Hacker News new | comments | show | ask | jobs | submit login
Tesla (TSLA) surpasses BMW's valuation as one soars and the other slips (electrek.co)
52 points by evo_9 7 days ago | hide | past | web | favorite | 107 comments





BMW reported profits of €8.7bn for the year 2017. [1]

Tesla stockholders must be very, very optimistic about its future performance when they value Tesla more than an already established, immensely profitable player.

[1] https://phys.org/news/2018-03-bmw-net-profit-bn-euros.html


This is a key point when considering Tesla stock. In order to justify the current price, Tesla really has to become the next Toyota.

Volkswagen is an $85B auto maker and the second most valuable. Tesla is already a $60B auto maker. If Tesla becomes the next Volkswagen in 10 years, they will have gained 42% returns over 10 years or about 3.6% annual returns. Given the high risk that Tesla won't become the next Volkswagen, it seems over-priced.

Even Toyota, at $192B, seems like it would be lackluster returns if Tesla reaches their heights in a decade. That would be a 12.4% annualized return. Now, that's a very good return, but is is likely that Tesla will become the next Toyota? Why not the Next Volkswagen at $85B or Ford at $28B or GM at $51B or Mazda at $7B? Those are all successful auto makers with good profits.

Worse, are cars really the future? More and more people are migrating to cities and looking toward public transit. Even if cars become green, they're still congestion in a world whose urban population is increasing a lot where congestion and parking are becoming larger problems.

Even if cars are the future, will people own them? If self-driving cars become a reality, demand for vehicles could fall by 90%. Most cars are idle most of the time. If I can just get a self-driving taxi everywhere I need to go, it would be a fraction of the price of owning a vehicle since I would be sharing vehicles with many people. That would lower the demand for vehicles a lot. Even if Tesla became 100% of the auto industry, if that industry is a tiny fraction of the size today, it would really hurt Tesla's finances.

Really, I think there are two ways Tesla could hold up to its expectations. 1) Being more than a car company. Tesla might become big in other industries like solar power in addition to being a car company. They'd probably need more than just solar as an add-on, but there are markets out there. 2) Tesla's vertical integration works really well and beats out competitors. One thing to note about this: the vertical integration also exposes them to a lot of risk. When you have several outside companies creating the same component for you, if one doesn't deliver, you don't have to push back projects - you just buy from a different supplier. While you pay a mark-up, you also get different companies and teams working on the same problem to drive down price and drive up quality. It's certainly possible that Tesla will do excellently with their in-house components and keep that going for decades and it could provide them a strong price advantage against competitors.


    If Tesla becomes the next Volkswagen in 10 years,
    they will have gained 42% returns over 10 years.
And if they become a trillion dollar company, they will have gained 1566%.

They are in AI and in Solar. Two giant waves ahead of us. AI will be bigger then the web. Solar might too. The 'Google of AI' will be way bigger then Google.

    Given the high risk that Tesla won't
    become the next Volkswagen, it seems over-priced.
The 'risk' that Tesla becomes the Google of AI or the Apple of Solar makes up for it.

> AI will be bigger then the web. Solar might too. The 'Google of AI' will be way bigger then Google.

My marketing bullshit sense is tingling.


> Tesla stockholders must be very, very optimistic about its future performance

or about their ability to flip the stock to the next buyer while the going is still good.


Not true. We are not all short sellers.

Flipping stock is not short selling. There is literally nothing wrong with selling a stock you own for more than you bought it. Maybe a good time to cash in a percentage of you’ve made a lot of money.

Buying something because you think it’s price will rise and then selling it is the opposite of short selling.

shhhh... short seller is just a code word for Tesla hater ;)

Speculators != short sellers.

Elon Musk has said repeatedly that the energy side of the business will grow faster and exceed the size of its car business.

Many stockholders bet on this – given the multiyear advance over its competitors in both EV and battery production. They expect Tesla to combine the sales of a large car and truck manufacturer, but also of the equivalent of a global car dealer network, of an oil and gas company, a power distribution company, a roof manufacturer and installer, a P2P car renting company, an automated on-demand transportation & logistics company, etc.

Other car manufacturers only manufacture and sell cars.

Apple didn't stop at the iPod, obviously.


