maybe a reason to sell TSLA?

What if another kind of alternative energy is just better than solar?…

The biggest hurdle with hydrogen-powered vehicles is the lack of a hydrogen station infrastructure.

No, that is at most the second biggest hurdle. Hydrogen is not a source of energy - there are no hydrogen wells - it is a way of storing energy. The biggest hurdle is where the hydrogen comes from, or stated another way, where the energy comes from to extract hydrogen from whatever you start with that contains hydrogen (water, natural gas).


What if another kind of alternative energy is just better than solar?

Very good chance that it won’t come about overnight, it will take years or even decades of development to make it a cost effective, accepted alternative (whatever it is).

A bigger reason to sell Tesla is called cheap oil. Not as big a deal with $100k cars, but more so when entering the mass market. This said, California forces manufacturers to sell electric cars at a loss to enable them to sell more profitable trucks and SUVs. Other than Tesla, that is what is pushing electric now because California is such a large market for cars.

Tesla has huge initial demand for the 3. The time to sell will be when continue ngnsuch demand gets overpriced in, assuming the 3s sell like hot cakes beyond expectations, which is silly given the preorders already. At some point though exuberance will kick back in.

Always does for Tesla.


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A bigger reason to sell Tesla is called cheap oil.

Electricity will always be cheaper than gas, and with the rapid growth of renewables, even more so as time goes by.

Meantime, Tesla keeps pushing the envelop on lowering battery costs (among many other things):……

Considering Tesla’s Model S is outselling everything - EV or ICE - in it’s segment, while earning the highest owner satisfaction ratings, seems to me their biggest (auto-related) challenges relate to ramping up reliable Model 3 production; figuring out a more expansive service network; and further building out the Fast Charging network.

And, yes, with the anticipated demand, getting a second hand 3 isn’t likely to be a bargain, at least early on.

Meantime, Tesla’s Powerball 2 batteries are a third cheaper than the nearest competition, and when combined with residential solar, have already demonstrated grid parity in Australia.……

Tesla is evolving into a multi-faceted conglomerate built around efficient, high quality transportation and renewable energy generation and storage.

For those curious to know more about where thing appear to be headed on the global energy front, Bloomberg New Energy Finance recently produced an exceptional report:

By 2040, zero-emission energy sources will make up 60% of installed capacity. Wind and solar will account for 64% of the 8.6TW of new power generating capacity added worldwide over the next 25 years, and for almost 60% of the $11.4 trillion invested.

Will give folks a sense of why Tesla is positioning itself the way it is.

  • Khleb

“cheap oil”
Alas I can not successfully predict oil prices.
If I could I would be posting this from my mega yacht anchored off Monte Carlo .
Maybe oil will be cheap.Maybe not. The 150 year history of crude oil suggests only one thing. Prices will fluctuate. A lot.

A thoughtful car buyer would realize that his operating costs (mostly electrons for a BEV) are unlikely to change in the future. In any case depreciation is the biggest expense. Not that I expect lots of car buyers to be rational. All those sales of gas guzzling SUV to people who may have poor credit and can’t afford to drive them at higher gas prices.

Only in America - one of the people mowing lawns in my neighborhood recently showed up in a Cadillac Escalade.

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Mauser, here is a good post that explains the bullish case for Tesla and makes a lot of sense actually.

Arguably, without the State of California there would be no electric competition at all except maybe the Nissan Leaf. This post postulates not California, but the innovator’s dilemma issue we discussed. And in fact, California is the same phenomenon but from a different cause.

I cannot say this poster is not correct. If so, all the current FUD may once again prove quite valuable for those investors who wish to invest more or again.


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As you know Tinker I am very familiar with the Innovation thesis. And Big Auto fits the incumbent role very well. The big difference between this and the innovation impacted markets discussed by Moore and Christensen is that the auto business is so huge that it will take 10 times longer than it did with disc drives. Giving incumbents more breathing room.

The link was most interesting in it’s discussion of outsourcing. I knew that a seldom discussed aspect of Tesla is to build more parts and to shorten the geographic range of suppliers. Anti globalism for economic returns.

I hadn’t thought much about the mindset of big auto, outsourcing because “that’s the way we have always done it”. And because heavy association with a union like the UAW made it much cheaper to get parts from outside.

Outsourcing innovation must be even harder because it requires more trust than auto companies usually give suppliers . Jumping into the deep end of the pool with no flotation device.

There is no question to me that Tesla is going turn the car business upside down. That is, if Tesla can survive long enough to do it. Because it requires lots of risk and lots of heavy lifting for a small newcomer to take on a 100 million unit /year, who knows how much revenue business . An entrenched business often with political patronage.

Trump and others freed of any political debts to big oil, unions, and big auto should look at Tesla as a real job creator, bringing leadership of this important business back to the US in a way that hasn’t been seen since the model T .


Christensen also covered the excavator market quite well - that’s the example that actually convinced me this wasn’t a Tech thing, but a true Disruptive thing. That took decades, but at the end, none of the original excavator companies survived, despite valiant attempts to move to the new technology, including hybrids.

In automotive, outsourcing isn’t done just because. It’s done because companies have set themselves up to specialize and either excel in design and quality, or provide economies of scale well beyond what even a Ford or GM can achieve. The design issue is hard to overlook. Can Tesla really be world class on everything that goes into a vehicle? When your company only does a few things, and does them for alot of automakers, it can have real expertise and experience that can’t easily be matched.

For instance, do you see Tesla making its own tires?

Tires are a field that is very competitive already , and one where tire companies do a lot of research. And there are multiple quality suppliers .

I can remember when Michelin refused to let Charles De Gaul tour their plant because they didn’t want any trade secrets revealed.

Tesla does make it’s own seats and auto glass , presumably because they consider companies making these have little to offer in terms of design. Concerning seats -I know that little Tesla was stuck at the back of the line in getting enough good seats so decided to by pass suppliers. I suspect many suppliers are leaned on by big auto not to serve Tesla.

I I buy the idea that outsourcing of anything more than limited number of items does not lend itself to rapid change.

Outsource or non outsource ,the non hydraulic excavators excavators still bit the dust.

I suspect many suppliers are leaned on by big auto not to serve Tesla.

No way.

Possible that Ford might say don’t supply GM, but unless the supplier is partially owned by an automaker, pretty unlikely, too.

Suppliers may not work with Tesla due to low volumes or designs they feel can’t be implemented within price targets or at appropriate quality, but not because some nefarious CEO thinks it’ll hurt Tesla.

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