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And I believe him. The charades can't go on much longer...
 

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Tesla is not the only company that operates in this mode, know a few others and others that blew their brains out by using the same strategy: don’t look at how I am doing now, look at my next project...repeat
 

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Lutz has been saying the same thing for years. This is not news.

So far, he has been wrong.

Musk has a formula that works. GM builds ICE Trucks and dabbles in EV tech. Big difference.
 

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Musk has a formula that works.
Musk has found investors willing to put money up. That will eventually stop if his ideas can't show a real profit potential. Basically any company that loses money every day is going out of business - it's just economics.

Take a look at a company like Amazon. "Pundits" have been saying for years that they are going to go under because they have almost never turned a profit. It's a different story though because their funding comes from their huge volume of sales and not from investors. They operate at a slim profit margin and like to reinvest in their employees and infrastructure instead of posting profits every year. So even though at the end of the year, they are showing a loss (or break even), they are pretty healthy.

I don't get the same vibe from Tesla.
 

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Tesla is my favorite non-profit corporation....:rolleyes:
 

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I am not sure it is really quite fair to put Tesla down just yet. They are a very young company and they have only a few products to sell at this time. They have come alot further along than many thought possible. Their cars are unique in some ways and that's what makes them appealing. They are also quite expensive, yet that has not stopped people from buying them and others from wishing for one.
When the more affordable Model is available in numbers we will then see what the future for Tesla looks like. Lutz doesn't think they have a future. I am betting he is wrong.
 

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Musk has found investors willing to put money up. That will eventually stop if his ideas can't show a real profit potential. Basically any company that loses money every day is going out of business - it's just economics.

Take a look at a company like Amazon. "Pundits" have been saying for years that they are going to go under because they have almost never turned a profit. It's a different story though because their funding comes from their huge volume of sales and not from investors. They operate at a slim profit margin and like to reinvest in their employees and infrastructure instead of posting profits every year. So even though at the end of the year, they are showing a loss (or break even), they are pretty healthy.

I don't get the same vibe from Tesla.
Amazon also bought the Washington Post and Whole Foods, but that because they are in a great cash position. Tesla’s acquisition of SolarCity was more desperation than expanding their strategy.
 

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I am not sure it is really quite fair to put Tesla down just yet. They are a very young company and they have only a few products to sell at this time. They have come alot further along than many thought possible. Their cars are unique in some ways and that's what makes them appealing. They are also quite expensive, yet that has not stopped people from buying them and others from wishing for one.
When the more affordable Model is available in numbers we will then see what the future for Tesla looks like. Lutz doesn't think they have a future. I am betting he is wrong.
Amazon was incorporated in 1994, went online in 1995 and finally turned its first profit in the fourth quarter of 2001: $5 million (i.e., 1¢ per share), on revenues of more than $1 billion. (Amazon's initial business plan was unusual; it did not expect to make a profit for four to five years.) And have contiined to expand and MAKE MONEY

Major Subsidiaries
* Amazon Maritime, Inc.
* Audible.com
* Beijing Century Joyo Courier Services
* Brilliance Audio
* ComiXology
* Goodreads
* Shelfari
* Twitch
* Whole Foods Market

Tesla is currently 14 years old and controls 0.2% of the US market in automobiles; GM controls 17.3% of the market.
Tesla has only had two profitable quarters in its history as a public company, while GM earned a profit of more than $9 billion last year.
Tesla's market capitalization is now bigger than General Motors', making it the largest U.S. based automaker by that metric.

Investors are clearly betting on Tesla's potential, and are undeterred by factors such as Tesla's loss of $773 million in 2016, however, there has been a quiet exit by several LARGE institutional investors, and the fact that it sells only a tiny fraction of the cars delivered annually by established competitors.

Owner Name..............................................Date............Shared Held...Change (Shares)...Change (%)...Value (in 1,000s)
PRICE T ROWE ASSOCIATES INC /MD/. 06/30/2017 5,554,653. (5,266,374) (48.67) 2,020,783
FMR LLC.......................................... 06/30/2017 21,343,782 (3,106,653) (12.71) 7,764,868
MORGAN STANLEY............................ 06/30/2017 1,420,182 (2,167,955) (60.42) 516,662
RENAISSANCE TECHNOLOGIES LLC..... 06/30/2017 0 (677,792) Sold Out
NORGES BANK.................................. 12/31/2016 442,966 (445,173) (50.12) 161,151
HIGHFIELDS CAPITAL MANAGEMENT LP 06/30/2017 283,434 (334,757) (54.15) 103,113
OPPENHEIMERFUNDS, INC................. 06/30/2017 0 (250,000) Sold Out
WELLINGTON MANAGEMENT GROUP LLP 06/30/2017 390,265 (234,541) (37.54) 141,978
DEUTSCHE BANK AG\........................ 06/30/2017 446,993 (210,645) (32.03) 162,616
BAILLIE GIFFORD & CO...................... 06/30/2017 13,424,092 (201,586) (1.48) 4,883,685
GOLDMAN SACHS GROUP INC............ 06/30/2017 596,983 (197,188) (24.83) 217,182
SUMITOMO MITSUI ASSET MANAGEMENT COMPANY, LTD 06/30/2017 394,554 (126,953) (24.34) 143,539
TIDE POINT CAPITAL MANAGEMENT, LP 06/30/2017 0 (125,706) Sold Out
JPMORGAN CHASE & CO.................... 06/30/2017 817,383 (121,121) (12.91) 297,364
ZEVENBERGEN CAPITAL INVESTMENTS LLC 06/30/2017 409,408 (88,314) (17.74) 148,94
(source: NASDAQ.com)

