By on June 23, 2014

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A recent research note from Morgan Stanley dubbed Tesla the “world’s most important auto maker”, on account of its innovation in the area of electric vehicles, autonomous cars and connectivity. Could there be another reason for such enthusiasm?

Observers will remember that earlier this year, Morgan Stanley raised its share price for Tesla to $320 per share, amid talk of Tesla disrupting the energy sector with is new battery-producing gigafactory. One day after that, Tesla announced a $1.6 billion debt offering underwritten by…Morgan Stanley.

In the case of the $320 share price target, analyst Adam Jonas was wildly optimistic about Tesla, even suggesting that the company could help bring about a “utopian society” by 2026. Jonas is also the same analyst labeling Tesla as the most important car maker…in the wuurrlld.

Coincdence? A massive breach of the Chinese Wall? Or a symptom of a press corp that is near-universal in its reluctance to “disrupt” Tesla’s brilliant PR narrative (hip, successful entrepeneur from Silcion Valley looking to topple one of Industrial America’s most sclerotic, antiquated industries)? Likely a combination of all three. Or, tell me why I’m wrong in the comments.

 

 

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71 Comments on “Tesla Is World’s Most Important Auto Maker, Says Tesla Debt Underwriter...”


  • avatar
    anti121hero

    Lol

  • avatar

    The only things that make TESLA important is the rising gas prices and the Global Warming Agenda.

    There is no “importing” of Electricity as it’s a byproduct of fossil fuel and alternative energy production. It is plentiful in America and cheap.

    The Global Warming Agenda makes it appear that TESLA is the most important thing since sliced bread and gives them plenty of breaks and leeway – even though 98% of the world’s population can’t even afford the base trim of a ModelS.

    Hopefully proliferation of the technology will make it cheaper.
    It’s far easier to set up a solar array in a desert and charge electric vehicles than it is to set up an oil industry or economy in the area. If I lived in Arizona or California, the Tesla model S is the car I would have – along with a bunch of solar panels.

    • 0 avatar
      Master Baiter

      You’ll end up spending $125K ($100K for the car and $25K for solar) to save $100/month on gasoline and maybe another $100/month on electricity. That’s about a 30 year payback if you consider that the Model S is equivalent in performance/luxury to a $50K ICE car. Doesn’t seem like a good financial strategy.

      • 0 avatar

        Well Master – the up-front costs of alternative energy are staggering and off-putting, but it’s a long-term investment.

        There are some people who spend over $8000 a year on fuel driving back and forth – few that there are. A Model S might make sense for them…more like an ELR or Volt would make sense for them to save them the time of recharging.

      • 0 avatar
        RedStapler

        The real game changer comes in 10-15 yrs when the Car is $30k and the solar system goes for $15k.

        Heck for most folks most of the time a Volt or plug in Prius would fit the bill today.

        Photovoltaic systems continue to get a bit cheaper and more efficient every year.

  • avatar
    APaGttH

    I wonder how made Credit Default Swaps they’ve bought betting against themselves.

    We’ve learned nothing apparently.

  • avatar
    NOPR

    I’m even more cynical about this, I think Morgan Stanley just wants to unload all their Tesla stock while the company is at its hype peak. Pretty soon the rest of the world will realize they’re nowhere near as valuable as their stock suggests, and I can guarantee Morgan Stanley won’t be left holding the bag.

  • avatar
    johnny ringo

    NOPR: +1

  • avatar
    schmitt trigger

    NOPR: I also give you a +1

    If you have underwritten shares of a company, the LAST thing one will do is badmouth them, because share price then will plummet.

  • avatar
    Pch101

    Tesla is a highly disruptive company, if one defines “disruptive” as the ability to generate hype.

    S&P gave the Tesla convertibles a junk rating, which sounds about right when considering the risk. http://www.zacks.com/stock/news/134977/Tesla-Gets-Junk-Rating-from-SampP

    • 0 avatar
      Dr. Kenneth Noisewater

      Meanwhile, their recent bond issue was boosted by 25% (from $1.6B to $2.0B), for absurdly good terms..

      http://www.efinancialnews.com/digest/2014-02-28/tesla-convertible-bond-issue?ea9c8a2de0ee111045601ab04d673622

      • 0 avatar
        Pch101

        Tesla raised $2.3 billion from the convertible bonds.

