Is Tesla a good investment?

[Paper Chaser]

Anyway, the stuff that they add on top of the vehicle is lidar, etc which should increase the ability for the vehicle to "see" it's surroundings without visual input (foggy, snowy weather, etc).

LIDAR is actually pretty crappy at dealing with fog/snow/rain. It's good for getting really precise distances/scans in clear weather.

The "etc" I used was to imply that it's more than just lidar. There's a suite of sensors that most companies use on their autonomous vehicles. Each technology system is good at different things, and there's also some redundant overlap in the capabilities. Tesla has chosen a different path and is using cameras only as far as I know. That is way cheaper and less intrusive to implement, but it may have limitations or safety drawbacks too.

[mistymoney]

welly, I put in a good til cancelled limit order for 2 shares based on the small amount of cash I had available for the purchase. Meanwhile.....initiated a transfer of 50 extra from my checking as it seemed super doubtful order would go through at that level. after 2/3 days adjusted the price up and my purchase went through today.

Woohoo! 2 more tesla shares into the kitty!

And 2k into ibonds. Just putting that out there so no one thinks I'm being too risk, ;P

[AdrianC]

There’s a new Model Y offering on Teslas website, reportedly using the new 4680 cells, and it seems a bit underwhelming, 279 mile range, only $3k cheaper than the 330 mile long range.

What’s the take on this from the Tesla bulls?

[EchoStache]

There’s a new Model Y offering on Teslas website, reportedly using the new 4680 cells, and it seems a bit underwhelming, 279 mile range, only $3k cheaper than the 330 mile long range.

What’s the take on this from the Tesla bulls?

Depends.  If maximum range without charging for frequent long highway trips in very cold weather is important, it wouldn't be the best choice as range could drop to 150 miles or less.  With Tesla's charging network, you could probably still make it work.

A reason to consider this model might depend on state tax credits.  For example, in PA, you get a $2,000 EV rebate if under $50k.  So net cost could be $40,500 for a brand new "SUV" EV.  So now it is $5k cheaper than the 330 mile range version.

We have a 239 mile range EV that we will probably keep for many years.....and it won't road trip anywhere remotely as well as a 279 mile range Tesla due to the charging network. 

[mistymoney]

There’s a new Model Y offering on Teslas website, reportedly using the new 4680 cells, and it seems a bit underwhelming, 279 mile range, only $3k cheaper than the 330 mile long range.

What’s the take on this from the Tesla bulls?

Depends.  If maximum range without charging for frequent long highway trips in very cold weather is important, it wouldn't be the best choice as range could drop to 150 miles or less.  With Tesla's charging network, you could probably still make it work.

A reason to consider this model might depend on state tax credits.  For example, in PA, you get a $2,000 EV rebate if under $50k.  So net cost could be $40,500 for a brand new "SUV" EV.  So now it is $5k cheaper than the 330 mile range version.

We have a 239 mile range EV that we will probably keep for many years.....and it won't road trip anywhere remotely as well as a 279 mile range Tesla due to the charging network.

but - will you be able to use the tesla network as the open those up?

Are there any spots where you wouldn't make it from one charging station to the next on tesla's system?

[EchoStache]

There’s a new Model Y offering on Teslas website, reportedly using the new 4680 cells, and it seems a bit underwhelming, 279 mile range, only $3k cheaper than the 330 mile long range.

What’s the take on this from the Tesla bulls?

Depends.  If maximum range without charging for frequent long highway trips in very cold weather is important, it wouldn't be the best choice as range could drop to 150 miles or less.  With Tesla's charging network, you could probably still make it work.

A reason to consider this model might depend on state tax credits.  For example, in PA, you get a $2,000 EV rebate if under $50k.  So net cost could be $40,500 for a brand new "SUV" EV.  So now it is $5k cheaper than the 330 mile range version.

We have a 239 mile range EV that we will probably keep for many years.....and it won't road trip anywhere remotely as well as a 279 mile range Tesla due to the charging network.

but - will you be able to use the tesla network as the open those up?

Are there any spots where you wouldn't make it from one charging station to the next on tesla's system?

Are both questions in regards to our Kia?  Yes, we will be able to use any of the Tesla stations that open for other cars, but I don't think the options are very extensive at this point.

If question two is in regards to the 279 mile range Model Y, I think it would be able to drive almost anywhere even under the worst conditions.  Nice thing about Tesla is that it can use ANY charger including Tesla.  All one needs is to keep a CCS adapter in the car.

[mistymoney]

There’s a new Model Y offering on Teslas website, reportedly using the new 4680 cells, and it seems a bit underwhelming, 279 mile range, only $3k cheaper than the 330 mile long range.

What’s the take on this from the Tesla bulls?

Depends.  If maximum range without charging for frequent long highway trips in very cold weather is important, it wouldn't be the best choice as range could drop to 150 miles or less.  With Tesla's charging network, you could probably still make it work.

A reason to consider this model might depend on state tax credits.  For example, in PA, you get a $2,000 EV rebate if under $50k.  So net cost could be $40,500 for a brand new "SUV" EV.  So now it is $5k cheaper than the 330 mile range version.

