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Palantir

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Correct predictions may or may not help you to be a good investor (produce alpha).

 

Correct or incorrect predictions do not necessarily make you a good/bad investor.

 

They also do not necessarily make you a good/bad entrepreneur.

 

Agreed, I made the point more so because I think there's a very clear trend of underdelivering, and so it would seem logical to incorporate that into one's forecasts...

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Correct predictions may or may not help you to be a good investor (produce alpha).

 

Correct or incorrect predictions do not necessarily make you a good/bad investor.

 

They also do not necessarily make you a good/bad entrepreneur.

 

Agreed, I made the point more so because I think there's a very clear trend of underdelivering, and so it would seem logical to incorporate that into one's forecasts...

 

The stock is driven by narrative more than any other stock that I have seen. 80%+ of it’s value is in Elon‘s personality and the narrative.

 

I bet if VW brings in a car equivalent to Tesla, it still would trade at the some crappy valuation. They can’t compete, because they don’t have the Tesla mystique. Elon could (and should) raise $20B right now and the stock would probably rise because they could spent the money to R&D everyone else into the ground.

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Correct predictions may or may not help you to be a good investor (produce alpha).

 

Correct or incorrect predictions do not necessarily make you a good/bad investor.

 

They also do not necessarily make you a good/bad entrepreneur.

 

Agreed, I made the point more so because I think there's a very clear trend of underdelivering, and so it would seem logical to incorporate that into one's forecasts...

 

The stock is driven by narrative more than any other stock that I have seen. 80%+ of it’s value is in Elon‘s personality and the narrative.

 

I bet if VW brings in a car equivalent to Tesla, it still would trade at the some crappy valuation. They can’t compete, because they don’t have the Tesla mystique. Elon could (and should) raise $20B right now and the stock would probably rise because they could spent the money to R&D everyone else into the ground.

 

I think the word you're looking for is "Brand".  Tesla has become a desirable brand.  It is like trying to explain why people buy Coca-Cola when the store brand of cola flavored sugar water tastes just as good for a fraction of the price.

 

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Correct predictions may or may not help you to be a good investor (produce alpha).

 

Correct or incorrect predictions do not necessarily make you a good/bad investor.

 

They also do not necessarily make you a good/bad entrepreneur.

Agreed, I made the point more so because I think there's a very clear trend of underdelivering, and so it would seem logical to incorporate that into one's forecasts...

 

The stock is driven by narrative more than any other stock that I have seen. 80%+ of it’s value is in Elon‘s personality and the narrative.

 

I bet if VW brings in a car equivalent to Tesla, it still would trade at the some crappy valuation. They can’t compete, because they don’t have the Tesla mystique. Elon could (and should) raise $20B right now and the stock would probably rise because they could spent the money to R&D everyone else into the ground.

 

I think the word you're looking for is "Brand".  Tesla has become a desirable brand.  It is like trying to explain why people buy Coca-Cola when the store brand of cola flavored sugar water tastes just as good for a fraction of the price.

 

The stock is not the same thing as the company.  None of the top brands command the equity valuation of Tesla.  In the 1990's they called them story stocks.  Now it's called narrative investing. 

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Interesting, electricity in Germany is so expensive, that charging up an electric car can be more expansive than fueling with Diesel. And Diesel is heavily taxed in Germany...

https://www.spiegel.de/auto/elektroauto-vs-diesel-und-benziner-strompreis-als-kostenfalle-a-6d8f929e-d742-439e-8de5-0f5bda3f5ecc

 

This is probably coming to California too.

 

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Guest cherzeca

Interesting, electricity in Germany is so expensive, that charging up an electric car can be more expansive than fueling with Diesel. And Diesel is heavily taxed in Germany...

https://www.spiegel.de/auto/elektroauto-vs-diesel-und-benziner-strompreis-als-kostenfalle-a-6d8f929e-d742-439e-8de5-0f5bda3f5ecc

 

This is probably coming to California too.

 

OT, but has anyone come across a price and pollution comparison between charging an EV (assume a generic power plant, not nuclear or coal) and driving an equivalent amount in a ICE?

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"In just over two months, orders for a newly launched premium electric sedan from Warren Buffett-backed automaker BYD have topped 40,000, the Chinese car maker disclosed at the Beijing auto show."

 

https://www.cnbc.com/2020/09/30/warren-buffett-backed-byd-strong-demand-for-luxury-han-electric-sedan.html

 

Well, looks like the competition is not five years away anymore, just a couple months.

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The non Tesla EV plays I think are positioned nicely in the event of a Biden win. Tesla will probably do OK as well, but the smaller and newer companies should get bid up nicely much like all the commodity stuff did in 2016.

 

Tesla has an edge compared to ICE vehicles in the “keeping up with the Joneses.” As more EV companies come into play with comparable products (when not if), consumers will begin to look at other manufacturers as the luster of Tesla wears off.