Stockholders just believe the no one else will ever be able to make an electric car.

Beyond the hype, I think it's feasible to believe that Tesla has a massive multi-year advantage that other car companies will be playing catchup to for a very long time.

Having the global manufacturing infrastructure of someone like Ford or VAG certainly seems like an advantage, but retrofitting that infrastructure to manufacture electric vehicles isn't exactly trivial or cheap. Then consider you also need to "retrofit" all of your people to figure out how to make electric vehicles (or hire new people). The platforms that worked for ICEs don't work for EVs. The electronics don't work. It requires a huge number of new parts. And the parts that stay the same might not be well-suited for EVs; ICE buyers, especially BMW, don't really care about fuel economy, but every EV buyer does care about range. That's a huge shift that affects every part; seats have to be lighter, made of different materials, you have to use more aluminum and carbon fiber in more expensive models, aerodynamics change, etc.

Then consider Tesla's massive lead in battery production which serves to drive down price and increase their technology lead.


Your greatly overstating Tesla's advantages. EV drivetrains aren't quite drop in replacements but they are close enough that the first modern commercial EVs... including Tesla...were simply converted ICE vehicles.

Also, Tesla doesn't make batteries, Panasonic does. Tesla just assembles them. Panasonic also sells batteries to Tesla's competition. And based on Tesla's past issues with paying vendors, if they miss even a single payment to Panasonic their supply advantage could disappear immediately.


Of course the first ones were converted ICE vehicles. I could take a lawnmover and make it electric, that doesn't mean it would feasibly compete with a true designed-from-scratch electric lawnmower.

Those first EVs designed like that sucked. Seriously. Horrible range. Bad part fit. The roadster in a Lotus body was a fast car with decent range, but it also weighed almost nothing, had two seats, and no storage capacity. Come on, you're smarter than to think that's a good argument.

Look at Audi and the e-tron. They're advertising "200+ miles of range", but the only real road test we've heard about so far had it below that, at closer to 175. Meanwhile, the Model X is getting up to 300. And, by the way, before you say it: Yes, the price on both of these is about the same, at the $80k mark.

Consider the Bolt. It's got a range of ~240mi. For roughly the same price (~$40k), a Model 3 will do 310, and it will do those miles with substantially better performance and AWD (and also not look like a squished minivan, beside the point).

Who else is there? The Leaf? Ford Focus Electric? BMW i3? Hilarious. I'm tired of this argument that "the traditional manufacturers will catch up." It's the same argument we were making 4 years ago, 2 years ago, 6 months ago, nothing has changed. They haven't caught up. It's seemingly increasingly likely that the 2021 model year cars might compete with what Tesla is putting out today, in 2018. What will Tesla have by then? Who's to say.

These companies aren't doomed; the car market is vastly large enough to have many many people competing. But Tesla is in a position today to be #1 for a very long time. Their valuation will level off to be more realistic as their revenue catches up with the hype.


For roughly the same price (~$40k), a Model 3 will do 310, and it will do those miles with substantially better performance and AWD (and also not look like a squished minivan, beside the point).

Categorically false, as the Model 3s do not currently sell for that amount with that range. Cheapest model 3 is $46k, without upgrades.

Can't find anything about the electric-only etron, which hasn't been released yet. The hybrid etron only has 16 miles of pure EV range. BMW's I3 is a superior riding experience, range and acceleration aside. Even the Leaf and Focus Electric are nicer to ride in. After the novelty of "Ludicrous" mode wears off, the actual driver experience matters most to most car buyers. Considering that most people don't have a 150-mile commute, the Model 3's only advantage is for the hypothetical holiday drive. Most people would just rather have a nicer car.


Really, they would? Then why are they all buying Teslas?

Also you're crazy if you think either of those cars are 'nicer' than a Model 3, which has rave reviews from its customers and critics.


The mid-range Model 3 is $46,000 before US federal and state tax incentives. "Categorically false" appears to be an exaggeration, but that fits with your overall posting quality.

The Roadster wasn't a "converted ICE vehicle". Only the outer shell was from Lotus. That's a relatively small % of the weight and value of the car.

Yes those cars were converted ICE vehicles... in 2008. Sounds like a multi year advantage to me.