        But I’m not sure why would you would believe that borrowing more money is a sign of strength.

        • 0 avatar
          Dr. Kenneth Noisewater

          Easy, because it’s cheap (cheaper than the Treasury) and at the conversion price is hardly dilutive. “Junk” bonds with lower yields than treasuries? The fact that it’s cheaper for Tesla to borrow than it is for the FedGov says something about the strength of Tesla or the weakness of the FedGov.

          http://online.wsj.com/news/articles/SB10001424052702304585004579415371025118570

          “Investors in Tesla’s offering at face value will receive annual interest of 0.25% for the five-year notes or 1.25% for the seven-year notes.

          For both bonds, they also will have the option at any time to get 2.8 shares for every $1,000 of bonds they choose to convert, but only if Tesla’s stock is up more than 42.5% from its last price before the offering, or to about $360.”

          So you get a 5y with 1/5th the yield of a 5y T note, or a 7yr with a bit more than half the yield of a 7y T note, with the promise to convert at a ~42% premium. Bond traders could just arb that spread, but for Tesla it’s a pretty sweet deal that involves much less dilution than an additional equity offering.

          • 0 avatar
            Pch101

            You’re still not getting it.

            1. EVs aren’t disruptive.

            2. Tesla convertible bonds are rated as junk because the company is (a) unprofitable, (b) lacks the scale that automakers need to be profitable and (c) risky.

            Whether or not there are some suckers who are willing to give their money to the company on favorable terms to said company is besides the point.

          • 0 avatar
            Dr. Kenneth Noisewater

            No, _YOU’RE_ not getting it.

            Tesla doesn’t give two shits about the secondary market, except insofar as it determines its cost of money for future offerings. Tesla got $2B of insanely cheap money and the market ate its offerings up and were left begging for more. It was extended 25% from $1.6B to $2B, and they sold it ALL.

            The convertability feature made them more valuable to investors who’ve been starved of convertible inventory, but at a 42% premium? That’s kind of insane. You’d be more liquid and earn more money buying the stock and having it appreciate 42% than you would by earning meager coupons for however long it took to get to the conversion price.

          • 0 avatar
            Vulpine

            1.: False
            2.: (a) False
            2.: (b) True–yet false.
            2.: (c ) Inherently

            On the other hand, some of the most wealthy people in the world wouldn’t be where they were if they didn’t take a chance on something like this. As I’ve stated elsewhere, EVs ARE going mainstream, that alone gives the lie to #1 and #2a.

          • 0 avatar
            Pch101

            A guy who can’t even read a financial statement is trying to claim that Tesla is profitable.

            You just aren’t very smart, and are in no position to comment intelligently about this.

          • 0 avatar
            Vulpine

            Attacking me directly, Pch, only proves how biased you are. If you pay attention to the stock market as is given by the “average” analyst, the only person getting rich is your stockbroker. You’ve got to look far beyond the ‘typical’ to see the logic behind a given product and manufacturer. What was, is not and what is can change the entire paradigm. You simply cannot rely on conservative financials if you want to earn money or make a real difference in world markets.

            What you seem to forget–or maybe you were never aware of it–is that Steve Jobs himself mentored Elon Musk on all four of his past and current projects. Elon Musk made his money on doing what others considered impossible in the same way that Apple made it’s money by doing the seemingly impossible. Steve Jobs took Apple from the brink of bankruptcy to the #1 tech company in the world by IGNORING everything you say is so critical. Elon Musk is headed towards that same lofty status in three different industries at the same time while achieving the capabilities to combine any two of them into a totally new industry.

            Let me ask you this: Who is going to put the first human on Mars, NASA, or Space X? If I were you, I would not bet on NASA to achieve it in anything less than 15 years. Space X plans to achieve it in just over 10. We already know there are over 10,000 volunteers to be the first human to step on the surface of a new planet–even if they never get to return to Earth.

            True capitalism could well be the victor in the next Space Race.

          • 0 avatar
            Vulpine

            Heh. Looks like you’re wrong on both sides of the argument, Pch, financial and practical.

