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Comment by petesergeant | Hacker News Reader

> Tesla’s EV business is in decline and the stock price depends entirely on the self-driving and robot promises

I don't think that's right; I think the stock price entirely depends on people seeing it a vehicle to invest in Musk. If Musk died tomorrow, but nothing else changed at Tesla, the stock price would crater.

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If it were only that TSLA is a way for retail investors to buy shares of ELON, Tesla wouldn't need to do a Robo taxi rollout in Austin to bolster claims that FSD is for real.

Elon can't levitate TSLA and other valuations by himself. There has to be at least the appearance of substance. That appearance is wearing thin. While I'm going to observe the caution that the market can stay irrational longer than I can stay solvent, once reality assert itself, Elon will be powerless to recreate the illusion.

The world’s best selling vehicle means nothing? Extremely safe vehicles mean nothing?

I get that it’s way over hyped, but they have real results that can’t be denied

That would justify a valuation in the same range as other car companies. Not the valuation Tesla has right now.

The best selling model counts for something, but even with that Tesla just isn't a big car company when compared to the other major car companies.

They have the best selling vehicle by a little under 1%, with the Tesla Model Y just edging out the Toyota Corolla. But Toyota also has the 3rd best selling model (RAV4) that is about 7% behind the Model Y. And they have a third model in the top 10, the Camry, at a little over half the Model Y sales.

Just those 3 Toyota models combined sell about 30% more than all Tesla models combined.

Across all models Toyota sells 6 times as many cars as Tesla.

By number of cars sold per year Tesla is the 15th biggest car maker. The list is Toyota, Volkswagen, Hyundai-Kia, GM, Stellantis, Ford, BYD, Honda, Nissan, Suzuki, BMW, Mercedes-Benz, Renault, Geely, and then Tesla.

If we go by revenue from sales rather than units sold it is 12th. The list is: Toyota, Volkswagen, Hyundai-Kia, Stallantis, GM, Ford, Mercedes-Benz, BMW, Honda, BYD, SAIC Motor, and then Tesla.

Yet Tesla has something like 6 times the market cap of Toyota and around 30 times the market caps of VW and Honda. That's pretty much all hype.

So a thing has to be among the “world’s biggest” to be of note?

Of course not.

They don’t make as many vehicles or have the revenue of other auto manufacturers, but who cares.

What they do, they do very, very well. They lead to mass market EV adoption. Even if they crumble tomorrow their contribution is immense. Who cares about market cap, it’s all just gambling.

I actually think the stock price would go up. His detour to fascism and megalomania has chased off tons of liberal environmentalists like myself that are the target audience for electric cars. I cancelled what would have been our replacement Tesla when he was implying on Twitter there can be good reasons for sneaking into the speaker of the house’s house and hitting her husband in the head with a hammer.

Nah Morgan Stanley and Wedbush would know the gig is up, the fraud would no longer be maintainable without Elon.

Yup. The effect of the reality distortion field has weakened, but remains plenty strong enough for now.

The reality distortion field is at ATH. Tesla stock is nearing its high, which it had when it was growing quickly and very profitable. Now they are shrinking sales and margins and the stock is soaring again

Eh, stock price is based on the hope that the reality distortion field will strengthen again and sales/margins will shoot up.

I guess it really does depend on which reality distortion field we’re talking about haha.

The issue is that if you look at Tesla as a normal car company (without an iconoclast CEO/personality), then you need to do normal P/E math, which is going to be sub-100 for sure.

Right now it’s easily double to triple that, even with Musks behavior.

Normal P/E math for a car company would put it in more like the 10-20 region - we’re not talking it being double to triple a sensible valuation but seriously something like 15 times…

He definitely has the shareholders by the balls. No doubt about it.

It may do this or that on the announcement, but if growth stops (arguably already has) and there is no hype for years, it's likely going to grind down to a normal valuation with time.

The passive investing / market cap weighted ETF complex tends to help big valuations stay big, but a company like Tesla still needs that sharp shot in the arm followed by frenzied buying occasionally in order to stay aloft (be it by traders, retail participants, shorts covering, etc).

I suppose they could replace Musk with another hype salesman, but the "hate" that Tesla gets is a big part of these upside shock cycles for the stock, because the ticker is a siren call for short sellers, who are ultimately guaranteed future buyers.

A thorough analysis of the materials/energy reality we inhabit could lead one to make a similar decision for environmental reasons alone

I think firing Musk would do wonders for Tesla as going concern but would be a disaster for the stock price.

I suspect a significant proportion of Tesla's stock price comes from people who are using it as a proxy for his other companies that the public can't invest in, primarily xAI (as all AI companies are in a horrific bubble right now) and SpaceX.

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