31–40 of 604 posts
Interesting, but market cap isn’t everything - FTA: "While Tesla’s market capitalization has swelled in size, Ford still overshadows the Palo Alto, California-based company in most other financial metrics. Over the last five years, Ford has posted net income totaling $26 billion, while Tesla has lost $2.3 billion. Last year, Ford had annual revenue of $151.8 billion compared with Tesla’s $7 billion. And when it comes…
The current state of the art battery technology for vehicles is heavy and has less than desirable energy density.
The minute a new technology can deliver twice the energy density at the same or lower weight and lower cost most established car manufacturers will jump in.
Electric cars are very easy to build when compared to IC cars. The simplest fact being that you are eliminating thousands of mechanical components and replacing them with an electric motor and hundreds (or thousands?) of electronic components (for motor control). Electronics design and manufacturing is easier, cheaper and faster than mechanical manufacturing.
I believe Tesla is positioned to take a big hit when that inflection point happens. They are inexorably married to a battery technology. The Gigafactory, as awesome as it might be, is now a large ship with huge mass that is very difficult to turn around.
The next battery technology might very well turn the Gigafactory into a huge anchor for a few years, during which all other car manufacturers, lacking that commitment, are likely to leave Tesla in the dust.
Earlier quoted context omitted.
If they can properly pivot into the electric car market, a lot. Ford has all the infrastructure that Tesla is attempting to build now (aside from the batteries, but that is something that Ford could easily partner with another manufacture to get). They know how to mass produce cars (granted right now, ICE cars). That's not an easy feat. They have a large manufacturing and maintenance base that, frankly, Tesla can't r…
Will that actually result in growth for Ford, however? Electric vehicle sales in Ford may displace sales of non-electric vehicles; in other words, the net effect might not be more than zero. This would not really represent growth for Ford, in that case. You are right about some of their resources, however I think it is a mistake to glibly discount the importance of the battery supply and manufacturing (and by extensi…
Hypothetically, it would cost Ford/GM much less to put a "SuperCharger" at every existing dealership than it would for Tesla's entire basic roll out.
Tesla has been successful at marketing thus far, not manufacturing.
Earlier quoted context omitted.
Investors invest based on promise of future value. How much is Ford expected to grow?
If they can properly pivot into the electric car market, a lot. Ford has all the infrastructure that Tesla is attempting to build now (aside from the batteries, but that is something that Ford could easily partner with another manufacture to get). They know how to mass produce cars (granted right now, ICE cars). That's not an easy feat. They have a large manufacturing and maintenance base that, frankly, Tesla can't r…
Ford also maintains an extensive dealer network which can disincentivize some painful adjustments that otherwise might need to be made to be more aligned with future sales, etc. People talk about direct sales for Tesla usually in a negative connotation due to institutionalized friction (re: lawsuits / political favoritism), but I think it's a strong asset in a savvy marketplace, and can illustrate how established infrastructure isn't always for the best. One less mule for the cart to pull, IMO.
I also think there are some signs that existing manufacturing practices can be / need to be rewritten around an all elective drivetrain. For instance, Tesla plans to operate its lines at full-speed using some new "invasive" robotic procedures that the full-glass roof of the model 3 will afford. This has dramatic labor and capital consequences for an automaker with a diversified fleet. Might be costly to rebuild the machine that makes machines.
https://electrek.co/2016/09/15/elon-musk-confident-that-tesl...
Interesting, but market cap isn’t everything - FTA: "While Tesla’s market capitalization has swelled in size, Ford still overshadows the Palo Alto, California-based company in most other financial metrics. Over the last five years, Ford has posted net income totaling $26 billion, while Tesla has lost $2.3 billion. Last year, Ford had annual revenue of $151.8 billion compared with Tesla’s $7 billion. And when it comes…
it is what you concentrate on when your other numbers don't look so good. The 3 is going to be a real test here. Not that they can make the car but that those expecting to get one at 35k actually get one and on a timely basis. Then throw in, is there any profit at that price point when factoring in all related costs?
Earlier quoted context omitted.
Investors invest based on promise of future value. How much is Ford expected to grow?
If they can properly pivot into the electric car market, a lot. Ford has all the infrastructure that Tesla is attempting to build now (aside from the batteries, but that is something that Ford could easily partner with another manufacture to get). They know how to mass produce cars (granted right now, ICE cars). That's not an easy feat. They have a large manufacturing and maintenance base that, frankly, Tesla can't r…
> Ford has all the infrastructure that Tesla is attempting to build now
* no battery production facilities * no charging infrastructure * no vertical integration (unlike Tesla, Ford has to sell through the dealershits - I see it as a big disadvantage)
> They know how to mass produce cars
Yes - but can they produce the car the public will want in three years from now, when affordable all-electric, high-performance, autonomous Model 3s will redefine what modern car means?
> They have a large manufacturing and maintenance base that, frankly, Tesla can't replicate
I admit that they have some hurdles ahead, but what would stop Tesla from being more efficient at manufacturing than Ford? It is one of their objectives - and their track record is pretty good, to say the least.
Interesting, but market cap isn’t everything - FTA: "While Tesla’s market capitalization has swelled in size, Ford still overshadows the Palo Alto, California-based company in most other financial metrics. Over the last five years, Ford has posted net income totaling $26 billion, while Tesla has lost $2.3 billion. Last year, Ford had annual revenue of $151.8 billion compared with Tesla’s $7 billion. And when it comes…
Investors invest based on promise of future value. How much is Ford expected to grow?
I'm a huge fan of Tesla and think that they will succeed, but saying that the stock is "priced for perfection" is putting it mildly.
Earlier quoted context omitted.
> This is why Ford is unlikely to succeed at pivoting into the electric car market. The power and pull inside their company doesn't want them to. It will take superhuman leadership to overcome that force.
That makes no sense. Companies seek to be viable in the future. If Ford or GM feel that an electric car is on the horizon and that car will eat their (ICE) lunch, they will pivot. By your logic Tesla would have been locked out of the VC/investment market due to Big Oil. Money flows like water.
I would highly recommend the book "The Innovator's Dilemma." It provides case studies of disruptive innovations across many different industries -- from farm tech to disk drives.
Earlier quoted context omitted.
Investors invest based on promise of future value. How much is Ford expected to grow?
The point is not really how much Ford is expected to grow, but how much Tesla is expected to grow. That is, it seems like the only way for Tesla to grow to reach Ford's metrics in terms of profitability would be perfect execution (plus Mars, Jupiter and Venus being aligned). I'm a huge fan of Tesla and think that they will succeed, but saying that the stock is "priced for perfection" is putting it mildly.