Tesla is more than an EV manufacturer. But if that portion of the business slows permanently-how does that affect Tesla valuation?
It’s both. In China there is serious price competition and an explosion of choices. In the US there is a backlash among many to Musk’s increasing Right wing politics - anathema to the customer base that was most likely to buy electric vehicles. And in Europe, who knows?
And, just for argument’s sake, is Tesla really more than an EV company? At least now? There are other irons in the fire, sure, but are any of them paying off yet?
I know he keeps saying “It’s more than a car company”, but mostly it’s a car company. The other initiatives may pay off, but he keeps crowing about them as though they’re already gigantic businesses. They’re not, though they may be someday. Or not.
Depends on how quickly the new product lines come online. Storage is growing like gangbusters, the Shanghai Megapack factory started production this January. The Nevada Semi factory is close to completion. Optimus and Autonomous taxis will take a bit longer even as the new AI data centers will accelerate them.
As far as I can tell the Mexico Giga factory was delayed or canceled based on the slowing EV sales, good move to save cash. No one can impose his will on the market and the next best thing is to react accordingly.
While studying management the best ones were not the ones who made fewer mistakes but the ones who corrected their’s soonest…
Right and Wrong
I have come up with a mathematical proof for this thesis. Let us suppose that on average, most people get one half of their decisions right and the other half wrong. The bad manager will agonize about making a new decision while the good manager will let the good decision run (if it ain’t broke don’t fix it) and will quickly remedy the bad ones. That means that after two rounds of decisions, on average, he has made 75% good choices and only 25% bad. By doing something about the 25%, on the third round he is 87.5% right and only 12.5% wrong.
Round Good Bad 1 50.0% 50.0% 2 75.0% 25.0% 3 87.5% 12.5% 4 93.7% 6.3% 5 96.9% 3.1%
The Captain
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Do we have any actual data on this? There certainly are a number of factors slowing EV sales for most manufacturers and no reason to suppose that they apply to Tesla as well. How many people choose the brand of car according to how they feel about the CEO?
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How many CEO’s make their views so well known? Let’s face it, the half of America most likely to buy an EV does not like fascists. And due to competition they have other choices. So yes, the US backlash against him is real.
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Disliking GM didn’t stop me from loving my Corvette Stingray.
The Captain
Lots, but here is just one from 3 days ago:
Note:
Interestingly, the bulk of the JW Surety Bonds was about other Tesla matters, and results were more positive.
Link to the actual survey:
https://www.jwsuretybonds.com/blog/perceptions-of-tesla-robotaxi-and-homes
Snip:
- Over 1 in 2 Americans would ride in Tesla’s self-driving Robotaxi.
- 1 in 4 Americans would prefer a Robotaxi over a traditional rideshare.
- 1 in 4 Americans avoid Tesla’s technology due to their opinions on Elon Musk.
- Nearly 1 in 5 Americans are open to selling their vehicle and relying on Robotaxis.
In other words, very Telsa positive, while also Musk negative.
Few, but then no other car CEO is as acerbic as Musk. When was the last time ANY CEO called people retarded of told their advertisers to go fornicate themselves?
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Now I’m not going to claim this survey is 100% accurate but 25% is a pretty big number to mean nothing. Moreover, I can state with absolute assurance of one instance: me. When it was time to trade to an EV I didn’t even consider Tesla, largely because of Musk.
As it turns out I belong to several Facebook groups about EVs, my own brand in particular (Ioniq 6) and note the number of people who say the same thing. I have no way of saying whether the number of responses is statistically significant, but given my own reaction and the number of times it’s come up I would have to say “Yes, there is some data.”
And then there are these popular stickers:
More than a guess, but yeah, I’m gonna say his antics have affected sales. (Yes, I’ve seen a couple of these stickers on Tesla’s driving around.)
Finally, from the “canary in a coal mine” file, I’d just note that EV sales in California are off 1.2%, while Tesla sales in that area are down almost 20%. Maybe there’s a reason.
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I think competition has to figure strongly into it. More specifically, Tesla’s lack of models and lack of a refresh.
Americans love trucks and SUVs. And yes, the Model Y is classified as a crossover SUV, but it has strong sedan roots. The Cybertruck is its own thing, I’m not sure how much of a competitor it is the traditional truck/SUV market.
I’ll happily eat my words if I’m wrong, but at this point it looks like Tesla has made a couple blunders. They should have come out with a low cost model which was their corporate strategy all along. That’s where the growth is. Instead, they pivoted to the Robotaxi, and there is no known timeline when that is going to happen. There are regulatory hurdles as well as the technical ones, so the Robotaxi is a ways off still and no guarantee Tesla will be first.
The next blunder is the Cybertruck. The CT is fine as a niche vehicle. Nothing wrong with niche vehicles except that there is tons of money still to be made with non-niche vehicles. Like a practical pickup or a true SUV. I think Tesla is going to regret these decisions. Again, I’ll be happy to be corrected if I’m wrong.
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I bet most people couldn’t name the CEO of any other car company.
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