Is there any reason to think mainstream automakers can't put batteries in their cars? Is there any reason to believe Tesla's self-driving aspirations will pay off (over say, GM Cruise, or Waymo)?
I'm sure Tesla is fine and they make a few nice luxury cars, but I feel like I'm going crazy here: How is Tesla worth $380B, but Porsche is worth only 20B?
Digital vs film cameras are, I think, a pretty good analogy here in a lot of ways, both in terms of business and technology. Digital cameras were more expensive than film and, initially, less performant but had low operating costs and more convenience. It was a transition where the eventual result was clear to most people except for, perhaps, film camera buffs, but the pace of change was uncertain.
Some companies like Nikon and Canon anticipated and adapted to the transition and did really well. Some, like Fujifilm, found their niche using the expertise they had. Some, like Kodak, were so firmly planted in their ways that they gave up their massive lead waiting for the tide to turn rather than risk disrupting themselves.
Kodak's patents on CMOS image sensors (which were invented in the 1970's) ran out just about the same time as all the complementary technologies became commercially viable. Things like signal processing, data storage, and energy storage.
Think about how you would perform the DCT to do JPEG compression in the early 1990s. You'd need an expensive, power-hungry ASIC. Think about storing 10-100 MB of data. That would be a 2.5" spinning hard disk.
10 MSps ADCs (fast enough to shoot a frame per second) were not exactly exotic, but still very expensive. 16MB of DRAM was a luxury on Unix workstations. How much of that do you want to spend on a framebuffer?
Think about how you'd power all this hardware. Heavy NiCd batteries with memory, yuck!
The first DSLR that really took off for photojournalism (i.e., good enough quality to use in a printed newspaper) was the Nikon D1, in 1999. It's not that nobody had the right idea (Kodak had been selling digital cameras since the late 1980's), but it took that long for technology to catch up with the idea of a digital camera. It turns out (gasp!) that nobody wanted a digital camera that weighs 40 lbs, stores fewer photos than a roll of film, and has lower image quality.
It's fun to blame Kodak management for being short-sighted, but I really don't see a winning scenario. Short of a "Bet the whole company on CMOS in 1980 on the assumption that multiple enabling technologies from 3rd parties will improve by 10-100x in 10 years and that consumers will actually like the new product while we develop the right competencies and starve investment in growing lines of business." That doesn't sound like a way to get your year-end bonus.
Tesla is the technology leader in electric cars. Meanwhile existing automakers have massive inertia because their entire company is built around ICE cars. There is not only substantial technical know-how that you need to acquire, there is also substantial know-how that becomes obsolete, and the positions that have this know-how might resist any change.
In the case of GM you can also add that GM is largely irrelevant outside of the US and China, while Tesla finds international appeal and seems to have a much larger potential market than GM can find.
The market is simply telling us that it expects Tesla to generate more cash flow (very different than accounting profit) than of GM.
If you believe otherwise you see something the market doesn't and therefore can profit handsomely
EDIT: wording
I'm sure not betting against insane shit continuing in 2020.
It seems so. They were supposed to ,,kill'' Tesla a few years ago. Also they came out with cars whose efficiency compared to their size is far below what Tesla has achieved by years of focusing on it, which means that they have a huge disadvantage even if they can get the same batteries for the same price.
Tesla is many things - they’re a distributed utility company for one. They’re ramping up their battery production for the coming shift to clean tech infrastructure.
They have a growing distributed utility business with proven track record. They work with governments to shift their grid to battery / solar. On a global scale, this is a enormous market
Plus extensive supercharging network. Giga factories, solar roofs and they’re going to reconfigure battery tech from ground up and I won’t be surprised if they’ll have major breakthroughs.
Not to mention Tesla’s energy tech is going to be a major component of Mars Colonization. Another huge market in not so distant future. Imagine this, if America’s energy infrastructure was built by singular company (a la standard oil) at its very inception towards today.
Space X is probably the only company on earth that’s gonna have the means to build Mars colonies en mass.
Long term (20+ years) Tesla is laying the groundwork for new world(s!), both Earth and Mars. This is mind boggling and other car companies are apples to oranges comparison.
Apple makes a healthy margin on their lower sales numbers and has an associated services revenue stream to boot.