No fewer than a dozen car companies are planning to launch more advanced EVs than Tesla within the next 3 years.

Tesla can't afford the capital investment it needs to compete with that generation of competition, largely because it executed this generation's launch so poorly.


Lol honestly are you trolling?

Tesla has 50% of the EV market share and is by far the leader in tech. I would love to see anything even close to the specs of the new roadster. Or honestly if any company has any plans for anything as good as the Model S that would be great.

And wouldn't 3 years away give Tesla a multi-year advantage, as claimed?


They are able, but they don't do it.

The only full electric car BMW currently produces is the wacky i3, which doesn't appeal to the average BMW buyer. For some reason all car manufacturers (except tsla) build really lame, goofy, small electric cars, why can't we just have a traditional luxury saloon?

The current 5 and 3-series are not offered in an full electric version. Which means that maybe, if we are lucky, there will be an all-electric 3/5 series in the next-generation (to be expected in 2021).


The i3 is one of the best interpretations of the electric car, although it I guess it has been surpassed by now by the likes of the Renault Zoe and Nissan Leaf.

The i3 is what you get when you build an electric car that is optimized towards what an electric drive is good at _right now_. Given the range problem of the current battery technology, a short range city car with minimized energy consumption is where the electric drive is best at showing off it's benefits.

The Tesla on the other hand is what you get when you brutally try to hammer the electric drive towards matching the range that people are used to. It's a heavy machine that uses most of it's energy to hauling around it's battery.

And while, as you can grasp from what I wrote, I really like the idea behind the i3, it's obvious that the Tesla approach turned out to be better. It leads to a more practical and competitive car that is easier to sell.

The story if BMW i is a bit sad, as things didn't turn out that well. The idea was to make purely electric vehicles and built them sustainably (the interior of the i3 is largely made from some kind tree leaves if memory serves me right) - but BMW quickly figured out that they can't sell enough of them. Which is why they switched their approach towards developing vehicles that can either be built with an electrical drive train or with a combustion engine.

They basically have Teslas problem in reverse: Tesla can't build their factories fast enough to meet the demand for their cars, BMW can't build demand for electric cars fast enough to fill the production capacity they have (3 million cars per year).

(This reads more pro BMW as I mean it - I don't wanna say what they do is the best they could, I don't know that - it's more meant to try to see their point of view to understand why they do what they do.)


The i3 is a really good car, I never said it's bad. It is (or was) also one of the very few proper electric city cars. Tesla has yet to make a decent small size city car. So I fully agree with your post.

It's just that I don't understand why BMW won't make their current lineup of luxury saloons and SUV's available in an all-electric version. It feels like they are missing the boat.

I really hope for them that the next-gen cars will have an electric version, or else they will stand to lose a large portion of the market they currently own.


I don't know their specific plans, but the strategy I know of is to build a platform that can support combustion, hybrid and electric. But they seem to take their time with that ... .

Yes, the i3 is a remarkable car on many counts including how it is manufactured. But it really is a niche vehicle that is only ever going to appeal to a small segment of the market.

I drove 2 Nissan LEAFs for 5 years. They are solid cars, and this year's iteration moved out of the "early adopter" segment and is being marketed as a mainstream car.

Their roadmap in 2022 calls for 4 EVs plus 2 more under the Infiniti brand. Unlike GM, Nissan has 8 years of experience with EVs so I think their roadmap is believable.


Also, the nissan leaf could be the kind of car that fetches the low end of the market.

All the people driving cheap tiny cars like the toyota aygo, these people are usually also those who don't drive long distances.

A nissan leaf would be a perfect car for my Mother in law for instance, she drives very little, and the distances she drives are usually >50km.


This is something that also always boggled my mind. One of the most expensive parts on an electric car are the batteries. No matter how cheap you try to make your car, you'll be set back about 20k just with the batteries.

At this point, why even bother trying to go for the lower end.


You can still go for the lower end if you sell based on the total monthly car costs. Many people see what they can afford based on the monthly loan payments rather than the total cost, and if they save more on fuel than what they pay extra on the loan, it's a good trade. But that doesn't work if the extra niceties push the loan value over that line.

>For some reason all car manufacturers (except tsla) build really lame, goofy, small electric cars, why can't we just have a traditional luxury saloon?

