Re: Musk endeavours
Posted: April 12th, 2019, 9:44 am
Hi Howard,
I think you are getting too focused on short term moving average and that you are in denial about the troubles that legacy auto is facing and how this helps Tesla.
One can argue that the whole auto sector is in a cyclcal decline as in this Seeking Alpha article and that this will hurt Tesla.
https://seekingalpha.com/article/425402 ... ycle?app=1
But the BEV market is not in decline and is instead receiving tail winds from politicians. if instead of looking at every blip in the curve you move to longer time scales there is clear growth in Tesla sales. Moreover, a new model in a new market often takes months to reach its peak, we are very early in the model 3 in Europe and China. Model 3 leasing as just started which should help the business buyer.
There is now relentless force to make folk go BEV. A neighbour who has a daughter in London, now finds that the area requiring clean vehicles is expanding beyond his daughters house and so he wants something that won’t give him unpleasant charges. There are no Tesla 3 in the UK, so he decided on a Korean BEV and was getting around to leasing it when he found there was a 12 month wait. Currently nothing in the market interests him but he is being forced to do something. This is bullish for all BEV, and bearish for all legacy ice.
Now if we look at BMW accounts we find:
https://annual-report2018.bmwgroup.com/ ... statements
Cash & equivalents balance sheet Euro 10.9b,
Declining profits from Euro 8.7(2017) to 7.2b (2018)
One of the other articles I linked states that to convert a car plant to electric costs about Euro 1.2b. 10.9b of cash won’t last long at that rate of consumption and while this is being done BMW loses sales and we are, if the seeking alpha article is correct, in a cyclical auto decline.
I believe that the dangers of the current market are not to Tesla, but to legacy and BMW looks to me to be in very serious trouble.
Regards,
I think you are getting too focused on short term moving average and that you are in denial about the troubles that legacy auto is facing and how this helps Tesla.
One can argue that the whole auto sector is in a cyclcal decline as in this Seeking Alpha article and that this will hurt Tesla.
https://seekingalpha.com/article/425402 ... ycle?app=1
But the BEV market is not in decline and is instead receiving tail winds from politicians. if instead of looking at every blip in the curve you move to longer time scales there is clear growth in Tesla sales. Moreover, a new model in a new market often takes months to reach its peak, we are very early in the model 3 in Europe and China. Model 3 leasing as just started which should help the business buyer.
There is now relentless force to make folk go BEV. A neighbour who has a daughter in London, now finds that the area requiring clean vehicles is expanding beyond his daughters house and so he wants something that won’t give him unpleasant charges. There are no Tesla 3 in the UK, so he decided on a Korean BEV and was getting around to leasing it when he found there was a 12 month wait. Currently nothing in the market interests him but he is being forced to do something. This is bullish for all BEV, and bearish for all legacy ice.
Now if we look at BMW accounts we find:
https://annual-report2018.bmwgroup.com/ ... statements
Cash & equivalents balance sheet Euro 10.9b,
Declining profits from Euro 8.7(2017) to 7.2b (2018)
One of the other articles I linked states that to convert a car plant to electric costs about Euro 1.2b. 10.9b of cash won’t last long at that rate of consumption and while this is being done BMW loses sales and we are, if the seeking alpha article is correct, in a cyclical auto decline.
I believe that the dangers of the current market are not to Tesla, but to legacy and BMW looks to me to be in very serious trouble.
Regards,