Interesting that over the last week the Nasdaq has been stronger than the SP500 and that continued through the day before a Fed rate increase. Seems like positioning..
I'm not assuming they go back to normal. I'm saying the margin that Ford has on F150s and larger SUVs simply gets pushed to Q4. Not all vehicles that Ford makes are zero margin. Quite the opposite actually. F150s have Tesla like margins. The Super Duty series are nearing that. The Explorer (and especially the Lincoln offshoots) are also high margin for them. Where Ford doesn't make any money are their cars in Europe, EVs, and small SUVs. Many of those are negative or zero margin.
Ford already has and will continue to increase the prices on their trucks. This is one area, as long as Tesla isn't in the market, where Ford dominates and pretty much has control of the market like Tesla does for the 3 and Y.
Ford has also been losing money in otherwise profitable markets because of huge pension obligations (they did not declare bankruptcy, remember) low capacity utilization in many factories and less attractive model mix outside of the US, where they exited the car market almost entirely. So...
Ford’s decision to halt production at its Saarlouis plant in 2025 is part of the biggest international assault on the social gains and rights of the working class since the 1930s.
www.wsws.org
That follows:
ford-will-close-six-european-plants-as-part-of-global-downsizing
Ford Motor Co said on Monday it will close its three plants in Brazil this year and take pretax charges of about $4.1 billion as the COVID-19 pandemic amplified the company's under use of its manufacturing capacity.
www.reuters.com
Then consider what they're trying to do with the paint that defined Ford more than a hundred years ago:
fords-rouge-redesign
When contrasting these developments with Tesla there is no vestige of comparison. Probably Ford might survive, but that is not at all assured. As Tesla expands they will continue to play the technological advances they're already done.
Ford really made pneumatic tires (Firestone), car batteries and lights (Edison) auto gasoline stations (Rockefeller) and integrated manufacturing (River Rouge) all work together coupled with close friendships with Firestone and Edison.
Today Tesla is performing the same roles. From charging stations (no modern Rockefeller probably can't exist) to BEV (Edison tried but really could not make enough progress) to manufacturing technology (Tesla is now delivering the 21st century version of S. Colt's interchangeable parts that Ford adapted) Tesla is accelerating progress in part buy ensuring mass adoption of new battery technology by buying from every battery producer that meets their standards.
When we consider those facts it becomes easy to understand why there is so much resistance and envy. It's also evident that Tesla needs many other OEM's success in order to accelerate adoption.
Then add in the storage products that are just beginning to accelerate production, so nobody knows how to value that today. The previous comparison with Ford illustrates that the
Giant Issue is refueling. That should show that Tesla, unlike Ford, is about to build on the Supercharger network, Solar (perhaps a bit of wind) and grid services plus Virtual Power Plants. They have quite a few licenses already. This one we're ignoring. What? Why?...
Most of us think of Supercharging as a facilitator to sell cars, which it certainly is. We miss the point.
John D Rockefeller was vastly more successful than Henry Ford. One sold vehicles, the other sold energy.
Now, in 2022 we have one who's selling both. This one knows that:
Though Musk was being interviewed about Australia, he emphasized that renewables are essential to all of humanity's future.
futurism.com
but also that:
elon-musk-renews-push-for-fossil-fuels-as-he-claims-civilization-will-crumble-without-oil-and-gas
(sorry for quoting 'The Capitalist Tool" for the old world part)
So, should we not think about how Tesla can attract more customers to their fundamental product rather than thinking about customers only as competitors?
Imagine Tesla as a global provider of EV charging, grid services and Virtual Power Plants, while continuing to innovate in all manner of vehicles, HVAC systems and so on! Add to that improved automation such as FSD, all manner of robotics, and more efficient transit systems (tunnels, etc) plus every kind of freight.
Ships (space and water) probably will be separate companies. Fueling, though, is Tesla, as is mass manufacturing technology.
Am I the only one who sees the future developing this way, if we humans do not destroy ourselves first?
To me, the entire point of TSLA holdings is to do what I can to help the mission. If in the process those holdings increase in value, GREAT! But making money is not my primary motivation.
By the way, I do understand why my view of purpose is not universally held among us.
It is that purpose that makes me hope traditional OEMs can succeed. Frankly, I much prefer the Nokia's and the IBM's to the Renault's and GM's. Better to survive and thrive from time to time than to fail and be bailed out repeatedly by governments.
Of course the Tesla's, Space X's and CATL's are the ones that Really excite me. It is those that help improve the odds of human survival. My investment strategy builds on the premise that survival is vastly preferable to any other option.