Because maybe high-quality saloons with expensive batteries are way to expensive for most consumers?


And yet expensive cars sell. Additionally the margins can be higher if the selling price is higher (and the product more about emotion), so there is more budget to fit in a good battery.

This is the entire reason the Model S was built the way it was.


Depends on the market. I live in the Netherlands (next to Germany) and even though NL is one of the most expensive countries to own a car, luxury german cars are very common here. So are Tesla's by the way.

I've never been to NL and never knew that it was expensive to own a car there. However, having learned that, I am certainly not surprised to also learn that many of the cars there are fancy and expensive. Wealthy people have more fancy and expensive cars than poor people. If none of the poor have cars, a greater portion of existing cars will be fancy and expensive. Singapore was the same, when I lived there. That isn't to say that all vehicles were luxury. Workmen still need work trucks, after all.

And yet, Tesla has the third highest average selling price of all manufacturers. Clearly there is an expectations mismatch.

Just bought a new Model S 100D. Sat in other cars just for giggles (BMW 5 series, Mercedes E Class, Audi RS 3). Where else am I getting an electric car that holds two large Clek Fllo car seats, two adults, a full trunk of luggage, has 330 miles of range, does 0-60 in 3.6 seconds, and I can travel cross country effortlessly in? It doesn't exist besides a Tesla.

Tesla is valued appropriately based on the market.


The fact that it's electric is not even close to the only advantage that Tesla's cars have over ICE cars.

Tesla turned the car into a software problem, and I would argue they have demonstrated they are WAY WAY ahead of the major OEM's at software and in the infrastructure supporting it.

Not to mention extremely sleek and well loved design, autopilot, etc. To just make a Camry electric won't be enough ( though it definitely will take some of the market share ).


>autopilot

Other than marketing, are they really ahead of the competition?


Which competition are we talking about?

GM Supercruise is the only other thing on the market that is comparable, and with Nav on Autopilot I'd argue Tesla is a fair bit ahead.

Maybe they are not ahead of Waymo, but can you buy a Waymo? If not then when will you be able to?

There is Comma.ai which I am impressed with and think will be the general autonomous solution to many (most?) non-Tesla cars going forward, but their product at the moment is for hobbyists and not consumers.


> Tesla turned the car into a software problem

No, they convinced fanboys that they turned it into a software problem. The reality is they are no different than any other auto manufacturer. Being in Silicon Valley doesn't change that.

An electric Camry would sell so much more than the model 3.


What are you talking about? They have turned it into a software problem. Name another company where you can make meaningful over the air software updates that affect more than the dashboard?

Also while I am a Tesla fanboy, I work in automotive technology and interface with many of the major car companies daily, so I'm not just getting this from articles.


If the airbags have a problem which causes them to hurt shrapnel into peoples faces you can't fix that with a software update.

and why is being able to push updates to heavy machinery that we routinely have moving at speeds of 60+ MPH a good thing?

If you can fix the brakes via software update you can break them too.

I'm fine with it if someone going to prison when a software update kills people.


The alternative is having to take your vehicle in to get the brakes fixed.

Battery packs for EVs are expensive and heavy. And more complicated than people realise. They're not just big batteries. Making an electric car with decent range at an affordable price* is not easy at all. Tesla is closer than anyone else.

* edit: an affordable price that isn't loss-making, I should say


I can go to a dealer today and grab a Chevy Bolt for under $32k with no haggling with 238 mile range. Hyundai hasn't come out with US pricing for their Kona EV yet, but in Norway they're selling it for the equivalent of $40k with 258 mile range.

It certainly isn't trivial and Tesla has invested a good bit in EV technology, but it looks like rivals aren't that far behind.


Both Chevy and Hyundai have decent range EVs that are significantly less expensive than a Tesla, so it seems like it's not a problem only Tesla knows the answer to.

The Chevvy bolt is sold at an $8000 loss.

The Hyundai Kona Electric looks cool but is only going to be sold in small numbers and won't be available in much of the USA https://insideevs.com/hyundai-kona-electric-limited-u-s-avai...

I wonder why.


