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re: SpaceX, Tesla & Solar City: Elon Musk's companies and their unique relationships
Posted on 5/10/16 at 9:42 am to GFunk
Posted on 5/10/16 at 9:42 am to GFunk
quote:
Point taken. Do you have any opinion-any whatsoever-on the 66% of the other companies mentioned in the OP and in subsequent follow-up responses?
In order, my level of interest in Elon's companies:
Tesla
SpaceX
Solar City
0
Posted on 5/10/16 at 9:43 am to lynxcat
quote:
The Model S, if fully loaded, can go 0-60 in under 3 seconds as a luxury sedan. That is absurd.
That isn't absurd at all. That is how electric motors work. The power output and efficiency will always crush the combustion engine. Tesla didn't invent some magic electric motor.
Posted on 5/10/16 at 10:08 am to GFunk
quote:
Point taken. Do you have any opinion-any whatsoever-on the 66% of the other companies mentioned in the OP and in subsequent follow-up responses?
I've already commented that I (and many others) think Tesla is WILDLY over valued and I wouldn't speculate on it. The Tesla cars are amazing, but not profitable.
As far as Space X, it's
* dependent on gov't subsides/policy
* competing against gov't subsidized agencies
* HIGHLY speculative due to above and VERY small number of potential customers
* private, so we don't even know the real financial picture and can't invest in it anyway.
Musk is cool as hell, but he's a dreamer. He only cares about these companies to create the money and technology needed to colonize space and save the human race from a mass extinction event. More power to him for his idealistic ambitions, but I'd prefer to invest with more practical men focused on creating wealth for me, not saving the world.
Carl Ichan isn't 5% the man Musk is, but I'd invest in him before Musk.
Posted on 5/10/16 at 10:25 am to notsince98
quote:
That isn't absurd at all. That is how electric motors work. The power output and efficiency will always crush the combustion engine. Tesla didn't invent some magic electric motor.
Yes, it is absurd that they have made a top-graded consumer vehicle that performs at supercar levels. The competitor set for Tesla Model S is not just electric vehicles but also luxury sedans with combustion engines. The speed is one tiny piece of what makes the Model S one of the best cars ever produced. If you fail to see the technological advancement Tesla is driving in the auto industry then you are honestly just being obtuse for the sake of it.
This post was edited on 5/10/16 at 10:28 am
Posted on 5/10/16 at 10:31 am to Ole War Skule
quote:
Carl Ichan isn't 5% the man Musk is, but I'd invest in him before Musk.
We are mixing apples and wrenches. Investing versus quality of product/company are two very different things.
However, I do think if Tesla finds a way to manufacture enough Model 3's to meet demand that the stock will soar. The Model 3 is the real test because it dramatically changes the auto landscape by adding hundreds of thousands of electric vehicles to the road (and not all of them will be subsidized).
I have doubts that Tesla can meet the incredible demand for the Model 3. The scale of production needs has to frighten Musk at the moment.
Posted on 5/10/16 at 11:02 am to lynxcat
Tesla are horrendous stewards of capital. Musk also serially overpromises and underdelivers. On their last call, he made some projection about manufacturing expansion by 2018 that is laughable and won't be achieved. The market just ignores that stuff now.
He doesn't really care about the company or its shareholders it seems. He just wants to use it as an avenue by which he can force the automotive industry to change. In some ways, it seems to be working, but I'm not sure. Automakers are coming out with more EVs, but a lot of it is assumed to be at a loss to appease the czars' outrageous CAFE standards (weighted average fuel economy sold).
Battery technology has had a massive amount of R&D dedicated to it (think phones and devices), but without a whole lot of improvement. It's going to take a step change to override the inherent tradeoff baked in, build out the requisite power grid, and also expand to developing countries, especially as oil continues to be easier and cheaper to bring to market.
He doesn't really care about the company or its shareholders it seems. He just wants to use it as an avenue by which he can force the automotive industry to change. In some ways, it seems to be working, but I'm not sure. Automakers are coming out with more EVs, but a lot of it is assumed to be at a loss to appease the czars' outrageous CAFE standards (weighted average fuel economy sold).
Battery technology has had a massive amount of R&D dedicated to it (think phones and devices), but without a whole lot of improvement. It's going to take a step change to override the inherent tradeoff baked in, build out the requisite power grid, and also expand to developing countries, especially as oil continues to be easier and cheaper to bring to market.
Posted on 5/10/16 at 11:04 am to Ole War Skule
quote:
Ole War Skule
quote:
* competing against gov't subsidized agencies
Agreed here. Boeing/Lockheed Martin are paid the tune of a billion dollars a year through their "Launch Alliance," to stay on "retainer".
But when their competitor-the Falcon/9 from SpaceX-shows that they can produce a rocket for 40-60% less, reuse it over and over and can land them autonomously...and they're already ok'd for military payloads...who do you really think is going to end up dominant in that market?
I'm asking honestly.
Posted on 5/10/16 at 11:34 am to GFunk
quote:
who do you really think is going to end up dominant in that market?
