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Is the valuation really based on AI and robotics? The legacy automakers have been stagnant innovation-wise for a long, long time. Tesla builds their own equip

Is the valuation really based on AI and robotics? The legacy automakers have been stagnant innovation-wise for a long, long time. Tesla builds their own equipment to build the cars, which gives them an advantage in design flexibility. They could (or could have) conceivably eat(en) the market share of many of the legacy automakers before they could possibly catch up. I feel like most of the valuation is and was speculation in that direction. It’s not the existing auto makers to compare them to, it’s the entire auto market. Unfortunately Elon can’t stay focused and thinks he can solve every major problem in parallel himself. I hope the board can at some point realize that he needs to take a break from Tesla, and later come back if and when he can focus.

jqpabc123 2y ago
It’s not the existing auto makers to compare them to, it’s the entire auto market. 2023 was Tesla's best year. They sold just under 2 million vehicles --- about 12% of the global total of 14 million EVs sold. Earlier this year, Tesla's market cap peaked at over $1.5 trillion --- more than virtually all the major auto manufacturers in the world COMBINED. Since then, Tesla has lost more than 50% of this outrageous market cap --- and what remains still defies reasonable justification based on actual product and market performance. Even the most optimistic projections suggest it will be another decade before EVs take a majority of auto sales. So even if you assume Tesla will own 100% of the EV market (instead of 12%) for the next decade, you still can't justify their current outrageous stock price.
- pfannkuchen 2y ago
  > They sold just under 2 million vehicles --- about 12% of the global total of 14 million. https://wardsintelligence.informa.com/wi967636/global-vehicle-sales-top-92-million-units-in-2023-december-volume-up-11 https://wardsintelligence.informa.com/wi967636/global-vehicl... "Global Vehicle Sales Top 92 Million Units in 2023" So it seems like Telsa in their best year had about 2% of global vehicle sales. BTW I'm not arguing that the stock price is justified. I just think it's based primarily on exuberance over their breakout success in selling actually usable EVs and actually scaling it and actually achieving profitability, and not based primarily on exuberance over their more questionable long term goals. A well executing breakout company in the physical goods space is a breath of fresh air, and I think that is mostly what the market is reacting to and speculating on. The other explanation requires a lot of investors to be very stupid, which I don't like accepting lightly when there are alternate explanations. I personally don't believe Elon is lying about any of this stuff. He is probably wrong, but he's not lying. He has had the ego-expanding experience of proving the haters wrong in a big way multiple times, and it has made him hubristic. This would probably happen to a lot of us in his shoes.
  - jqpabc123 2y ago
    So it seems like Telsa in their best year had about 2% of global vehicle sales. Yes. I revised my post above to show that 14 million in 2023 was EV sales only. So a company with 2% of total vehicle sales and 12% of EV sales had a market cap larger than all the other auto manufacturers in the world COMBINED. Absolutely OUTRAGEOUS!. So much for the efficient market hypothesis. https://www.investopedia.com/terms/e/efficientmarkethypothesis.asp https://www.investopedia.com/terms/e/efficientmarkethypothes...

jqpabc123 2y ago

It’s not the existing auto makers to compare them to, it’s the entire auto market. 2023 was Tesla's best year. They sold just under 2 million vehicles --- about 12% of the global total of 14 million EVs sold. Earlier this year, Tesla's market cap peaked at over $1.5 trillion --- more than virtually all the major auto manufacturers in the world COMBINED. Since then, Tesla has lost more than 50% of this outrageous market cap --- and what remains still defies reasonable justification based on actual product and market performance. Even the most optimistic projections suggest it will be another decade before EVs take a majority of auto sales. So even if you assume Tesla will own 100% of the EV market (instead of 12%) for the next decade, you still can't justify their current outrageous stock price.

pfannkuchen 2y ago
> They sold just under 2 million vehicles --- about 12% of the global total of 14 million. https://wardsintelligence.informa.com/wi967636/global-vehicle-sales-top-92-million-units-in-2023-december-volume-up-11 https://wardsintelligence.informa.com/wi967636/global-vehicl... "Global Vehicle Sales Top 92 Million Units in 2023" So it seems like Telsa in their best year had about 2% of global vehicle sales. BTW I'm not arguing that the stock price is justified. I just think it's based primarily on exuberance over their breakout success in selling actually usable EVs and actually scaling it and actually achieving profitability, and not based primarily on exuberance over their more questionable long term goals. A well executing breakout company in the physical goods space is a breath of fresh air, and I think that is mostly what the market is reacting to and speculating on. The other explanation requires a lot of investors to be very stupid, which I don't like accepting lightly when there are alternate explanations. I personally don't believe Elon is lying about any of this stuff. He is probably wrong, but he's not lying. He has had the ego-expanding experience of proving the haters wrong in a big way multiple times, and it has made him hubristic. This would probably happen to a lot of us in his shoes.
- jqpabc123 2y ago
  So it seems like Telsa in their best year had about 2% of global vehicle sales. Yes. I revised my post above to show that 14 million in 2023 was EV sales only. So a company with 2% of total vehicle sales and 12% of EV sales had a market cap larger than all the other auto manufacturers in the world COMBINED. Absolutely OUTRAGEOUS!. So much for the efficient market hypothesis. https://www.investopedia.com/terms/e/efficientmarkethypothesis.asp https://www.investopedia.com/terms/e/efficientmarkethypothes...