I believe Musk’s actions are harming Tesla’s stock price

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nycfan said:


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“… One of the staggering things the latest Cybertruck recall has revealed—other than Tesla’s use of the wrong glue—is that Elon Musk’s company appears to have sold 46,096 of these 7,000-pound electric pickups since customer deliveries began a little over 14 months ago. This is far fewer sales than Musk predicted for the Cybertruck just weeks before the roll-out—he told investors that Tesla would soon sell 250,000 Cybertrucks per year.

On an earnings call a month before the November 2023 launch of the production vehicle, Musk boasted that Tesla had bagged “over 1 million” Cybertruck reservations and that “demand is off the charts.”

… “Reservationists” initially paid $100 to join the queue, a refundable deposit later raised to $250. Car companies often open wait lists for models expected to outstrip supply, but most auto executives don’t expect that all of those who lodge deposits will follow through.

“The automotive industry aims for a conversion rate of around 2 to 16 percent [on reservations],” Stephanie Valdez Streaty, director of industry insights for car tech firm Cox Automotive, tells WIRED.

By that reckoning, Tesla’s conversion rate is just under 5 percent. That’s at the lower end of the conversion scale, but many experts, used to Tesla’s stratospheric sales, might consider that a flop. Analysts generally don’t treat the world’s richest automaker like a regular car company. Its stock trades at many times earnings, valuing it multiples higher than companies that sell more cars. …”
 
Callatoroy said:
Question for the board lawyers. Are there grounds for suing Musk to either oust him from his role at Tesla or seek financial remedies based on his lack of focus on Tesla? I got out about a year ago so I don’t have any skin in that game but if I was a shareholder I’d be pissed about right now.
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Yes, the remedy is to send him an e-mail asking him to send shareholders approximately 5 bullets about his accomplishments in his capacity as CEO of Tesla for the past week.
 
nycfan said:
“… One of the staggering things the latest Cybertruck recall has revealed—other than Tesla’s use of the wrong glue—is that Elon Musk’s company appears to have sold 46,096 of these 7,000-pound electric pickups since customer deliveries began a little over 14 months ago. This is far fewer sales than Musk predicted for the Cybertruck just weeks before the roll-out—he told investors that Tesla would soon sell 250,000 Cybertrucks per year.

On an earnings call a month before the November 2023 launch of the production vehicle, Musk boasted that Tesla had bagged “over 1 million” Cybertruck reservations and that “demand is off the charts.”

… “Reservationists” initially paid $100 to join the queue, a refundable deposit later raised to $250. Car companies often open wait lists for models expected to outstrip supply, but most auto executives don’t expect that all of those who lodge deposits will follow through.

“The automotive industry aims for a conversion rate of around 2 to 16 percent [on reservations],” Stephanie Valdez Streaty, director of industry insights for car tech firm Cox Automotive, tells WIRED.

By that reckoning, Tesla’s conversion rate is just under 5 percent. That’s at the lower end of the conversion scale, but many experts, used to Tesla’s stratospheric sales, might consider that a flop. Analysts generally don’t treat the world’s richest automaker like a regular car company. Its stock trades at many times earnings, valuing it multiples higher than companies that sell more cars. …”
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“… the Texas Gigafactory, where the Cybertruck is made, currently has the capacity to build more than 125,000 of the pickups per year. But, according to a Business Insider report from January, poor Cybertruck sales led to workers being taken off the “Cyber” production line and moved to a Model Y line.

Tesla’s current elevated worth is based not on its actual sales, but on predicted sales of yet-to-be-launched robotaxis and humanoid Optimus robots, which—like the Cybertruck, slated to arrive three years before it went into production—could be several years away from being mass produced.

… Grandiose predictions excite Tesla bulls who believe him when Musk says, “I know more about manufacturing than anyone currently alive on Earth,” but back in the real world Musk is in charge of a car manufacturing company that can’t even spec the correct grade of panel glue.

… Now on its eighth recall in the past 14 months—prior recalls involved failing windshield wipers, trapped accelerator pedals, and possible loss of power to the wheels—Musk’s polarizing polygonic pickups are in sales freefall. Month-over-month Cybertruck sales were down by 32.5 percent in February, according to estimates by Cox Automotive.