Whoever has the best lobbyist and contributes the most to campaigns?
I agree SpaceX should do well, but their future depends wholly on gov't policies, U.S. and foreign. If foreign and U.S. gov'ts choose another company to get the work, they will. Cost of the launch isn't the only factor. Other aerospace companies MUST succeed due to gov't dependence of their military products. Gov't may choose to subsidize competitor's commercial launches as well if they believe those funds will end up supporting development of military equipment.
I'm not saying SpaceX hasn't done some amazing things, I'm just pointing out the very, very high risk any company has whose future depends on domestic and foreign gov't policy, corruption, and often twisted logic when making purchasing decisions.
Hell, SpaceX could end up being the next Boeing, Lockheed, or Airbus if Congress decides it should.
Posted on 5/10/16 at 1:51 pm to Lou Pai
quote:
Musk also serially overpromises and underdelivers.
Again, he makes some of the best vehicles ever produced.
quote:
On their last call, he made some projection about manufacturing expansion by 2018 that is laughable and won't be achieved.
Do you want to be more specific? The Gigafactory will double the world's production of batteries and is the largest factory in the world by land mass. It is operational today but not yet at full scale.
My concerns on Tesla are:
1) Meeting demand for Model 3
2) Building enough superchargers around the country / globe to meet the increased demand and the make distance traveling in a Tesla less worrisome
Posted on 5/10/16 at 2:10 pm to lynxcat
quote:
Again, he makes some of the best vehicles ever produced.
Disagree. I was mainly referring to his execution. While the acceleration of the vehicle is impressive, the CR stuff was a but overinflated (and they went back on it and tweaked some of the ratings lower). I'm talking about as a company, they are really shitty at estimating demand and meeting that demand correctly.
quote:
Do you want to be more specific? The Gigafactory will double the world's production of batteries and is the largest factory in the world by land mass. It is operational today but not yet at full scale.
I'm pretty sure he has lied about this as well, but I'm talking about his fresh claim that he will produce 500k Model 3s by 2018. No one believes him. And just like his estimate back in 2014 about his '15 run rate (he only hit half of what he promised), it won't happen.
I've seen him compared to Trump in that the details don't matter with him, and I definitely agree with that assertion. Like I said, I don't think he cares about the company itself very much.
Posted on 5/10/16 at 2:17 pm to Lou Pai
quote:
I'm pretty sure he has lied about this as well, but I'm talking about his fresh claim that he will produce 500k Model 3s by 2018. No one believes him. And just like his estimate back in 2014 about his '15 run rate (he only hit half of what he promised), it won't happen.
What do you expect him to say? "We have 400k pre-orders but there is no way in hell we can actually make that many." As if that would be better than aspirationally saying they will start orders at the end of 2017.
quote:
I'm talking about as a company, they are really shitty at estimating demand and meeting that demand correctly.
They are in the process of creating a new market. There are no legitimate comparables for their vehicles...so how can we be surprised that the demand forecast is shaky at best?
quote:
But those problems mostly still fall under Tesla’s four-year/50,000-mile bumper-to-bumper warranty (and eight-year/unlimited mileage battery and drivetrain warranty), so they are generally being corrected at no cost to owners.
LINK /
So the reliability has been an issue for some....but they rarely come out of pocket for the fix.
I don't think this thread is about Elon's companies as "stock picks" so I don't know why we are hung up on that.
Posted on 5/10/16 at 2:30 pm to lynxcat
quote:
What do you expect him to say? "We have 400k pre-orders but there is no way in hell we can actually make that many." As if that would be better than aspirationally saying they will start orders at the end of 2017.
It's not true. No one thinks it's going to happen. He feels he needs to keep the hype machine humming. So he will stay stuff about that on his earnings call, talk about how he has a sleeping bag there, etc., and people will roll their eyes. There are a lot of other ways to handle it.
quote:
They are in the process of creating a new market. There are no legitimate comparables for their vehicles...so how can we be surprised that the demand forecast is shaky at best?
He doesn't have to just make up backlog.
Posted on 5/10/16 at 3:13 pm to Lou Pai
From what I've read the issue with his Gigafactory isn't its construction or completion. It's raw materials. I think I read while I fell down the research wormhole on Elon that he's stated that if Gigafactory hits its trajectory he's predicted, it would become the world's number one buyer of Lithium.
If you look at the prices of Lithium, it's already been on an upward trajectory. The Gigafactory has the potential-if it even comes close to what he's saying it'll have to do-to spike the cost of raw materials for the batteries.
But again, I think most are missing the point that Tesla and Solar City are in position to be floated-for YEARS-by the profitability of SpaceX. That company is poised to become a veritable private sector NASA. Soon.
Very soon.
If you look at the prices of Lithium, it's already been on an upward trajectory. The Gigafactory has the potential-if it even comes close to what he's saying it'll have to do-to spike the cost of raw materials for the batteries.
But again, I think most are missing the point that Tesla and Solar City are in position to be floated-for YEARS-by the profitability of SpaceX. That company is poised to become a veritable private sector NASA. Soon.
Very soon.
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