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I would propose viewing Tesla as an energy storage company, not a car company (JB and Elon both think of Tesla this way). The car is a battery on wheels, and t

I would propose viewing Tesla as an energy storage company, not a car company (JB and Elon both think of Tesla this way). The car is a battery on wheels, and the battery is the product. They're not trying to be the next BMW, and attempts to value them through this lense will miss the mark.

tbabb 10y ago
> I would propose viewing Tesla as an energy storage company Yeah, I'd say it would not be unfair to compare future Tesla to a company like GE ($270B mkt cap). Optimistic, but not irrational.
- semi-extrinsic 10y ago
  I beg to differ - GE is not an energy company, it's a multinational conglomorate heavily involved also in a dozen other fields like oil&gas, aviation, healthcare, home appliances, finance, research and transportation. GE Healthcare alone employs >40 000 people and does >4x the revenue of Tesla today. Maybe if Tesla merged with SpaceX and also with five-six other large companies you'd be about right.
  - tbabb 10y ago
    > GE is not an energy company Fair enough (though I'd think the oil & gas you mention would count), but look at any energy company today and you'll see similar numbers. Another poster in this thread compares to Exxon; similarly favorable. You may not think Tesla will make it there, and you might turn out to be right. But those that do are optimistic; not stupid.
    - kgwgk 10y ago
      Why stop at Exxon? You can also compare Tesla with Saudi Aramco and that would justify a multi-trillion valuation!
Gibbon1 10y ago
When I worked at Intel there were some comments along the lines of 'Intel is a Fab House that designs Microprocessors on the side' One can apply that to Tesla as a battery manufacturer that also builds cars. Strength I see for Tesla is unlike the other car companies they don't have capital tied up in the legacy car business. Granted legacy is 97% of the market right now, but it won't be in ten years.
erikpukinskis 10y ago
Musk has also started talking like the product is factory, not the car or the energy storage.
usrusr 10y ago
How high is their current valuation relative to other energy storage companies? (Honestly, I don't know)
- patrickk 10y ago
  Another way to look at it: how big is the global market for gas peaker plants? If current trends continue, solar PV + batteries will be cheaper at some point than any fossil fuel[1], so at that point Telsa energy will begin to consume large chunks of that market. According to this link[2] gas peaker plans were 50% of energy installs in 2013, the best link I could find from a quick search. [1] Interesting talk on this topic: https://www.youtube.com/watch?v=Kxryv2XrnqM https://www.youtube.com/watch?v=Kxryv2XrnqM [2] http://www.eia.gov/todayinenergy/detail.php?id=15751 http://www.eia.gov/todayinenergy/detail.php?id=15751

tbabb 10y ago

> I would propose viewing Tesla as an energy storage company Yeah, I'd say it would not be unfair to compare future Tesla to a company like GE ($270B mkt cap). Optimistic, but not irrational.

semi-extrinsic 10y ago
I beg to differ - GE is not an energy company, it's a multinational conglomorate heavily involved also in a dozen other fields like oil&gas, aviation, healthcare, home appliances, finance, research and transportation. GE Healthcare alone employs >40 000 people and does >4x the revenue of Tesla today. Maybe if Tesla merged with SpaceX and also with five-six other large companies you'd be about right.
- tbabb 10y ago
  > GE is not an energy company Fair enough (though I'd think the oil & gas you mention would count), but look at any energy company today and you'll see similar numbers. Another poster in this thread compares to Exxon; similarly favorable. You may not think Tesla will make it there, and you might turn out to be right. But those that do are optimistic; not stupid.
  - kgwgk 10y ago
    Why stop at Exxon? You can also compare Tesla with Saudi Aramco and that would justify a multi-trillion valuation!

Gibbon1 10y ago

When I worked at Intel there were some comments along the lines of 'Intel is a Fab House that designs Microprocessors on the side' One can apply that to Tesla as a battery manufacturer that also builds cars. Strength I see for Tesla is unlike the other car companies they don't have capital tied up in the legacy car business. Granted legacy is 97% of the market right now, but it won't be in ten years.

erikpukinskis 10y ago

Musk has also started talking like the product is factory, not the car or the energy storage.

usrusr 10y ago

How high is their current valuation relative to other energy storage companies? (Honestly, I don't know)

patrickk 10y ago
Another way to look at it: how big is the global market for gas peaker plants? If current trends continue, solar PV + batteries will be cheaper at some point than any fossil fuel[1], so at that point Telsa energy will begin to consume large chunks of that market. According to this link[2] gas peaker plans were 50% of energy installs in 2013, the best link I could find from a quick search. [1] Interesting talk on this topic: https://www.youtube.com/watch?v=Kxryv2XrnqM https://www.youtube.com/watch?v=Kxryv2XrnqM [2] http://www.eia.gov/todayinenergy/detail.php?id=15751 http://www.eia.gov/todayinenergy/detail.php?id=15751