I'm more concerned with what's available on the market, not whether or not it sells in enough quantity to offset R&D, etc. Tesla had it's first profitable quarter in what, 15 years? It might be premature to move the goalposts ;-).

The fact remains that both Chevy (or LG) and Hyundai clearly know how to make a battery that competes on price. Tesla doesn't have any magic technology, what they have is good marketing. They have a plausible shot at replacing BMW as the image car of choice for folks in the lower premium car range, which seems fairly lucrative. Not a bad niche to be in.


Chevy (or LG) and Hyundai clearly know how to make a battery that competes on price.

No, they don't. That's my point. They've made long range EVs that they are selling at a loss, or only in small numbers which implies either loss-making or supply-chain problems.

Tesla doesn't have any magic technology

Thats not clear. Look at the recently announced Audi and Mercedes EV efforts (and the Jag i-Pace) and see how they compare with Tesla in terms of battery size, weight and efficiency.

Sandy Munro says the Model 3 is at least 4 years ahead of anything else. https://www.bloomberg.com/news/videos/2018-10-25/why-tesla-s...


Not only are they losing money, it also starts at $36,620 which is more than the Tesla 3 base model and it’s tiny.

   Bolt: 164″ L x 70″ W
   Model 3: 185″ L x 73″ W
Which is not nessisarily a bad thing for a city car.

The Tesla 3 base model is not in production right now. Only the higher priced models are. I'm sure they'll eventually get to it, but you're comparing a model that is available to buy today with one which is not.

Sure, in practice you can even get a 2019 Bolt for 9k under MSRP becase nobody wants them. https://www.cars.com/vehicledetail/detail/747922437/overview...

Tesla may or may not start base model production in Q1 2019, but availability is not really helping the Bolt sell.


Cars almost always sell under MSRP - because there's a middleman involved. For example: https://www.cars.com/vehicledetail/detail/750619576/overview...

"Nobody wants one" is also hyperbolic - Chevy releases sale numbers, and while not top-of-the-line, they're also not 0.


Depends on the car and when you buy it.

Some high demand cars sell over MSRP. Seeing deep discounts at the end of a model year is common when trying to shift inventory or when dealing with very high margin trim levels. Advertising 26% under MSRP for a base 2019 model in 2018 is a rather extreme case.

PS: For some actual numbers: GM delivered 3,949 Bolt EVs during the last three months in the US from 6,710 units during the same period last year. In automotive sales terms that's very close to zero. https://electrek.co/2018/10/03/chevy-bolt-ev-sales-slumping-...


I looked at & test drove the Bolt before buying my Tesla. I kind of liked it, but I bought a Tesla instead. The two issues that pushed me to get a Tesla:

1) GM seem to go out of their way to make the Bolt seem cheap and unappealing. The seats in particular are too narrow and are uncomfortable. The car is wide enough to accommodate more comfortable seats, but they just decided to use the cheapest seats possible.

2) There is no DC fast charging network that the Bolt can use in the US.

Thanks to the supercharging network, I can (and have) take thousand mile road trips in my Tesla without worrying that I'll be able to find a place to charge in a reasonable amount of time.

With a Bolt, any trip approaching 1/2 the car's range (eg roughly 115mi) from home suddenly becomes an adventure where you have to look for slow level 2 chargers and be prepared to wait hours for your car to charge. The Chevy dealership where we drove the car had a charger, but it was ICE'd in by their inventory of giant gas guzzling SUVs. I imagined this scenario would be typical.


And when you add in the $8k loss, they are the same price as the profitable Model 3 you can buy today (not even the base model).

The Bolt at 238 miles is still quite a bit under the Tesla which can reach 300+. But at half the cost, its a price point that will suit many folks.

Only because Chevy doesn't offer an LR upgrade for the Bolt. Otherwise it seems like it has more range than a 220-mile Model 3?

BMW's net profits just tanked 24% in Q3. Meanwhile, TSLA is producing margins that the legacy manufacturers can only dream of. They are making 20% on a Model 3 while the others are squeezing out a few hundred Euros in the non-luxury segment.

Also, TSLA's battery tech is years ahead while especially the German manufacturers have been putting their eggs mostly in the Diesel basket. But those have become increasingly hard to sell to the point where Porsche has abandoned that technology altogether, and others are likely to follow. These companies are the Palm, Blackberry and Nokia of the auto industry: They don't understand that the paradigm has shifted, and when they finally do, it will already be too late.


