T Nation

Tesla Motors

Stock topics pop up on here from time to time and they usually don’t hold much interest. This one probably won’t fair much better but I think Tesla does deserve some discussion. I can see this company not only eclipsing the success of companies like Apple and Microsoft but also leading the country into a new wave of prosperity. That’s not a prediction on my part, I’m just saying I can see how that could happen.

I became aware of Tesla a few months ago when the shares were trading between 25 and 30 dollars. I liked the story but didn’t buy because “story” stocks just never seem to work out. I bought a company called Plug Power many years ago because it had a nice story and now the 2000 dollars I bought shares with is worth less than the 8 dollar commission it would take to sale the shares. I’ve learned to tread cautiously with “story” stocks.

While I liked the possibilities a couple months ago I didn’t fully grasp the potential the way I think I do now. They are manufacturing a very expensive car that only rich people can afford so I saw them as only being a niche player never competing in the mass market with the major auto makers. Nissan and Toyota seem to have some pretty nice fuel efficient options for the middle class. Now I see Tesla in a much different light. They have a plan to roll out charging stations across the country and the technology to adequately charge a vehicle in under a half hour.

You may think a half hour is way too long when someone can stop in a gas station to fill up in under five minutes. I know I did. I heard this and I thought “why don’t the make it a battery swap that would only take a few minutes?” The practical answer to that might be the logistics of making a battery swap, I don’t know. It doesn’t matter though because a 20-30 minute charge is a much better idea regardless of the reason for it.

Imagine if they make the charging stations into a pleasurable experience? When we stop to fill our cars we have to put up with the stink of gas & exhaust fumes and the greasy pump handles from all crack heads ahead of us. If we need to go to the bathroom or grab a snack we have to go into one those sleaze ball minimarts. The Tesla charging stations could be modeled after Starbucks, or a partnership with Starbucks, where the customers would have a luxurious waiting area to enjoy tea, coffee or other beverages while using free wifi. There would be pastries and other quality snacks not three day old hotdogs spinning in a carrousel. Their might even be a play structure for children.

Tesla has an aggressive plan to build out these charging stations across the country in just three years. Check out the map here; http://www.teslamotors.com/supercharger This build out plan will effectively be grabbing the market share for such a service before the other auto makers or the service stations have moved a finger in that direction. Tesla will own that market and all the electric vehicles of evry auto maker will be using them.

The owners of Tesla vehicles today own them because they are cool and trendy. It’s basically hip to own a Tesla, not practical. Soon Tesla will be coming out with a middle class vehicle. Potential car buyers who would be in the market for a Camry will look at the Camry at $30,000 vs the Tesla Model X at $40.000. They will mentally deduct the $7,500 in tax and account for the energy savings month after month. They will conclude that owning a Tesla is not only cool and hip but practical too. They will also feel like the cat’s meow when they pull into those charging stations to have a latte, catch up on email and call a friend to say, oh I’m just enjoying a latte while my Tesla is charging.

I firmly believe that the best way to make money in the market is to place your assets in the path of social change. The trick is identifying what the change is and which companies will successfully capitalize on it. I think the trail Tesla is blazing is much easier to see than the trail Apple blazed over the last ten years and as easy, if not easier to see, than the trail Microsoft blazed before that. I know I could easily lose the $8,700 I put into buying the stock but I think the upside potential of a million or more over the next 20 years is worth it.

I’ll be watching

It’s an interesting topic, from what I’ve heard. However, with the good, I have heard some bad. Mostly this:

I don’t know much about running a business or economics, so someone qualified to speak on the subject is more than welcome to tune in to what this might mean. I got nothin’, haha.

On Edge, you should join the current discussion about this company over in PWI.

I’m totally onboard with the company as well. Your input would be a welcome addition in that thread.

[quote]rrjc5488 wrote:
It’s an interesting topic, from what I’ve heard. However, with the good, I have heard some bad. Mostly this:

I don’t know much about running a business or economics, so someone qualified to speak on the subject is more than welcome to tune in to what this might mean. I got nothin’, haha.[/quote]

Oh god if it’s true that other car companies have to pay Tesla for credits, that’s the most awesome thing I ever heard. Regarding the 7500+ tax rebate, that’s available for purchasing any car that meets the requirements, not just Tesla. If the gov ends that program before Tesla is truly viable they’re toast.

