you $5 for it. That does not mean I now have $5. Tesla could dilute their stock and sell more, but that is quite the dilution. Further, the sell price might not be just the market cap value, particularly for a profitable company. Though, exactly those kind of take overs do happen (and with tesla's numbers, not too hard to imagine)
chmod775 4y ago
Falsehoods HN believes about market cap... Market cap has little to do with actual size of a company (employees, manufacturing capacity, ...), nor can a company with a larger market cap automatically buy a smaller one. Especially the latter completely ignores how markets work. These mistakes are particularly egregious when you bring meme stocks like Tesla into it.
- DwnVoteHoneyPot 4y ago
  Especially egregious when the HN posters could take a second to look up financials on Yahoo Finance. Revenues: Tesla $75B. Mercedes $144B. Op Income: Tesla $12B. Mercedes $18B. Assets: Tesla $62B. Mercedes $260B. But according to this guy, "it could happen tomorrow".