I don’t think this is the same as the phone market. Tesla’s success does not stop BMW from thriving in the EV market in the future, another way to put it is that cars are not a platform.

Until autonomous rideshare services take over. Then regional monopolies will arise due to the infrastructure needed to support those fleets.

> BMW's net profits just tanked 24% in Q3.

What caused this?


AMZN has reported $6.15 billion of profits over the past year. [1]

AAPL has reported $185 billion of profits over the past year (30x that of AMZN). [2]

AMZN has an $865 billion market cap and AAPL has a $980 billion market cap.

[1] https://finance.yahoo.com/quote/AMZN/financials?p=AMZN

[2] https://finance.yahoo.com/quote/AAPL/financials?p=AAPL


(Side note: your profits for AAPL are way off, they should be around $58 billion)

This is an interesting comparison, but I don't think it is an applicable one.

Amazon and Apple run vastly different business, whereas BMW and Tesla compete entirely within the same market (even market segment).

Furthermore, Amazon is infamous for being an outlier with regards to profit reporting, but this was generally understood to be a financially engineered situation rather than a lack of success. If I recall correctly, in 2016 or so AWS became so successful that the profits it generated couldn't be engineered away anymore, hence why we're seeing billions of profits (after 20 or so years without them).


I often enjoy Electrek's coverage, but they aren't a reliable news source. http://www.thedrive.com/news/24025/electreks-editor-in-chief...

Nothing in TFA seems suspicious to me. The main point, at least, is easy enough to confirm. 60B > 56B.

https://ycharts.com/companies/TSLA/market_cap

https://ycharts.com/companies/BAMXF/market_cap


>Nothing in TFA seems suspicious to me.

I don't know about "suspicious", but what exactly is the point? Tesla, whom many consider overvalued, has a higher market cap than BMW. So what? BMW makes more money, has higher revenues, produces more cars and has been in business way longer. Their sales have been growing for years. They deliver almost as many cars in a month as Tesla has in its entire existence.

So what is the main point? Only in Silicon Valley do people care about "valuation".

Electrek literally takes random Elon Musk tweets and writes "articles" about them. HN votes them up, while criticizing every second article as "fake news".


Tesla's high valuation represents the hopes for its future importance. So at this point you could say the market values Tesla's future as being more important than BMWs future. And if you are ecologically minded, thats interesting.

>And if you are ecologically minded, thats interesting.

This doesn't follow.

If you were truly ecologically minded, you'd cheer on all the automakers in their move to EVs, not one in specific with a microscopic market share. BMW has more potential to shift the landscape than Tesla.


Tesla has definitely given a tremendous push to the market.

I highly doubt the EV efforts would be nearly as far along as they are without Tesla, and the danger that the catch-up activity by other players dies down again if Tesla goes under is very real. (until the Chinese manufacturers start tackling the European market, that is)

There is nothing better to put pressure on other manufacturers than a successful EV vendor.


Well thats true, I do want other automakers to follow. That's Tesla's stated mission actually - to accelerate the transition to sustainable transport. So perhaps this market valuation will give BMW a kick up the arse. BMW and all the other major carmakers are continually announcing how they're going to start producing loads of EVs blah blah, but its always still 'a few years away'. And seems to have been like that for a decade now. I think there is some sort of deadlock at the senior management level.

Also, Tesla's market share is no longer microscopic and the likelihood is its going to continue to grow. Thats the whole point of the market valuation that this conversation we're having is about.


Tesla is shifting the landscape, BMW could be.

Comparing the indicative with the indicative mood isn't fair. Vapourware always/never beats what's shipping.


Maybe, but Tesla is selling significantly more cars than BMW right now.

When another automaker starts selling an all-electric lineup, I'll cheer for them as much as for Tesla.


>Tesla is selling significantly more cars than BMW right now.

By "right now" you mean for a single historical quarter, in one specific, shrinking auto segment (sedans), in one global market right (USA), correct?

Because, again, BMW sells 250k vehicles globally, per month. Torture the data enough and anyone can be a leader.


> Their sales have been growing for years.