One is waiting for the 2017 numbers...:rolleyes:
 

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I am one of many small investors that is betting on Tesla's future. The first lot of shares I bought @ 38 and the second lot @ 35.
I can afford to hang on for sometime. I would even consider buying more IF it got below $200 at anytime in the future.
Next year will be hugh in terms of importance for Tesla's future.
 

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dannycamps, +100 on your take.

Instead of insuring a prosperous future, the Model 3 ironically might be one of the things that leads to the collapse of the company. The window of opportunity for the M3 to lead the company to prosperity is closing down with all the delays.

Tesla needed the Model 3 to burst out of the gate running forward for it to have a positive impact for the company. In effect, the M3 would have shifted the company away from depending entirely upon high profit margins to depending more upon volume sales to lead to profitability. Its presence was bound to cut into demand for the Models S and X with their substantially higher profit margins. And this is what is happening - the gate opened for the Model 3 and S&X demand dropped.

Tesla probably should have remained a niche manufacturer expanding into market segments where profitability did not depend upon high volumes. They wasted precious time with the poorly conceived and unnecessary gull winged doors of the Model X, pushing back the Model 3's development - and GM jumped in and beat them to the punch with the Bolt EV.

And now, amidst the delays in getting the Model 3 produced, Tesla surprises the world with an exotic sports car as well as debuting a semi truck, both marked for future debuts and both candidates for bringing in cash via reservations in advance of production. These are the sort of niche vehicles that Tesla should have been doing before going down the big volume path with the Model 3.

Looking at Tesla over their short history and where and what they are doing now, I am reminded of another car company created by a rich and successful industrialist with no background in the auto business - Henry J. Kaiser. His company lasted for nearly 10 years in the post WWII period. That was a time when things advanced at a sudden rapid pace in styling and engineering design. Kaiser's cars were among the first post-war modern designs to debut and sold quite well, but they stuck with using flathead engines of old design, and the company quickly fell behind the big manufacturers with their new, overhead valve V-8 engines with ever-increasing size and horsepower.

Towards the end, and in an attempt to draw positive attention to themselves, Kaiser came out with a limited production two-seat roadster with sliding doors - the Kaiser Darrin. Not a lot were made and the company soon bailed out, sending their production equipment and dies down to South America where it lived for several more years.

I really hope the surprise debut of the exotic sports car is not that same harbinger of fate for Tesla.
 

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dannycamps, +100 on your take.

Instead of insuring a prosperous future, the Model 3 ironically might be one of the things that leads to the collapse of the company. The window of opportunity for the M3 to lead the company to prosperity is closing down with all the delays.

Tesla needed the Model 3 to burst out of the gate running forward for it to have a positive impact for the company. In effect, the M3 would have shifted the company away from depending entirely upon high profit margins to depending more upon volume sales to lead to profitability. Its presence was bound to cut into demand for the Models S and X with their substantially higher profit margins. And this is what is happening - the gate opened for the Model 3 and S&X demand dropped.

Tesla probably should have remained a niche manufacturer expanding into market segments where profitability did not depend upon high volumes. They wasted precious time with the poorly conceived and unnecessary gull winged doors of the Model X, pushing back the Model 3's development - and GM jumped in and beat them to the punch with the Bolt EV.

And now, amidst the delays in getting the Model 3 produced, Tesla surprises the world with an exotic sports car as well as debuting a semi truck, both marked for future debuts and both candidates for bringing in cash via reservations in advance of production. These are the sort of niche vehicles that Tesla should have been doing before going down the big volume path with the Model 3.

Looking at Tesla over their short history and where and what they are doing now, I am reminded of another car company created by a rich and successful industrialist with no background in the auto business - Henry J. Kaiser. His company lasted for nearly 10 years in the post WWII period. That was a time when things advanced at a sudden rapid pace in styling and engineering design. Kaiser's cars were among the first post-war modern designs to debut and sold quite well, but they stuck with using flathead engines of old design, and the company quickly fell behind the big manufacturers with their new, overhead valve V-8 engines with ever-increasing size and horsepower.