 

NIO CEO did say they were not currently targeting the budget class yet. He did say Tesla currently has a price advantage in that area, but they have seen a lot of positivity and enthusiasm for brands other than Tesla (specifically in China and among the younger generation)

 

I do think NIO will have some cost advantages as they continue to scale.  The BaaS model is interesting. They can sell the car at a cheaper price point, and the consumer can change out the battery balancing range/cost as they see fit. Going in a road trip? Swap to a longer range battery. Live in a city? Pay less and get a short range battery. The logistics and swap function seem to be going smoothly (within city centers). I do worry a bit about logistics when you scale out to less dense areas.

 

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Tesla also has a pretty amazing brand and is able to sell cars without any advertising.  Legacy automakers may be able to compete with that, and niche names selling extremely expensive cars like Lucid may not need to.  Other than that, I have a hard time seeing how new EV companies like BYD and Nio will be able to compete in America since they can't compete on price or performance. 

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Tesla also has a pretty amazing brand and is able to sell cars without any advertising.  Legacy automakers may be able to compete with that, and niche names selling extremely expensive cars like Lucid may not need to.  Other than that, I have a hard time seeing how new EV companies like BYD and Nio will be able to compete in America since they can't compete on price or performance.

 

How are these not comparable? I would argue both Lucid and NIO are more luxurious than Tesla as well.

 

NIO ES6

Price: 52k starting

Range: 379m

0-60mph: 4.7s

 

Tesla X

Price: 80k starting

Range: 351m

0-60mph: 2.6s

 

__________________________

 

Lucid Air

Price: 80k starting

Range: 517m

0-60: 2.5s

 

Tesla S

Price: 74k starting

Range: 402m

0-60: 2.3s

 

__________________________

 

Li Auto also looks interesting (https://www.lixiang.com/)

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https://www.cnbc.com/2020/09/30/warren-buffett-backed-byd-strong-demand-for-luxury-han-electric-sedan.html

 

Well, looks like the competition is not five years away anymore, just a couple months.

 

The competition for EVs is all cars, not just other EVs.

 

The EVs that BYD makes aren't very competitive with Teslas. Probably more competitive with other downmarket ICEs.

 

(and please, look at products vs products, not at a few specs on a piece of paper... that's the dumb way of comparing products that leads to people missing all the things that aren't easily quantifiable but that are important to customers)

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https://www.cnbc.com/2020/09/30/warren-buffett-backed-byd-strong-demand-for-luxury-han-electric-sedan.html

 

Well, looks like the competition is not five years away anymore, just a couple months.

 

The competition for EVs is all cars, not just other EVs.

 

The EVs that BYD makes aren't very competitive with Teslas. Probably more competitive with other downmarket ICEs.

 

(and please, look at products vs products, not at a few specs on a piece of paper... that's the dumb way of comparing products that leads to people missing all the things that aren't easily quantifiable but that are important to customers)

 

What's the secret sauce that Tesla has compared to some of the newer competitors like NIO, Li, Lucid? Because functionally and aesthetically the vehicles don't seem much different.

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You will know when you sit and drive in a Lucid what the difference is. : )

 

https://www.cnbc.com/2020/09/30/warren-buffett-backed-byd-strong-demand-for-luxury-han-electric-sedan.html

 

Well, looks like the competition is not five years away anymore, just a couple months.

 

The competition for EVs is all cars, not just other EVs.

 

The EVs that BYD makes aren't very competitive with Teslas. Probably more competitive with other downmarket ICEs.

 

(and please, look at products vs products, not at a few specs on a piece of paper... that's the dumb way of comparing products that leads to people missing all the things that aren't easily quantifiable but that are important to customers)

 

What's the secret sauce that Tesla has compared to some of the newer competitors like NIO, Li, Lucid? Because functionally and aesthetically the vehicles don't seem much different.

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You will know when you sit and drive in a Lucid what the difference is. : )

 

https://www.cnbc.com/2020/09/30/warren-buffett-backed-byd-strong-demand-for-luxury-han-electric-sedan.html

 

Well, looks like the competition is not five years away anymore, just a couple months.

 

The competition for EVs is all cars, not just other EVs.

 

The EVs that BYD makes aren't very competitive with Teslas. Probably more competitive with other downmarket ICEs.

 

(and please, look at products vs products, not at a few specs on a piece of paper... that's the dumb way of comparing products that leads to people missing all the things that aren't easily quantifiable but that are important to customers)

 

What's the secret sauce that Tesla has compared to some of the newer competitors like NIO, Li, Lucid? Because functionally and aesthetically the vehicles don't seem much different.

