Long-Term Fundamentals of Tesla Motors (TSLA)

[PeterJA]

2. I'd be very careful about making predictions about details "many decades from now"

One possibility within one decade is gas heating will be replaced by fusion power.

Lawrenceville Plasma Physics expects to demonstrate scientific feasibility of their small-scale fusion generator within 12-18 months, and have a prototype within 5 years. Then they plan to license the technology non-exclusively to large manufacturers, who will have incentive to ramp up mass-production quickly to gain market share. In 10 years, the rapid ramp could be underway.

We'll know more about the likelihood of this scenario this summer, when LPP begins testing their new electrodes that should eliminate plasma contamination that has been holding them back. If their fusion yields dramatically improve, as expected, you will hear a lot about it in the mainstream media.

 

[Robert.Boston]

Let's bring this discussion back to TSLA, please -- there are other places on TMC to discuss the future of the energy sector.

 

[PeterJA]

Let's bring this discussion back to TSLA, please -- there are other places on TMC to discuss the future of the energy sector.

Right, the place for discussion of LPP fusion is here:
LPP investment questions/discussion
Eric Lerner of Focus Fusion

 

[SteveG3]

here is a link to the new Goldman Sachs report on the website scribd which Lump had posted on the short term thread. I created a free account on scribd and downloaded the report. I did some quick research on scribd and they seem to be an established website with a business model that contracts for copyrighted material (fwiw, I suspect Goldman themselves may have decided to temporarily put the report up on the website).

the report may have some helpful fodder for discussing Tesla's long term outlook.

Tsla Goldman


update: having read the Goldman report, I'd say if you read it, read with caution... I think they wanted to try to shape opinion on Tesla for their own purposes, and then formulated scenarios with some dubious assumptions to paint the picture they wanted to project (the picture may be "yes, Tesla may be appealing, if you think they will be building over 3 million cars/year in a decade... we think there's about a 15% chance of that, while there's a 25% chance the shares are worth $66"). so, read carefully (i.e, the amount of dilution, the discount rates), and note footnotes, for example the ones on page 4 that indicate the future share price in the chart is not a 2025 price projection but rather an average of 2019-2025. fwiw, I think they did this to minimize the extent a reader would notice their outsized share dilution and discount rate assumptions (if you spend some time looking at their charts this will make more sense).

 

[Words of HABIT]

Excellent article from George Kesarios. He gets it.
The EV transformation will be like nothing gone before.

Tesla Motors Inc (TSLA) news: Tesla's Deflationary Creative Destruction Has Not Even Begun - Seeking Alpha

Best,

 

[ItsNotAboutTheMoney]

Excellent article from George Kesarios. He gets it.
The EV transformation will be like nothing gone before.

Tesla Motors Inc (TSLA) news: Tesla's Deflationary Creative Destruction Has Not Even Begun - Seeking Alpha

Best,

However, I think he's fundamentally wrong about there being a negative impact on wealth. I think it's quite the opposite since electric vehicles improve efficiency in multiple ways, and the resulting increases in efficiency improve human productivity to increase wealth. What it could do is move wealth.

 

[Johan]

However, I think he's fundamentally wrong about there being a negative impact on wealth. I think it's quite the opposite since electric vehicles improve efficiency in multiple ways, and the resulting increases in efficiency improve human productivity to increase wealth. What it could do is move wealth.

It's kind of an abstract argument he is making, since wealth is hard to define. It seems overall wealth is constantly increasing in the world, the only thing you can do is shift it's distribution. Sort of like energy that cannot be destroyed only transformed between different forms. I do agree with him however that there is an inevitable evolution taking place. And if wealth is bein shifted I like the way it's shifting in to my account

 

[Robert.Boston]

Kesarios makes an interesting argument, but I think he understates the time scale. The world has a tremendously large installed base of gas- and diesel-fueled vehicles. Even if every single car sold beginning in 2015 were an EV, there's at least a decade-long off-ramp. But we know that the ramp is going to be much longer: it seems wildly optimistic to me that even 10% of cars and light trucks will be BEVs by 2020, and the conversion rate for large vehicles will be even slower. Therefore, the wealth destruction is more on the scale of 50-100 years, which is so slow as to be unimportant for most companies.

The dealers are a special case, however, because their continued existence depends heavily on legal constructs. I'm 100% certain that auto dealership owners earn far more economic rent than their services justify. They know this, too, which is why Tesla's direct-sales approach is so threatening to them.

