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The Almighty Buck Businesses Transportation

Tesla Tops GM by Market Value as Investors See Musk as Future (bloomberg.com) 289

Tesla became the largest U.S. auto maker by market value on Monday, overtaking General Motors -- a feat that would have seemed highly improbable 13 years ago when the electric-car maker first began tinkering with the idea of making a sports car. From a report: Tesla climbed as much as 3.4 percent in early Monday trading, boosting its market capitalization to about $51 billion. The company was valued at about $1.7 billion more than GM as of 9:35 a.m. in New York. The turnabout shows the extent to which investors have bought into Musk's vision that electric vehicles will eventually rule the road. While GM has beat Tesla to market with a plug-in Chevrolet Bolt with a price and range similar to what Musk has promised for his Model 3 sedan coming later this year, the more than century-old company has failed to match the enthusiasm drummed up by its much smaller and rarely profitable U.S. peer. No matter, say investors who like the stock. Tesla is a technology player with the ability to dominate a market for electric cars and energy storage. To those same investors, GM and Ford are headed for a slowdown in car sales that will erode profits. "Is it fair? No, it isn't fair," Maryann Keller, an auto-industry consultant in Stamford, Connecticut, said of GM ceding the market-cap crown. "Even if Tesla turns a profit, they will eventually have to make enough to justify this valuation."
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Tesla Tops GM by Market Value as Investors See Musk as Future

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  • by Kludge ( 13653 ) on Monday April 10, 2017 @10:08AM (#54206399)

    Large American car companies have been a cluster fuck since the 70s. GM could have dominated this market starting with the EV1 years ago. Idiots.

    • http://www.whokilledtheelectri... [whokilledt...riccar.com]

      • by Ol Olsoc ( 1175323 ) on Monday April 10, 2017 @10:37AM (#54206607)
        Politics are something. Inertia is something as well.

        Different people have different reasons for hating on Electric Vehicles. The Petrocar dealerships are threatened because a large part of their revenue stream is based on post-sales service. And the electric car is a hellava lot less prone to the little issues that hit petrocars.

        Many Politicians hate Electric Vehicles because tax revenue from petro sales goes down, and those taxes are easier to hide while railing against other taxes. A lot of people have severe inertia issues. "If leaded gas was good enough for Grandpa, it's good enough for me." Anything new is anathema.

        And some people are just plain nuts. How are we gonna go "coal rolling in an EV? https://en.wikipedia.org/wiki/... [wikipedia.org] Where these insane idiots like to do this when they see an Electric vehicle or hybrid.

        It is just going to take time for the normal people, and the actuarial tables for the lunatic fringe to die off - probably via black lung or COPD for the coal rollers - and EVs will take over just like Petrovehicles took over from the horse and buggy.

        • And some people are just plain nuts. How are we gonna go "coal rolling in an EV?

          I always thought the diesel Dodge trucks that did that were poorly maintained / poorly manufactured. It would never occur to me that people were dumb enough to do it on purpose. Thanks for making today depressing.

      • I'm on a techie mailing list which includes someone who has a deeper knowledge of the EV1 issues than appears in a tendentious "documentary".

        GM was betting on rapid improvement of batteries. By the time they'd have to replace the batteries in a couple of years, they'd have better/cheaper/more powerful batteries. By only leasing the EV1, not selling them, they guaranteed that the batteries would actually get replaced, and not have to rely on everyone paying attention to recall notices, because everyone do

    • by AmiMoJo ( 196126 ) <mojo&world3,net> on Monday April 10, 2017 @10:17AM (#54206479) Homepage Journal

      Nissan are in danger of missing the boat too. The Leaf is a great car and they have done a lot to get people driving EVs, especially in Europe. The problem is that circumstances have kind of screwed them - Tesla's Model 3 is looking unbeatable right now, so far ahead of anything anyone else can offer it's stunning. That big screen, full self driving if not from day one fairly early in its life, and best of all software updates in an age when most manufacturers can't keep the sat nav up to date.

      On top of that they build the Leaf in the UK, and the UK plant's future is uncertain due to Brexit. It seems like they held back with the new model because of these things, hoping to release it with their ProPilot tech which isn't even as good as Telsa's auto-pilot was at release (doesn't work at low/high speeds, can't even change lanes by itself etc.)

