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They are planning a new cheaper model which will allow them to offer a car to a lower priced market. Also, Tesla buyers are very loyal so they will get a lot o
by fallingknife 3y ago
They are planning a new cheaper model which will allow them to offer a car to a lower priced market. Also, Tesla buyers are very loyal so they will get a lot of sales when existing owners get new cars https://jalopnik.com/tesla-buyers-are-remarkably-loyal-to-the-brand-1850853217 https://jalopnik.com/tesla-buyers-are-remarkably-loyal-to-th.... And BEVs are still the fastest growing segment of the market, but not even 10% share yet, so there is the other 90% of the market to go after.
Not sure why you bring up interest rates as a weakness when Tesla is the least dependent on debt of all the major car companies. High interest rates will be much more of a burden on their leveraged competitors. Same thing with the price deflation. Yes, that will hurt Tesla's profits, but it will hurt competitors that are selling BEVs at a loss even more.
- dkrich 3y agoBecause higher interest rates make everything more difficult. It incentivizes people to save instead of buy expensive cars. It makes it more expensive to finance expensive cars. It makes it more expensive to raise financing to pay for factories and workers. It can very well bring about a recession where unemployment rises and your TAM shrinks. Tesla is still trying to convince people it is in hyper growth mode constrained only by its ability to supply cars with robots, self driving cars, semis and compact cars all in the pipeline. Let’s see how that plays out with fed funds at 5.5% for a few more months.
- fallingknife 3y agoTesla is in hyper growth mode. Q3 revenue was up 50% year over year, which is absolutely hyper growth mode for a car company, or really any company as big as Tesla. Fed funds rate during Q3 was 5.25-5.5%.