We have a 239 mile range EV that we will probably keep for many years.....and it won't road trip anywhere remotely as well as a 279 mile range Tesla due to the charging network.

but - will you be able to use the tesla network as the open those up?

Are there any spots where you wouldn't make it from one charging station to the next on tesla's system?

Are both questions in regards to our Kia?  Yes, we will be able to use any of the Tesla stations that open for other cars, but I don't think the options are very extensive at this point.

If question two is in regards to the 279 mile range Model Y, I think it would be able to drive almost anywhere even under the worst conditions.  Nice thing about Tesla is that it can use ANY charger including Tesla.  All one needs is to keep a CCS adapter in the car.

sorry I was unclear! I was just referencing your current vehicle, if it could do road trips when all the tesla chargers are opened up for everyone.

[EchoStache]

I don't think the majority of existing stations are going to be opened to everyone.  There are only a small handful open now, and I suspect it will be limited to stations that aren't very busy.  Tesla will be building new stations that are open for all cars, and they seem to build stations faster than anyone else, so I'm sure it will help.  But I'm pretty sure it won't be anything at all like suddenly having access to the entire network.

We've done a good handful of 200ish mile trips with the Kia.  It has worked, but even with such relatively short and limited trips, there have been challenges, such as arriving to a charge station that is completely out of order.  So you really *have* to have a backup, and probably a 2nd backup.  We've gotten to the backup plan and getting a charger to work can be hit or miss.   The screen and/or charging app can be glitchy.  We've had to change spots a couple times to get chargers to work.  Other times we arrive, plug in and charge no problem.  So roadtripping works, but it isn't 100% carefree i.e. just jump in the car and go.  You have to plan charge stops with plenty of reserve and make sure there are multiple locations within range.

Knowing what we know now, we probably would have bought a used Tesla when we bought our Kia Niro.  It's a good car, seems well built, quiet, runs and drives great, plenty of power, and pretty good efficiency for a small SUV/crossover type vehicle, but the charging network is just night and day.  It's not even remotely close to how extensive, reliable, and well integrated Tesla's ecosystem is.  We had to experience the difference first hand to really understand.  When I went to test drive a M3 and just pushed the charge icon on the display, it was incredible to see the vast network of chargers that were in range based on the current rate of charge of the vehicle.   I don't really see anyone catching up or even getting remotely close for perhaps 5-10 years, if then?

[ColoradoTribe]

IRS has released an updated list of EVs and PHEVs that will qualify for either full ($7500) or half ($3,500) of the federal tax credit going forward. There are 13 vehicles that qualify for the full credit. In Q1 Tesla produced approximately 111,000 qualifying vehicles (Model Y and Model 3 variants) and all other makes and models accounted for approximately $28,500. So, Tesla currently has 80% market share for vehicles that qualify for the full tax credit going forward. I don’t see that market share decreasing while Austin gigafactory is still ramping. Also guessing the CyberTruck will qualify for the full credit same as the F-150 Lightning.

[AdrianC]

There’s a new Model Y offering on Teslas website, reportedly using the new 4680 cells, and it seems a bit underwhelming, 279 mile range, only $3k cheaper than the 330 mile long range.

What’s the take on this from the Tesla bulls?

Depends.  If maximum range without charging for frequent long highway trips in very cold weather is important, it wouldn't be the best choice as range could drop to 150 miles or less.  With Tesla's charging network, you could probably still make it work.

I meant the first use of 4680 cells is underwhelming. The 4680s have been touted as a game changer.

[AdrianC]

Price for the Y just dropped another $3k: $46,990 for the AWD (with 4680), $49,990 for LR (older cell design).

Starting to get attractive. A couple more price drops like this and I'd be interested, except Mrs C has said there is no way she will ever drive or even ride in a car associated with Elon Musk, so I guess buying a Tesla is a non-starter.

[maizefolk]

Six price cuts since the start of the year is not going to be good for Telsa's profit margins. But it should be good for overall electric car adoption.

A year ago it was an exciting event if I saw even one Telsa in my small noncoastal american city. Last week I set a "high score" of five Telsa's in the course of a single 20 minute commute. And yesterday saw four just walking out to my car in the parking lot.

The question is whether the current stock price had the assumption that Tesla could maintain '21/'22 margins long term baked in or if selling a lot more cars at lower profit per units is enough to justify the current valuation. I don't know the answer.

[FINate]

We see a fair number of Tesla's around Boise, but that's been true for several years now. But now we're seeing a growing number of other EVs: Mach e, Ionic 5, Bolt, BMW, and even a few Rivian's. Rivian is interesting to me, though I have doubts about their long-term survival. They're building a service center here in Boise, so that's interesting. Boise is a prime location for their target demographic, urban and outdoorsy overlander types.

RE Tesla price drops: This may be in response to losing some of the federal tax credits.

However, it’s important to note that in this case, this is Tesla’s only model to have seen its federal tax credit being reduced from $7,500 to $3,750 following the battery source requirements.

It appears Tesla is trying to counter the reduced incentive with a direct price cut.

Which is why -- being FIRE with "low income" -- the tax credit is really a negative for me. I don't want to pay prices that have been increased with the assumption that this will be offset by a non-refundable tax credit. So hoping these largely go away before we're in the market for an EV.

