It is a never-ending saga – will Tesla enterprise survive or not. Two topics of conversations (both starting with the letter “T”) lead to broken families, lost friends or clients: President Trump and Tesla. We will not be commenting on the first topic but would like to add two cents to the second.
Here are the main arguments why we believe in Tesla survivability:
Tesla Model 3 is a beautiful great car;
Elon Musk told us yesterday that Model 3 had (or soon would) be profitable;
Mr. Musk has apologized for his comments during the last conference call (he blamed his rudeness for insufficient sleep – but with all his ventures, it is understandable) – let’s forgive him; at least it means that somebody at his Board of Directors is sober and he listened to the advice – and this is unusual for him!
Production numbers continue to increase, and anecdotal evidence support the strong demand for Model 3;
I have not seen many electric cars of the same esthetical beauty and quality on the roads yet. Have you?
Should we give him (and the company) another chance?
To answer this question, investors need to change their traditional Graham’s mentality in evaluating companies. After all, nobody believed in Apple in 1980 when it went public – and it is about $1 trillion in capitalization first time in the history of publicly traded companies.