      Really sad because they could be a big player. They just need to get the next Leaf right but don't appear to have the tech to keep up with Tesla, and when the Model 3 comes along the ~40kWh car with old tech is not going to cut it at the 30k price point.

      • GM and Nissan both struggle to market their electric vehicles. They are building them, sales are sluggish (the Volt is doing okay) and most people know little about them. Dealers aren't prepared to educate consumers.

        I think this is a case where they simply don't know what else to do. Musk has won over the mind share by building beautiful cars everyone wants. Nissan built a car that looks like a frog.

        • by Anonymous Coward on Monday April 10, 2017 @10:38AM (#54206615)

          Yet Nissan sells more electric cars than Tesla and has been doing so for a while.

          • by guruevi ( 827432 )

            Does Nissan or GM sell more electric cars compared to their respective total production and market share?

            The Tesla will be hard to get for a long time to come because they haven't yet ramped up production to a Nissan-level. The problem is that no dealer wants to sell the electrics because they lose everything. They're already making minimal margins on the sale of a car, they may get a cut from the bank but they get more income reselling second hand or end-of-leases and the service work.

          • by thegarbz ( 1787294 ) on Monday April 10, 2017 @12:46PM (#54207719)

            Yet Nissan sells more electric cars than Tesla and has been doing so for a while.

            No they don't. They sell more cars with an electric drive train somewhere in the chassis. The Leaf which is Nissans only all electric car with any kind of sales figures is the best selling EV in the world behind the Tesla Model S.

            Which is saying something given the insane price and performance differences.

        • by Junta ( 36770 )

          Except Tesla's sales are not that higher than GMs when sticking to elecric vehicles. For GM a lifetime sales of 150k is dismal and hard to justify existance, for Tesla, 150k lifetime sales is roughly their whole sales. Somehow Tesla is viewed as wildly succeeding, despite not moving any more units than the 'pathetic' GM....

          • by DontBeAMoran ( 4843879 ) on Monday April 10, 2017 @10:47AM (#54206695)

            GM is viewed as pathetic because they had their own electric vehicle two decades ago [wikipedia.org] and decided to crush them all [whokilledt...riccar.com] despite people wanting to keep them. They had their chance to start the revolution but it got killed from within the company.

            The fact that they're making electric vehicles again just seems pathetic and hypocritical.

            However, I do wish them luck because electric vehicles or even hybrids are still a better option for most people.

            • Why? That's where the market is. Gotta understand a business. People are buying SUVs. Stupid move but that's what buyers are doing. Makes little sense to push electric cars where there's a small market.
            • Go read some the interviews from the lawyers of the people who wanted to keep the cars outside of the movie. They admitted that if something had happened to any of the cars they would of had no problem suing GM no matter the case and papers shown in the movie. Actually looking into reality the movie lied so much about what actually happened and could happen that is should of been labeled fiction.
          • In the luxury market, Model S and X are selling okay. Tesla has managed to deliver enough to rival brands like Cadillac.

            Whether their success can translate to the mass market is the $50b question.

          • Its more than that. The Tesla is basically at production limits. Demand is outstripping supply. THAT creates the elusive self fulfilling hype machine with "I have a Tesla on order, but it won't be here for 3 months". You can't beat that kind of viral advertising.

            • by Junta ( 36770 )

              Yeah, that's the other thing, Tesla hasn't shown they can keep up with their current 50k/year volumes that well, and it is a massive undertaking to get to support volumes that would compete with the traditional car companies. Very capital intensive and very ongoing expensive undertaking, and their cars aren't *that* different than what their competitors have on offer already.

        • It seems more like GM wants their piece of the pie if electronic cars take off, but they don't want to influence the market. Prudence, yes. Vision, no.
        • Re: (Score:2, Insightful)

          by Anonymous Coward

          Beautiful? The Tesla X looks like a Pontiac Aztek.

        • by oh_my_080980980 ( 773867 ) on Monday April 10, 2017 @11:21AM (#54206961)
          Musk has sold investors on a vision. He now has to deliver profits. That's the problem for Tesla.
          • Re: (Score:2, Insightful)

            by Anonymous Coward

            Musk has sold investors on a vision. He now has to deliver profits. That's the problem for Tesla.

            Spot on, these pie in the sky financial valuations are just that. A ponzi scheme with no substance behind where only the company's ceo and the banks make out like bandits while fucking the rest of the investors. Tesla is a physical company and they sell physical goods (cars) but there is no way in hell the company is worth 50 billion dollars even accounting for potential growth. That's wishful thinking and a dangerous game to play.