Towards the end, and in an attempt to draw positive attention to themselves, Kaiser came out with a limited production two-seat roadster with sliding doors - the Kaiser Darrin. Not a lot were made and the company soon bailed out, sending their production equipment and dies down to South America where it lived for several more years.

I really hope the surprise debut of the exotic sports car is not that same harbinger of fate for Tesla.
I was stunned by the introduction of the sports car and the semi. It sure feels like that to me. Remember Webvan?

Elon is so creative and whether he intends to or not, he seems to keep waving shiny objects around. I love SpaceX and The Boring Company. So what?

I should add that I have a friend who placed a deposit for a Tucker and, years later, he still had the Tucker Radio and custom Tucker Luggage.
 

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There's no way he would have unveiled the sports car unless he was worried about the perception of company prospects. I doubt they have anything even close to a prototype of the specs he's quoting, and the promotional materials online are all CGI.

If the Model 3 continues to founder in production well into next year, then the bottom will fall out, no matter what he does to raise more cash. Too much competition is crowding into his market, and all the speculation (i.e. its current market capitalization) is betting on Tesla essentially taking over the automotive world. That is not going to happen, and eventually investors are going to realize that. But for a while, they will continue to play the game hoping to not be the last ones into the pyramid.

BTW, if you watched the Lutz video, could those CNBC anchors be more smug? I just wanted to pull their chairs out from under them. And as a side note, Lutz is really starting to show his age.
 

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There's no way he would have unveiled the sports car unless he was worried about the perception of company prospects. I doubt they have anything even close to a prototype of the specs he's quoting, and the promotional materials online are all CGI.
Umm...

They showed a car on stage, and spent a few hours giving people rides in it including a 0-60 run in less than 2 seconds. Lots of videos of both these things all over YouTube, so I'm confused how you think the whole thing is CGI...
 

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I am one of many small investors that is betting on Tesla's future. The first lot of shares I bought @ 38 and the second lot @ 35.
I can afford to hang on for sometime. I would even consider buying more IF it got below $200 at anytime in the future.
Next year will be hugh in terms of importance for Tesla's future.
Me also. And I'm in no hurry. Warren Buffet teaches the best holding period for a stock is forever. Whether or not any investor or investment group chooses to be a trader and buy and sell by the whims of the market or any other short term goal that is their business. So long as Tesla keeps pushing forward I'm in. Whether I get my M3 in 2018 or 2019 or even 2020 is OK by me.

And Tesla Energy is a cash generator and the money can be used to keep Tesla Motors moving forward. That's what diversity gets you.
 

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Umm...

They showed a car on stage, and spent a few hours giving people rides in it including a 0-60 run in less than 2 seconds. Lots of videos of both these things all over YouTube, so I'm confused how you think the whole thing is CGI...
I didn't say the whole thing is CGI. IMO the car they showed is some kind of rough prototype. I will look for the videos you are talking about.

Edit: I found a video here:
https://www.youtube.com/watch?v=izhYXO9wKz0

OK, it's more than a rough prototype.
 

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Tesla is my favorite non-profit corporation....:rolleyes:
++ Tesla has a large base of buyers and investors that are very happy, and many would be very happy even if their investments aren't super profitable. Sorta like contributing to a good cause ... So Tesla can burn through an enormous amount of cash ...
 

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We should be able to agree that Tesla doesn't have a business model that works and we should be able to agree that as long as Tesla can tap the capital market for free money (aka equity offerings) the fact there is no viable business model doesn't matter. So both sides are right, at least for the moment.

Me also. And I'm in no hurry. Warren Buffet teaches the best holding period for a stock is forever. Whether or not any investor or investment group chooses to be a trader and buy and sell by the whims of the market or any other short term goal that is their business. So long as Tesla keeps pushing forward I'm in.
The quote applies to holding stock in profitable businesses that have sustainable and competitive advantages. Buffet isn't suggesting buying or holding stock in a company which isn't profitable and has no competitive advantages. That's why Warren Buffet isn't buying Tesla stock or lending it any money. If you're buying Tesla stock your adage would be: "The fools are dancing but the bigger fools are watching". Sometimes that works, but the first time I heard this adage was as justification for investing in tech stocks in 2000. ;)

I'll note, however, that Buffet freely concedes his biggest mistake was not investing in Amazon.

Anyway, I've stopped listening to Bob since this:
He's been saying this in one way or another for twenty years. At first it was his observation that if you took the badges off cars all the luxury car manufacturers would go out of business. This morphed into the idea that if you're "renting" a ride then the badges don't matter even if they are on the car. Makes perfect sense to me.
 
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