Guest essay by Eric Worrall
Elon Musk’s Tesla shares have plunged in value this week. Analysts cite competition and production concerns.
Tesla’s Stock Selloff Messes Up Musk’s Big Week
By Dana Hull
8 July 2017, 02:47 GMT+10
- Execution and competitive risks cloud cheaper car’s arrival
- Stock is on course for its worst week since February 2016
This was supposed to be Elon Musk’s big week, capped by Tesla Inc.’s first Model 3 sedan rolling off the assembly line. Instead, shares that had been riding high in anticipation of his most consequential car yet are poised for their worst week in almost a year and a half.
A troublesome quarterly sales report, the emergence of competing electric vehicles from the likes of Volvo Car Group and lingering concern about Tesla’s ability to mass produce have sent its stock down 13 percent this week. Modest gains in Friday trading still have left the shares on course for their steepest weekly drop since February 2016, and Tesla’s market value has dropped back below General Motors Co.
This week’s worries put a damper on the arrival of the linchpin to Musk’s growth ambitions. For Tesla, bringing out Model 3 and becoming more of a mass-market carmaker will require overcoming the routine manufacturing issues that have handicapped output of batteries or Model X sport utility vehicles. And so-called legacy automakers have sent a clear signal they won’t go down without a fight — Volvo underscored this by announcing all of its new models will have hybrid or fully electric powertrains from 2019.
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Tesla will soon have more competition coming from major carmakers, Barclays Plc analyst Brian Johnson said.
“We’ve long argued that Tesla as an EV company is not truly disruptive, in that legacy carmakers will eventually wake up and offer fully electric vehicles by the early 2020s,” Johnson wrote in a report Wednesday.
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This plunge in share value could be a short term blip. But given the interest expressed by established carmakers in embracing the electric or hybrid car markets, the pressure appears to be on for Elon Musk to explain what he does which is so different – why people should continue to invest with him, rather than investing with other, more established carmakers.
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If one is thinking of buying an EV as a daily commute and charging it from a power point in the garage, don’t even think of buying anything bigger than a Leaf. It has a 30 KVA battery which, in Australia with 240V, 10 amp outlets will take 15 hours to charge. It would be pointless owning a Tesla 3 without 415V 3 ph power especially connected. Your provider may nix that idea.
I read that’s denmark abolished subsidies – Teslas now pay the same road tax as everyone else (Telsa was suitably horrified that they’re not allowed to use roads for free any more.)
Sales down 94% in response. Will be the same in HK – they avoid the congestion tax. When you buy a $60k Model S against a $120k BMW every 2nd car is an S. At $120k, they will buy a proper car.
I think Elon Musk updated this ancient s c a m below to power his enterprises along the lines of perpetual motion, except he uses taxpayer money to keep things going:
Glorious Opportunity To Get Rich!!! — We are starting a cat ranch in Lacon with 100,000 cats. Each cat will average 12 kittens a year. The cat skins will sell for 30 cents each. One hundred men can skin 5,000 cats a day. We figure a daily net profit of over $10,000. Now what shall we feed the cats? We will start a rat farm next door with 1,000,000 rats. The rats breed 12 times faster than the cats. So we will have four rats to feed each day to each cat. Now what shall we feed the rats? We will feed the rats the carcasses of the cats after they have been skinned. Now Get This! We feed the rats to the cats and the cats to the rats and get the cat skins for nothing!
http://www.telegraph.co.uk/content/dam/news/2017/07/05/matt-gallery-05072017-large_trans_NvBQzQNjv4BqqVzuuqpFlyLIwiB6NTmJwfSVWeZ_vEN7c6bHu2jJnT8.png
SW Australia is being the crash test dummy for Musk’s battery play and Bloomberg has his number.
https://www.bloomberg.com/news/articles/2017-07-10/tesla-s-australian-battery-fix-comes-at-big-price-woodmac
Musk is a pioneer whether you like him or not. You all seem scared of change. We need to work on new things until we get them right. Or… we can hide our heads in the sand and hope steam power makes its big comeback!