      • by Junta ( 36770 ) on Monday April 10, 2017 @10:46AM (#54206687)

        The Model 3 will have to be judged when it releases. Whether Tesla can really fare better than the traditional automakers when faced with having to support sales of 3 million or cars or more annually is *very* far away. It's much easier to do a lot of these things when you sell on the order of 50k vehicles a year compared to 3 million a year that the likes of GM and Nissan have to deal with.

        • by AmiMoJo ( 196126 )

          Tesla's advantage is that they are the iPhone of cars. People are willing to put up with beta quality features like auto-pilot until it gets good with a software update. It's not like any other car where if the sat nav is useless you need to return it because there is 0% chance of it ever getting better.

          It will be hard for Tesla, but they have a lot of good will on their side and have deliberately made it as different to a traditional car as possible, e.g. with the lack of an instrument cluster and a single

      • The Leaf is a great car and they have done a lot to get people driving EVs, especially in Europe.

        The Leaf is not a great car. It's a good enough car that proves there is demand for EVs but objectively it is a car with some very serious deficiencies. The worst deficiencies are that it's ugly and the range of the vehicle stinks. And before anyone repeats the meme about how far people drive in a day, it doesn't matter. If the car can't go at least 200-300 miles on a change then it is a crap car as far as the mass market is concerned in the current market. My brother-in-law has one and it's fine for a

        • by AmiMoJo ( 196126 ) <mojo&world3,net> on Monday April 10, 2017 @12:05PM (#54207317) Homepage Journal

          I've owned two Leafs. They are great cars, and you don't realize how great until you live with one. For example, the interior and instrument cluster layout is brilliant, and every other EV I've tried doesn't come close. Some look better, with fancy graphics and the like, but in terms of usability the Leaf is king.

          The range is absolutely fine for most people most of the time. And most people have access to more than one car - via a partner or family member. Nissan will loan be an ICE for a couple of weeks if I need it anyway, but I never have. Even long trips have been no problem.

          The M3 will be fully self driving in time, just like the Model S and X. Unless Tesla screw up spectacularly, any model bought with auto-pilot hardware will get a software update to enable fully autonomous driving.

          • I've owned two Leafs. They are great cars, and you don't realize how great until you live with one.

            I've driven one a fair bit and my brother-in-law owns one so I've spent enough time behind the wheel to get a good opinion. It's fine but all the stuff you are talking about as good features (which I don't dispute) are second order considerations. It has crap range and therefore it's mass market appeal is going to be limited. I'd buy a Chevy Bolt over a Leaf without question for the range alone. It also is a rather ugly vehicle from the outside. Most people don't care how nice the interior is if it do

      • The Leaf is dead. The Hyundai Ioniq is going to put a fork in it. It has the same crappy kind of range, but better driving dynamics and a lower price tag. The Model 3 is the least of Nissan's worries.

        • by AmiMoJo ( 196126 )

          I test drove the Ioniq. It's crap. Really. The "sport" mode is like the Leaf's "Eco" mode. It's uncomfortable, low, lots of gadgets but the instrument cluster is poorly designed. It's particularly bad in an EV because you don't have engine noise for feedback on speed and acceleration, so you need the speedo to be big and clear like it is in the Leaf.

          Plus the Ioniq is more expensive than the Leaf (not much on paper, but in terms of actual discounts available from dealers it's huge), and it has the wrong char

    • by Junta ( 36770 ) on Monday April 10, 2017 @10:27AM (#54206545)

      134,500 Volts sold,
      1,741 Bolts sold
      2,958 ELR sold
      Spark EV I could only find three year old numbers, at the time it was 2,958 sold.

      25,000 model x sold
      158,159 Model S sold

      Tesla's *total* car sales do marginally outpace GMs electrified cars, but not overwhelmingly so. Also, GM sells a *lot* more cars than the electric vehicles. Note that in a year in the US alone, GM sells over 3 million cars, an order of magnitude more sales than Tesla has had in it's entire existence.

      The valuation on Tesla is insane, just like all the 'unicorn' ones, investors obsessed with new and novel behaving irrationally. One could charitably say it's because of hyperloop and such, but I think that's pushing credibility far.

