A few weeks ago, Ford announced they were putting their battery plant near Marshall, MI on hold.
Today, Ford announced that it is also putting it’s new Kentucky battery plant on hold.
Work on the Tennessee battery and EV plants proceed, for now.
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The competition was coming, now they are going…
The Captain
long TSLA
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One thing to think about as Tesla has dropped pricing, it hurts the rental car market that is always expecting to resale their cars.
While repairs are less likely, it seems to have a lot of chatter that the cost and time for repairs is driving up the insurance cost of Tesla’s quite a lot
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Very true. One should never expect the economy, finance, or investing to be a smooth escalator to Financial Heaven. This is one reason why linear extrapolation seldom works as expected. A bird’s eye view of the auto market says that it is mostly a commodity market which means that the low cost producer is the winner with exceptions like muscle and luxury brands.
From a Tesla investor long term view the right path forward is lowering costs to service mid-range mass markets which means a balancing act between pricing strategy, production capacity, and cash flow. For months now Tesla bears have been predicting dire results for Tesla but the real outcome is that competitors have had to dial back their ambitious Tesla Killer plans.
A bird eye’s view says that maybe Hertz needs to cut back while BP is buying chargers because they see the transition to EVs as unstoppable. The competition is starting to copy Tesla showing the Tesla was not just plain crazy. Competitors are starting to adopt Tesla charging standards. All this point to a commodity future for EVs. That’s the goal line for Tesla in EVs while leveraging “The Adjacent Possible”
For Tesla that is batteries, charging, AI, FSD, Optimist, Dojo, VPP, peaker plants (storage), etc. As a commodity car company Tesla might be worth a P/E of 20, with “The Adjacent Possible” maybe 80.
The Captain
Recommended reading by Stuart Kauffman, my favorite Complexity scientist.
gh
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Thanks, will check out the book. But yes, largely agree that EV cars are now largely become a commodity. Tesla still may be the biggest seller but commanding high net margins may be over.
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