Looks like they just posted a solid ~5% YoY growth for the last quarter, while TSLA posted ~125%. It's clearly an interesting difference. Valuation is the metric that summarizes all of the other metrics.

https://www.zacks.com/stock/chart/bamxf/fundamental/revenue-...

https://www.zacks.com/stock/chart/TSLA/fundamental/revenue-q...


>Looks like they just posted a solid ~5% YoY growth for the last quarter, while TSLA posted ~125%. It's clearly an interesting difference.

Do you really expect a 100+ year old company that sells 3 million vehicles annually to be growing 125% annually? Where would the cars go?


If you're trying to convince investors that BMW is undervalued relative to Tesla, this isn't a good argument.

Valuation does not AT ALL summarize all the other metrics.

Valuation is NOT a representation of the future of even expected future of a company.

I could bet on Tesla and help its value rise just because I think tomorrow other people will bet on them and so the share will rise. I could bet on Tesla because I think Softbank has way too much money and will ensure I get an nice ROI soon. I could bet on Tesla because I just see that they've been growing and think it will keep going at the same pace without issue.

As long as you have people ready to buy at a higher price for whatever reason, the share will rise. And if people stop believing it will drop. Both regardless of the actual metrics behind. When Tesla gains or lose more than 10% IN A DAY, it's not because suddenly their metrics are 10% better or worse, it's just the mirror of the market's collective psychology.


While I don't disagree with you (are you not describing every bubble in history?), eventually the music will stop and any 'investor' should at least be making reasonably sure there is a seat nearby. Tesla's jump on their earnings report was as I understand it, because they made a profit. I suppose you could make a case for that increasing the 'value' much more than 10%. (although I could also take it as a signal for the end of teslas growth phase, and mark it down.) Hopefully all the different opinions average out at 'the one true answer' (tm).

Imagine what their sales would be in the US if they were actually allowed to have dealerships! I'm quite amazed they've been doing as well as they have been with that huge barrier the other car companies don't have. Imagine if the other manufacturers had to deal with this: https://finance.yahoo.com/news/cant-buy-tesla-states-1613182...


I don't think it is much of a stretch to suggest that Electrek is part of Tesla's marketing team. In a similar way to The Verge being part of Apple's.

In a similar way to The Verge being part of Apple's

??? I read The Verge fairly regularly and can't recall them ever regularly giving undue praise to Apple. I mean if nothing else, they gave both the latest iPad and MBA a 7.5/10


The Verge are Google/Android fanboys at heart. Unclear to me how they got the iVerge moniker besides giving good scores to Apple’s objectively good devices.

That reputation came about due to their notorious review of the Nokia Lumia 900 in 2012. The reviewer gave it lower numerical scores than the iPhone on various factors like ergonomics and camera even though the review text didn't imply that it was lower quality.

That led to accusations of Apple bias, especially because of editor Topolsky's love of all things Apple back during his Engadget days.

I think it's still their most-commented article ever.


If you're looking for more context for this, Benedict Evans lays out the bull and bear cases for Tesla vis a vis other car makers: https://www.ben-evans.com/benedictevans/2018/8/29/tesla-soft....

Right now, IMO, it isn't clear who will "win." If anyone. But Tesla can certainly plausibly win. It can also plausibly lose.


It does seem to me there is a lot more competition just around the corner from Jaguar (iPace), Mercedes (EQ), Audi (e-tron), etc. I expect supply of all of these will be constrained to start with but Tesla isn't going to have the high end of the market to itself for much longer.

As a former BMW fanboy, here's my take:

1) Over the past decade, BMW has snuffed the enthusiast/semi-enthusiast crowd to cater to mainstream luxury buyers.

2) Anecdotally, I've noticed that the Tesla buyers of today were the BMW/Audi buyers of yesterday.

Who's still interested in new BMWs?


> Who's still interested in new BMWs?

This. Exactly this.

I've overheard potential buyers (not just at BMW, but all car dealerships) asking questions like:

- Can I get this car in an all-electric version? > No

- Can I get this car with AWD (dual motor) > No

- Can I get this car with autopilot > No

- Will this car receive updates over the air? > No

- Does the base model come with 300+ HP? > No

- Can I control this car using an app? > No

- Can I fuel/charge for free? > No

Then why pay 80k for a 5-series, if you can also get a tesla for that price?