      • by Guspaz ( 556486 )

        The Volt and ELR are plug-in hybrids, not EVs: the gasoline engine is still mechanically linked to the drive train. Tesla's valuation is nuts because their revenue is far smaller than GM, not because GM sells almost as many hybrids as Tesla does EVs.

        Still, the valuation reflects the market's expectations for future revenue, not current revenue. Tesla is seen as having more potential for revenue growth than GM.

        • by Junta ( 36770 )

          Of course, the Leaf has outsold them all. There are nearly twice as many Leaf vehicles sold as Tesla.

          I don't buy for a second that Tesla has *that* much potential upside.

          • by Guspaz ( 556486 )

            It's kind of an uneven comparison, because the pricepoint of the Leaf and the Model S are so different. It's not unusual for a $35,000 car to outsell a $75,000 car regardless of if they're EVs or not. As you lower the pricepoint, exponentially more people are willing and able to pay that much for the vehicle. A more direct comparison would be to come back in a few years and compare the model 3 to the Leaf, since they're much closer in price. I suspect that Nissan will be shipping the Leaf with a much larger

      • by hey! ( 33014 )

        It's really faith in Musk as a visionary, not numbers, that drives this.

        If Musk got hit by a bus the market value of the company would evaporate.

      • The valuation on Tesla is insane

        You held on to your Stanley Steamer stock, didn't you?

      • by Nutria ( 679911 ) on Monday April 10, 2017 @11:02AM (#54206803)

        The valuation on Tesla is insane, just like all the 'unicorn' ones, investors obsessed with new and novel behaving irrationally.

        Exactly.

        Tesla's P/E ratio is... non-existent.
        GM's P/E ratio is 5.7 and their dividend yield is 4.46%. GM's If investors had *any* sense, GM's P/E ratio would be 16, which would make it's market cap $141.6B, and Tesla's market cap would be around $10B.

        Honestly, obsessing about market cap is *stupid*.

    • by Guspaz ( 556486 )

      The EV1 might have been well loved, but it had many of the same shortcomings of other electric cars of the day which caused electric cars to fail to get any mainstream adoption: poor battery technology (lead acid in the first set of EV1s) and ugly vehicles. It's not a coincidence that the first electric vehicles to find widespread success looked like normal cars and not wierd pod-cars like the EV1.

      If GM hadn't killed the EV1, it would have continued on as a niche product.

    • Stop it with the EV1 (Score:4, Informative)

      by sjbe ( 173966 ) on Monday April 10, 2017 @11:00AM (#54206781)

      Large American car companies have been a cluster fuck since the 70s.

      And yet people continue to buy their vehicles by the millions. I work in the industry and have for a lot of years. Fact is that the big US car companies are pretty well managed - they are at worst comparable to most of their competition. The problems they've had have mostly been legacy problems from back in the 80s and earlier when they didn't have as much competition. Primarily high labor and pension costs that they simply could not shed and that their competition was not subject to. US cars today are largely of good quality (with some exceptions) and all the US auto makers have managed to get their costs more competitive. FCA is still something of a mess but Ford and GM are pretty well managed and very profitable at the moment.

      GM could have dominated this market starting with the EV1 years ago.

      GM could have possible dominated the EV market but not with the EV1 and probably not its hypothetical successor either. They would have had to have a much longer investment horizon on EVs than was probably reasonable to expect. The EV1 was a nice enough little car if it happened to fit your needs but it was wildly impractical for most people (it was a two seater with very limited range) and hugely expensive to build. There was no way GM could have sold them profitably without huge government subsidies and it was never going to be a car with mass appeal. The battery pack in it only gave a range of 100 miles and the batteries on the last models were NiMh batteries with a capacity of 26.4kWh (a Tesla Model S has capacity 3-4X that amount). The EV1 routinely earns spots on worst car lists [time.com] because it was a vehicle that relied on technology that just wasn't ready yet. EVs are only becoming practical now because of progress in battery technology.

    • by Solandri ( 704621 ) on Monday April 10, 2017 @11:17AM (#54206909)
      You wanna know why GM abandoned the EV1? They developed the EV1 because the California Air Resources Board (CARB) mandated that by 2000, a certain percentage of each auto manufacturer's sales had to be zero-emissions. If an automaker couldn't meet that requirement, either they'd have to buy credits from another automaker, or they'd be locked out of the lucrative California market.

      GM built the EV1 (using a lead-acid battery). Ford and Chrysler bet on hydrogen fuel cells, which didn't pan out (still haven't). The Japanese automakers tinkered with EVs, but decided the technology was unfeasible at the time and focused instead on hybrids.

      1999 came around and GM was the only company with a car which would meet CARB's emissions-free requirement the next year. GM had invested over a billion dollars developing the EV1, but they stood to make many times that in licensing fees from 2000 and on. Everything was looking rosy for them.

      Then the whole thing collapsed. The other automakers convinced CARB that the zero-emissions requirement was technologically unfeasible with year 2000 technology. And that the best they could do at the time were hybrids, which used a battery to improve efficiency, but still got all their energy from the ICE. CARB agreed and rescinded the zero-emissions requirement, instead using a less-stringent low emissions vehicle and ultra-low emissions vehicle requirement (LEV and ULEV).

      Basically, CARB pulled the rug out from under GM. They'd coerced GM into investing over a billion dollars in the technology, then on the eve of GM hitting paydirt, CARB changed the rules making it impossible for them to recoup their investment. This is why companies hate government regulations - because unlike real-world physics which remains constant, regulations change based on politicians' whims. You spend a billion dollars trying to comply with an upcoming regulation, then they suddenly change the regulation making all the money you spent irrelevant. CARB even had the unmitigated gall to ask GM to continue selling the EV1 after pulling this double-cross.

      Do you understand now why GM recalled all the EV1s and had them destroyed? CARB was trying to get the benefits of the technology developed for the EV1, while denying GM the promised financial payout for developing the technology in the first place. GM wasn't playing that game. If they were going to take a billion dollar bath on the project, there was no way in hell they were going to let CARB derive any benefit from the whole shenanigan.

      Tesla is no different. The only reason they made a profit for two quarters, and aren't even further in the red in the other quarters is because they're able to sell carbon credits to automakers who don't meet CARB's zero-emissions requirements. In other words, Tesla's "success" is an artificial regulatory construct. The only difference between Tesla and GM is that CARB stuck with the ZEV requirement this time. If they'd abandoned it at the last minute like they did with GM, you can bet the Musk would've given CARB the middle finger as well and abandoned Tesla.
      • by Nemyst ( 1383049 )
        As much as I agree that the CARB thing was a huge fuck up (they shouldn't have backed off on it), the problem with saying that it's an "artificial regulatory construct" is that if you remove any and all pollution regulations, the pollution doesn't go away. The manufacturers have been able to benefit from the fact pollution is an external cost for decades. There's exactly one way to ensure that the cost of those emissions factors into their bottom line: regulation. You can't work around that fact.
    • LMOL, MARKET VALUATION not profits.

      FTA: "Even if Tesla turns a profit, they will eventually have to make enough to justify this valuation."

      GM posts $9.43B in net profits for 2016 http://www.detroitnews.com/sto... [detroitnews.com]

      Tesla NET Income for 2016, $674.9M https://en.wikipedia.org/wiki/... [wikipedia.org].

      Yeah GM is real worried....
  • by Anonymous Coward on Monday April 10, 2017 @10:16AM (#54206471)

    If you made money on it, good for you. The company is grossly overvalued. Get out while you can.

    • Re: (Score:2, Interesting)

      by thegarbz ( 1787294 )

      The company is grossly overvalued.

      Compared to a competition which only survived due to a loan from the government?

      • by Altus ( 1034 )

        Yeah because tesla's only competition in the car market is from US Companies.

    • It is. I have a friend who works in electric vehicles in Germany. All the big players are moving on this now. Nobody argues about it being the future anymore, the discussion has moved on to how they smooth the transition into electric vehicles while best protecting their existing investments.

      To a large extent, Elon has been responsible for bringing about this change in attitude so quickly. But look at your average car buyer. They don't care how many cylinders or fancy engine tech the thing has. Fiat put a h

  • by Anonymous Coward

    It's shocking how much faith investors seem to have in what is essentially a Ponzi scheme with stockholder money despite how obvious it is. There is no way Tesla is ever going to make a profit in many years to come, even if it manages to pour more money into it several more times. The hallowed Model 3 will get trampled in the mass market. Several major companies that actually know how to build cars will have competing electric cars right around the time the Model 3 will be available in significant numbers,

    • Do you believe then that a majority of Model 3 deposits will not convert to sales? If just half of the deposits become sales, the Model 3 will be the top selling EV of all time. Leaf sales are sluggish and the Bolt EV is expensive and slow to roll out. Anyone else is a small player in the market or doesn't have a vehicle in production yet. The best competition so far seems to be the Volt, which is a plug-in hybrid rather than a true EV.