Finally, interesting commentary from Electrek relevant to this thread:

Despite some of the staunchest Tesla fans or investors trying to make us believe that it’s all part of Tesla’s mission to make EVs more affordable, these price cuts are indeed due to demand going down.

Tesla’s goal is to sell all the vehicles it produces. If it could sell them for a higher price, it would and it has in the past. Yes, there might be some cost improvements involved too, but not $16,000 or 24% worth in just a few months.

[FINate]

I'm also looking forward to simpler lower cost EVs coming to market in the next several years: The $25,000 electric vehicle is coming, with big implications for the auto market and car buyers

Tech-rich vechiles with big touch screens and tons of features don't really appeal to me. An EV with physical buttons, fewer features, but with good range and battery management is more my speed.

[ChpBstrd]

Recall about a year ago when I was being called a fool for predicting that the competition was coming and Tesla's margins would have to decline to stay competitive? Good times.

TSLA 12 month performance: -45.5%

[ColoradoTribe]

Recall about a year ago when I was being called a fool for predicting that the competition was coming and Tesla's margins would have to decline to stay competitive? Good times.

TSLA 12 month performance: -45.5%

How’s the Tesla performance over the past 2, 3, 4 and 5 years? Investors are in it for the long haul. Tesla is up 9X since the start of this thread in 2018. While you’ve been expressing an ever evolving list of “concerns” Tesla has created value for shareholders. Plenty of folks cashed out and retired early thanks to Tesla. You’ll forgive me if I don’t credit you for your insight when it comes to Tesla. Anybody listening to you 5 years ago missed out on huge gains

Tesla is now selling Model Ys for the same price they sold for 8 qtrs ago. Production of Model Y has gone 5X over that same span. OEMs offer discounts all the time to match supply and demand, its just obscured by the dealer network. Tesla’s automotive margin is still best in the business by a wide margin.

Tesla bears will never be satisfied. Tesla’s is either screwed because the cars are too expensive and Tesla is going to run out of buyers or Tesla is screwed because Tesla is cutting prices to match willing buyers to the rapidly growing production capacity.

Sure, I’d love it if Tesla could continue 50% YOY growth and maintain 29% margins, but that’s not realistic, especially in this macro environment of rising interest rates and recession fears. We’ll have to settle for selling 1.8-2.0 million EVs in 2023 at 15-20% margin.

Lost in the noise about Tesla price drops is the rapid growth in the Energy business. Energy storage deployment was up 360% YOY with healthy 10%-11% margins.  TE is expected to grow to rival automotive sales. Need for storage is inexhaustible for the next decade at least.

CT deliveries to start end of Q3. Gen 2 vehicles late 2024. Tesla will continue to grow cash reserves while also pouring money into R&D and growth. Tesla will continue to reduce production costs and grow homemade 4680 cell production. Tesla Energy will rapidly grow with a new megapack battery factory going up in Shanghai this year. The competition will be lucky if they don’t go bankrupt while transitioning from ICE to EV, and trying to achieve scale. Tesla will continue to gobble up market share. Nothing about these price cuts effect Tesla’s ability to execute on its long-term plans. The future for long-term investors remains bright.

I’ve been down this road before and listened to all the “experts” warn of Tesla’s imminent demise and the coming competition from 2013-2019. Six years wondering the wilderness while Tesla SP drifted sideways or worse. But all the while I knew Tesla was executing, growing, laying the foundation. The spring is being compressed again.

[AdrianC]

I'm also looking forward to simpler lower cost EVs coming to market in the next several years: The $25,000 electric vehicle is coming, with big implications for the auto market and car buyers

Tech-rich vehicles with big touch screens and tons of features don't really appeal to me. An EV with physical buttons, fewer features, but with good range and battery management is more my speed.

Tesla saves money using that large touchscreen for everything. It's the same concept we use in my business - factory control systems and automation. The old way was lots of hard-wired buttons and switches and lights. We haven't done that in factories for decades. We use touchscreens and ipads.

It's tricky for cars, though. You don't want to be driving and digging through touchscreen menus at 75mph, obviously.
Our Chevy Bolt has normal car controls. We like that. Has decent range. Not good fast DC charging. It literally is a very usable $25k EV (we paid less in 2021).

[AdrianC]

Tesla will continue to reduce production costs and grow homemade 4680 cell production.

What is the advantage of the 4680? Is it to reduce costs? In the current offering (model Y AWD) there is no performance improvement.
The vehicle is the cheapest Model Y, but it's also the least range, slowest charging.

[bacchi]

Tesla bears will never be satisfied. Tesla’s is either screwed because the cars are too expensive and Tesla is going to run out of buyers or Tesla is screwed because Tesla is cutting prices to match willing buyers to the rapidly growing production capacity.

Tesla could have either dropped prices or slowed down growth because, bottom line, the premium market isn't unlimited. It's why Audi and BMW aren't selling 10M cars/year and Toyota is -- not everyone can afford a $50k+ car. Tesla chose to drop prices and, to no one's surprise, profit margins dropped.

Thinking this is a "bear" position says more about that person than it does about the person making the observation.

Tesla will continue to gobble up market share.

Tesla US market share has declined 14% from 2020-22. There are only vague rumors about a <$30k model and there are dozens of other EVs showing up this year and next. Tesla is going to lose market share this year, and see decreased profit margins, as it tries to make room for its production capacity. If the CT takes off, as predicted by its order list, it may well gain some market share in 2024.

[mistymoney]

lol!

looks like I should have waited for my 2 shares purchase!!

[mistymoney]

Tesla will continue to reduce production costs and grow homemade 4680 cell production.

What is the advantage of the 4680? Is it to reduce costs? In the current offering (model Y AWD) there is no performance improvement.
The vehicle is the cheapest Model Y, but it's also the least range, slowest charging.

seems like you should google that up?

[ColoradoTribe]

Tesla will continue to reduce production costs and grow homemade 4680 cell production.

What is the advantage of the 4680? Is it to reduce costs? In the current offering (model Y AWD) there is no performance improvement.
The vehicle is the cheapest Model Y, but it's also the least range, slowest charging.

My understanding, going off Battery Day recollections, is the sum of the new technologies (dry anode/cathode, tabless, less graphite, etc.), the manufacturing process, and scaled production of 4680 batteries were going to bring down battery cell costs by 50%. I don’t know what amount of that has been realized to date, but it’s great than 0 and less than 50%.

The other advantage of 4680 was improved energy density in the pack. Greater energy density means more power for less weight, which means more range from reduced vehicle weight for the same size pack.

Lastly, I believe the 4680s are supposed to last longer (less degradation, more cycles) over time, which is why they were slated for the semi and CT in particular.

This is not a comprehensive response, but what I recall. Perhaps most importantly now, but unknown when the 4680 was announced, is the importance of domestic battery cell production to capture the credits contained in the IRA. Every cell produced in the US (or with raw materials sourced from the US and close trade partners) will fetch a sizable credit and essentially be produced at a discount. Tesla can pocket that money or pass it on to the consumer.

[ColoradoTribe]

Tesla bears will never be satisfied. Tesla’s is either screwed because the cars are too expensive and Tesla is going to run out of buyers or Tesla is screwed because Tesla is cutting prices to match willing buyers to the rapidly growing production capacity.

Tesla could have either dropped prices or slowed down growth because, bottom line, the premium market isn't unlimited. It's why Audi and BMW aren't selling 10M cars/year and Toyota is -- not everyone can afford a $50k+ car. Tesla chose to drop prices and, to no one's surprise, profit margins dropped.

Thinking this is a "bear" position says more about that person than it does about the person making the observation.

Tesla will continue to gobble up market share.

Tesla US market share has declined 14% from 2020-22. There are only vague rumors about a <$30k model and there are dozens of other EVs showing up this year and next. Tesla is going to lose market share this year, and see decreased profit margins, as it tries to make room for its production capacity. If the CT takes off, as predicted by its order list, it may well gain some market share in 2024.

So, Tesla’s share of the EV market share has decreased when compared to a time period when competitors were basically producing zero EVs. No kidding. I’ve said it numerous times, as has Elon, Tesla is not competing with the OEMs for some share of a fixed EV market pie. Nearly all ICE is going to transition to EV, so everyone is competing for the total passenger vehicle market with their EVs.

Would you rather have 30% of 3 million or 15% of 20 million (numbers for illustration only). Of course you’d rather have the latter even though your “share” is smaller or shrinking. Tesla is increasing its share of the only pie that matters, total vehicle market. This has been explained to you before.

Tesla is not a luxury car producer. What other luxury car manufacture is making 2 million vehicles this year. Not BMW, Cadillac, Lexus, Audi, Porche, Jaguar or Mercedes Benz. Tesla’s ASP, including model X and S stands at $46,000.  The average price of a new car in the US right now is $48,000. After federal tax credits and before state credits, you can pickup a model 3 for ~$36k and a Model Y for ~$40k. So, Tesla is offering a premium, best in class EV for less than what the average consumer is willing to pay for a new vehicle today. Can we please retire this tired trope about Tesla being a luxury vehicle company?

Bottom line. Tesla will produce between 1.8 and 2 million EVs this year and sell them all for a profit (15-20% margin). Every other EV sold in the US this year will be sold at a loss. The auto industry is cyclical. People defer big purchases when interests rates rise and times are uncertain. Tesla is not being uniquely affected, but is in a better position (margins, low debt, cash reserves, etc.) to weather any macro conditions than any of its “competitors”. Unless Ford has a rapidly growing and profitable utility scale energy storage business I’m not aware of?

[GuitarStv]

Tesla is not a luxury car producer.

https://electrek.co/2023/01/11/tesla-becomes-top-luxury-auto-brand-us/
https://www.insurancenavy.com/questions/is-tesla-considered-a-luxury-car/
https://www.caranddriver.com/news/a42938734/tesla-best-selling-luxury-brand-2022/

Tesla is absolutely a luxury car.  They don't offer an inexpensive bare bones model, all versions are chock full of luxury shit that nobody needs.

The cheapest car that Tesla offers here in Canada is the model 3, which is $54,990 for the 'barebones' version - a full 10 grand more than the average MRSP for a car sold in this country.  There's also the 'performance' model 3, retailing for 73 grand .  . . the model Y (70 - 76 grand), the model S (117-144 grand), or the model X (131 - 144 grand).  By any measure I can think of, they are a luxury car producer.

