By on January 16, 2015

Elon Musk

Tesla shareholders felt lighter Wednesday after the automaker’s stock price fell from just over $200/share to $186.09/share after CEO Elon Musk’s announcement at the 2015 Automotive News World Congress in Detroit — held during the 2015 Detroit Auto Show — that his company wouldn’t be profitable until the start of the 2020s.

Business Insider adds that another bombshell dropped at the start of his presentation likely helped to take the wind out of the sails: sales of the automaker’s Model S in China were down in Q4 2014. Musk put the blame on perception among Chinese consumers regarding the charging infrastructure for Tesla’s sole model, explaining that not only had the issue been handled, but that the Supercharger network was expanding; the rate of said expansion, however, is slower than that of Europe or the United States.

Further into the presentation, Musk proclaimed that Tesla would sell “a few million” vehicles by 2025 by going for volume over being a niche luxury player, likely built on the back of the upcoming Model 3. Meanwhile, the Model X due sometime this year is already sold out for the entire year despite the company’s best efforts to manage demand, such as steering would-be X owners into the driver’s seat of the S.

Finally, Musk urged the majors in the audience to continue their investments into electrification, stating that they all need to do more to change the public’s perceptions on EVs and hybrids.

Since the plunge, Tesla shares have recovered some of their lost value, closing $191.87/share Thursday afternoon.

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27 Comments on “Tesla Share Price Plummets After Musk’s NAIAS 2015 Visit...”


  • avatar

    Useless. More puffery. 2020 is an overly-ambitious/optimistic goal for Tesla to become profitable according to GENERALLY ACCEPTED ACCOUNTING PRINCIPLES (and they have NEVER made an honest profit yet, even with sales of Carbon Credits).

    I look for them to have severe problems delivering the promised and/or paid-for orders of Model X vehicles inside of this calendar year, let alone any 200-mi compact obsolete “Model 3” to come.

    By the time Tesla is able to deliver a production Model 3, the BOLT (perhaps under a different name) will be releasing its’ SECOND generation with expanded range and THE LEAF will be close to debuting its’ third generation and probably 300+ mile range.

    • 0 avatar
      GranMarkeez

      Cmon Cameron. Quit the hyperbole.
      A 10 percent cut in the price of Tesla stock hardly constitutes “plummeting”.
      Don’t make a bigger deal out of this than what it is.

    • 0 avatar
      healthy skeptic

      >> By the time Tesla is able to deliver a production Model 3, the BOLT (perhaps under a different name) will be releasing its’ SECOND generation with expanded range and THE LEAF will be close to debuting its’ third generation and probably 300+ mile range.

      Why do people buy an M3, when a Honda Civic will get you from Point A to Point B just as well? I think you’re simplifying things a bit much.

  • avatar

    Lower fuel prices won’t help either. Plus Toyota launched its Tesla-like approach to promote hydrogen propulsion by making patents available for free.

  • avatar
    hreardon

    One of two things is likely to happen to Tesla:

    1. They’re bought out
    2. They’re out-spent and out-distributed by someone who catches up (Money is on BMW or Audi)

    I’m a fan of their product and I give Elon credit for the big brass ones he’s got, but I don’t see them as a standalone company for the long term.

  • avatar
    an innocent man

    So Tesla profits are like fusion reactors, always just around the corner?

  • avatar
    nickoo

    Ugh, I want to reload my tsla short so bad. Just gotta be patient and wait for it to run back up. Sell high, buy low.

  • avatar
    Vulpine

    Yup. Share prices plummeted because shareholders chose to misunderstand his statements. On the other hand, this opens the door for people to buy Tesla stock at a discount and make money before the next “balancing”.

    • 0 avatar

      And now Musk threatens to punish dealers who opposed him by not granting them a franchise? WTF?!?

      • 0 avatar
        Vulpine

        What’s so puzzling about that? We all knew–or should have known–that he would eventually have to go the franchised dealer route, but it simply hasn’t been economically viable to do so until he has enough production capacity to provide inventory for every franchisee. Those dealers who directly opposed him honestly shouldn’t be rewarded by even having the opportunity to buy into the Tesla ecosystem. I’m sure there were a lot of others who tried to say, “wait and see” instead of fighting him tooth and nail.

  • avatar
    korvetkeith

    I’ll give him credit. He’s built a premium faster than one of his cars takes to fully charge.