      Tesla is going to sell as many as it can build, certainly this year

      • Re: (Score:2, Insightful)

        by Anonymous Coward

        Half of deposits becoming sales would be extremely optimistic, but even then, it will be years before Tesla has actually made them and by that time, there will be enormous competition from companies that have huge resources, lots of experience building cars and lots of capacity, and who can support their electric efforts with the profits from internal combustion engined cars, while Tesla will have its hands full just keeping things afloat while selling Model 3s at a loss for at least a few years.

        • No question they have their hands full, and an uphill battle for years to come. But I'm not going to count them out yet. Tesla has emerged from adversity over and over. They are focused and driven, and this attitude mirrors their leader, Musk.

          With the projected volume that Musk has committed to, 10,000 cars a week by the end of 2018, they may catch up to demand in a couple years. Of course they also have a history of slipped schedules, so there is still much to prove. The car doesn't need to be profita

      • Not $9.8 Billion worth. You really need to focus on the companies financials.
    • by Junta ( 36770 )

      I agree with you, though I do like the traditional car companies seeing:

      1) Enough to make them worry and be competitive.

      2) The amount of investor money up for grabs by being visibly innovative.

    • by bazorg ( 911295 )

      [...]There is no way Tesla is ever going to make a profit in many years to come[...]

      Well if AC can speculate, so can I !

      One way to accelerate the adoption of electric vehicles would be to make legislation to phase out ICE cars. Mainstream manufacturers would not like it but one way to deal with the chicken and egg problems of electric car adoption would be to set out a modular design for passenger cars and mandate that from... say 2025, all new models need to be ready for retrofitting an electric drivetrain as per the standard. Non-compliant manufacturers will have to take their focus away

    • What you've just written pretty much defines the investing market since the dot.com era, aside from one (painful) deep breath of rationality in 2007.

      Financially, the world is literally sitting atop a soap-bubble, with governments desperately scrambling to maintain the illusion for the wallowing masses.

  • by Eloking ( 877834 ) on Monday April 10, 2017 @10:29AM (#54206555)

    Yeah the Stock is severely overpriced and, as much as I like Tesla, there's no way it's value can compare to GM and Ford at the moment. We all know that, and we all know this balloon will eventually deflate. So what?

    Unless someone put a gun in your head and force you to buy Tesla stock and kept them no matter what happens, this is good news for everyone. It's a proof of confidence to an emerging car maker in North America (who would have thought this would be possible in the 2000s?). Also, it send a serious message to the GM/Ford and it make them better (Ford is back on track and it's Ford Fusion is, in my opinion, the best mid-size sedan in the market, and for GM is launching the best competitor to Tesla Model 3 with the Chevy Bolt).

    This is better for the car industry and it's better for the environment.

    • LMOL proof of nothing other than investors are extremely foolish. For the morons who don't don't bother with details:

      GM posts $9.43B in net profits for 2016

      Tesla posts $675M in net profits for 2016

      Tesla has a LONG way to go.
  • Electric vehicles are fighting for market share at a time near historically low gasoline prices. There are several reasons for that--a price war between OPEC and domestic producers, fossil fuel industry protecting itself from growth of EVs, and decreased fuel demand due to more EVs and fuel efficient cars.

    But the net effect is that few consumers can see the real value of an electric vehicle, and that's not about to change. With Tesla, consumers are seeing something else besides driving on pure electricity

    • by Junta ( 36770 )

      Tesla sells around 50k vehicles a year.

      Nissan moves around 5.5 million units a year.
      GM moves around 10 million vehicles a year.
      Toyato around 17 million a year

      Tesla is more like Maserati than a general car company (similar regard, similar volumes of sales, similar pricing). Maserati is only a small slice of FCAU, and FCAU market cap is less than half of GM.

    • Electric vehicles are fighting for market share at a time near historically low gasoline prices.

      EV market share just jumped over 20%. It's still under 3% but clearly fuel prices are not the only major driver of EV sales.