          • 0 avatar
            Pch101

            “Tesla got $2B of insanely cheap money”

            This is the problem with fanboys — they just can’t grasp basic facts that don’t conform to their narrative.

            I am noting that Tesla is quite good at creating hype. This is evidenced by the fact that there is dumb money that is willing to pay ridiculous prices for convertible bonds issued by a company that produces no profits, does not scale and has since been issued a junk rating for said securities.

            A recitation of the specifics only supports my argument, as the prices paid bear no resemblance to the underlying fundamentals. You apparently believe that the dumb money provides validation, which is just foolish.

          • 0 avatar
            Vulpine

            “This is the problem with fanboys — they just can’t grasp basic facts that don’t conform to their narrative.”
            * You realize that argument works both ways, right?

            “I am noting that Tesla is quite good at creating hype.”
            * They seem also quite good at creating cars–cars that do as they’re advertised.

            “A recitation of the specifics only supports my argument, as the prices paid bear no resemblance to the underlying fundamentals.”
            * Really? It seems to me that despite your argument, the prices seem to reflect the changes that Tesla is making even now in the general automotive market.

            “You apparently believe that the dumb money provides validation, which is just foolish.”
            * On the other hand, smart money moves in BEFORE a new product surges–to gain the greatest realization from their investment. As an example, my investment in Apple has now realized a nearly 28x return on my initial investment. That’s 2800% The best we’ve seen from ANY automaker over the last 20 years has been in the range of 20% or so by comparison. Well, except Tesla at 1,000% in just the last 2 years.

    • 0 avatar
      Splorg McGillicuddy

      In this context, I would describe “disruptive” as negatively impacting M5 and other sports sedan sales.

  • avatar
    GoVeg

    I’m trying not to be too harsh, but, while normally an interesting read, it’s sad when something like this passes as “news” or “information” on this otherwise good website.

    First, I believe ALL US brands have debt rated at “junk?” Tesla’s debt is no different (although of much greater quality since the rating agencies look backward, not forward–hence the market cap differential vs. the “old” brands).

    Second, most of the comments above suggest a remarkable amount of ignorance. Let’s begin with climate change considerations resulting from dumping trillions of TONS of GHG’s (Green House Gasses) into the atmosphere and oceans of our only planet. Rather than spend any more keystrokes trying to educate, why not go to the sources, and the reason there’s a supposed “debate” on the science (hint: ExxonMobil made a PROFIT of $123 MILLION every single day in 2012. And that’s just ONE company of the thousands in the fossil extraction business.):

    http://climate.nasa.gov/

    http://www.theguardian.com/environment/climate-consensus-97-per-cent/2013/may/16/climate-change-scienceofclimatechange

    and:

    http://www.skepticalscience.com/global-warming-scientific-consensus.htm

    http://news.yahoo.com/exxons-2012-profit-44-9b-170340809.html

    Lastly, for the many that have been completely consumed by the “debate” story, please read the short review of “Merchants of Doubt.” Many of the same players from the tobacco wars are again fully employed spreading more seeds of doubt on what is established scientific consensus. With billions of cash flow at stake, it’s sad how many people will line up to flat out lie for some of the money:

    http://en.wikipedia.org/wiki/Merchants_of_Doubt

    What I find most surprising is how so many are so gullible and ignorant as to buy into their story: we can dump trillions of tons of GHG (carbon dioxide, among many others) and we can, magically, expect no impact on the climate, atmosphere and oceans of our one and only planet.

    Do you really believe this?

    REALLY?

    In our case, we’re part of the solution, not part of the problem.

    We’ve purchased the most expensive thing we’ve ever purchased (that wasn’t a house) in our Tesla Model S, and have installed SolarCity solar panels (for much less).

    Despite charging up the Tesla every night (it has well over 14k miles in its first year of operation), our electric bill last month was a CREDIT. Other monthly bills are in the 10′s and 20′s.

    To be clear, last month WE PUSHED >50% MORE POWER ONTO THE GRID THAN WE PULLED FROM THE GRID.

    Our PV system cost us $8k, and we’re cash positive in about two to three years from our installation date last year. The next 18 or 17 years are money in our pocket, and we get to drive the highest rated car that Consumer Reports has ever tested (“besting brands that have been building cars for over 100 years”), and also the safest car ever crash tested by the US Government.