[bacchi]

So, Tesla’s share of the EV market share has decreased when compared to a time period when competitors were basically producing zero EVs.

Correct, Tesla's EV market share in the US has declined. It now has competitors.

I’ve said it numerous times, as has Elon, Tesla is not competing with the OEMs for some share of a fixed EV market pie. Nearly all ICE is going to transition to EV, so everyone is competing for the total passenger vehicle market with their EVs.

No one has denied that EVs will take market share from ICEs.

What other luxury car manufacture is making 2 million vehicles this year. Not BMW, Cadillac, Lexus, Audi, Porche, Jaguar or Mercedes Benz.

Eh? BMW sold 2.4M cars last year. Mercedes sold 2.0M cars last year.

Tesla’s ASP, including model X and S stands at $46,000.  The average price of a new car in the US right now is $48,000.

This has been stated before but average is not median. The median household income in America is $70k. The average is $102k.

[EchoStache]

Tesla bears will never be satisfied. Tesla’s is either screwed because the cars are too expensive and Tesla is going to run out of buyers or Tesla is screwed because Tesla is cutting prices to match willing buyers to the rapidly growing production capacity.

Tesla could have either dropped prices or slowed down growth because, bottom line, the premium market isn't unlimited. It's why Audi and BMW aren't selling 10M cars/year and Toyota is -- not everyone can afford a $50k+ car. Tesla chose to drop prices and, to no one's surprise, profit margins dropped.

Thinking this is a "bear" position says more about that person than it does about the person making the observation.

Tesla will continue to gobble up market share.

Tesla US market share has declined 14% from 2020-22. There are only vague rumors about a <$30k model and there are dozens of other EVs showing up this year and next. Tesla is going to lose market share this year, and see decreased profit margins, as it tries to make room for its production capacity. If the CT takes off, as predicted by its order list, it may well gain some market share in 2024.

You seem really concerned about Tesla's share of the EV market.  Is this what you think matters in some way?

Edit:  To clarify what I'm getting at, what do you think matters more, that Tesla has increased their share of the total US light vehicle market by 50% in a year(from ~1.7% to ~2.5%), or that their share of EV only is decreasing as legacy ICE transitions?

For example, if Tesla's EV only market share drops to only 25%, but that turns out to be 25% of ALL light duty vehicles in the US, is that a bad thing in your eyes that signifies the company is doing poorly somehow?  If so, I'm not sure math agrees with you.

[ColoradoTribe]

So, Tesla’s share of the EV market share has decreased when compared to a time period when competitors were basically producing zero EVs.

Correct, Tesla's EV market share in the US has declined. It now has competitors.

I’ve said it numerous times, as has Elon, Tesla is not competing with the OEMs for some share of a fixed EV market pie. Nearly all ICE is going to transition to EV, so everyone is competing for the total passenger vehicle market with their EVs.

No one has denied that EVs will take market share from ICEs.

What other luxury car manufacture is making 2 million vehicles this year. Not BMW, Cadillac, Lexus, Audi, Porche, Jaguar or Mercedes Benz.

Eh? BMW sold 2.4M cars last year. Mercedes sold 2.0M cars last year.

Tesla’s ASP, including model X and S stands at $46,000.  The average price of a new car in the US right now is $48,000.

This has been stated before but average is not median. The median household income in America is $70k. The average is $102k.

A lot of deflection in this response. So does Tesla’s share of the EV market matter relative to their growing share of the automotive market? You clearly thought Tesla's declining share of the EV market was important enough to point out.

Is Tesla really a luxury car maker if their ASP is less than the average cost of a new car in the US (before the federal credits puts the price well below the average)? I didn’t catch your response. Regardless, Tesla has and will continue to work down market with their vehicle offerings and expand market share by entering new vehicle segments.

I know the difference between median and average, but average is what we have to work with unless you actually know the median price of new cars right now?

[bacchi]

You seem really concerned about Tesla's share of the EV market.  Is this what you think matters in some way?

Well, yeah, if we're talking profit margins and growth targets. Competition does that. However, if you have other ideas as to why Tesla has dropped car prices 6 times this year in the US, I'm willing to listen.

Edit:  To clarify what I'm getting at, what do you think matters more, that Tesla has increased their share of the total US light vehicle market by 50% in a year(from ~1.7% to ~2.5%), or that their share of EV only is decreasing as legacy ICE transitions?

For example, if Tesla's EV only market share drops to only 25%, but that turns out to be 25% of ALL light duty vehicles in the US, is that a bad thing in your eyes that signifies the company is doing poorly somehow?  If so, I'm not sure math agrees with you.

The point is that Tesla stock is priced as a high growth, high profit margin, company. If it can't maintain both of those attributes, then the stock price will fall, which we saw today (-9.75%).

The company won't collapse, they'll sell more and more cars each year, the stock price won't drop to 10, but they're facing growth limits like every very profitable company has in the world.

[bacchi]

So does Tesla’s share of the EV market matter relative to their growing share of the automotive market? You clearly thought Tesla's declining share of the EV market was important enough to point out.

Yes.

