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Tesla, TSLA & the Investment World: the Perpetual Investors' Roundtable
- Thread starter AudubonB
- Start date
My guess 1) He's addictive to attention, but not likely an intentional fraud; 2) our confirmation bias tricks us: as Tesla bulls, we're more like to bias for/attracted to anything positive about Tesla, and what he tweets is often very, if not outrageous positive. In short, a good attention grabber grabs the attention of those who're not attentive enough of its trick.
This video has me thinking:-
The generally accepted view is that the analyst is wrong, because Tesla's margins are higher.
While that is true, there is on additional factor...
Selling ICE vehicles through dealers has become a low margin business overtime.
Many companies have similar margins, because they have similar products, sales prices, production processes, component costs.
Advertising is necessary to differentiate from similar competitor products.
When legacy auto migrates to selling EVs online, they may lose market share, but in the long run I expect them to have better margins.
That is because EVs are fundamentally easier to build with fewer parts... but also because other revenue sources like parts sales don't exist, and also because dealers are not in the loop. Many carmakers will be happy to avoid a fight to the death on margins.
The one party that may compete aggressively on price are the Chinese, but I will not be surprised to see some trade protection measures used against their cheaper models. especially in the US and Europe.
So Tesla; margins are not just protected by a 5-10 year lead in some areas of production. I can see EV margins being higher than ICE margins for many years, and they need to be for multiple reasons.
The other factor is customers, most customers will be happy to get an EV for the same price as an ICE, If manufacturers are able to lower production prices below that point they don't need to pass all of that on immediately. Again given the massive costs in retooling to produce EVs, and costs in other areas like redundancies, I think many manufacturers will grab higher margins with (where possible) with both hands.
A likely shortfall in battery and EV production will also help keep margins higher. (Production lagging demand).
The other way of competing is product diversity, EVs will allow a wider range of vehicle shapes, sizes, prices and interior options.
Bottom line I don't think we can conclude anything about EV margins from ICE margins, and that is where I think many analysts may be wrong.
The generally accepted view is that the analyst is wrong, because Tesla's margins are higher.
While that is true, there is on additional factor...
Selling ICE vehicles through dealers has become a low margin business overtime.
Many companies have similar margins, because they have similar products, sales prices, production processes, component costs.
Advertising is necessary to differentiate from similar competitor products.
When legacy auto migrates to selling EVs online, they may lose market share, but in the long run I expect them to have better margins.
That is because EVs are fundamentally easier to build with fewer parts... but also because other revenue sources like parts sales don't exist, and also because dealers are not in the loop. Many carmakers will be happy to avoid a fight to the death on margins.
The one party that may compete aggressively on price are the Chinese, but I will not be surprised to see some trade protection measures used against their cheaper models. especially in the US and Europe.
So Tesla; margins are not just protected by a 5-10 year lead in some areas of production. I can see EV margins being higher than ICE margins for many years, and they need to be for multiple reasons.
The other factor is customers, most customers will be happy to get an EV for the same price as an ICE, If manufacturers are able to lower production prices below that point they don't need to pass all of that on immediately. Again given the massive costs in retooling to produce EVs, and costs in other areas like redundancies, I think many manufacturers will grab higher margins with (where possible) with both hands.
A likely shortfall in battery and EV production will also help keep margins higher. (Production lagging demand).
The other way of competing is product diversity, EVs will allow a wider range of vehicle shapes, sizes, prices and interior options.
Bottom line I don't think we can conclude anything about EV margins from ICE margins, and that is where I think many analysts may be wrong.
Last edited:
willow_hiller
Well-Known Member
Addiction is a good way to put it. In fact, back in April, he tried to quit. Someone should invent a chewing gum that cuts cravings for Tesla news...
Thx! I wrote a bit on that a bit ago...
TL;DR - It's fine for the long term as radar fusion is hard as it doesn't agree with camera a whole bunch; a bit of a hindrance for the short term.