    (And that’s an old video–the car is now even better as it’s been updated via the over-the-air updates, and the ever-expanding SuperCharger network.)

    http://www.teslamotors.com/about/press/releases/tesla-model-s-achieves-best-safety-rating-any-car-ever-tested

    And you think it’s hype?

    I’d reconsider your topic choices in the future as it’ll look a lot better if you’re informed about what you’re writing about. Basic research isn’t hard in an era of Google and Yahoo; I’d start there. Actually, no, I’d start with a test drive of a Tesla Model S as you are way, waaaay behind knowing what the heck is going on with this game-changing company.

    Thanks.

    p.s. It’s like having an annuity worth almost a million dollars sitting in the garage, but that’s an angle that most people can’t understand because of financial illiteracy. How about an article on that instead, something that will educate and inform rather than confuse and obfuscate?

    http://www.dallasnews.com/business/columnists/scott-burns/20140510-can-your-car-be-a-life-annuity.ece

    • 0 avatar
      Pch101

      Ford, Nissan, Toyota, Honda, VW, Daimler and BMW Group were all investment grade, last I checked.

      There are sound reasons to rate Tesla as junk. And that junk status necessitates the hype — Elon Musk needs to appeal to the dumb money, since he doesn’t have access to the top tier of the capital markets.

      • 0 avatar
        Vulpine

        “— Elon Musk needs to appeal to the dumb money, since he doesn’t have access to the top tier of the capital markets.”
        On that you’re wrong, though I know how difficult it will be for you to believe it. The simple fact that MS IS backing Tesla points to the fact that top-tier capital markets are buying into it.

        However, the only viable proof you’re likely to accept is when Tesla succeeds despite all your negativity, just the way Apple succeeded despite all the negative publicity they received in the ’90s and later.

        Interestingly, my Apple stock is now 18:1 over when I purchased it.

        • 0 avatar
          Pch101

          “The simple fact that MS IS backing Tesla points to the fact that top-tier capital markets are buying into it.”

          As usual, you don’t know what you’re talking about. Yet you keep talking anyway.

          “Junk” means “not investment grade.” The major institutions can’t invest in Tesla because it isn’t investment grade.

          Morgan Stanley has an analyst who hypes the bonds. If you haven’t figured out the difference between an analyst who flogs a report and the investment choices of a pension fund manager or other top-tier investor, then you’re even more hopeless than I thought.

          • 0 avatar
            Vulpine

            As usual, you think you know everything, yet are too blind to see the truth. Believe what you will Pch; meanwhile, I’ll watch the future embarrass you.

          • 0 avatar
            Pch101

            Instead of blathering on and filling the internet with your nonsense, you could just type “junk bond” into Google, and learn the difference between “junk” and “investment grade.”

            And while you’re at it, learn what analysts at brokerages do, and how they differ from fund managers. Most of it will surely fly above your head, but even you might be able to figure out that the jobs are different.

      • 0 avatar
        GoVeg

        Above I limited the comparison to US-based brands; only one (Ford) that you’ve listed is a US-based brand, and is also the only one that’s investment grade:

        http://www.bloomberg.com/news/2013-09-06/gm-credit-outlook-revised-to-positive-by-s-p-ford-raised.html

        • 0 avatar
          Pch101

          There is more to the auto industry than American corporations. Automaking is a global industry.

          And of the three major US automakers, two of them filed bankruptcy. So you’re apparently thrilled that Tesla has something in common with the two automakers that filed bankruptcy.

          In any case, it seems that some folks don’t understand what a “junk” rating signifies. Tesla is a small company that lacks the scale that automakers needs and that remains unprofitable, so it isn’t surprising that it is junk. It may or may not go the distance, but a stable investment-grade issue it isn’t.