The point is that Tesla stock is priced as a high growth, high profit margin, company. If it can't maintain both of those attributes, then the stock price will fall, which we saw today (-9.75%).

The company won't collapse, they'll sell more and more cars each year, the stock price won't drop to 10, but they're facing competition and growth limits like every very profitable company has in the world.

Is Tesla really a luxury car maker if their ASP is less than the average cost of a new car in the US (before the federal credits puts the price well below the average)? I didn’t catch your response. Regardless, Tesla has and will continue to work down market with their vehicle offerings and expand market share by entering new vehicle segments.

I'll refer you to  GuitarStv's post above. ^^^

Even Teslarati got into the cheering. But what do 'KBB' and 'Automotive News' and 'Car & Driver' know, right?

https://www.teslarati.com/tesla-wins-luxury-crown-kelley-blue-book-2023-brand-image-awards/

These articles always get the Tesla haters riled up and trying to claim that Tesla is not a luxury brand. A quick check reveals that Motortrend, Motor1 and JD Power also include Tesla in their luxury category and rank them at or close to the top and I am sure there are others.

Lol. Are you the Tesla hater then?

I'm also not sure it behooves (some) stans to claim that Tesla isn't a luxury brand because then it becomes just another EV in a sea of them. This is why Honda and Toyota have separate luxury brands. When people think of Toyota, they think function. When they think of Lexus, they think form.

[mistymoney]

LMFAO!!!

Zuckerberg runs down Elon as Meta's market cap tops Tesla for first time in 16 months
7:32 pm ET April 20, 2023 (MarketWatch)
 Print
By Emily Bary

musk will do whatever it takes now ><

rest easy tesla holders!

[maizefolk]

Elon Musk's net worth dropped an estimated $11.4B yesterday. Mark Zuckerberg's estimated net worth today is still only ~40% that of Elon Musk's. To the extent this stuff matters to either of their ego's (and I could imagine answers all the way from "not at all" to "a lot") I don't think the situation today is any different that it was last week.

[StashingAway]

I know the difference between median and average, but average is what we have to work with unless you actually know the median price of new cars right now?

Lack of access to a good metric doesn't justify using a bad metric.

[AdrianC]

Tesla will continue to reduce production costs and grow homemade 4680 cell production.

What is the advantage of the 4680? Is it to reduce costs? In the current offering (model Y AWD) there is no performance improvement.
The vehicle is the cheapest Model Y, but it's also the least range, slowest charging.

seems like you should google that up?

Channeling your inner Musk?

[AdrianC]

Tesla will continue to reduce production costs and grow homemade 4680 cell production.

What is the advantage of the 4680? Is it to reduce costs? In the current offering (model Y AWD) there is no performance improvement.
The vehicle is the cheapest Model Y, but it's also the least range, slowest charging.

My understanding, going off Battery Day recollections, is the sum of the new technologies (dry anode/cathode, tabless, less graphite, etc.), the manufacturing process, and scaled production of 4680 batteries were going to bring down battery cell costs by 50%. I don’t know what amount of that has been realized to date, but it’s great than 0 and less than 50%.

The other advantage of 4680 was improved energy density in the pack. Greater energy density means more power for less weight, which means more range from reduced vehicle weight for the same size pack.

Lastly, I believe the 4680s are supposed to last longer (less degradation, more cycles) over time, which is why they were slated for the semi and CT in particular.

This is not a comprehensive response, but what I recall. Perhaps most importantly now, but unknown when the 4680 was announced, is the importance of domestic battery cell production to capture the credits contained in the IRA. Every cell produced in the US (or with raw materials sourced from the US and close trade partners) will fetch a sizable credit and essentially be produced at a discount. Tesla can pocket that money or pass it on to the consumer.

Thanks, and that aligns with reading I've done about the 4680.

The initial use of them doesn't meet the promise of greater range/less weight. The Model Y using them is not significantly lighter than the LR version, I've read, and does have less range.
Don't know. Too early to tell, I guess. No way to know if they are less expensive to make yet. The AWD Y is a bit cheaper for less range and slower charging. That's all we know.

Bringing down battery costs by 50% would be a game changer. I hope that does happen.

Re: average price of new cars - it includes pick-up trucks, yes?

[mistymoney]

Elon Musk's net worth dropped an estimated $11.4B yesterday. Mark Zuckerberg's estimated net worth today is still only ~40% that of Elon Musk's. To the extent this stuff matters to either of their ego's (and I could imagine answers all the way from "not at all" to "a lot") I don't think the situation today is any different that it was last week.

way to stomp on my jocosity.....this thread seriously needs some lightening up!

In my expert opinoin!

[GuitarStv]

Elon Musk's net worth dropped an estimated $11.4B yesterday. Mark Zuckerberg's estimated net worth today is still only ~40% that of Elon Musk's. To the extent this stuff matters to either of their ego's (and I could imagine answers all the way from "not at all" to "a lot") I don't think the situation today is any different that it was last week.

way to stomp on my jocosity.....this thread seriously needs some lightening up!

In my expert opinoin!

Musk seems to have carried over his Twitter strategy to the latest spaceX launch . . .

