odysseus2000 wrote:With the world economy slowing the demand for all things will fall as shown by last nights Apple revenue warning.
We have the FED raising rates, tariff wars, Brexit shenanigans... lots of uncertainties that have recently appeared in the market.
These changing economic forces will hit all of auto, probably legacy worst of all, as sales across their existing hydrocarbon fleets will fall due to slowing growth and competition with electric vehicles.
Imho Tesla are better placed to weather this storm than are legacy.
Things might blow over, the Fed might reverse its raises, tariff disputes may end, Brexit may be smooth... or they all might get worse.
We have a series of market forces that did not exist in the same way a year ago and this makes forecasts very unreliable.
I'm pleased you are coming round to accepting that forecasts are proving unreliable.
So forecasts that Tesla will be wiping the floor with established European manufacturers in the next three years are looking just that much more stretched.
To achieve significant worldwide sales Tesla will have to show that they can profitably sell and maintain large volumes of cars at significantly less than $35,000 dollars each. And they haven't yet sold a single car at $35k. Is the average price of a model 3 still around $49k?
If China's economy turns down in the near future the potential for premium electric car sales volumes will continue to be relatively small. It's going to be interesting to see if Tesla can simultaneously develop significant sales in Europe and China whilst serving a US home market. The costs per car of distribution worldwide are significant and Tesla haven't yet proved they can make the margin required to cover this.
We know that Tesla has been very successful in selling premium cars in sunny California. It will be interesting to see how the Model 3 performs in the winter months in the Eastern States where the climate is much colder. Their reliability vs ICE cars in colder conditions will be important in influencing the next swathe of potential customers. As someone who has owned a plug-in hybrid for two years I could see how much the electric only range is reduced in cold weather when the heater is on.
From a marketing viewpoint the next three to six months are critical. Tesla and its supporters have set expectations so high that if it is seen to be under-performing for whatever reasons then the market and potential consumers will be re-evaluating the brand.
From an investor's viewpoint, there are a few questions to be answered and "Tesla bulls" will be hoping the company shows that it is increasing its profitability so that future growth can be financed.