    • 0 avatar
      RogerB34

      Your PV system cost you $8k plus free taxpayer money.
      Your PV system converts at a 15 percent efficiency rate and 21 percent of that is lost getting to the power line. More than 10 years of PV propaganda and efficiency hasn’t changed. Cut direct grants until PV has at least 30 percent conversion rate. By the way the system degrades at 5 percent per year so when you are the owner it will be junk on the roof.
      The problem with Tesla and electric cars is battery technology also stuck 10 years back. It is coming, it is coming like our economic recovery next year.
      Interesting article Westways AAA mag by writer with a Leaf. Purchased so her husband could do a killer LA freeway commute in the HOV lane. She stated reliable range was 65 miles. LA and moderate temps. They had a number of anxiety endings to local trips where all internal power was turned off to just arrive at home. She also stated $18k for a battery replacement and that after two years it would max charge one bar lower than new. The li-ion batteries degrade significantly and $200 per month is the Toyota plan to replace.
      Tesla engineering is space age but the battery remains high risk on an expensive car.
      If CO Armageddon is here then nuclear power is the answer.

      • 0 avatar

        Roger,
        Not sure where the 5% degradation number comes from. You may loose something on Inverters but in my experience with off grid solar systems I’ve seen 15 year old panels still putting out close to 90% of their rated output several times in fact. They may degrade but it’s nowhere near 5% a year. I know of an off grid system in VA that still works well with panels that are 25 years old.

        • 0 avatar
          RogerB34

          The 5 percent was in an article and may not be accurate. Mfg warranty is 25 years and a study shows 20 – 30 years lifetime.
          One inverter at about $2.3k at 15 years and monthly washing in low rain areas. PV will be 15 percent efficiency because higher means much higher cost.

      • 0 avatar
        GoVeg

        Unbelievable amount of gross misinformation here, but let’s just say that comparing a Nissan Leaf with a Tesla Model S is a great place to start.

        The Nissan does NOT have an actively cooled battery; the Tesla does.

        The Teslas Roadsters sold in 2008 have had negligible battery degradation, despite some having more than 200k miles, indicating nearly complete charge/discharge cycles.

        How Toyota, with nearly no presence in the BEV market, enters into a comparison with Tesla is beyond my comprehension.

        All in all, the rantings of the grossly ill-informed adds very little to the conversation so do please stop.

        Thx.

        • 0 avatar
          RogerB34

          The Tesla battery weighs 1,050 to 1,141 lbs, an engineers estimate. Of the weight 322 lbs is the enclosure, coolant and electronics. Likely heavier now as the enclosure was recently strengthened. The Leaf battery is 648 lbs. No info on cooling but likely doesn’t have. The batteries both cars are lithium ion and they have reliability issues. Boeing and the Dreamliner for example.

          • 0 avatar
            Vulpine

            Boeing and the Dreamliner NOT “for example”, as the Tesla and Nissan both have proven that–at least on the ground–the batteries tend to operate as advertised. The Nissan Leaf’s batteries are half the weight due to less than half the physical capability and size and, as was pointed out above, are not actively cooled. Taking something out of context–like the Boeing battery–doesn’t help your argument since it is not relevant to the discussion.

          • 0 avatar
            RogerB34

            @vulpine.
            Battery agony Tesla forum:
            http://www.teslamotors.com/forum/forums/holy-poop-ev-ownership-gone-horribly-wrong-leaf-owner

          • 0 avatar
            Vulpine

            @Roger: It would have been better if you could have found the first-hand article rather than a second-hand piece. To be blunt, we have no idea why the battery failed on that Leaf and I’m almost willing to wager that the local Nissan dealer simply refused to even try to figure it out. I’m far more willing to expect that an issue OUTSIDE of the battery pack is the real culprit of that user’s problem.

            Even so, that’s one… just one… Nissan Leaf with such a serious problem reported and that is in no way related to the Boeing battery fires. In conclusion, the link provided appears to be the exception that proves the ‘rule’ that under normal use, lithium batteries do NOT ” remain (a) high risk on an expensive car.”

            That said, the posting does point out a serious design issue with the Nissan Leaf. I can’t believe anybody would design a car with no means for even a repair shot to replace the batteries.

    • 0 avatar
      Kenmore

      “this game-changing company”

      Nope, not till they offer more color choices than Dismal Dark, Whirlpool White and Rabble Red.

      And silver doesn’t count as it’s really just Greasy Grey left over from the Asian Invasion of the ’80s.

  • avatar
    28-Cars-Later

    Fanboyism strikes Morgan Stanley, film at 11.

  • avatar
    Z71_Silvy

    Tesla is a joke. They are a complete house of cards that builds vehicles less capable than a $12k sub compact…..Abd they charge $90k for them.

