It Is Dangerous To Bet Against Elon Musk Long-Term
We have another detractor opining personal views on Elon Musk. This time, Bill Blain of Shard Capital proved his where he stands in his "analysis" of the Tesla situation.
Here is what he had to say:
“Musk is a product of our age. Entitled, arrogant, unbelievably rich and powerful, he reckons normal rules don’t apply to him,” he wrote of the car maker’s chief executive in a note Monday.
What Blain writes he is all probably true. So what?
Is Musk arrogant? He does appear that way especially towards Wall Street and its analysts. The way he dismisses them is obvious. Nevertheless, to make it personal because you do not like they way someone acts is pretty foolish.
Musk is not the stuffed shirt type that Wall Street has come to embrace. He is a wild card, apt to say (and do) most anything. Yet, when you look at the results, it is hard to argue with any sense of clarity.
Listen, I get it. Musk consistently over promises in terms of his timeline. He success rate with hitting his targets is abysmal. He might be a brilliant engineer and marketer but his PR sucks.
This is where a lot of the divide comes in. Musk is a lightening rod and many on Wall Street hate that.
The problem for them is Musk repeatedly hits homeruns. It might be 2 or 3 years later than promised but, thus far, he always delivers.
We see the CyberTruck as the latest example. It is edgy, futuristic, and a divider. People are torn between loving and hating it. In spite of that, it is a grand slam. Musk is going to sell every one he can build for the next 6-7 years. It will provide Tesla with tens of billions in sales over that time. The people who are turned off by it will not be in line to purchase. Musk doesn't care. He knows there are going to be hundreds of thousands who do.
I don't know this Blain at all but I think he is amiss here.
don’t want to hold an investment in a firm run by someone like Elon Musk. The next 10 years are not going to be about Unicorn Hype — it will be back to fundamentals.’
Why would the next 10 years be about fundamentals when the last 30 have not been? Is he not aware of all the changes that took place in an effort to provide solid accounting standards to determine fundamentals. Unfortunately, all have failed. Intellectual property makes this completely impossible. Unless we are moving back to the plant, raw materials, and capital concept, I only see more disconnect between the "fundamentals".
Tesla just got approval to start selling cars in China under the "Made in China" program. This opens up the largest car market with Tesla being the only company with a whole-owned plant in China. There are no partners or front companies taking a large piece of the pie. It is all Tesla.
Certainly, there will be little positive impact on the numbers this quarter. It is more likely there will be a drain since there were expenses for most of the quarter to get the factory up and running without much income arriving. This is common for manufacturers until production ramps up.
They also saw their battery costs drop. This will increase their margins on each vehicle as the new technology is rolled out across the manufacturing process. Batteries make up a large percentage of the cost of EVs.
In this instance, it is crucial to separate Musk the character from the leader. His approach is unorthodox and is apt to upset many. Yet, when you look at where the company stands in not only the EV market, but also energy storage, it is easy to see how this one could have a lot of upside.
It would be a shame to miss this one because someone feels that Musk is a douchebag.
As an aside, Musk just announced a program that seems to be overlooked. Tesla is going to charge $10 per month for access to its software features above the basic connection for uploading data. With roughly 800,000 vehicles out there, this has the potential to bring in close to $25 million per quarter, in pure profit.
Yet people want to focus upon Musk buying mansions in California when he claims he is cash poor.
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