    GM or Ford would likely pay up to $1 billion for a brand that already has more cachet than Lincoln or Cadillac. Although fords ill times departure from land rover suggests they could still muck it up.

  • avatar
    Felix Hoenikker

    Tesla stock. Mmmm – It’s bubblicious.

  • avatar
    APaGttH

    If the mainstream Model 3 comes out during a period of low gasoline prices, the justification math (look at the money you’ll save) gets tough to present.

    Selling to mainstream customers isn’t just about chargers, brand aspiration, and look at the money you’ll, *ehem” save by spending $35,000, but it’s about a dealer and service network.

    There is a lot of logistics and business needs to go mainstream over niche boutique brand, and I think people are under estimating these challenges.

    The way you treat a relatively small number of luxury customers simply won’t scale in a mainstream operation. If they did scale and didn’t hurt profitability, ever dealer service department would operate like Lexus, BMW, Porsche, etc. etc. etc.

    • 0 avatar
      Vulpine

      You’re making the assumption that Tesla will never go the Licensed Dealer route; he’s never said that. He’s only said that going that route is not economical for Tesla as a brand YET.

    • 0 avatar
      SCE to AUX

      My Leaf saved me $100/month compared to my 30 mpg xB1, back when gas prices were $3.80. My MPGe is about 120, I think.

      The Tesla’s MPGe is about 86. Gas would have to drop to about $0.60/gallon to break even with an ICE car at 30 mpg.

      But buying an EV isn’t always about saving gas or saving the planet – the driving & ownership experience and simplicity of the vehicle can’t be beat. You are correct – spending $35k to save on gas money doesn’t make sense if that’s all there is to it.

      Tesla won’t have to provide calculators (Nissan doesn’t). People understand ‘no gas’, which is a nice convenience. It’s also nice to never worry about oil changes, transmission fluid, belts, starter motors, exhaust pipes, catalytic converters, engine sensors, fuel systems, engine rattles, fumes, or hot radiators.

      http://nissan-leaf.net/wp-content/uploads/2011/08/686974-600×329.png

      • 0 avatar
        mcs

        To add to what you’ve said, for me it still amazes me when like today, I hit a nice smooth section of pavement and I’m gliding along vibration free and silent. Perfect if you like listening to music. Conversations can be held in a softer voice. Sometimes it’s cool just to listen to the silence. It’s amazing these things aren’t the standard for luxury vehicles.

        Recently I had co-workers complaining about standing outside freezing pumping gas during the recent polar cold snap. My Leaf was full of power and toasty warm after pre-heating inside my garage. No range anxiety because on most of my routes you can’t swing a dead duracell without hitting a level 2 charger. At the furthest point of my longest commute, I have a choice of 2 fast DC chargers almost across the street from each other, although I usually end up with a level 2 charge at my destination. That commute is 50 miles one way and the car easily made it non-stop in -2 weather.

        As for cost, I haven’t figured out the latest numbers, but I’m in the process of getting solar, so that should reduce the cost of running the car (and my house along with the heat pump) down to some fairly low levels. But, it really is the experience of driving an electric and being able to devote 99% of my vehicle maintenance time to simple to work on vintage fun cars that would never survive a daily commute. Saving money on gas definitely isn’t my highest priority.

        • 0 avatar
          SCE to AUX

          @mcs:
          Is your Leaf a 14 with the heat pump and new lizard battery? Mine is the 12 with resistance heat and old battery.

          Now in its 3rd winter, my actual range is down to about 36 miles @ 100%, or 30 miles @ 80% fill. The gas gauge is never accurate. The Pittsburgh area has very few L2 chargers and only 2 L3 chargers. No 50 mile journeys for me. Spring and summer will be better, but at this point I can basically drive to the next community and back – that’s it.

  • avatar
    Ron B.

    The price has been bought down by day traders shorting his stock,probably the same day traders who sit on the PC all day buying and selling in nanoseconds to suit their whims or what ever some daytime TV financial guru tells them. Hence the slight dead cat bounce later in the day. For my money,Tesla is just another Columbia Electric . A toy for the rich and fatuous and eventually they will go the way of all such toys…into museums to be gawked at.

  • avatar

    NEVER EXPLAIN…NEVER COMPLAIN.

    Did Elon learn NOTHING from Jim Cramer?

    THEY KNOW NOTHING!

  • avatar
    jdash1972

    Elon, you lying sack of s…..

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