Another point that I brought up over in the PWI thread about Tesla is that they are also positioned nicely to take advantage of Google’s driverless car technology in the near future. Google is making big breakthroughs in that area right now and I suspect that rather than enter the auto manufacturer industry, Google will simply contract out the technology to a select few car companies. Given that Tesla and Google are both Silicon Valley-based companies, I would think that Google would love the idea of partnering up with Tesla on such a venture.

I know that Google really has a propensity for doing everything entirely on their own right now. Hell, they’re even going that direction in energy production and selling. But I think at some point in the near future they will realize that they risk stretching themselves a little thin in that respect, so I don’t think they will be looking to make their own driverless cars and instead will look to contract with other companies.

Also, I believe that Lincoln is also developing driverless cars of some sort right now, and I suspect that Chevrolet and Chrysler will follow suit very soon. But I think that Google’s current reputation for seeking sustainable alternatives to the way they do business, especially when it comes to energy resource consumption, is a sign that they would prefer to do business in the driverless car world with an electric car company, and Tesla would be it.

It sounds interesting at first, but is it really a strong product?

I can’t see something like this succeeding in some very large areas of the country, most specifically the Appalachian and Rocky mountain ranges. As a social statement by people who have the money to make that type of statement, sure. But as an every man go to vehicle, I just can’t see it.

Of course I could be wrong. I just bought some Freddy Mac when I got fidgety from seeing it rise so much- a couple of days before it dropped.

[quote]SkyzykS wrote:
It sounds interesting at first, but is it really a strong product?

I can’t see something like this succeeding in some very large areas of the country, most specifically the Appalachian and Rocky mountain ranges. As a social statement by people who have the money to make that type of statement, sure. But as an every man go to vehicle, I just can’t see it.

Of course I could be wrong. I just bought some Freddy Mac when I got fidgety from seeing it rise so much- a couple of days before it dropped.
[/quote]

I was quite surprised a couple of weeks ago at seeing a Model S half way between Boise and Twin Falls Idaho. That’s pretty much out in the middle of fucking nowhere.

When Tesla comes out with the Model X it will be a status symbol for the everyman, not just rich hipsters.

[quote]on edge wrote:
Stock topics pop up on here from time to time and they usually don’t hold much interest. This one probably won’t fair much better but I think Tesla does deserve some discussion. I can see this company not only eclipsing the success of companies like Apple and Microsoft but also leading the country into a new wave of prosperity.
[/quote]

That is a stretch if I have ever heard of one.

Consider that Ford has 1/8th the market cap of apple.

Anyways, the real issue, as I was reading in JPMs monthly investors newsletter, is that the carbon footprint of a telsa is about the equivalent of a honda civic. Once people realize that the novelty of buying an “Electric car” will die off.

http://news.yahoo.com/teslas-carbon-footprint-no-better-183047337.html

[quote]Anonymity wrote:

[quote]on edge wrote:
Stock topics pop up on here from time to time and they usually don’t hold much interest. This one probably won’t fair much better but I think Tesla does deserve some discussion. I can see this company not only eclipsing the success of companies like Apple and Microsoft but also leading the country into a new wave of prosperity.
[/quote]

That is a stretch if I have ever heard of one.

Consider that a company like ford has 1/8th the market cap of apple.

Anyways, the real issue, as I was reading in JPMs monthly investors newsletter, is that the carbon footprint of a telsa is about the equivalent of a honda civic. Once people realize that the novelty of buying an “Electric car” will die off.
[/quote]

By the time they realize that, the carbon footprint will most likely be much smaller. It isn’t a static product. it’s still in the infancy stages of its development and will continue to change and improve as the company makes more and more money that can be used to fund R&D.

Besides, from everything I’ve read in magazine like Consumer Reports and Car and Driver, the actual experience of driving a Tesla is already light years ahead of that of a Civic. Consumer Reports gave it the highest rating they’ve ever given a car before and it’s customer satisfaction marks are unheard of. It’s a fun car to drive that accelerates FAR better than any Civic on the road today.

[quote]Anonymity wrote:

[quote]on edge wrote:
Stock topics pop up on here from time to time and they usually don’t hold much interest. This one probably won’t fair much better but I think Tesla does deserve some discussion. I can see this company not only eclipsing the success of companies like Apple and Microsoft but also leading the country into a new wave of prosperity.
[/quote]

That is a stretch if I have ever heard of one.

Consider that Ford has 1/8th the market cap of apple.

