Tesla loses another fleet customer

We’ve talked about Hertz jumping off the Tesla bandwagon. There’s a rental company in Europe which is doing the same: SIXT. Although they had a far small number of Tesla’s in their fleet (said to be 5,000, although the company wouldn’t confirm), they have announced they will buy EVs, PHEVs, hybrids and ICE from Stellaris going forward, in a deal estimated to be worth 250,000 vehicles over time.

And now SAP is cutting 29,000 Teslas from its fleet, arguing that price swings and other issues are making it too hard for planning.

29,000 here, 50,000 there, 5,000 over here, pretty soon you’re talking about real money.l

Tesla shares off over 25% so far this year.


Not to add salt to this wound but I read yesterday that Tesla is the worst performing stock in the S&P500 so far this year. Would be curious as to just how much lost performance/percentage that amounts to.


Let’s add lay-off fears to that as well:


It is only a car company not a software company.

$60 billion market cap?

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Yeah, that’s definitely not the kind of survey you take when you’re thinking of expanding the workforce to increase production.

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Maybe Elon should not have taken those red pills. Those closest to him in his corporate life seem concerned.

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I would think that Tesla will be among the first companies to replace workers with robots.

Tesla has already replaced car dealers with an app – and GM’s multi-billion dollar advertising budget with the nonsense that Elon Musk posts on X (nee-twitter).



They tried that. They had to go back to humans, remember? Doesn’t mean there won’t be more in the future, but then all the automakers will have more in the future

It’s a common refrain that Tesla gets by without “advertising”, and it’s true. But it’s elementary marketing that there’s more to the equation:


Tesla didn’t disclose a marketing expense, saying only that “we have been able to achieve sales without traditional advertising and at relatively low marketing costs.” That’s true, but as any marketing professor will tell you, price is one of the three “P’s” of marketing, along with product and promotion. If pricing is part of marketing, then Tesla spent billions of dollars on it in 2023.

The average price for a Tesla in 2024—measured by automotive sales divided by unit deliveries—came in at about $44,500, down about $8,500 year over year. That $8,500 multiplied by the 1.8 million cars sold works out to about $15 billion.

That $15 billion figure is why some investors and analysts believe that some marketing is a good idea. There could be a combination of price cutting and advertising that resulted in 1.8 million units sold for far less than $15 billion.

GM spent about $1000 per car to move the product. Tesla spent $8500. Which was the better “investment”? (Tip: Tesla’s margins fell right in line with every other major car maker, so … yeah, moved some metal while cratering the illusion that they’re a software and AI company deserving of a vastly higher multiple than the others. At least for now: illusion shattered.)


Tesla is not acting that out. The company is acting out becoming the largest car company solely building EVs.

The comparison would not hold water because GM sells cars to the dealers at a different markup from the factory than Tesla directly to the consumer. I get the deals with the dealers for ICE can be more complex than that will inventory held by the manufacturers but the cut is not the same.

The job that may not be critical is that one at the top.

Regardless of the sales channel, GM’s margin on selling a car is nearly identical to Tesla’s margin on selling a car. What goes on underneath the margin is essentially irrelevant, unless the company can change it and dramatically change the margin outcome.

A year ago Tesla could, because they had lots of room to move - and GM couldn’t, because their business is built on a certain cost and delivery structure. Well now GM hasn’t changed - but Tesla doesn’t have the room to move unless you think they can suddenly raise prices by $9000 per car and sell the same number. (I don’t.)

Well that’s nice, but they are now the same, from an investment standpoint, as any other car company. Or old line manufacturer, for that matter. Maybe they’ll regain the halo of “we’re so far ahead technologically that we deserve triple the multiple”, but maybe they won’t,

Musk is making the claim he will lower costs. Again not a deep dive for me into Tesla but the next model will be less expensive to build? I get into the drift of things not the particulars of which car model.

I have said prior Tesla with FSD would sell at below cost.

The make up of the margins matters. Software is worth more than a car. GM and F can get left behind here. Or Tesla along with them may get left behind.

This is interesting


Last year, Musk said the world’s most valuable car maker would be “worth basically zero” without achieving full self-driving capability.

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But they are doing AI. Much more than GM or Ford. And have modern new factories unlike the competition that still has major investments needed to compete.

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Alien Dreadnought 3.0 - Elon’s Factory of the Future is being built today!

According to the presenter HumanWorkers will not be replaced by HumanoidRobots, Dreadnought Factory design excludes humans from the production line.

The Captain

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to an extent their systems failed. Musk has handed over the needed improvements in AI/FSD to xAI.

Has a final decision been made. He was asking for $50b in stock to keep AI in Tesla or develop as separate company. Delaware ruled out the $50b. He planned to move corp to Texas. Still in play?

The $56 b was a prior stock award. He was asking now to be made 25% owner up from 13% shareholder.

Nothing is final. But Tesla is drifting as he wishes. Some of this is just his need for a show.

As has been said many times, he has existing options to bring him to about 22% total, so he is only asking for an additional 3%, possibly plus what he has to sell to pay taxes.

He used to have enough stock to bring him to 22% if he exercised his total. Since he sold shares to purchase Twitter, his total share upon full exercise would have only been about 17% of the company. Which is why the package necessary to bring him up to 25% would have been around $60 billion - about 10% of the company (8% plus enough to cover taxes on exercise), and Tesla had a market cap of about $600 million at the time.


I guess reiterating the wrong information is one option.

@albaby1 That is really telling.

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