Not to mention resale. A 2013 Model S still sells for 40k. A 2013 BMW 5-series sells for about 15k. All BMW has left is its badge.

They should really just have anyone who asks if they can control the car using an app tossed out.

Being able to pre-heat the cabin, or checking the charge status on a phone is a reason to be 'tossed out' of the dealership? Boy, you'd be a good car salesman!

> 1) Over the past decade, BMW has snuffed the enthusiast/semi-enthusiast crowd to cater to mainstream luxury buyers

Interesting you say that, as I feel Apple is committing the exact same mistake lately.


Tesla is the new status symbol. Tech is in today. If you are an elite business man and don't have the highend flagship phone, either pixel 3 or iphone XR etc... you are not respected. Similarly if you don't have the coolest and most high tech car (Tesla), you are not respected.

Interesting. I work in LA, and Tesla's are already passe in the entertainment, music, and sports industries. If you still drive a Tesla, it means you weren't on the waitlist for the Jaguar i-PACE. Executives are already bragging about preordering the Porsche Taycan.

Having ridden in every model Tesla and test-driven an i-PACE, Tesla should be terrified. The i-PACE doesn't have the range or acceleration of a Tesla, but everything else about the car--including, most importantly, ride comfort (this is LA, after all...0 to 60 speed is irrelevant in rush hour traffic)--is miles ahead of what Tesla can muster.


Lol, what nonsense. Look at Warren Buffett.

Warren Buffet has his head on straight. Most wall street guys are just about money power and __status__!

I bought a 2013 hard top convertible with 40k miles for $20k. Couldn't be happier. Console has real knobs, too.

Doesn't matter all car companies are toast, car sales are falling, iPhones have eclipsed cars as a status symbol among young people. Many of my friends no longer have cars.

The ones successfully migrating to autopilot Uber style service have a bright future. Mercedes and BMW have the most successful in Germany (they merged their operations), so the real next decade competitor of BMW is Uber/Lyft not Tesla. I guess it depends on how good autopilots will be (and there are rumors Musk really wants to to move into that space and Tesla is the means to do that).

If Google and Apple and Amazon get into that space, I guess consumers would choose their service over a BMW/Mercedes company though - they have the better tech brand and people would rather get into a driverless Apple/Google product than BMW/Mercedes.

Most people in this thread write from a US centric view where people live a long way outside of cities so they can't imagine what's coming.


> iPhones have eclipsed cars as a status symbol among young people

uhh...

People use their iPhone to go on Instagram and like photos of people with $300k cars. I pinky promise.



You are literally talking to somebody born in the 90s that 1,000% sees cars as a status symbol, and all of my friends do too.

If we see a modern Rolls Royce, Lamborghini, Ferrari, or McLaren, we all pay mental respect to the owner/driver because we know what depreciation + upkeep cost for that driver.

A $15/hr call center rep leasing a $27/mo $699 iPhone for 18 months is so far from the scale of $300k supercar that it makes me physically angry to have to write back to this.


"[...] physically angry to have to write back to this"

I think BMWs failures are the most significant part about it. They are still tainted by their emissions cheating scandal and accordingly viewed as shifty people who will sell you a car that isn't really accredited.

I would be overjoyed to see others entering the electric market at a broad scale but right now I haven't seen anything to give me confidence. They are trying luxury with a tarnished brand and even say stuff like electric cars will always be more expensive which is a clear lack of long term vision. Always is a very long time.

Even an absolute pessimist should say "probably not in our lifetime" because in the long run stored energy sources will either be best off unused for whatever reason or used up already there will come down two choices for storing energy from our actual power sources - fixing our own novel hydrocarbons or batteries. The one has a far higher storage efficiency and less overhead if we are stick even if we assume absolute stagnation in battery tech and thermodynamic limits in fuel efficiency.


Wasn't it VW/Audi that got caught up in the emissions cheating or did I miss something?

They did as well. They were a lesser fined one discovered later also using defeat devices but they are also dirty.



Guidelines | FAQ | Support | API | Security | Lists | Bookmarklet | Legal | Apply to YC | Contact

Search: