Tesla races past $100B in market valuation • Hacker News Board

Re: Tesla races past $100B in market valuation

#221

Post by SilasX » Wed, Jan 22, 2020, 5:33 PM UTC

shyn3 wrote: post #111

nerdkid93 wrote: post #2

I for the life of me cannot figure out what could possibly justify this valuation for Tesla. Sure, their cars are pretty great, they have a ravid fanbase, and they have a pretty entertaining CEO who excels at driving interest in the company. They would need to execute perfectly and deliver more cars to customers than Volkswagen in a few years to justify such a valuation right now, and I just don't see that happening…

Everyone seems to miss the biggest reason why Tesla has won and the other companies won't be able to catch them. The dealer network. The Nissan Leaf came out and was way ahead of everyone but nobody bought it because they couldn't find it. The dealers would hide the car in the back and avoid showing it to you. There was no incentive for them to get you in a Nissan Leaf because they would make profits, negligible ones…

Is ... that really true? That (traditional) car dealers discourage purchase of low-maintenance cars? As you note, that seems like a dangerous case of misaligned incentives between the manufacturer/driver vs dealer.

Re: Tesla races past $100B in market valuation

#222

Post by Zenbit_UX » Wed, Jan 22, 2020, 5:33 PM UTC

vinniejames wrote: post #105

bob33212 wrote: post #83

Earlier quoted context omitted.

Some of us are not buying TSLA today because we like where the company is today. We buying because they like where the company may be in 5 years.

This is the goal of every passive investor in any company..

I think the GP is implying some of Teslas customers are buying Tesla vehicles for the same reasons.

I think I'd generally agree with that sentiment, there's certainly a fair amount of people who are buying into the zero emissions dream that Elon is selling and purchasing their vehicles (at least in part) to bring that dream closer to reality. I can't imagine many Ford customers buying into the "Ford future" but I see it with Tesla.

Re: Tesla races past $100B in market valuation

#223

Post by _ph_ » Wed, Jan 22, 2020, 5:34 PM UTC

extrapickles wrote: post #114

ec109685 wrote: post #82

Earlier quoted context omitted.

One thing Tesla doesn’t have is the lock in that Apple has. If you are using iPhoto, iWatch and iMessage, switching to another manufacturer is hugely disruptive. I totally agree that Tesla’s software chops are light years ahead.

Their charging infrastructure is pretty good lock in, especially if you install one of their chargers in your house.

At least here in Europe, they are using the same plug for charging as everyone else, so any other car can charge at a Tesla wallbox (and you can buy your wallbox by any supplier).

Re: Tesla races past $100B in market valuation

#224

Post by _Microft » Wed, Jan 22, 2020, 5:34 PM UTC

dcchambers wrote: post #204

I am ready for an electric vehicle - but I can't get over how much I dislike the interior of the Model 3 and Y. I hate the single-giant-touchscreen interface they have settled on. I get it, it's cheap for them to produce and it looks 'futuristic.' I firmly believe physical knobs and buttons are better for most things in a car. The Model S and Model X are better, but they're pretty much out of my price range. I also w…

I'm convinced that the Model 3 interior is already designed for a self-driving future. The screen is meant to show movies not gauges.

Re: Tesla races past $100B in market valuation

#225

Post by mediaman » Wed, Jan 22, 2020, 5:35 PM UTC

ccheney wrote: post #123

0xB31B1B wrote: post #41

Earlier quoted context omitted.

WRT Uber, market seems to value recurring revenue streams higher than non recurring streams (ie average customer buys a new car every 7 years, likely from different manufacturers, but an Uber customer uses the product a few times per month). Auto makers could be valued more highly if they can sell subscriptions to something.

Tesla recently started billing $10/mo for internet service[1] (might be at a break-even price). They've also started to release in-app DLC ($2k) that makes your car accelerate quicker[2] [1] https://www.tesla.com/support/connectivity [2] https://electrek.co/2019/12/18/tesla-acceleration-boost-upgr...

Most of the major auto makers are trying to sell various tack-on services to get that ARR honey. Car-based internet is one of them.

It's tough though: most people don't care about car based internet when their phone already has it.

It doesn't feel like anyone has yet found a recurring revenue stream for vehicles that has met any actual demand.

Re: Tesla races past $100B in market valuation

#226

Post by alharith » Wed, Jan 22, 2020, 5:35 PM UTC

jotakami wrote: post #69

alharith wrote: post #18

Earlier quoted context omitted.

My speculation (and this is all speculation at the end of the day to some degree) is I also think the success of other companies impact each other, such as the recent successful SpaceX abort test. For homework one night I will run an analysis showing the rise and fall of Tesla and SpaceX stock over each other mapped to positive news. I am hypothesizing there is a correlation.

SpaceX is not publicly traded, so there’s no stock price to use for such an analysis

My company is also not publicly traded, but rest assured investors and analysts still attach a valuation to it.

