Yesterday there was an interesting article from "Seeking Alpha":
"Can Tesla Reach 500,000 In Vehicle Sales Or Is Dougherty & Co. Overly Optimistic?". This is one of the first articles to appear on the stock app for the iphone under the symbol TSLA (for Tesla). The article Challenges the inherent value of Tesla cars, the company's business model, their contribution, and their prospects. It's interesting because it includes a large amount of information. I tried posting the following comment in that article several times since yesterday (screen name Plutarc):
"The flaws in this article’s assumptions:
1- People with $30,000 to $50,000 to spend on a car would ever spend it on an electric vehicle with a range of less than a hundred miles - now or in the future. That is what Tesla competitors are offering. You buy a car because it’s fully functional, at any price point. In other words, aside of Tesla, what is out there now, and in your charts, for other campanies’ electric cars is a waste of resources and space. Their dismal sales numbers, also in your charts, reflect this. Tesla customers are in line for months, with money up front, for a reason.
2- That other companies “will catch up with Tesla”. Tesla’s technology is leaps and bounds ahead. You seriously think that Tesla’s platforms won’t keep getting better and cheaper at a faster rate, from their current , vastly superior starting point? What do you think they’ve been about the last 20 years? Why do you think the other auto makers are desperately introducing grossly subpar electric vehicle products which, by measure of their inadequacy, have terrible sales?
3- It’s been known for a while that the profit margins for Tesla are no longer relying on the government credits, yet they are exceeding their profit margin target by all reports.
4- Has anyone heard of a hydrogen or natural gas car? Isn’t that a much blurrier logic to base projections? That would be explosive...
5- There is no reason to believe Tesla’s new models will be delayed. There’s a waiting line, for months, with money upfront.
6- The model S is a large luxury sedan. It is priced at the same level as it’s gasoline/hybrid competitors. It beat them, in every way, the first year it came out! Tesla sales accounted for the entire growth in the luxury car segment- about 9% as of July 1st . They achieved this in year one!!!! Like you said, the brands at the level of the models S are well known with established reputations. Where is their reputation in delivering an electric car for the emerging new auto industry? A Tesla Gen III will be priced and sized for equally appropriate comparisons. Do you think people like to pay 10-15% more to go to what is widely regarded as a painful dealership experience? Regardless of how you buy Tesla cars, the comparisons remain the same.
7- Hybrid sales. Hybrids are polluters. People don’t like to pollute any more. That is a global, unmet, demand.
Gasoline vehicles (including hybrids) will lose their value as electric vehicles come out. They already depreciate quickly. How much quicker do you think they will depreciate as the electric vehicle market grows. Who likes to own an asset with an accelerating depreciation?
8 - Tesla was smart enough to integrate the technology for their vehicles into owning the infrastructure that provides their energy and the clean energy that powers buildings. Their technology sells in multiple directions, not just in their cars.
What were the projections for Tesla in the past? How did it measure up to them? Answer: it exceeded them in every way, captured the best in all of us, and gave unprecedented hope for preserving/restoring the environment. With that in mind, a clearer set of projections, reflecting an unprecedented growth trajectory, emerges.
It’s time to make way for this bright new star!"
The comment has not posted. I encourage you to read the article. It is informative, but, in my opinion, grossly off base about its projections for Tesla.
We all know that all sorts of misleading articles have come out since the introduction of the model S. That is a major reason why supporters of Tesla have become vocal.
It's about a great company, that is great for the world, having its fair chance to succeed.