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Comment by taylodl | Hacker News Reader

I would argue this is Tesla's real business - battery production. I don't believe they intend to stay in the auto market forever. They're in the market to create demand for quality electric cars, goad the traditional auto makers into making them, and then selling those traditional auto makers the batteries they need to make them work well. I believe that is Tesla's long-term business plan.

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Batteries are a commodity, so I doubt Tesla would want to reduce themselves to an OEM and shrink their margins. Their energy business might eventually be bigger than their automotive one, but either way I think they will continue selling vertically integrated products.

Cars are a commodity, the real money is in providing the finance for them.

Are batteries a commodity or are we just assuming that?

batteries are absolutely not a commodity at this time. every other manufacturer is held back by not enough battery capacity. Even the biggest companies are held back.

Yeah, until batteries are traded the same way actual commodities are they are not commodities. A good way to tell whether something is a commodity or not is whether there are strong brands in the space. I can’t go onto a major exchange and speculatively trade lithium battery cells.

Batteries with 20% more watt hours for the weight than the rest of the market are certainly not a commodity.

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