Past 12 months has seen a hefty decrease in the value of $TSLA (~50%, it's 60% if you look at just 2022). I've read numerous reports about Tesla quality (fit / finish), the FSD is receiving horrid reviews, and that's not even bringing into the equation Musk and his antics. Can't say I'm surprised to see the stock taking a hit and hope it doesn't dissuade companies from continuing down the EV path.
Tesla's build quality never seemed to impact stock performance. I think Elon's takeover of Twitter has definitely been a big hit on Tesla stock. The main concern being his focus on all things Tesla, which appears to be shifting to Twitter.
> Tesla's build quality never seemed to impact stock performance.
Tesla for a long time had a lack of serious competition, and a popular hype man at the helm that kept investor's eyes pointed at the future, by making promises such as "Fully self driving in 12-18 months" for a decade plus.
With the age of pop culture hype taking a turn for Musk and Tesla, competition starting to look quite attractive, and the whole sector becoming more mature, attention is beginning to flow back to boring things like build quality.
I think plug in hybrids may be real competition for them.
I had to buy a new car recently, and was thinking about electric and Tesla was one of the potential options.
I ended up buying a RAV 4 Prime instead. I do most of my driving within the EV only range of the vehicle, but it leaves me flexibility for road trips when needed. Eliminates the range and charger infrastructure concerns entirely, but I've also only had to fill up the gas tank once on the vehicle in the last 6 months.
Maybe there will be an EV that will directly out-compete on all those categories, but I think they've got competition coming at them from pretty much all angles.
Why do I care about those things if all I do is drive to town and back and I charge at home? Not everyone is a jet setting Bay Area resident who also drives to wine country every weekend. I would prefer a reliable Toyota over the quality issues plaguing Tesla, plus the poor working conditions at the factory put me off of ever buying a Tesla, for ethical reasons. I don’t care if the model 3 is gold plated and cheap, the company and product quality sucks.
Last time I cared to check a few years ago, there were 3x more injuries at Tesla plants versus UAW plants, feel free to research it. I don’t care to look into it today, Tesla lost my business long ago and I’m going to lunch with my wife, which is more important than arguing with Musk fans on this site.
But I don't care about the superchargers (I have a 2nd non-EV).
If you ignore that feature, the Nissan Leaf and Chevy Bolt are both cheaper and slightly more functional (hatchbacks).
Props to Tesla for pushing the chargers - EVs have benefitted - and now with Superchargers opening up to non-Tesla + other charging stations building out - the distinction will soon be minimal.
Tesla is massively profitable. The vagaries of the stock market are just a distraction, what matters is profits, and Tesla has lots of that. Other companies will want some of those sweet profits too.
Share price reflects expectation of future profits and growth.
When you buy a share you do not care about the profits in the past, you care that the company will generate profits and thus increase its value in the future. The only reason people care about past profitability is in how it can help you predict future profitability.
This is also the reason why companies can be generating losses quarter after quarter and still be gaining value -- as long as there exists expectation of future growth and profit.
And in case of Tesla a lot of this expectation of future profits and growth was based on charisma of its owner and on belief that he is the force behind Tesla's spectacular success.
Starting one successful company is impressive but can be partly attributed to luck. Starting multiple hugely successful global multi-hundred billion dollar companies is not luck at all, especially when you spend a moment learning about Elon's work ethic and his tight grip over everything.
Now, if you are an investor, it seems the owner lost its focus and made a bunch of questionable decisions. This puts a huge question mark on whether he will be as involved and as effective with Tesla in the future.
> in case of Tesla a lot of this expectation of future profits and growth was based on charisma of its owner
Not even a little bit. Musk has a charisma of a bag of potatoes.
What matters is that Tesla had 10 years of 50%+ revenue and unit growth, on average. They performed better than any of the FAANG companies.
With Giga Berlin and Giga Texas ramping up, Cybertruck, refreshing Model 3 for lower cost of production, ramping 4680 battery production, lithium refinery in Texas, Inflation Reduction Act in US => the 50% growth the company is guiding for in the next several years seems to be in the bank.
What charisma is depends on the person. It is defined as ability to induce devotion in others and different people will get moved by different things.
Charisma is not an absolute and objective measure. Some people will find Trump charismatic to them, some people will see him completely opposite.
I personally find Warren Buffett very charismatic, some people will probably see him as an old and wrinkled guy who is boring them with stories they don't care about.
As investors are generally mostly interested in money, ability to get shit done and generate profits reliably IS charisma.
Tesla has been building out its manufacturing lines during this time, which is extremely capital intensive. Remember when the Model 3 was just being rolled out, and how that almost killed them?
Don't you have to include the shares outstanding in your calculation? Your analysis seems to assume the total shares is the same between the two companies.
And at one time Porsche progits were higher than their revenue (look it up, that was caused by their VW shares exploding in value). Ferrari is more profitable than, say, Hyundai. Different market segmentd have different profit margins, and Toyota actually can build cars with retail prices below 30k.
Revenue =|= profits. Now, if you are interested, devide what ever that revenue was by Tesla's profits. Because those credits have a zero cost behind them. And those credits will go away with every EV those other brands build and sell.
If you look at the SEC filing it's 8% of profits. Though Tesla isn't trying to be particularly profitable right now. They've been spending tons of money on new factories so they can scale up production.
Credits aren't pure profit. You have to build and deliver a car to get them, so the 1% number of the parent comment is much more relevant than your 8% number.
Past performance is not an indictor of future performance.
VW is on pace to outsell Tesla in a little over a year, they're just one competitor.
I now see just as many Polestars and VW id's as Tesla's in the UK ... it's quite remarkable how much things have changed from Tesla being the only real game in town just a few short years ago.
Musk doesn't exactly strike me as a guy who would not cook the books.
Guy believes in manifestation and self-fulfilling prophecies, fake it till you make it type strategy.
General Electric employed the same strategy too with all its financial engineering but at the end of the day you are still making turbines in the real world and with anything manufacturing you have razor thin margins. Of course we came to know about it only after
The Model Y build quality is really good nowadays. And Tesla cars have great performance and ace all the safety tests. So they are still good cars that are undeserving of all the hate.
People who hate Elon musk, which includes almost all of media, have no qualms about lying about Tesla in order to hurt it/him. In fact they might think is the right thing to do, for the sake of, well whatever.
If you are interested in the ground truth, check the videos by owners, talk to people who use FSD and best of all see if you can rent and drive a Tesla yourself.
Its sad to say, but even in tech we swim in an ocean of ideologically driven BS and not all of us have realized it yet.
