Hacker News Reader

Comment by Shivetya | Hacker News Reader

The model X is the bogeyman in Tesla's house. If they fail to start deliveries by September as they have indicated they will likely not make their sales goal for year. The suspect in the X delay is the gull wing doors which like the ragtop they had before, Elon's insistence on particular features again is causing production issues.

View on HN

"Elon's insistence" has also created a $35b company. I think anyone would happily delay a car launch to both improve the car and increase the company's long term value.

Besides, if Elon didn't insist on those doors, I'd be stuck with a fucking car whose doors open like this: https://youtu.be/0oV4IVy8tvE?t=70

Irrational exuberance created a $35B company. There's no way Tesla should be worth 60% of what Ford, GM, or Honda is.

That's not a dig against Tesla, but it's P/E is way off the charts for a car company.

Tesla is more future proof compared to ford gm or Honda, if tomorrow the world decides to run on battery powered cars then form gm and Honda will have a lot to catch up.

>if tomorrow the world decides to run on battery powered cars

There's no indication that will happen in the next 10 years. Certainly not quickly. Any shift away from gas will be gradual and give automakers plenty of time to react.

Did you miss the fact that they are not only a car company any more?

$35B is reasonable if Tesla actually has a good chance of becoming as big as Ford, GM, or Honda. Maybe it doesn't, but a lot of people seem to think it does.

You're comparing a company that sold 11k cars last quarter to one who sold 11k F-150s last week and got raked over the coals for it.

Tesla is a boutique manufacturer. Their stock price is entirely based on dreams of future earnings, just as Amazon's price has been unnaturally elevated for 15 years despite never turning a profit worth writing home about.

You're saying what I said. Stock prices are ultimately an attempt to predict the future. If the price is vastly higher than would be indicated by what the company is doing now, that means people think it will get much, much larger. Whether or not this is sane or insane depends entirely on how realistic that expectation is.

Tesla is most certainly valued correctly, with a P/E ratios similar to that of Amazon, and a valuation just slightly above the likes of Snapchat, Twitter, and LinkedIn. Seems to be a reasonable estimation to me.

A high-risk $500M loan from Uncle Sam (read: You and me, against our knowledge or direct choice) has created a $35B company, in which we the investor have no stake.

Better than blowing another $1 trillion on another pointless Mideast war or a fighter jet that can't fight.

If making a $500 million loan that not only gets paid back but produces a valuable and productive American company is the worst thing my government did today, I'd count us all extremely lucky.

US Govt will collect at least 15% capital gains on that 35B plus 20-40% of the salaries. It's not equity, but it's pretty close.

And local governments get sales tax on each car sold as well.. Figure 7% average sales tax (most cars are sold in CA - 7.5%, NY - 4.5%, MA & TX - 6.25%), and an average price of $80k; 11,500 Model Ss would equate to about $65M into state coffers for Q2 alone. Of course, many are sold overseas so discount that number a bit, but either way, states are probably happy.

That loan was made because the US has significant interests in catalyzing the growth of electric transport, for many reasons. It was not designed to make the country money directly. Tesla is far from alone in receiving such loans from the government. Oil companies receive far more money as direct tax breaks (i.e. never paid back).

I don't understand why this is getting downvoted. The 'loan' the US made was extremely high risk and taxpayers got a terrible ROI for the amount given and the risk taken:

http://www.slate.com/articles/business/moneybox/2013/05/tesl...

Edit: I am a big fan of Tesla, SpaceX, and the feats Elon Musk has accomplished, but I don't think that means one can't be critical of him, his companies, or the way taxpayer money might have been spent to prop them up. It's undeniable that if the US govt had received some equity stake taxpayers could have more equally shared in Tesla's success, and I don't think there would have been anything unreasonable about that.

It's getting downvoted because it's unnecessarily inflammatory, and ignorant of common practices with many other companies, both for companies that are well-established and for companies that bringing forth strategic emerging technologies.

Please describe how it is inflammatory.

Please describe how I implied Tesla was the only company who benefits from government largess.

I think we as taxpayers got a great ROI on it, since new economic activity within the country translates into increased prosperity and increased tax revenue.

Looking purely at interest earned on a government loan misses half the picture since the government gets to essentially double-dip on all the success stories.

Tesla is almost single-handedly dragging the world into the electric car age so I think the loan served its purpose quite magnificently. Oh, and the government got all its money back and then some. The only mistake was allowing the buyback in lieu of equity upside.

That's the difference between loaning money and buying equity in a company.

We should have insisted on owning a stake, given the risky nature of the loan, and the size, at the very least.

Large government loans to big industries are not uncommon. Ford secured a 5.9 billion dollar loan from the government in 2009 (not a bailout, a loan to retool factories).

That's not right either, but at least it's less wrong, as Ford had a far greater chance of repayment.

Government just should not be making loans like this to private entities at all.

That loan will end up enabling billions of dollars of tax revenue for Uncle Sam. Probably the single most successful loan in the history of government loans.

Any tax revenue increase would remain if Uncle Sam had equity as well.

Look at this way: It's your money. Literally. Would you, as a VC, or as a kickstarter-type group, give $500M to a company, with no equity stake, but Elon telling you, "Hey, it's risky I know, but it's a great investment because it will kick off all this other economic activity that will benefit you in the long run, so you don't really need equity; you will reap the benefits indirectly in greater magnitude." Of course not. It's only acceptable because it's a cause many HNers believe in, and the money does not seem "real" since it's abstracted out through tax collection and distribution.

How much of a pay cut would you accept being forced on you to pursue these dreams? Might be the next dream, you don't agree with (like a trillion dollar war).

"Elon's insistence" (or Steve's insistence, for example) on particular features sometimes make great products. In the past he proved many times that he can deliver.

Well, it's called "insistence" when it comes from an average person. But when it comes from a visionary genius like Steve or Elon (or the likes of Larry Page for that matter), it's really something else.

When the outcome is negative, it's insistence. When the outcome is positive, it's rebranded as genius.

Well, there's the "disappearing door" option.[1] Sadly, this never seems to have made it into a production vehicle. It wouldn't work for Tesla's cars anyway; they need that underfloor space for the battery.

[1] https://www.youtube.com/watch?v=loshV54nHeQ

Elon's decision to keep the gull wing doors is awesome though. The concept had them and he believes that a company shouldn't show one concept with cool features, then deliver the actual car without those cool features. All the other auto companies do it and it's incredibly disappointing.

Companies put stuff on concepts knowing they won't make it to production. If his concept had them and they just couldn't make it work out but they legitimately tried, that doesn't seem as bad.

I guess it depends on the idea of the concept car vs show piece of future production. I think some of the concept cars that GM/Ford/Dodge sometimes display are obviously concept cars that will never see the light of day. However, Tesla isn't really at that stage. So when they show a concept, it needs to be closer to reality. Toyota had a concept Rav 4 a few years ago that I really liked and had hoped they would put into production, they never did and it was extremely disappointing.

I guess what I'm saying is, if it's going to be a concept car, make it so outlandish that no one will believe it will be production.

Yes, the Model X is a big question mark for now. I think September may finally be it, because it's getting very close and there's no sign that it's going to slip.

Model X will tell us whether Tesla can pull it off again, or whether the Model S was just a fluke. I think/hope they can, but it's probably fair to say that the company is riding on it at the moment.

Reply on news.ycombinator.com