If you think about it, the largest typical object people would buy in terms of value is a car. A house can last a last time but less so a car. I think the reas

If you think about it, the largest typical object people would buy in terms of value is a car. A house can last a last time but less so a car. I think the reason for investor's optimism in Tesla is their vision is to get everyone a car. If you look at the design of the Model S it can allow for a very cheap & safe car (The Tata Nano had issues with safety at first). I would say this is still a baby as a company even now. If you saw GM's size before the financial crisis things would get more into perspective of what the potential is here. I think investors get that and this is why the premium is so high. This is a company that can outdo GM because of the different structure. Tesla is very robotic/automated in its manufacturing & the car's drive system is just the floor. When GM wasn't so much under attack as it is now it used to regularly get under the record annual profit for a publicly traded corporation. These crazy volatile drops are because there are lots of speculators trying to get in on the action (options, leverage.. etc). These volatile moves keep everything in balance.