What do you get when you take a tech company and an automobile company, poor it into a cocktail shaker, mix it all together and then poor it into a martini glass? You get Tesla. Now, let’s add a power company to make it a dirty martini, though it’s a sustainable power company so we’re going to call it a “sustainable martini”. As we watch this company come together it doesn’t always makes sense. There are many times you wonder if there is a plan. Is Tesla stretching themselves too thin? Should Tesla narrow their focus to the production of the automobiles and forget about the energy company? Is Tesla’s stock a good investment? Let’s look at some of these questions and explore a few possibilities of how Tesla may change the history of mankind.
Tesla went public in June of 2010 (TSLA). Stocks started trading at $17.00 a share and today (November 2017) TSLA is trading at $312.60. If you were able to buy stock at it’s opening, you’d currently have a 1,838.82% return on your investment. However, the stock is volatile and could remain that way for the next 2 to 3 years. As Tesla figures out their production issues of the Model 3 many analysts expect the stock to dip to $200.00 before blasting off to $400.00. The future of the stock is bright as long as you have a long-term strategy with it. This patience is expected of a company with a business model the likes of which no one has seen before. Now that we’ve made the “sustainable martini”, let’s have a drink.
Tesla’s mission is to bring sustainable transport to the mass market. Starting in the high end sports car market, not because the high end sports car market needed another expensive high end sports car, but because Tesla believed this would be the quickest way to bring cash into their new startup company. With full intentions of bringing a mass produced sustainable car to the market they introduced the Model 3 in 2016. The model 3 is the car that will change the world. The most simplistic version of the Model 3 has 258 horsepower and will go 220 miles on one charge. The automobile industry has taken notice. Toyota invested $50 million into Tesla’s initial IPO. Volvo announced this year that by 2020 all of their cars will have some version of an electric motor. Every major automobile company has added an EV line to their product. Some might want to take notice of the Chevy Bolt. The Bolt does 0 to 60mph in just over 6 seconds and gets 238 miles per charge. Perhaps Chevy should take notice of the Bolt and announce it to the world. I just recently heard of the Bolt while watching a car review on Doug DeMuro’s youtube channel.
The growth and development in car technology is ready to explode and it’s going to happen quickly. The first iPhone was introduced 10 years ago. Today phones are doing things that we never imagined before the first iPhone was introduced. Look for this kind of growth in the automobile industry within the next 10 years. It’s a rocket launched by Tesla like the smart phone revolution was launched by Apple’s iPhone. There were many times the stock market thought Steve Jobs, and Apple, was crazy. When Apple started to manage the company by reacting to the stock market is when they lost their innovation. There are many times the current stock market thinks Elon Musk and Tesla are crazy. But if they manage the company to appease the stock market they will most certainly loose the freedom for their creative innovation. This is the tech side of the business plan. An understanding that this innovation needs to be invested in. It’s paid off for Apple investors. How many times have you heard someone say, “I wish I’d gotten in on Apple back in the day”.
The production of the cars is where this tech company comes smashing into the automobile industry, and that’s about to create the next big bang. With so much potential to humanity, with a world changing vision of how humans think about transportation, and so much financial growth on the line, these current production issues on the model 3 will soon be a small molecule in the giant galaxy that Tesla is creating. These production issues aren’t the part of the business redefining human thought. We’ve been mass producing cars since the early 20th century. It is knowledge that is known to us, it’s a platform that’s been used over and over. For Tesla it’s just a matter of having their production line up and running so they can work out the bottlenecks in their production lines. Don’t be surprised that in 2 to 3 years Tesla has the most efficient production lines that we have seen.
At this point, it’s all about the battery pack. This is why Elon Musk wanted to make this martini into a “sustainable martini” and merge with Solar City. Tesla is innovating the battery pack, and Solar City is needing a battery pack to store the energy produced by their solar panels. Now Tesla has become not only about sustainable transport, but sustainable energy for the planet. Not only has Tesla become an energy company, it’s become the company creating the energy, storing the energy and creating the means by which we use the energy, like with the Model 3. Some might say “Whoever controls the energy will control the world.” and Tesla’s current business model seems to be pointed in that direction.
As the US government has struggled to get the existing power grid in Puerto Rico back online and finding itself in incompetent contracts with power companies like Whitefish. Tesla is finding success in helping Puerto Rico with solar-battery projects like the one they donated to San Juan’s children’s hospital del Niño. It took Tesla less then 3 weeks to get this hospital fully energized on self sustaining energy. Earlier this year Elon Musk promised South Australia, who has struggled to save and disperse the sustainable energy they are producing, causing long blackouts throughout South Australia, that he can build them 100MW battery set in 100 days or it’s free. Tesla has done it in 2/3’s of the time and this battery farm is scheduled to go online December 1st. With many more projects going on in Puerto Rico and around the world this is the vision of Tesla. Sustainable transportation and sustainable energy for all. Now that we’ve had our drink, a “sustainable martini”, I wonder what Elon Musk and Tesla has planned for the main course.