 

[kenliles]

Interesting data point showing the biggest single group of Tesla converts from Toyota (Prius)
Who is Buying the Tesla Model S? - Blog Posts by Tom Libby | The IHS Automotive Blog

 

[Auzie]

Interesting data point showing the biggest single group of Tesla converts from Toyota (Prius)
Who is Buying the Tesla Model S? - Blog Posts by Tom Libby | The IHS Automotive Blog

That helps to defeat the argument that 'Tesla car is a toy for rich people'.

 

[JRP3]

They could be rich Prius owners :wink:

 

[Jonathan Hewitt]

They could be rich Prius owners :wink:

Or were poor prius owners who invested in tesla and are now rich tesla owners :tongue:

 

[kenliles]

Or were poor prius owners who invested in tesla and are now rich tesla owners :tongue:

Now there's a couple of thinkers! I'll bet you're both right

- - - Updated - - -

They could be rich Prius owners :wink:

Edit

 

[Auzie]

Originally Posted by Jonathan Hewitt
Or were poor prius owners who invested in tesla and are now rich tesla owners :tongue:

Originally Posted by JRP3
They could be rich Prius owners :wink:

Now there's a couple of thinkers! I'll bet you're both right

Hmm if they are both right then we can deduce from their statements that Tesla owners are rich and that defeats the argument that there may be some Tesla owners who are not rich. Maybe bears are correct, Tesla is rich person's toy

 

[Mario Kadastik]

I'm not rich and I'm a Tesla owner

 

[Auzie]

I'm not rich and I'm a Tesla owner

Some people might disagree with your statement and estimate of yourself as 'I am not rich'. Or some people might say that you are 'the exception that confirms the rule'.

Most people living in 1st world countries with decent education may be classed as rich, or perhaps 'well off' rather than rich :biggrin:

The more I think about it, the more I agree with bears argument that people who buy Tesla are well off (for now), but I would not put it in the same terms as bears like to put it - 'rich person's toy'. The term toy is used to diminish the car.

 

[JRP3]

It depends on what you consider "rich". Certainly by US standards financially responsible middle class can and do afford to buy a Model S.

 

[AlMc]

Originally Posted by Jonathan Hewitt
Or were poor prius owners who invested in tesla and are now rich tesla owners :tongue:

Originally Posted by JRP3
They could be rich Prius owners :wink:

Now there's a couple of thinkers! I'll bet you're both right

Hmm if they are both right then we can deduce from their statements that Tesla owners are rich and that defeats the argument that there may be some Tesla owners who are not rich. Maybe bears are correct, Tesla is rich person's toy

The mods may end moving this discussion: While I agree that a model S or X is not a vehicle everyone can afford, I do believe there are many people that one would not consider wealthy/rich that do purchase the car. Many people, like myself, want to try to encourage companies like TM to help our planet/children/grandchildren with 'greener' modes of transportation and are willing to do so even if it does strectch the household budget.
Personally, it is the most expensive car I have ever purchased.

Disclaimer: It is also very compelling technologically and asthetically as well as 'fun' to drive.

 

[kenliles]

Originally Posted by Jonathan Hewitt
Or were poor prius owners who invested in tesla and are now rich tesla owners :tongue:

Originally Posted by JRP3
They could be rich Prius owners :wink:




The mods may end moving this discussion: While I agree that a model S or X is not a vehicle everyone can afford, I do believe there are many people that one would not consider wealthy/rich that do purchase the car. Many people, like myself, want to try to encourage companies like TM to help our planet/children/grandchildren with 'greener' modes of transportation and are willing to do so even if it does strectch the household budget.
Personally, it is the most expensive car I have ever purchased.

Disclaimer: It is also very compelling technologically and asthetically as well as 'fun' to drive.

Well said AIMc. And so the reason I think both statements may be right. It clearly takes a lot of money to buy the ModS, many (likely most) would be in the 'rich' domain. But VERY many, and I'll bet a surprising many are not, but have found a way to prioritize it into their budgets (some from TSLA stock, others in different ways). At the same time Auzie makes a great point- the bears tend to bend the point of ModS cost into a toy vernacular that suits a purpose that won't stand the test of time - why wouldn't anyone rich or not want the toys they choose to afford? and isn't that the perfect testament to GENIII? A 'toy' for many-many more customers. What 'toys' do the bears spend their money on? The entire vernacular is an exercise in validation of Tesla and it's long term strategy.

Great discussion, I think it belongs exactly here

ps- and If you really insist on a 'rich-toy' ModS,
at $206k we might all agree this one qualifies
This is what it takes to make the worlds most expensive Tesla Model S

 

[JRP3]

I suppose one could argue that any vehicle purchase beyond basic transportation is a "toy". Why buy a Camry when a Corolla will perform the same function?