Tesla Motors (NASDAQ: TSLA), as you have probably heard of in the media, is a California-based, US company that makes electric cars. The stock has risen about 600% since 2013 and it has received enormous attention in the media. In September last year did the stock peak at $289 and since then have it been on a downward trend in recent months, shares now stands at $192. However, if we look long-term at the stock, we see that there is a rising trend although it has slowed down lately. Hedge funds and major players have left the stock and many day traders have come, this has led to a high volatility in the stock. Tesla's valuation is something controversial, if you look at how many cars they sell, you could argue that the stock is overpriced. Tesla is currently valued at nearly half of example, General Motors (NYSE: GM) that sells a thousand times more cars than Tesla. But Tesla has a very high growth rate, I will talk more about their valuation and figures ahead.
Tesla has been very successful and I think their success will continue into the future.
Tesla has also a great CEO, Elon Musk, which is co-founder of Tesla, PayPal, SpaceX and Solar City (NASDAQ: SCTY). Musk is considered as one of the biggest entrepreneurs in US, and people say that he's the new Henry Ford. The main reason why I invested in Tesla was not because the cars they sells, even though they make great cars. Below will I go through all their business and all of their cars since it's the product that they sell. You will see why Tesla have been so successful, I will in a future post give you a fundamental description of the value I see in Tesla and why I consider the stock is worth buying. Tesla released its first electric car in 2008, The Tesla Roadster, which was a high-performance sports car. The electric car could accelerate from 0 to 60 mph (0-97 km/h) at around 3.7 seconds and had a range over 200 miles (320 km) on one charge. And this year has the owner been able to upgrade their Roadster so that it can travel an incredible 400 miles (640 km) on one charge. The models who started shipping in 2009 cost $109,000, however, Tesla stopped taking order for the Roadster after 2011. Tesla presented the following year the world's first premium electric sedan. The company wanted to demonstrate that electric cars (The Roadster) are as good as regular cars, if not better.
In 2012, did Tesla present the world's first premium electric sedan, Tesla Model S. It was a huge success and Tesla started to get a lot of publicity. The Model S was in 2013 named Motor Trend's 2013 Car of the Year and got a 5-star safety rating from the US National Highway Traffic Safety Administration, the highest rating a car have ever received. The car accelerated 0-60 mph (0-97 km/h) in about 5 seconds, and you could traveling over 265 miles (424 km) on one charge. Today can Model S 85D travel around 270 miles (432 km) and the high-performance car, the Model S P85D, accelerate to 60 mph (97 km/h) in only 3.2 seconds. The price for a Tesla Model S varies from $70,000 to 100,000 besides have several countries subsidies for electric cars. In the US, you get a Federal Tax Credit of $7,500 and several states have also additional incentives of several thousands of dollars.
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Further, will Tesla release their long-awaited SUV this summer, the Model X. The car has been postponed several times, Elon Musk have told that the reason is that they want to ensure the quality of the car. Tesla will not release a car if it's not incredible good, the customer experience is very important for Tesla. Performance-wise will the Model X be able to go from 0 to 60 mph (97km/h) in about 4.4 seconds, it will be the fastest SUV on the market and outperforming many sports cars. When it comes to the driving range is it expected to be in line with the Model S. The starting price of the Model X is expected to be around $75,000 before tax credits.
When I first saw Tesla Model S did it blown my mind, but the most amazing was its interior. They have replaced all the buttons that you usually found in a car with a large 17-inch touchscreen that can be used for just about anything (you can even surf the internet). Another cool thing is that the door handles senses when you come and automatically come out (handles contributes to air resistance that reduces the travel distance). All these details that the company spends time on the show that Tesla stands for quality.
Tesla decided last year that, in collaboration with Panasonic, build a Gigafactory in Nevada (USA), which will produce lithium-ion batteries for their electric cars. The Gigafactory will cost $5 billion to build, Tesla and Panasonic will invest approximately $2 billion each and the rest will industrial partners and the state of Nevada pay. With the help of the factory, is the cost of the batteries gonna decrease by at least 30%. Tesla must decrease the manufacturing cost to be able to sell a mass-market car. In 2020, is the factory expected to supply 500,000 Tesla cars per year. Elon Musk has also said that they will build more factories in the future and that by 2025 will Tesla sell millions of cars each year. Tesla's plan has always been to sell an electric car that the public can afford to buy, but this has been a long development and the production cost of lithium-ion batteries is high.
Something that is much awaited is Tesla's Model 3, which will be presented in 2017. The car will be about 20% smaller than the Model S and cost half as much, $35,000. Recently at the Detroit Auto Show, did General Motors unveiled their new car; The Chevrolet Bolt, which has a price of $30,000 and a range of 200 miles (320 km). The car will go on sale in 2017 and is a clear competitor to the Model 3. Elon Musk, however, welcomes all electric cars to the market and believes that there will be no threat to Tesla. Although it will show up more electric cars on the market in the next few years, does Tesla have an infrastructure that is hard to beat. I refer especially to their Supercharger network which currently consists of 347 stations with 1,902 superchargers and they build more all the time, at a very high rate. The best part is that you can charge your electric car completely free there, this infrastructure will help Tesla to create a strong brand. It's primarily their Supercharger network that I believe creates a high value and potential for the company, something I will talk more about in future posts. Tesla has been very successful and I think their success will continue into the future.
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