
Tesla Fairy Tale Is About to Become a Horror Story - uladzislau
https://seekingalpha.com/article/4069671-tesla-fairy-tale-become-horror-story
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aerovistae
I've been reading every article that comes up in the news from a wide variety
of sources on Tesla for 6+ years daily, and Seeking Alpha is one of the most
consistently biased. They're as reliable as the tides in terms of which side
of the story they want to tell.

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dmode
Just FYI, Seeking Alpha is a forum for many investors with short positions on
Tesla. They have been predicting Tesla's demise for a decade.

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fowlerpower
Tesla ain't going nowhere. A lot of people are missing the point as to why the
stock is so high.

It's so high because it's the future, not because of current sales. If it's
the future then the argument needs to be a little different if your hoping to
convince people to dump it.

~~~
dragonwriter
It's clearly high because of what people _believe_ about the future.

What remains to be seen is whether those beliefs are correct. It's not unheard
of for stocks to.fly high because of what people believe the future will
bring, and then to come down when that prediction turns out to be false.

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vivekd
This seems a little premature as the model 3 is not in production yet.

The article claims that the model 3 sales projections are optimistic, I
disagree. The model 3 is a fully electric car for $ 35 000, my brother just
bought a Camry recently for more than that.

An electric car with tesla quality at that price range is a game changer than
can transition the average middle class American to electric. In fact, in my
mind, the model 3 seems like the make or break model for tesla.

In my mind a lot of these doom and gloom articles about tesla started when
goldman sachs and consumer reports downgraded Tesla stock. But the only reason
for the downgrade was continued (and admittedly long) delays for the model 3.
And while the delays have been long, when you're on the bleeding edge of tech
doing something new, delays are a part of the process.

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chronic940
Delays don't seem to be part of the process at Slack, Google, or any of your
top tier software companies.

Tesla? Delay after delay. Want to cite auto industry, I can point more
successful examples.

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Animats
This makes some good points.

\- Tesla is still losing money. Basic reality check: that can't go on
indefinitely.

\- Tesla is no longer production-limited. Tesla's can no longer sell as many
cars as they can make.

\- Solar City installations are down, way down.[1] More systems are being sold
rather than leased, which is good for revenue.

\- Tesla's selling, general and administrative expenses are very high for an
auto company.

\- Even with optimistic sales and profit margin assumptions for the Model 3,
profitability doesn't look good.

These are real problems.

[1] [http://investorplace.com/2017/05/tesla-solarcity-
tsla/](http://investorplace.com/2017/05/tesla-solarcity-tsla/)

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xiphias
Tesla is not production limited, that's why it's planning to create 4 more
Gigafactories this year, right?

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MarkMMullin
I sometimes wonder if Tesla should be getting into autonomous nav with some of
the evident problems they have with high school geometry and recharge
planning. That said, the author of the article used SG&A expenses as a club to
smack them with, without bothering to examine the reeds that make up the club.
Tesla has more in common with Amazon than GM for a business model, they've got
a voracious R&D appetite, and so on. They may well fail, but this article
doesn't even seem to have a grasp on what they are, hence the measurements are
all of time in furlongs per fortnight :-)

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foxylad
Methinks someone wants Tesla stock cheaper. Absolutely no mention of the
considerable IP capital Tesla is building, or what that might be worth to a
company with smart car ambitions and 250B in the bank.

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akmarinov
Can't even read the story on mobile. Good job, seeking alpha. And no, I don't
want your app.

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ww520
The stock still defies gravity to all time high. Not sure whether it's
irrational exuberance or investors truly see something in Tesla.

Edit: Got scared and got out at ~280. It was a good run but time to move on.

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hackuser
One factor: At least a couple of major investment banks, along with many other
commentators, see Musk's apparently good relationship with President Trump as
a reason to invest in Tesla. Of course, nobody can say how much it affects
their market capitalization, but just the banks saying it will be self-
fulfilling to an (unknown) extent.

Musk wouldn't be the first to use lobbying to help his business, and so far (a
small sample) Trump has used his power much more than past presidents to help
and punish businesses he favors/disfavors (e.g., threatening businesses that
want to relocate factories, threatening airplane manufacturers, tweeting
favorable and unfavorable things about businesses, etc.). Trump has a
reputation for corruption, that's factual; that doesn't tell us how true it is
or how it applies in this kind of situation or in this particular case. What
I'm trying to say is, let's be careful with the facts.

If you search for 'musk trump', you can find plenty of discussion of it.
Here's one article from a good source:

[https://www.nytimes.com/2017/01/26/business/elon-musk-
donald...](https://www.nytimes.com/2017/01/26/business/elon-musk-donald-trump-
wall-street.html)

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ww520
Unless the government buys from Tesla, Trump's help won't matter much to
investors. In the case of a bailout, investor equity is the first thing
destroyed. Trump would certainly help Tesla to survive in such an event, but
for investors, its' better to buy after that than before.

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hackuser
Good points; I wonder what the investment banks saw. Certainly Tesla depends
on government laws, regulations and policy, especially as a new entrant
seeking widespread changes in several regulated industries. For example, they
want electric charging stations spread nationwide, they'd probably like fossil
fuels to become more expensive or at least become less subsidized, subsidies
for electric cars, regulators to not delay or limit Tesla innovations, etc.
etc.

Also, government does R&D on battery tech, I'm pretty sure. Does anyone know
how much Tesla directly or indirectly benefits? Finally, they may want to sell
to government; fleets of large organizations often are good customers for
alternative fuels, because (AFAIK) they can provide and support their own
infrastructure. But that is speculative (as is investing!).