[mistymoney]

Elon Musk's net worth dropped an estimated $11.4B yesterday. Mark Zuckerberg's estimated net worth today is still only ~40% that of Elon Musk's. To the extent this stuff matters to either of their ego's (and I could imagine answers all the way from "not at all" to "a lot") I don't think the situation today is any different that it was last week.

way to stomp on my jocosity.....this thread seriously needs some lightening up!

In my expert opinoin!

Musk seems to have carried over his Twitter strategy to the latest spaceX launch . . .

><

[EchoStache]

You seem really concerned about Tesla's share of the EV market.  Is this what you think matters in some way?

Well, yeah, if we're talking profit margins and growth targets. Competition does that. However, if you have other ideas as to why Tesla has dropped car prices 6 times this year in the US, I'm willing to listen.

Looming recession, lots of layoffs in high paying sectors, drastically higher finance rates have affected affordability?  Remember, most people who buy new cars can't actually afford to buy them, they *have* to finance. 

I don't think Tesla lowered prices because of competition or EV market share.  Honestly, there just isn't an EV offering that competes will with Tesla IMO. 

If Tesla losing EV market share was somehow directly correlated with Tesla somehow actually performing poorly, that would matter.  It is basically mathematically impossible for Tesla to not lose EV only market share as we move forward, even if they go on to become the largest and most profitable company in the world by 2030, which is why I think EV only market share is an almost meaningless metric moving forward.  I just don't see how that metric matters, at all, in terms of signifying how well Tesla is performing.

Tesla increased their share of total US light vehicle sales by 50% last year.  If that doesn't strike you as significant and meaningful, not sure what will.

Rates will remain high for much(all?) of the year.  I can see the scenario where there may not be much upside for Tesla share price *this year*, but with CT and the next gen vehicle in the pipeline, it sure seems like there is a definite path for massive sustained growth, cost reduction, and profitability. 

It is absolutely fair to say that lowering prices hurt margins. 

Maybe I'm way off here, but here's some quick napkin math:

Average sales price $46,000
1,800,000 units for 2023.
18% profit margin.
15 billion profit 2023.  Bad result?

[FINate]

Maybe I'm way off here, but here's some quick napkin math:

Average sales price $46,000
1,800,000 units for 2023.
18% profit margin.
15 billion profit 2023.  Bad result?

Investors certainly think it's a bad result, with a ~10% drop post earnings. Profit and margins aren't absolutes, they must be evaluated relative to current valuation. On this very thread theses to support a much higher than usual PE ratio included predictions that demand would continue to outpace supply, and that Tesla would be able to maintain margins by cutting costs while undercutting competitors. Yet we're seeing what looks like a demand problem, lower margins, and lower market share. In no way does this mean Tesla's business is in trouble, but this misses the point of this thread, which is whether or not Tesla is a good investment. And it doesn't matter if TSLA was a good investment 2 or 5 years ago, implicit in the question is if TSLA is a good investment right now. Even for those who invested many years ago and are sitting on large gains (to be clear, good for you!), you still have to ask if continuing to hold TSLA is a good investment going forward.

[mistymoney]

I've been noticing stinky cars a lot when I am out and about.

in urban areas, the switch to EV is going to be great for health - particular to those with asthma, COPD, etc.

Super glad to be part of that :)

from tesla on twitter:

Every vehicle we sell, battery we install & solar panel we add moves the needle in the direction of a sustainable future.

Thank you to the Tesla team, customers & supporters for bringing us closer to our goal!

Happy Earth Day 🌎💙

Money isn't everything. And money is nothing without our health and the health of the planet.

[FINate]

I've been noticing stinky cars a lot when I am out and about.

in urban areas, the switch to EV is going to be great for health - particular to those with asthma, COPD, etc.

Super glad to be part of that :)

from tesla on twitter:

Every vehicle we sell, battery we install & solar panel we add moves the needle in the direction of a sustainable future.

Thank you to the Tesla team, customers & supporters for bringing us closer to our goal!

Happy Earth Day 🌎💙

Money isn't everything. And money is nothing without our health and the health of the planet.

Yes, and what's best for the planet isn't necessarily best for Tesla investors. It's good that multiple EV makers are battling it out on price and features. This will drive innovation while lower prices, thereby making EVs more attractive to the masses, which is good for the climate. But by definition, this means lower margins and lower profits for EV companies, including Tesla. Which is why I'm rooting for all companies while also cheering that Tesla is having to contend with real competition and less profitability.

[TomTX]

Recall about a year ago when I was being called a fool for predicting that the competition was coming and Tesla's margins would have to decline to stay competitive? Good times.

TSLA 12 month performance: -45.5%

Cherry picking. You know better than that.

[TomTX]

Tesla will continue to reduce production costs and grow homemade 4680 cell production.

What is the advantage of the 4680? Is it to reduce costs? In the current offering (model Y AWD) there is no performance improvement.
The vehicle is the cheapest Model Y, but it's also the least range, slowest charging.

So, technically a 4680 is just the form factor. It's a cylinder 46mm wide and 80mm tall. The 2170s are a cylinder 21mm wide and 70mm tall.

