Tesla has compelling products that will sell themselves for a while.
Will the product become less compelling over time? As far as I can tell the gap between Tesla and the competition is growing except for competitors claiming low-hanging fruit such as making EVs with more than 200 miles of range (albeit at negative gross margin in most cases most likely). The tear downs from Munro Live reveal how stark the gap actually is.
Sales are in good shape for now. But if your argument is that Elon's antics aren't making an impact, that is just as flawed as your comparison of $AMZN and $TSLA.
I did not compare just TSLA and AMZN. Check my post again. I compared TSLA to the macros, and the entire tech and automotive sectors, excluding AAPL which is the *only* one that’s significantly outperformed in the last two years. Again, this observed coupling has not changed significantly since the last big TSLA rally in 2020. The whole time since has been TSLA whipsawing around with volatile macros and its high beta.
I presented high quality data on demand and sales. There is even more data if you want to look at other areas like Washington state which has similar Tesla and EV sales dynamics as CA. I have seen the increase with my own eyes living in Seattle for the past six years. These are hard econometric facts. What do you have other than conjecture based on intuition, speculation and anecdotes? I’ll change my mind if there’s good information presented to me.
Tesla has 11% market share in the largest car market in America. This figure includes the millions of people living in smaller towns and rural areas of California, where Tesla sells far fewer cars. Depending on exactly how we estimate the bias towards the Bay Area and SoCal, it’s roughly 20% or maybe even 40% Tesla market share for new vehicles in those metro areas.
This is happening:
- with high average selling prices and no economy cars on offer
- Tesla’s sole car for America’s most popular vehicle type (crossover SUVs) is the $65k+ Model Y.
- with much of the populace still unaware of the value proposition offered by these compelling products that sell themselves
- without Tesla advertising
- with a much smaller and worse Supercharger network than we will have in 2030
- without Tesla offering any pickup trucks, large SUVs, minivans, small sedans, small hatchbacks, vans, or any cars with a different aesthetic styling than Tesla's sleek aerofoil rounded body shape
- heavy bias for the major Californian urbanized areas
The 3 and Y outsell the COMBINED rest of the competing products in their specific segments in California.
Yes, both companies have had similar stock performance in the last year. However, Tesla the company has executed far better and has better future prospects than Amazon. $TSLA should be outperforming $AMZN.
This was also true in 2019, 2020, and 2021. The market has been misunderstanding Tesla's fundamentals since the company IPOed. That's a huge reason why I'm still invested; it's still deeply undervalued.
Similarly, sales in the near term might be robust, but that doesn't mean that Elon's antics aren't having an impact. Relative to what Tesla could be, this has had an impact.
Do you have convincing statistical evidence of this assertion and the relative size of the supposed impact compared to other factors? The overall econometrics show rising prices and quantities which normally indicates rising demand, so it clearly hasn't mattered much yet.
Perhaps they could not sell any more cars in the near term than they make, but they could maintain higher prices with greater demand. Brand erosion will have an influence in the medium term. In the longer term, this will limit the total addressable market. That 20M car sales per annum in 2030 has been made much more difficult. The long term growth story has an impact in today's share price.
20M vehicles per year in 2030 would be approximately 20-25% market share at 80-100M total global vehicle sales. Considering that the Californian market has been a leading indicator for global EV and Tesla adoption since literal day one, I infer that Tesla will have no trouble reaching adequate demand for 20M per year once cheaper models are available for the mass market segments, assuming the competitors don’t miraculously show up and start doing a lot better on EVs than they have been for the entire 21st century thus far.
Americans and Europeans went to war with the Nazi Germany, fascist Italy and Imperial Japan, yet today car companies from these countries are highly successful selling in these markets. It doesn't get more political than deciding whether to drop nuclear bombs on civilians in order to stop a government from pursuing goals. VW and Porsche were founded by actual Nazis and Ferdinand Porsche came to Germany to do this at the personal request of Hitler himself, who worked directly with him to help with these endeavors. The Porsche-Piech family still has this blood money by the way, as well as controlling voting stakes in both VW Group and Porsche. They never gave it away or donated it to holocaust survivors or anything like that. VW got caught committing intentional mass murder less than a decade ago but they’re still selling almost 10M cars per year. GM fleeced American taxpayers in 2009 with huge bailouts that they still haven’t paid back, but the Silverado is still selling.
Despite this direct evidence that people can look past terrible corporate behavior by car companies and still buy millions of cars, we are seriously pulling our hair out over nonviolent tweeting about controversial subjects as though demand will, at some indeterminate point in the future, be materially impacted by this? If Tesla sells 20M cars instead of 22M because of this I’m not going to be crying about it. Elon also won’t be around forever and if things go remotely according to plan then he’ll be a lot more focused on Mars five to ten years from now than on Tesla, Twitter or US politics.