Anyways, the real issue, as I was reading in JPMs monthly investors newsletter, is that the carbon footprint of a telsa is about the equivalent of a honda civic. Once people realize that the novelty of buying an “Electric car” will die off.

http://news.yahoo.com/teslas-carbon-footprint-no-better-183047337.html[/quote]

Besides, if you think about it, the Tesla DOES represent a significant drop in carbon footprint in at least one respect. People who buy Teslas aren’t doing so instead of buying Civics. They are bypassing vehicles made by Mercedes and BMW and Audi, Tesla’s main competitors right now. Those cars all have substantially higher carbon footprints than the Tesla Model S. This will continue to be the case when they come out with their SUV model, the X. That will represent an even larger discrepancy between its own carbon footprint and that of the vehicles it competes with.

[quote]Anonymity wrote:

[quote]on edge wrote:
Stock topics pop up on here from time to time and they usually don’t hold much interest. This one probably won’t fair much better but I think Tesla does deserve some discussion. I can see this company not only eclipsing the success of companies like Apple and Microsoft but also leading the country into a new wave of prosperity.
[/quote]

That is a stretch if I have ever heard of one.

Consider that Ford has 1/8th the market cap of apple.

Anyways, the real issue, as I was reading in JPMs monthly investors newsletter, is that the carbon footprint of a telsa is about the equivalent of a honda civic. Once people realize that the novelty of buying an “Electric car” will die off.

http://news.yahoo.com/teslas-carbon-footprint-no-better-183047337.html[/quote]

That is highly geographical. Owning an EV in the Western U.S. will drastically reduce the “carbon footprint” since much of the energy generated is hydro.

Even in Eastern U.S., coal is the primary source of generation but coal plants are capable of harnessing much more of the potential energy of coal than gasoline burned in cars. IC engines only used <1% of the power in gasoline, and the rest is wasted(which is crazy to think of the energy density of gasoline). At 100% efficiency, a gallon of gas can power a typical U.S. home for a year.

I have also been following Tesla’s stock lately and am looking for the opportunity to make big bucks on it.

[quote]DBCooper wrote:

[quote]Anonymity wrote:

[quote]on edge wrote:
Stock topics pop up on here from time to time and they usually don’t hold much interest. This one probably won’t fair much better but I think Tesla does deserve some discussion. I can see this company not only eclipsing the success of companies like Apple and Microsoft but also leading the country into a new wave of prosperity.
[/quote]

That is a stretch if I have ever heard of one.

Consider that Ford has 1/8th the market cap of apple.

Anyways, the real issue, as I was reading in JPMs monthly investors newsletter, is that the carbon footprint of a telsa is about the equivalent of a honda civic. Once people realize that the novelty of buying an “Electric car” will die off.

http://news.yahoo.com/teslas-carbon-footprint-no-better-183047337.html[/quote]

Besides, if you think about it, the Tesla DOES represent a significant drop in carbon footprint in at least one respect. People who buy Teslas aren’t doing so instead of buying Civics. They are bypassing vehicles made by Mercedes and BMW and Audi, Tesla’s main competitors right now. Those cars all have substantially higher carbon footprints than the Tesla Model S. This will continue to be the case when they come out with their SUV model, the X. That will represent an even larger discrepancy between its own carbon footprint and that of the vehicles it competes with.[/quote]

Fair enough, but consider two main reasons for buying an electric car: 1) carbon footprint 2) Fuel savings. The high end luxury market they are competing in is not going to care about 2. So they sure as shit better be making a car that drives as well as a bimmer and looks good too.

FTR I like the tesla styling.

…but I’ll eat my shoe if they grow to 8 times the size of ford.

Also for anyone reading this thread, Elon Musk is quite an interesting guy. This 60 minutes interview is very interesting: http://www.cbsnews.com/video/watch/?id=7410538n

[quote]Anonymity wrote:

[quote]DBCooper wrote:

[quote]Anonymity wrote:

[quote]on edge wrote:
Stock topics pop up on here from time to time and they usually don’t hold much interest. This one probably won’t fair much better but I think Tesla does deserve some discussion. I can see this company not only eclipsing the success of companies like Apple and Microsoft but also leading the country into a new wave of prosperity.
[/quote]

That is a stretch if I have ever heard of one.

Consider that Ford has 1/8th the market cap of apple.