… Forbes spoke with experts who estimate thatTesla sunk at least $2 billion into the development of the Cybertruck. A traditional car might need 200,000 units per year to cover the research and development costs, Olav Sorenson, professor of strategy and sociology at UCLA and faculty director of its Price Center for Entrepreneurship & Innovation has estimated.

… Tesla is now offering low financing rates to move Cybertrucks. Indeed, it has reportedly buffed out the badges on Foundation Series vehicles that failed to find a buyer so they can be sold as regular models. To clear yet more Foundation Series Cybertrucks from inventory, Tesla dealerships have also listed perks such as free lifetime Supercharging. The electric pickups are even piling up on used-car lots. …”
 
This is my brother’s Tesla after hitting a small flat bed trailer being used for light yard work and going about 10mph..

IMG_4370.jpegIMG_4371.jpeg
 
p5mmr9 said:
Bleak? I think that's overstated - and I do think you are overstating the revolt on the Left. We'll see how it plays out. The legacy manufacturers in the USA are behind Tesla in both tech and reach and most of the start ups have floundered. The tariff situation will significantly impact the auto sector as well - leaning heavily into these legacy manufacturers. I think Tesla agrees that the "car business is not that viable" - which is why it views itself as more of a tech company that sells cars, batteries, and other future tech. The autonomous robot market - as ridiculous as it sounds - could be era defining and Tesla is at the front of this industry.

No doubt, Musk is a real problem though. He seems to have become disinterested in the business and clearly his own personal brand has tarnished Tesla. Again, I don't condone his actions, but there seems to be a lot more hoping for schadenfreude regarding Tesla due to its association with Musk than actual reality regarding the company itself.
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I know of one stock in your portfolio, LOL.

My son is studying robotics at U of M. He said Tesla's robotics ambitions are a running joke in the department. I don't think many people knowledgeable in the field would consider Tesla "at the front" of the industry. All I've seen or heard are people mocking the Optimus.

It's not that sales aren't growing into the absurd P/E. It's that sales are **falling** everywhere, even with discounts, perks, etc. It could be falling by a lot. That's bleak, given that there are no new products in the pipeline that might entice buyers.

This is the problem with not having a CEO. There's no vision, except Cybertruck -- one of the biggest boondoggles in automotive history. When was the last time Tesla had a successful design? Wasn't it several years ago now/
 
Tesla is in a bit of a pickle, the company reached it's lofty value because of public perception of Musk. Now Musk is ruining the brand, how do you divest from Musk without tanking your stock?

My guess is they try to ride it out until they can't. Maybe they'll get MAGA's to buy a significant amount of EV's? If so, we are probably weeks away from Cybertruck nuts being a common scene.
 
p5mmr9 said:
Bleak? I think that's overstated - and I do think you are overstating the revolt on the Left. We'll see how it plays out. The legacy manufacturers in the USA are behind Tesla in both tech and reach and most of the start ups have floundered. The tariff situation will significantly impact the auto sector as well - leaning heavily into these legacy manufacturers. I think Tesla agrees that the "car business is not that viable" - which is why it views itself as more of a tech company that sells cars, batteries, and other future tech. The autonomous robot market - as ridiculous as it sounds - could be era defining and Tesla is at the front of this industry.

No doubt, Musk is a real problem though. He seems to have become disinterested in the business and clearly his own personal brand has tarnished Tesla. Again, I don't condone his actions, but there seems to be a lot more hoping for schadenfreude regarding Tesla due to its association with Musk than actual reality regarding the company itself.
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I think you seriously underestimate the revolt on the left. My circle of people isn't terribly left leaning and I don't know anyone who would remotely consider a Tesla product. I've also seen many who are becoming anti Starlink.
 
CHAMTRAIN said:
Tesla is in a bit of a pickle, the company reached it's lofty value because of public perception of Musk. Now Musk is ruining the brand, how do you divest from Musk without tanking your stock?

My guess is they try to ride it out until they can't. Maybe they'll get MAGA's to buy a significant amount of EV's? If so, we are probably weeks away from Cybertruck nuts being a common scene.
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MAGAts aren’t buying Cybertrucks.
 
hedge said:
This is my brother’s Tesla after hitting a small flat bed trailer being used for light yard work and going about 10mph..

IMG_4370.jpegIMG_4371.jpeg
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Wow. That sucks. Weird looking damage like the car is made out of the extra thick aluminum foil for grilling.
 
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