    • I'd be interested just for the lack of required maintenance. I got a new lithium ion battery line trimmer when my ICE one bit the dust, and it performs so well compared to the old NiCad stuff I'd love to replace all my ICE equipment. (I'm to cheap so I'll keep them until they break, but I don't see them getting replaced with more ICE stuff)
  • Remember AOL (Score:4, Insightful)

    by tomhath ( 637240 ) on Monday April 10, 2017 @10:47AM (#54206693)
    Tesla "worth" $51 billion? Pfft. Back in the dot bomb bubble days AOL was "worth" $224 billion [qz.com], now it's under $5 billion. We'll see how Tesla holds up.
  • by mykepredko ( 40154 ) on Monday April 10, 2017 @10:51AM (#54206727) Homepage

    I'm trying to find the current backlog for Tesla cars and it seems to be somewhere north of 400k vehicles with close to a billion in deposits for the orders. Nobody else has that kind of traction (if you'll excuse the pun) for current, announced or planned vehicles - in comparison, in 2016 Mercedes sold 374k vehicles in the US.

    Yes, the investors are taking a risk on Tesla, but isn't that part of the job description?

    Along with this, there seems to be a significant demand for electric vehicles. I don't expect them to overtake fossil fueled vehicles any time soon, but at least 10% of buyers are seriously interested in EVs and Tesla is the number one name there with generally great reviews for products compared to the competition (ie the Leaf makes you feel like you're settling for less and the Volt/Bolt just don't have the cachet), the company is serious about renewables/reducing customers' carbon footprint and a rock star CEO.

    You can say it's a fad stock, but there are some solid fundamentals there in terms of backlog and customer demand which justify a high stock price.

    Maybe if the Model 3 turns out to be a lemon, things will change with regards to the stock, but as I said, part of the job description for an investor is to take risks and people seem to think that there will be a reward at the end of the day.

    • I'd argue that the fact that Tesla isn't a car company is also part of the valuation.

      Everyone commenting on this article seems to have a vision of Tesla as it was several years ago (as a company that put electric drivetrains into Lotus cars). But Tesla hasn't been that in years - Tesla is a vertically integrated energy and transportation company. Electric vehicles are just the sexy front end - the Gigafactory, utility scale storage, SolarCity, and an actual live, working, iterating self-driving system are t

    • by mjwx ( 966435 )

      Maybe if the Model 3 turns out to be a lemon, things will change with regards to the stock, but as I said, part of the job description for an investor is to take risks and people seem to think that there will be a reward at the end of the day.

      I doubt the Model 3 will be a flop, it wont do as well as expected due to competition, but it wont flop either.

      The problem is, the technology isn't quite there... and the infrastructure is nowhere near there. there are only 680 locations with fast chargers in the UK, even then you're looking at an hour per charge from less than empty. Take note, only 188 of the 1004 chargers (across 680 locations) are Tesla's supercharger stations, most of them are slower chargers that take over twice as long.

      So an EV is fi

  • Tesla is undoubtedly cool. Their cars seem to be holding up well, despite some hiccups and a weird amount of hate from the 'MURICA folks -- especially given that Tesla is

    1) on track to be the most "domestic" of domestic automakers -- 90% when the gigafactory is fully working.
    2) creating jobs in America
    3) creating EVs that are sporty, fun to drive, etc.

    I do see them as the future -- but they are a growing niche player. As an American I'm happy they are here and I'm happy to see what they are doing. It's good

  • The price isn't completely insane. If you figure that GM sells 10 million cars a year, but has very narrow profit margins. Tesla is looking for a production rate of 0.5 million cars by the end of next year and 1 million cars a few years after that. But Tesla has a much higher margin on its cars than GM. So if you look at the projected profits of Tesla selling 1m cars vs. GM selling 10m cars, Tesla comes out on top.

    Of course, when Tesla is selling 1m cars per year, they'll likely still be expanding, so t

  • If you think Tesla is a car company - then it's overvalued.

    If you think Tesla is a battery company that happens to sell cars - then the valuation is closer to correct.

    The real key to their offering is batter management. Taking tons of little batteries as commodities and making them appear as one big battery. Then resizing that big battery for accomplishing things which at the time was expensive. Such as powering a car or a house.

    • The real key to their offering is batter management. Taking tons of little batteries as commodities and making them appear as one big battery.

      Uh no. Even the Honda Insight did that from the beginning.

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