Tesla's market cap per car sold is 112x higher than Volkswagen (sales data for last year). They never had a profitable year.
Over recent years they built a substantial tech base for EVs that they are on the brink of introducing at scale. The Zwickau plant alone is planned to scale to 330000 EVs/y next year. ICE production at Zwickau is shut down.
This is diametrically opposed to, for example, BMW who seem to be more doubling down on ICE with token efforts towards EVs for now. It's not insane to say that Tesla will eat BMWs share of the future, but that is valued ten times lower.
VW can barley get the basic software for their EV right at the moment. The CEO has admitted the lead Tesla has.
> planned to scale to 330000 EVs/y next year.
They have been missing their claimed targets many times before. Even if they manage that, only a tiny % of current cars sold are electric. Nobody believes Tesla will own 100% of the market.
If VW can actually make good on all those promesses, their stock will also go up.
But having the legacy and investment of massively depreciating ICE assets and not shown the ability to produce profits with EVs, they will need to execute to convince investors again.
What exactly was Tesla first on? They managed decent range but there EVs are simply not that difficult to build compared to ICEs. Software is big but they know they are behind they have the ressources, and the institutional commitment.
It's not that I think Tesla should have the same cats/validation ratio as VW. They are ahead after all. But it's very hard to see the extend of the discrepancy in validation as justified over the long run for me. And it's not like VW is ignoring adjacent markets, Moia is a reasonably successful pilot, etc...
This myth simply does not hold up once you consider how pretty much all manufactures have run into massive problems with EV production and struggle to achieve margin.
If it was so easy as claimed, Tesla would not multiple of the highest selling EV all over the world.
All that ICE infrastructure is massive bound up capital, that gone be a negative in a couple of years.
Tesla's valuation is now three times higher than in April, what exactly is supposed to have happened in the last few months that changed investors minds about the long term future? Had they not turned the car industry on its head in April yet?
Even if that is possible, which I'm not sure it is, the future is uncertain and the stock should have significant discount to reflect that.
For example, Uber isn't that far behind Volkswagen in terms of total valuation. If Tesla ever nails Autopilot, Tesla can immediately become Uber. Volkswagen doesn't have nearly as clear of a path to those extra revenue streams.
Lots of these products and services are nowhere near maturity, but the stock market is the sum of all future revenue streams weighted for probability. There is a potential future in which many of us get our energy from Tesla solar panels, that energy is stored in Tesla battery, we use that to power our autonomous Tesla cars that we either own or call to us with a ridesharing app, all while Tesla owned and operated trucks cross the nation autonomously. I don't think that is a particularly likely outcome, but there is a way for Tesla to get there while there is a near zero chance Volkswagen has a similar future.
They've sold reasonable-sized power infrastructure to utilities in a few different places.
I think you're trying too hard.
Is Tesla overvalued? Very overvalued? Reasonable debate to have given where the market cap is at now.
However Tesla very obviously isn't being valued today based on whether they turned a profit in the past. Companies aren't valued by their profit from five years ago. That they have never had a profitable year, doesn't dictate whether they will in the future. Tesla has grown by nearly 300% in 3.x years. The market is primarily concerned about growth and cash burn rate, limiting excess red ink, not that they must immediately generate immense profit.
Tesla has also shown a drastic improvement in their operating picture. From negative $1.6 billion in operating income in 2017, to negative $252m in 2018, to positive $80m in 2019, to positive $841 million in the last four quarters. Investors tend to pay attention to direction in particular, betting on where the company is going.