Tesla loses money on car sales and has managed to squeeze out some positive earnings by selling regulatory credits to their competitors. It's not a "selling less luxury goods but at a higher margin" story.
If we assume that the regulatory credit revenue stream eventually dries up then the case for the valuation seems to revolve around Tesla becoming the only car company and/or Tesla being or becoming so much more than just a car company.
Few automakers are nearly so vertically integrated. None are investing in bleeding edge battery technology. None are deploying grid-scale energy services.
- reasonable but ambitious long term plans to increase the worlds battery production to insane new levels
- thereby doing actually something against climate change, like no other company
- thereby having the chance do get in serious competition with the largest energy companies in the world (oil/gas)
- long term plans to decrease the disadvantages of weight, cost and size of their current main disadvantage, batteries
- they are nailing energy effiency in their cars
- Full self driving beta is rolling out. No manufacturer is improving their already sold car like tesla does. This is key for me
- they feel like the apple of energy
- cybertruck looks awesome, thats a bold move for such a player
- battery wall, solar roof and tesla car are an insanely harmonic product for many places in the world
- using a tesla supercharger? Imagine Volkswagen getting a part each time you refill your car
- they innovate not just to show of on some event but to include it in their mass production
- they commit to public long term plans
- their non-marketing works. I mean come on, he shoot a tesla into space
Not saying it’s a good idea, only that it’s possible
The whole point of passive investing in an index is that you don’t need to concern yourself with the individual index components.
Compare VV (Vanguard Large Cap ETF) with VOO (Vanguard S&P 500 ETF) and their performance is very correlated despite VV owning Tesla and VOO not.
Currently VV is slightly over-performing VOO but it might or might not reverse in the future.
In an efficient market, one might expect the smart, rational players to correct these bubbles. But once they’ve sold all their own holdings, you’re left with a Winner’s Curse [1] dynamic where the most (irrationally) optimistic investors are the ones ultimately setting the price. And essentially the only way the rational players can affect things from there is through short-selling, thereby risking running afoul of Keynes’ famous adage about the market remaining irrational for longer than they can remain solvent.
Thus there can fairly regularly arise situations in which somewhat common knowledge has it that some asset is overvalued, without the price of that asset collapsing. Until eventually it does.
It seems to me, then, that it’s not so foolish to attempt to get some of the diversification benefits of an index fund, while avoiding particular components whose valuations seem to defy rationality.
The average person would be better off buying 10 x $5 scratch off lottery tickets tomorrow and accepting the result... than buying a far out of the money short dated put.
Tens of millions of people will own significant Tesla stock via the index despite obvious evidence of fraud and financial engineering at the company.
Even if everything was above board (i.e. the company had a general counsel or was able to obtain a D&O policy from someone other than Elon Musk himself)... this is probably the most overpriced car company on the planet by any metric, and it's revenue has flat-lined the last 8 quarters (no, it's not a growth stock).
Well that aged well
Due to the large size of the addition, S&P Dow Jones Indices is seeking feedback through a consultation to the investment community to determine if T esla should be added all at once on the rebalance effective date or in two separate tranches ending on the rebalance effective date
ETFs and other mechanisms tied to the index will be selling a whole lot of stock to buy TSLA.
It's really hard to make money in the stock market from extremely public information.
@notechback, if you are reading this, what is your opinion of what I was saying now, given the fact that I started buying the stock in March, and wrote those ten points back in April?
https://news.ycombinator.com/item?id=22964850
My only wish is that I could go back and write my reply to him in a kinder style, but with the same exact substance.
We really are running into a wall on the methane crisis, and we we simply don't have the time to integrate these changes at a slower pace.
Let's focus on changing our regulations that prohibit building neighborhoods for pedestrians. Let's work on getting homes with solar roofs and big batteries. Let's get drone delivery everywhere. Let's electrify the transport system with electric cars, electric trucks, eVTOL aircraft. Let's tunnel underneath and between cities and connect them with hyperloops. Let's connect people in rural areas with low-cost, low-latency satellite internet access.
Doing these things will directly provide a great number of jobs for a great number of people. It will make a great number of new jobs possible. It will improve the natural environment. I think this is a much more positive direction to take than to try to slow things down.