Anyways, the real issue, as I was reading in JPMs monthly investors newsletter, is that the carbon footprint of a telsa is about the equivalent of a honda civic. Once people realize that the novelty of buying an “Electric car” will die off.

http://news.yahoo.com/teslas-carbon-footprint-no-better-183047337.html[/quote]

Besides, if you think about it, the Tesla DOES represent a significant drop in carbon footprint in at least one respect. People who buy Teslas aren’t doing so instead of buying Civics. They are bypassing vehicles made by Mercedes and BMW and Audi, Tesla’s main competitors right now. Those cars all have substantially higher carbon footprints than the Tesla Model S. This will continue to be the case when they come out with their SUV model, the X. That will represent an even larger discrepancy between its own carbon footprint and that of the vehicles it competes with.[/quote]

Fair enough, but consider two main reasons for buying an electric car: 1) carbon footprint 2) Fuel savings. The high end luxury market they are competing in is not going to care about 2. So they sure as shit better be making a car that drives as well as a bimmer and looks good too.

FTR I like the tesla styling.

…but I’ll eat my shoe if they grow to 8 times the size of ford.

Also for anyone reading this thread, Elon Musk is quite an interesting guy. This 60 minutes interview is very interesting: http://www.cbsnews.com/video/watch/?id=7410538n
[/quote]

You’re forgetting a third reason for buying Teslas. They are a trendy sign of status amongst a certain demographic. And from everything I have read and heard, they drive FAR better than any comparably-priced BMW. I personally think they look a lot better, too. They aren’t what you would think an electric car would look like. They’re big, they ride low, they have a nice profile. They remind a little bit of the way American cars used to be: big, grand, stylish. Part of the uniqueness of American car culture is that we like our cars bigger than everyone else’s. I think this car nicely captures that sentiment without being a gas-guzzler that other cars about the same size and performance are.

[quote]Anonymity wrote:

[quote]DBCooper wrote:

[quote]Anonymity wrote:

[quote]on edge wrote:
Stock topics pop up on here from time to time and they usually don’t hold much interest. This one probably won’t fair much better but I think Tesla does deserve some discussion. I can see this company not only eclipsing the success of companies like Apple and Microsoft but also leading the country into a new wave of prosperity.
[/quote]

That is a stretch if I have ever heard of one.

Consider that Ford has 1/8th the market cap of apple.

Anyways, the real issue, as I was reading in JPMs monthly investors newsletter, is that the carbon footprint of a telsa is about the equivalent of a honda civic. Once people realize that the novelty of buying an “Electric car” will die off.

http://news.yahoo.com/teslas-carbon-footprint-no-better-183047337.html[/quote]

Besides, if you think about it, the Tesla DOES represent a significant drop in carbon footprint in at least one respect. People who buy Teslas aren’t doing so instead of buying Civics. They are bypassing vehicles made by Mercedes and BMW and Audi, Tesla’s main competitors right now. Those cars all have substantially higher carbon footprints than the Tesla Model S. This will continue to be the case when they come out with their SUV model, the X. That will represent an even larger discrepancy between its own carbon footprint and that of the vehicles it competes with.[/quote]

Fair enough, but consider two main reasons for buying an electric car: 1) carbon footprint 2) Fuel savings. The high end luxury market they are competing in is not going to care about 2. So they sure as shit better be making a car that drives as well as a bimmer and looks good too.

FTR I like the tesla styling.

…but I’ll eat my shoe if they grow to 8 times the size of ford.

Also for anyone reading this thread, Elon Musk is quite an interesting guy. This 60 minutes interview is very interesting: http://www.cbsnews.com/video/watch/?id=7410538n
[/quote]

Hell, I’ll eat your other shoe if they get that big!

I think what’s more likely is that they eventually get bought out by another company, probably either Ford or General Motors. I was reading an interesting article this morning over breakfast about such a possibility. Keep in mind that by 2025 something like 15% of all car companies’ sales have to be zero-emission vehicles, and Ford and GM have completely failed at producing an electric car anywhere close to what the Tesla is. Their styling choices have been horrendous and their technology in terms of power efficiency and energy storage aren’t in the same league as Tesla is. It might make more sense for one of them to buy out Tesla and bring it under their own banner.

Tesla’s gross margin right now is about 25%, whereas Ford’s is about 11% and GM’s is just under 7%. So in that respect, there certainly is the potential for Tesla to be turning some large profits. And that in turn gives Ford or GM the incentive to purchase what is basically an overvalued company right now. Tesla’s stock prices aren’t going to continue to sit this high for much longer. In fact, I expect a bit of a dip in price here in the next few months given that Musk just announced their intention to provide cars in the 30-40K range in the very near future. I think a lot of people might hold off on buying a current model for 62K if they can get a similar model at a lower price in another year or so, especially if there’s also the possibility of getting one with a farther range to its battery.