Producing fewer, larger batteries should be noticeably cheaper once production has ramped up and they get the bugs worked out.

https://history-computer.com/teslas-2170-vs-4680-batteries/

Tesla also announced a lot of planned internal improvements when they  (tabless design, silicon, dry process cathode production, etc.) However, it seems they are having trouble with something in their 4680 transition - despite being about 5x the volume of a 2170, I'm seeing reported capacity values only about 2x that of a 2170. Hopefully it's just temporary.

https://history-computer.com/teslas-2170-vs-4680-batteries/

[AdrianC]

From your article dated 2/25/23:

“The Tesla 4680s is expected to increase the range of Tesla EVs by as much as 54%. What’s more is that these batteries will reduce the total weight of EVs. This, paired with the sheer amount of mAh in the 4680s, will boost acceleration while reducing costs and increasing sustainability. In short, the 4680 was designed with power, precision, profit, and the planet in mind.

While the 4680s have yet to be rolled out across the full line of Tesla EVs as initially planned, they have begun to hit the streets in small numbers in Model Ys assembled at the Texas Gigafactory. Initial impressions have been nothing short of remarkable. Drivers lucky enough to get their hands on the wheel of a 4680-equipped Model Y have praised the charging speed, the vehicle’s acceleration, and the maximum distance they can get per charge.“

Oh my.

[mistymoney]

this is where my concerns for the company/investment come in:

A group of Tesla Inc. shareholders have come out against the nomination of a former executive to the car maker's board over concerns he is an insider coming in to replace an independent director.

Labor pension fund advisory firm SOC Investment Group and other investors urged Tesla shareholders on Monday to vote against the nomination of former Chief Technology Officer J. B. Straubel to a seat that will be vacated by independent director Hiro Mizuno.

The group has already engaged the board's chair, Robyn Denholm, about a potential overhaul of the board that would have "truly independent directors" swapped in for board members that have strong ties to Chief Executive Elon Musk, including his brother Kimbal Musk and other personal friends, according to the letter.

Installing Mr. Straubel to the board would mean that at least five of the board's eight members lack independence, the shareholder said.

"Replacing an independent director with another insider risks exacerbating existing problems that seem to arise from such a clubby board," the investors said.

A representative for Tesla didn't immediately respond to a request for comment.

The investor group argues that Tesla needs a more independent board to rein in Elon Musk and protect the company from its chief's recent actions, which they fear have tarnished the car maker's reputation

Other than that - no real concerns on competitors, unless musk continues to drop the ball/alienate potential customers. It is a positive that the field is opening up with more options. Competitors, volatility, that is expected.

Will tesla outperform or underperform the market on a 5-10 year time frame? My bet is outperform. If it is 10-20% below market on that timeline, I'm still ok with my investment as I am super into the mission and tesla leadership in making mass EV sales a reality.

Musk just needs to stop drinking his own coolaid.

[ChpBstrd]

I’m a a-hole for posting this.

[EchoStache]

Interesting chart I saw.  Legacy Q1 results looked pretty good when considered in a vacuum.  However, Q12023 is being compared to abysmally horrible Q1 2022 numbers(for legacy).  Most legacy are down significantly compared to 2 years ago.

[stealthwealth]

Legacy is intentionally restricting supply.  They've learned you don't make money overproducing and discounting. 

As for Tesla, you couldn't pay me enough drive one.  Their CEO is a piece of grade A magat trash, and I'm not interested in giving him a dime.  Fuck him, you know?  There's a ton of other EVs and competitively priced hybrids out there, and most of them are nicer.  So I'll be putting my money there on my next car a few years from now.

[AJDZee]

As for Tesla, you couldn't pay me enough drive one.  Their CEO is a piece of grade A magat trash, and I'm not interested in giving him a dime.  Fuck him, you know?  There's a ton of other EVs and competitively priced hybrids out there, and most of them are nicer.  So I'll be putting my money there on my next car a few years from now.

Will you vet the character of CEOs of other car brands before you buy?
Elon gets a lot of media attention, more than he should, and it seems to influence people more than it should.  From looking at his antics, he seems like he's immature. But is he any worse than the CEO of Ford or Hyundai? Or Proctor & Gamble, Unilever, Tyson Foods, and countless other companies you give your dollars to every day?

[stealthwealth]

As for Tesla, you couldn't pay me enough drive one.  Their CEO is a piece of grade A magat trash, and I'm not interested in giving him a dime.  Fuck him, you know?  There's a ton of other EVs and competitively priced hybrids out there, and most of them are nicer.  So I'll be putting my money there on my next car a few years from now.

Will you vet the character of CEOs of other car brands before you buy?
Elon gets a lot of media attention, more than he should, and it seems to influence people more than it should.  From looking at his antics, he seems like he's immature. But is he any worse than the CEO of Ford or Hyundai? Or Proctor & Gamble, Unilever, Tyson Foods, and countless other companies you give your dollars to every day?

Pretty sure he is worse, because if other CEOs were acting the same way, we'd hear about it.  Most other corporations have a better governance structure than Tesla, and he would've been out long ago.  So, no, I'm not giving a dime to him, either through purchasing one of his products, or through adding to the value of his company via investing in it.  Tesla is never going to see $400 again.  And they are never selling 20M cars a year.  Like I said, my next vehicle will likely be electric, but it will *not* be a Tesla.