Re: Tesla races past $100B in market valuation

#227

Post by Strom » Wed, Jan 22, 2020, 5:35 PM UTC

shawnz wrote: post #46

beamatronic wrote: post #21

Earlier quoted context omitted.

Is your taxi driver or your hairdresser talking about buying TSLA themselves? That’s how you know.

What should I do if my taxi driver is talking about buying shares in a low cost total market index fund?

Commend them for their wisdom.

Re: Tesla races past $100B in market valuation

#228

Post by cs702 » Wed, Jan 22, 2020, 5:35 PM UTC

xedeon wrote: post #153

cs702 wrote: post #99

Earlier quoted context omitted.

As someone who has purchased and owned multiple luxury European vehicles (mainly BMW and Mercedes) for the past 20+ years, for the first time I'm seriously considering switching over to Teslas when I replace my current vehicles. From my perspective, Tesla has now gained long-term credibility , so we may well be on the cusp of seeing much broader adoption by a mass of non-early adopters, i.e., people like me, who eval…

Our household came from driving BMWs, MBenz and Lexus cars/SUVs. Now we are an all Tesla household. The gas and maintenance savings are huge benefits. The Tesla Reddit forums is also filled with many owners who share the same sentiment.

It's a common enough story. I myself have quite a few friends and acquaintances who are in your camp, including a handful of bleeding-edge adopters who bought model S's seven years ago and suffered through some of the company's growing pains. The difference now, I think, is that the people who are switching to Teslas are not early adopters.

Re: Tesla races past $100B in market valuation

#229

Post by bananaowl » Wed, Jan 22, 2020, 5:36 PM UTC

donogh wrote: post #53

nerdkid93 wrote: post #2

I for the life of me cannot figure out what could possibly justify this valuation for Tesla. Sure, their cars are pretty great, they have a ravid fanbase, and they have a pretty entertaining CEO who excels at driving interest in the company. They would need to execute perfectly and deliver more cars to customers than Volkswagen in a few years to justify such a valuation right now, and I just don't see that happening…

Tesla is the Apple of the auto industry. They are getting stellar customer satisfaction ratings, which is translating into brand loyalty[1]. They've built an ecosystem between their above-average EV hardware, industry-leading software (with frequent improvements), and a top-notch charging network. I can see some automakers matching them on hardware, but they have a huge lead in software. Traditional car manufacturers…

The Mercedes voice control system can't understand anything I'm asking for.

Re: Tesla races past $100B in market valuation

#230

Post by charliemil4 » Wed, Jan 22, 2020, 5:36 PM UTC

donogh wrote: post #53

nerdkid93 wrote: post #2

I for the life of me cannot figure out what could possibly justify this valuation for Tesla. Sure, their cars are pretty great, they have a ravid fanbase, and they have a pretty entertaining CEO who excels at driving interest in the company. They would need to execute perfectly and deliver more cars to customers than Volkswagen in a few years to justify such a valuation right now, and I just don't see that happening…

Tesla is the Apple of the auto industry. They are getting stellar customer satisfaction ratings, which is translating into brand loyalty[1]. They've built an ecosystem between their above-average EV hardware, industry-leading software (with frequent improvements), and a top-notch charging network. I can see some automakers matching them on hardware, but they have a huge lead in software. Traditional car manufacturers…

On the surface, 'user experience' is a good starting point to align Tesla with Apple. However, I look at the underlying product / service being offered to see if their trajectories should strongly correlate, and when analyzing this way they have significant differences in addressing their core product - which means the Apple - Tesla narrative should not be the defacto response.

Here's what I mean: Apple has always been about bringing computing to the masses. What happens with one person and one computer is Transformational (was never done before, changes society), Platformable (random people build on top of your core product: raw computation, frameworks, etc.), and Valuable to the end user (I now can communicate high bitrate, FaceTime, and low bit rate, twitter, messages real-time, all the time).

Placing Tesla in that same bin doesn't necessarily check the boxes. Tesla's product is personal transportation, and when you look at the three categories above, Tesla is not in the Apple echelon. Tansformational: the Model T was the first and we now have a 5 day work week because of it. Platformable: you can't build directly on top of the driving experience, only entertainment purposes. Consolation: Robotaxi's could allow such platformable-like characteristics - however, the robotaxi platform is discounted as it is not mass platformable as having a Mac, learning Swift, then publishing to millions. Valuable: Tesla's value is in 'a faster horse'... except we call it a 'self-driving car'. Transportation time will not significantly decrease just because the car drives itself. Sure, a faster horse would have been really loved because it was faster (i.e. I no longer have the stress of driving), but when it comes down to it... the core value of transportation is A-B.

The iPhone level change to me is coming with Flying Taxis. The platform side is still out - but as far as transformational and valuable - I see no greater impact on the 2020's than these flying machines.