Tesla was a crazy bastid~ totally got skrewed by Westinghouse.

[quote]Anonymity wrote:

[quote]on edge wrote:
Stock topics pop up on here from time to time and they usually don’t hold much interest. This one probably won’t fair much better but I think Tesla does deserve some discussion. I can see this company not only eclipsing the success of companies like Apple and Microsoft but also leading the country into a new wave of prosperity.
[/quote]

That is a stretch if I have ever heard of one.

Consider that Ford has 1/8th the market cap of apple.

Anyways, the real issue, as I was reading in JPMs monthly investors newsletter, is that the carbon footprint of a telsa is about the equivalent of a honda civic. Once people realize that the novelty of buying an “Electric car” will die off.

http://news.yahoo.com/teslas-carbon-footprint-no-better-183047337.html[/quote]

People don’t drive Tesla’s for the carbon footprint. They drive them because they think the cars are cool and they think the cars will make them look cool.

When the affordable models hit the mass market people will buy them because they are 1/5 the cost to ‘refuel’ and because they want the Tesla lifestyle. Remember, refueling a Tesla will mean shopping Oberon Designs while sipping a Latte not sucking in gas fumes while handling a greasy pump.

[quote]on edge wrote:

[quote]Anonymity wrote:

[quote]on edge wrote:
Stock topics pop up on here from time to time and they usually don’t hold much interest. This one probably won’t fair much better but I think Tesla does deserve some discussion. I can see this company not only eclipsing the success of companies like Apple and Microsoft but also leading the country into a new wave of prosperity.
[/quote]

That is a stretch if I have ever heard of one.

Consider that Ford has 1/8th the market cap of apple.

Anyways, the real issue, as I was reading in JPMs monthly investors newsletter, is that the carbon footprint of a telsa is about the equivalent of a honda civic. Once people realize that the novelty of buying an “Electric car” will die off.

http://news.yahoo.com/teslas-carbon-footprint-no-better-183047337.html[/quote]

People don’t drive Tesla’s for the carbon footprint. They drive them because they think the cars are cool and they think the cars will make them look cool.

When the affordable models hit the mass market people will buy them because they are 1/5 the cost to ‘refuel’ and because they want the Tesla lifestyle. Remember, refueling a Tesla will mean shopping Oberon Designs while sipping a Latte not sucking in gas fumes while handling a greasy pump.
[/quote]

Yeah, but will the charging stations sell that guarana and ginseng-infused coffee that’s all the rage at the gas stations these days? That shit has me completely hooked. It gets right on top of me, and fast!

[quote]DBCooper wrote:

[quote]on edge wrote:

[quote]Anonymity wrote:

[quote]on edge wrote:
Stock topics pop up on here from time to time and they usually don’t hold much interest. This one probably won’t fair much better but I think Tesla does deserve some discussion. I can see this company not only eclipsing the success of companies like Apple and Microsoft but also leading the country into a new wave of prosperity.
[/quote]

That is a stretch if I have ever heard of one.

Consider that Ford has 1/8th the market cap of apple.

Anyways, the real issue, as I was reading in JPMs monthly investors newsletter, is that the carbon footprint of a telsa is about the equivalent of a honda civic. Once people realize that the novelty of buying an “Electric car” will die off.

http://news.yahoo.com/teslas-carbon-footprint-no-better-183047337.html[/quote]

People don’t drive Tesla’s for the carbon footprint. They drive them because they think the cars are cool and they think the cars will make them look cool.

When the affordable models hit the mass market people will buy them because they are 1/5 the cost to ‘refuel’ and because they want the Tesla lifestyle. Remember, refueling a Tesla will mean shopping Oberon Designs while sipping a Latte not sucking in gas fumes while handling a greasy pump.
[/quote]

Yeah, but will the charging stations sell that guarana and ginseng-infused coffee that’s all the rage at the gas stations these days? That shit has me completely hooked. It gets right on top of me, and fast![/quote]

If Starbucks is selling it then yes. I, like you, am totally down with a Tesla-Starbucks partnership.

I’m coming around on the driverless idea too btw.

This is all nonsense, Tesla is just a leach off the bullshit central planning that stifles actual competition in the car market to make vehicles more cost efficiently(including fueling cost).
They will fade and die when this type of central planning collapses at the federal level.