  • avatar
    TW5

    Tesla is an interesting phenomenon. As others have pointed out, Morgan Stanley’s involvement seems like your typical pump-and-dump. Hype the stock price to euphoric levels (are we there yet?), and then peddle the overpriced paper to unsuspecting trend chasers.

    The structural economics behind Tesla are more interesting. The two biggest import categories in the US are NAICS 211xxx (crude oil) and 334xxx (consumer electronics). Consumptive imports of these goods comprise over 50% of our trade deficit, and Tesla is tackling them both head-on. The potential revenues for Tesla during the next decade could be measured in hundreds of billions, and the economic benefits to the United States could be measured in the trillions. If Tesla were to monetize 10%-20% of their economic impact, they would be a very wealthy company, and their business endeavors would prove fruitful for the United States, as well. Tesla is vaporware, at the moment, but the potential is real, and it’s understandable that some people would get carried away with superlatives, like most important auto maker in the world.

    Not long ago, a bond stooge at some investment firm opined that Tesla should drop cars and focus on batteries. His remarks reflected his belief that Tesla can more easily monetize battery-providence than oil-avoidance. His opinion was ignorant of branding, imo, but from a structural economics standpoint, his remarks made sense.

  • avatar
    Vulpine

    Battery-electric vehicles are going mainstream, whether we want them to or not, if for no other reason than to save money on refueling. Summer is now here and fuel prices where I live have jumped nearly 50¢ since the winter, putting 89/90 octane gas at very nearly $4.00/gal and diesel almost a full dollar over winter regular-gas prices. Oil companies in the US are doing everything they can to drive people away from diesel-powered vehicles and not trying very hard to drive them away from gasoline-powered vehicles. Oh, sure, they’re blaming it on middle-eastern instability, but that’s not the REAL cause. They’ve just made it an excuse to jack up fuel prices.

    So, BEVs have the advantage of costing from 1/5th to 1/10th the price of gasoline per mile driven with the ability to start every single day with a “full tank”. Tesla and Nissan currently have the only TRUE BEVs on the market now that certain partnerships have dissolved. Others are going the hybrid/EREV/plug-in hybrid route which still requires gasoline to go any farther than their *extremely limited* battery range. This pretty much puts those two brands in the catbird’s seat where it comes to having something already on the market when everybody suddenly decides to downsize for economy that isn’t JUST an economy car.

    But let’s analyze that “1.3 Billion dollar debt” thing. What the article doesn’t state and we don’t necessarily know is whether that is ‘old’ debt or a new loan to pay for the construction and initial production from the battery “gigafactory” which should break ground any time now. Any commentary claiming the debt proves Tesla’s “failure” as a manufacturer is simply blowing smoke. Based on Tesla’s annual reports they make enough profit off of each car sold to maintain current production levels indefinitely. But Tesla isn’t trying to stand in place, they need to keep moving forward, which means those profits are used to increase capacity and design new products as quickly as they can. They have a newer CUV coming out very soon for the ’15 model year that challenges even the most luxurious ICE versions for truly functional features. They’ve already announced their plans to introduce a lower-cost model by ’17 with the potential for a pickup truck by ’20. To do all of this, they need money NOW to build the infrastructure and capacity for mass manufacturing.

    So maybe, just maybe, Morgan Stanley is right about Tesla being the most IMPORTANT brand in the world.

    • 0 avatar

      Gas is well over $5 in Canada and people are still buying pickups. The USA will adapt to it as well.

      • 0 avatar
        Vulpine

        Aye, but the way they do it is to let the gas prices reach a certain peak–where they stop buying the BIG vehicles–then slide back about 50¢ to 75¢ for a while, to a point about 40¢ or so above the previous average and let it sit for another year or two. People start buying the bigger vehicles again and get used to it… then the prices find an excuse to rise again.

      • 0 avatar
        TrailerTrash

        DK
        be truthful. that is not an honest comparison. Other nations do not have similar gas tax as the US. Their taxes, for example, might be higher… but a lot of the tax in these other countries is used for other socialist purposes that are individual fees here.
        Are you suggesting we copy the Canadian system?