Good points. I think the #1 misperception is that those OEMs can easily pivot to EVs “when they decide to”. The reality is their assets, workforce, and ties to dealerships are a woeful albatross about their necks. Stranded assets, too many workers for EV assembly - jobs protected by unions. . . Extricating from dealership sales easier said than done.
Some of them won’t make it. Where did I hear - bankruptcy is very gradual and then very sudden. Sadly, hard days ahead for those workers.
Artful Dodger
"Neko no me"
They read this forum. /s
Joe F
Disruption is hard.
May I suggest you practice with Jenga? Rookie.
Artful Dodger
"Neko no me"
Elon has already said that Fremont will supply 3/Y for customers West of the Rockies, while Giga Texas will provide cars to customers East of the Rockies.
It's all about the cost of logistics.
uujjj2
Member
Note that at the moment Tesla sells many more cars west of the Rockies than east. California alone is half of Tesla's US sales. But that's going to balance out over time since 3/4 of the US population is east of the Rockies.
lafrisbee
Active Member
it is the wee-est of hours of night so OT...
If the final version of the CT is shared and the SP goes down a little I'd still be happy for awhile cuz I really want to know what I am gonna be riding.
If the final version of the CT is shared and the SP goes down a little I'd still be happy for awhile cuz I really want to know what I am gonna be riding.
Anyone who needs 4 tweets to tell me they are quitting is most likely not quitting anything other than succinct communication.
dhanson865
Well-Known Member
We've seen public sightings in
* California (Elon driving to various resturaunts and factories)
* Texas (at the factory)
* New York (Elon going to SNL)
have you heard of sightings from all over the country in between these locations or do you think Elon has taken one vehicle with him all over the US in some covert fashion?
Could be that There is one in each of those states plus one somewhere else like say Florida?
Keeping this thread On Topic is about as likely as someone here, some day, posting a “Request” form from Zill…..
I think I’d better think this out again.
I think I’d better think this out again.
mltv
Member
Sandy Munro's Mustang Mach-E teardown begins
Automotive engineer and former GM and Ford employee Sandy Munro and his team are tearing down a new Ford Mustang Mach-E.
www.autoblog.com
StealthP3D
Well-Known Member
This is the best kind of advertising. Mostly because it's obvious it's not coming from Tesla. The fact that Tesla doesn't have to budget for it is just the icing on the cake. They even called the practical family sedan known as a Model 3 a "sports car". Nice. Michelin would know. Now dad can get the sports car of his dreams while telling mom it's a practical car that will help them save for the kids college fund.
Looks like there is a private company near Giga Berlin that owns water rights and wants to offer 2million cubic meters/year to Tesla, just doesn´t know how to reach them properly - can someone here help?
translate.google.com
Unternehmer bietet Tesla feinstes Wasser für Giga Berlin an – aber wie kommt es dorthin?
Wohl eher früher als später wird Tesla für seine deutsche Gigafactory mehr Wasser brauchen – dafür gibt es ein Angebot aus der Ferne.
translate.google.com
Looks like there is a private company near Giga Berlin that owns water rights and wants to offer 2million cubic meters/year to Tesla, just doesn´t know how to reach them properly - can someone here help?
Unternehmer bietet Tesla feinstes Wasser für Giga Berlin an – aber wie kommt es dorthin?
Wohl eher früher als später wird Tesla für seine deutsche Gigafactory mehr Wasser brauchen – dafür gibt es ein Angebot aus der Ferne.
Talk to the [now cancelled] Keystone Pipeline folks?
edit: lol you meant reach them as in email probably. Maybe find a Tesla Europe honcho on LinkedIn?
dhanson865
Well-Known Member
I just spent 30 minutes or so trying to find the current status on the proposed EV tax credit / rebate. I still see wording about the cars bought after Jan 1 2022 but I don't see wording about sales for cars in 2021. Am I misreading that?
www.autoblog.com
U.S. Senate panel advances EV tax credit of up to $12,500
The U.S. Senate Finance Committee advanced legislation that would boost electric vehicle tax credits to as much as $12,500 for EVs that are assembled by union workers in the United States.
www.autoblog.com
Is that your wife's drink?
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