I kinda wonder what will happen to TSLA if Musk were to just _walk away_. Which, to be clear, he can. And whether that'd be a net positive to "Tesla's largest retail shareholder".
Tesla the company would be fine, and I presume a giant merger would occur in the future.
https://www.cnbc.com/2024/02/29/tesla-to-earn-billions-from-...
They are hitting over $1B a quarter in solar battery revenue, a business growing faster than their EV division
https://www.bloomberg.com/news/articles/2024-01-24/tesla-s-b...
EVs sales is still the lion's share of revenue, but any of these divisions could be a stand-alone business. (maybe not the solar panels, which hasn't done well at all)
"By 2030" is a long time away for a company that was close to bankruptcy about 6 years ago - anything can happen. Full-self driving is also 5 years away if you believe Musk - it's been 5 years away for the last 10 years, though. The first article you cited is basically quoting Tesla marketing material.
Here's the objective picture today (as of end of 2023): TSLA has $74.2 billion in revenue from being a car company. TLSA has $4.8 billion in revenue from energy production and storage. Gross profit is the same story for the two segments - $16 billion and $1 billion respectively. Margins are not dramatically different.
Tesla is a car company.
https://www.sec.gov/Archives/edgar/data/1318605/000162828024...
The “5 years for 10 years” meme seems to be confusing a lack of accuracy when giving a precise answer to a difficult to estimate task for either foolishness or fraud, or perhaps both. To me it reads like every software and research estimate I’ve ever seen - a sliding estimate on something you know will deliver but hard to pin down exactly all the unknowables are worked out.
To be fair to you, it was actually "next year" for about 5 of the 10 years that Tesla was promising self-driving, which is a different story (likely actually fraud).
Even after the recent plunge (it's only a beginning) it's valued at $460B.
$6-12B of best case projected revenue, with low margins, by 2030 is meaningless for a company with this kind of valuation, to say it politely.
Tesla valuation was justified by a myriad of promises from Musk, and analysts that started to believe that sales of EVs will grow by 50% each year for the next 10 years.
I expect this to be ephemeral due to geopolitics and the local politics. Chinese domestic consumption is lackluster compared to their production and they are “product dumping” on the rest of the world that have domestic manufacturing and varying levels of preexisting market protectionism. That and China’s belligerent geopolitical alliance increasingly clashing with the West and in their regions means that stiff(er) tariffs are imminent.
The demand reduction is also a problem for Tesla.
But one thing Chinese EV companies have is existing products in the lowest market segments. Tesla is giving up on a car cheaper than the 3 and I don't think that's a particularly unique Musk decision. American public companies are allergic to low margin products.
They will be “persuaded” with sanctions. Europe is not really a sovereign entity.
EU defense and government contractors might not have a lot of agency, but plenty of other businesses do depending on the country.
Market protectionism is sufficient to provide pushback on Chinese product dumping in Europe in the medium term. However, as the global order deteriorates and countries have to pick sides most of the EU is unlikely to choose to align with a Russian ally.
Opening a factory is a different matter. If the factory contains significant capital (ie isn’t just glorified assembly) then much of the manufacturing capacity is domestic as is the labor which is a method of avoiding tariffs that host countries tend to favor. The calculus is different at that point and could only affect the imported parts or raw materials if applicable. In a pinch such manufacturing can be nationalized and repurposed.
Countries without domestic production are also not major consumer markets, and when aggregated into major trading blocks like the EU their most influential member states do have domestic production and a strong protectionist bent so I expect they’ll also be strong armed into a protectionist umbrella. It also makes sense for Europe as a whole to not have its domestic production product dumped into oblivion as globalization crumbles.
Australia is more than nothing, but a country with 26 million people and about 1.2 million new car sales annually isn’t tipping the scales of the global market too much. They’re also geopolitically aligned with the USA so the medium to long term outlook is negative for China trade relations.
> SEA has money to buy things even if they don’t make many cars outside of maybe Thailand
Every region has money to buy things and their business isn’t worthless, but SEA isn’t a big consumer market yet and isn’t going to be making up for the loss of/reductions in the big consumer markets. There’s only so many sales that the region can absorb even if we don’t factor in the fact that the region is adjacent to and frequently the target of Chinese military belligerence recently and for centuries. There is increasing regional geopolitical alignment with the USA albeit at arms length.
1. Musk has destroyed the brand for many of their potential customers (who tend to be "liberal")
2. He no longer will force the company to pursue foolish distractions like the CyberTruck.Merge with Toyota, sort out reparability issues, slap ten year warranty on cars and put up prices 15%. Dominate the profitable middle of the market as production costs fall and mint money while everyone else is left scrabbling at the bottom of the market.
I think the other question is how likely he would be to walk away. I think at $0, Musk would likely stick it out at Tesla, since so much of his net worth, ego, identity, and brand is locked up in there. In other words, this seems like a bluff.
It could actually be good for Tesla to be freed from his whimsical decrees (a friend of mine works there and his mercurial nature gives the company whiplash) and it could be good for him to think he has to start something new. He seems to think he can do a lot of good ai work. Maybe he can.
If history is any indicator, he seems strongest at mid-stage companies. He didn't start Tesla. He isn't doing well there right now (or Twitter, for that matter). He's too erratic for a mature company.
But he did an awesome job taking Tesla from the $M to the $B stage.
Any company at that stage would also benefit from the visibility he brings. For smaller players, any press is good press.
So, no, he’s not really walking away.
But, even if he does, depending on who they get, it might be a net positive for Tesla in the long run.
He better be driving that cyber truck with 3000 dollars cyber tent professionally installed at full speed while leaving the company.