>I've invested in GM and avoided investing in Tesla. Mostly just because I understand GM, their business and financials and stock price history makes sense to me. I do not understand the valuations on Tesla, and hadn't even long before COVID and the most recent run-up in value. Clearly I've missed out on massive earnings if I had invested in Tesla instead of GM (although GM's done decently lately).
I'm not currently invested in automotive. Just drive by some dealerships, empty lots. Not because they are selling out but because business is bad. There will be a work from home permanence, the inflation reality will destroy the automotive industry. The only thing keeping them barely afloat is low interest rates.
Then you also have the market disruptor of Tesla. Ford and GM obviously have some fantastic products coming and even some already here. EV silverado and hummer are amazing. Mach-E and EV f150 are possibly the best.
EV cars is a new generation of vehicle and will harm the existing auto industry. Ford and GM are obviously going to survive no problem. They arent worth a trillion $ because they are behind but have significant costs upcoming. GM and Ford's upcoming profitability is going to be quite poor.
Stellantis looks like they are too far behind. Ram revolution silouette looks good but if the Chevy Bolt proves anything... building a good battery has many hurdles. Stellantis has nothing coming soon and may just die.
>To me looking at the stock pricing, Tesla looks like a software company where tremendous growth has been occurring and is expected to continue for some time. To some extent they are a software company, but that software so far has seemed to me to require quite an expensive set of hardware to be sold with it in order to get the software and continuing monthly/yearly/feature revenues sales. This has worked for Apple, so it's not unprecedented, but it'll be interesting to watch how long it can last.
Tesla's first disruption is that after the car leaves the lot. It continues to get better. The traditional auto industry, you leave the lot and your car will be that or worse forever.
The second big disruption is efficiency. AC motors have regen, their motors are ~90% efficient. This creates the new generation of car. A model 3 performance(inexpensive sedan) has a 0-60 of 3.2 seconds. That's faster than all production Corvettes. Faster than a Hellcat. As fast as a Mclaren F1 from back in the day. About as fast as a Nissan GTR or Porsche 911. All the while not being annoying loud, far more practicality, and no emissions.
The most recently disruption... Tesla is now the fastest car with the plaid edition. 0-60 of 2 seconds model s plaid means it's faster than the Demon. Faster than all hyper cars. Yet at significantly cheaper price point. The roadster coming with compressed air to make it faster? Ridiculous.
By the time Ford/GM really get going, Tesla will not have sat around. They will have moved forward.
This is why Tesla has a ridiculous valuation. They effectively are the only competitor in the auto industry for the next several years.