    • 0 avatar
      CRConrad

      @Vulpine: “Battery-electric vehicles are going mainstream, whether we want them to or not”

      Gotta admit you’re right there: When even Harley-Davidson are doing it, it’s pretty indisputably gone mainstream.

    • 0 avatar
      RogerB34

      True – mainstream and the drug is Federal “incentives”.

  • avatar
    chuckrs

    Tl;dr.

    The headline was as far as I needed to go.

    OTOH, I bought some Motorola in 1996 and for the hell of it bought one of their suppliers – Qualcomm. Guess which one I still have? I wonder what the consensus view on QCOM was in the mid 90s? Sometimes its a crapshoot.

  • avatar
    akatsuki

    I thought this axe grinding was going to end with the changes at TTAC. Frankly TTAC has had a horrible track record with Tesla and can’t just seem to let it go. Is Tesla the most important car company out there? From an innovation and aggressive strategy context – absolutely.

    They have bypassed the traditional strictures preventing electric cars including setting up their own charging network. They have bypassed the almost universally consumer-hated dealers (who are a big portion of your readership given the massive pandering that goes on here and which, I suspect, is the real reason for these articles). And they are planning to bring out a very affordable electric car that may represent the biggest and most credible effort yet. If you want to bet against Elon Musk, you are taking long odds as this is a guy who has delivered time and time again on very outlandish ideas.

    • 0 avatar
      GiddyHitch

      “I thought this axe grinding was going to end with the changes at TTAC. Frankly TTAC has had a horrible track record with Tesla and can’t just seem to let it go. Is Tesla the most important car company out there? From an innovation and aggressive strategy context – absolutely.”

      Stockholm syndrome.

      Yesterday I was talking to an executive in Germany about cars and he mentioned that if he got a new car, it would be an American car. I was bordering on apoplectic when he clarified that he was referring to Tesla and I responded, “oh, that makes sense.”

  • avatar

    For all of Tesla’s “disruption”, the company is staffed primarily by people who worked for other automakers. They still have an office in the Detroit area with about 2 dozen engineers.

  • avatar
    3Deuce27

    I could tell you Derek, but I doubt you would still get it given your staked out position on the subject, but I will tell you this… It has nothing to do with ‘Tesla versus the OEM’s’.

    As far as the Morgan Stanley hype…hey! Its capitalism in America…No matter what… Sell! Sell! Sell!

  • avatar
    Big Al from Oz

    Telsa isn’t the future without significant government support.

    ICE engine will reign as the predominant source of motive power for at least the next several decades and longer.

    How much lithium is there to mine cheaply and easily.

    Morgan Stanely are taking a gamble. Remember how much cheap and easy money there sloshing around is out there and how much of this cheap and easy money is not invested wisely.

    Yellen will keep that money coming, investment houses are addicted to the stuff. Even the EU is heading down that road with the Japanese.

    The money must be spent.

    • 0 avatar
      Vulpine

      “Telsa isn’t the future without significant government support.”
      Tesla paid off their government loan years early.

      “ICE engine will reign as the predominant source of motive power for at least the next several decades and longer.”
      I give ICE 20 years maximum as the predominant CONSUMER source of motive power. As fuel supplies shrink, military services are going to be hoarding it so they can operate when electric sources get knocked offline.

      “How much lithium is there to mine cheaply and easily.”
      More than you think. One of the largest reservoirs of lithium discovered is still essentially untapped in Bolivia.

      • 0 avatar
        Dr. Kenneth Noisewater

        Or, Nevada:

        http://www.rgj.com/story/news/2014/04/06/tesla-factor-recharging-nevadas-lithium-industry/7354627/

        “Although the bulk of the world’s lithium supply comes from countries such as Chile and Argentina, proponents of a domestic industry say Nevada is no slouch. Western Lithium claims the Humboldt County site’s deposits represent the fifth-largest lithium resource in the world. The Nevada Governor’s Office of Economic Development says the state’s overall lithium portfolio is even bigger.

        “Nevada is lithium rich — second only to the size of deposits found in Chile,” said Steve Hill, executive director of the Governor’s Office of Economic Development.”

        “As fuel supplies shrink, military services are going to be hoarding it so they can operate when electric sources get knocked offline.”

        If things ever get that bad, the military can just Fischer-Tropsch coal.


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