 

Sure, but if you're (not you specifically) going to claim that there is some specific moat beyond performance metrics and luxury standards then the proof of burden is on you. So far the bull case has been "everything else is vaporware and everyone else is 5 years behind Tesla in battery function and engineering." That gap seems to be quickly closing as there is not multiple EV companies producing products with similar metrics on paper.

 

What is the Tesla moat over the next five years?

 

 

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You will know when you sit and drive in a Lucid what the difference is. : )

 

https://www.cnbc.com/2020/09/30/warren-buffett-backed-byd-strong-demand-for-luxury-han-electric-sedan.html

 

Well, looks like the competition is not five years away anymore, just a couple months.

 

The competition for EVs is all cars, not just other EVs.

 

The EVs that BYD makes aren't very competitive with Teslas. Probably more competitive with other downmarket ICEs.

 

(and please, look at products vs products, not at a few specs on a piece of paper... that's the dumb way of comparing products that leads to people missing all the things that aren't easily quantifiable but that are important to customers)

 

What's the secret sauce that Tesla has compared to some of the newer competitors like NIO, Li, Lucid? Because functionally and aesthetically the vehicles don't seem much different.

 

Sure, but if you're (not you specifically) going to claim that there is some specific moat beyond performance metrics and luxury standards then the proof of burden is on you. So far the bull case has been "everything else is vaporware and everyone else is 5 years behind Tesla in battery function and engineering." That gap seems to be quickly closing as there is not multiple EV companies producing products with similar metrics on paper.

 

What is the Tesla moat over the next five years?

 

One risk to Tesla is that all their cars look alike. The S and X are declining in their production, and they are the ones with unique designs. Literally no differentiation between any 3 other that color. The Y looks like a 3 on dubs. I can't imagine this works to their advantage over the long term.

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https://www.cnbc.com/2020/09/30/warren-buffett-backed-byd-strong-demand-for-luxury-han-electric-sedan.html

 

Well, looks like the competition is not five years away anymore, just a couple months.

 

The competition for EVs is all cars, not just other EVs.

 

The EVs that BYD makes aren't very competitive with Teslas. Probably more competitive with other downmarket ICEs.

 

(and please, look at products vs products, not at a few specs on a piece of paper... that's the dumb way of comparing products that leads to people missing all the things that aren't easily quantifiable but that are important to customers)

 

BYD makes batteries. They got into the car business to accelerate battery development. BYD hired design chief from Audi a few years ago - notice a slight correlation between style and quality of BYD products recently? If you’re asleep at the wheel of a Tesla, I wouldn’t blame you. Elon Musk has built quite the empire. $350, $400 billion, if BYD is only half as good as Tesla, my goodness its got some legs!

 

To think, BYD will spinoff its battery business, operate in the largest car market, and develop its JV with Toyota, that’s quite a promising future. And again, while Elon Musk has the boring company, BYD shareholders have Skyrail.

 

And just like how Audi reshaped itself and dominated the luxury market in the US and China after fledging for years, never underestimate the power and potential of legacy auto brands in shaking the cage with an opportunity to reinvent themselves with electric power and new tech.

 

Tesla might be here to stay, but when the dam is let loose, there’s no telling who will end up on top.

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One risk to Tesla is that all their cars look alike. The S and X are declining in their production, and they are the ones with unique designs. Literally no differentiation between any 3 other that color. The Y looks like a 3 on dubs. I can't imagine this works to their advantage over the long term.

 

10 years ago they sold hundreds of cars a year of one model based on a Lotus, give them a little time to build a line up. Tesla is usually accused of moving too fast, not too slowly..

 

But all BMWs look like BMWs, all Porsches look like Porsches. If what you have is desirable, it's not too much of a problem.  If you have more commodity products, then it helps to try to make a zillion variations and try to see what sticks or what may fills a niche. Same for iPhones vs Android phones.

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One risk to Tesla is that all their cars look alike. The S and X are declining in their production, and they are the ones with unique designs. Literally no differentiation between any 3 other that color. The Y looks like a 3 on dubs. I can't imagine this works to their advantage over the long term.

 

10 years ago they sold hundreds of cars a year of one model based on a Lotus, give them a little time to build a line up. Tesla is usually accused of moving too fast, not too slowly..

 

But all BMWs look like BMWs, all Porsches look like Porsches. If what you have is desirable, it's not too much of a problem.  If you have more commodity products, then it helps to try to make a zillion variations and try to see what sticks or what may fills a niche. Same for iPhones vs Android phones.

 

The bigger car companies have a lineup up cars that tend to have a similar style, but yet different. Tesla’s to me look like Hyundai’s to me.

 

They have good tech in them (batteries , motors) and the performance (acceleration) is very good. Quality is abysmal though. I think it is at this point an enthusiasts car for people that are willing to put up with those shortfalls. We will see if that’s the case when competition comes up with more mainstream cars, which should be next year.

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