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Comment by wonder_bread | Hacker News Reader

Listing current financial metrics compared to incumbent automakers kind of misses the point on Tesla. Not that it isn't "overvalued" (might be the most ambiguous word in investing) but Tesla's annualized GM is ~8% better than Fords, they own the refueling network (as opposed to incumbents which outsource it to gas stations), and are poised to control much of the future battery supply. Your Musk marketing comment is spot on in my opinion but at the end of they day these are not analogous companies financially, Tesla's charted a much-bifurcated path to growth and profitability relative to current auto companies.

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> [Tesla] are poised to control much of the future battery supply

"Chinese companies have plans for additional factories with the capacity to pump out more than 120 gigawatt-hours a year by 2021, according to a report published this week by Bloomberg Intelligence... By comparison, when completed in 2018, Tesla Inc.’s Gigafactory will crank out up to 35 gigawatt-hours of battery cells annually.

...

Roughly 55 percent of global lithium-ion battery production is already based in China, compared with 10 percent in the U.S. By 2021, China’s share is forecast to grow to 65 percent, according to Bloomberg New Energy Finance."

https://www.bloomberg.com/news/articles/2017-06-28/china-is-...

Relative to the companies their stock is being compared against I'd say I'm still pretty impressed with their lithium-ion production plans.

It's perhaps worth noting that musk has said:

> I will announce locations for between two and four Gigafactories later this year – probably four.

This puts them in the range of around 175 (35 * 4 new + Nevada) gigawatt-hours annually. They are certainly looking to compete in this space

It's worth noting though that the estimates for the Gigafactory have been massively revised (although no one seems to pay any attention to it) and will now be producing 100+ GWh of batteries yearly and Musk had stated that they're announcing 2-4 more this year.

Further, the Chinese government can say "fuck you" (as they have done with other companies) and make it prohibitively expensive to obtain the raw materials used for battery production.

Incorrect.

China comes number four on the list of lithium producing companies.

Much of the world's lithium reserves seem to come from South America.

http://investingnews.com/daily/resource-investing/energy-inv...

You need other minerals, which are collectively termed "rare earth minerals":

Rare earth element map: In 2013, China produced about 90% of the world's supply of rare earth element ores. The USGS Mineral Commodity Summary [2] reported production tonnages for Australia, the United States, India, Brazil, Russia, Vietnam, and Malaysia. Rare earth element exploration and/or development is being done in Canada, South Africa, Thailand, Malawi, and Sri Lanka; however, production from those countries was insignificant during 2013.

http://geology.com/articles/rare-earth-elements/

Further China has already show willingness to ban export of these materials (for example in 2010). At the end of the day the risk to the production of batteries in particular has motivated vulnerable countries like Japan to develop alternative processes:

http://fortune.com/2016/07/12/honda-rare-earth-battery-hybri...

i am invested in Tesla because i feel like they have the best chance of seizing the bulk of the autonomous car market, out of the publicly traded companies available to me.

I could be totally wrong, but being first will allow them to grab the lions share of the business opportunities, and let them vertically integrate aka Tesla run uber, Fedex etc.. Being second is like being second with PageRank.

Definitely, I feel like it's partially just a question of what a full-stack 21st/22nd century auto company is going to be worth once the dust settles after the autonomous car wars. If it still means producing close to 10 million cars a year while also being a leader in autonomous driving software then we could be talking about a multi-hundred billion dollar company in the making. If, however, the number of cars needed to be manufactured drops precipitously and a number of strong competitors emerge in autonomous transport they may end up relying on their semi-truck and energy network investments a bit more. Only time will tell

Battery production is dominated by Chinese companies and having to maintain a global proprietary charging network is a liability.

> Battery production is dominated by Chinese companies

Tesla has built the largest factory in the world for the sole purpose of producing batteries. Battery production is about to be dominated by Tesla.

China has several times more actual output capacity than what is planned for Tesla's factory.

Yes, the country is going to have more output than one company

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