“It’s not the unknown that’s causing you trouble, but the thing you are convinced is not what you think.”
Editor’s note: This article comes from WeChat public account “ autocarweekly ” (ID: autocarweekly), of: Qian grandfather
At four o’clock on the afternoon of January 13, 2020, Tesla (TSLA.NASDAQ) ‘s stock price reached 524.86 US dollars / share, an increase of 9.77% on that day.
In after-hours trading, Tesla’s quotation even reached 528.1 USD / share, which continued to rise slightly by 3.24 USD or 0.62%. From this, it is basically certain that Tesla has stood firm at the $ 500 mark, with a market value of $ 94.603 billion, and it is close to a market value of $ 100 billion.
01 What is the market value of 100 billion yuan?
GM has a market value of US $ 50 billion in US stocks, Ford has a market value of US $ 36.6 billion, FCA (Fiat Chrysler) has a market value of US $ 28.1 billion, and Toyota has a market value of US $ 196 billion.
In other words, if Tesla rises a bit, it is equivalent to two General Motors, or equivalent to GM plus Ford plus FCA. In other words, Tesla used Toyota’s 1/34 sales to create half of Toyota’s market value, and Tesla has not yet made money.
From the perspective of stock price trend, at the close of December 31st, Tesla’s stock price has just returned to $ 400. That said, Tesla is up 25% after 13 days.
The time scale has been stretched a little longer-not even a month-Tesla only hit $ 400 on December 19 last year. If you look further-probably October 24, more than two months ago-Tesla opened with a gap of 17.67% and approached $ 300 until the next day with a 9.49% increase Stand on the $ 300 mark.
In other words, in the 80-day period, Tesla’s stock price broke through the three levels of $ 300, $ 400, and $ 500, an increase of more than 106%.
According to the 52-week low of $ 176.99, the annual return is high.It reached 196.6%. For investors, this is an extremely “beautiful” return on investment, enough to make people crazy.
02 What is a bubble and what is excess?
“It is not important whether the foam is continuously digested and absorbed. Of course, if the foam can be continuously absorbed and digested, it is not a foam. Some people say that it is called a foam only if it is broken. “Burst is not a bubble, that’s what it means.” The explanation given by Zhang Jun, an economist in “Crisis Reform and China’s Long-Term Growth,” is appropriate.
If I can, I will choose to short Tesla. The current Tesla stock price has clearly become a “bubble”.
So, back to the start of this boom, on October 24, 2019, what exactly is supporting Tesla’s gap?
You remember, on October 23, 2019, Tesla Model 3 appeared in the Ministry of Industry and Information Technology’s 325th batch of “Road Motor Vehicle Manufacturers and Product Announcements”, which means that Tesla’s Chinese factory has achieved electric vehicle production. Qualification.
Soon, Tesla announced the completion of its Chinese factory, which will begin delivery by the end of 2019.
So what happened on December 31, 2019? Tesla delivered the first Chinese-made Model 3 to 15 employees on December 30, 2019. And there are reports that Tesla’s first Volkswagen delivery will be on January 7, 2020, at which time Musk will also come to China to announce subsequent plans.
So why did Tesla soar on January 13 this year? Obviously, it is because of the “No new subsidy for new energy vehicles on July 1, 2020, and no further decline” will be revealed at the China Electric Vehicle Hundred Talents Association.
You can be sure that Tesla’s stock price has doubled in this round, relying on the “Chinese concept.”
The vast new energy market in China has given Tesla enough imagination. Investors believe that Tesla can replicate a North American sales trend in the Chinese market, so Tesla’s stock price is worth doubling.
The reasons for the high expectations of the Chinese market are, first of all, that Tesla has entered a plateau in the North American market.
According to official data, in Q4 of 2019, Tesla sold 112,000 units, and annual sales are expected to be 367,500 units. The sales volume in the Chinese market is about 36,000, and the European market is expected to sell more than 22,000..
In other words, Tesla reached the scale of 300,000 vehicles in the North American market in 2019, an increase of about 100,000 compared to 2018, which has almost “squeezed” the North American market-Model 3 was It is the largest model sold in the California market and is expected to account for more than 20% of Tesla’s total in 2019.
Although Tesla will start selling Model Y in 2020, car companies such as Ford and GM will also invest in corresponding products. More importantly, Tesla has no subsidies, and traditional car companies have launched pure electric vehicles with similar performance, which makes Tesla no longer have an overwhelming advantage.
So, what kind of performance does Tesla need in the Chinese market to support its stock price?
To put it simply, Tesla’s sales in the Chinese market should be equivalent to the US market-at least 150,000 to 200,000.
So, can the Chinese market produce so many Tesla and then sell so many Tesla?
According to the current weekly production of 1,000 vehicles at the Tesla China plant, the annual production capacity is only 50,000 to 60,000 units, which is far from the 150,000 units.
According to third-party estimates, the production cost of Model 3 in the Chinese market is 20% lower than in North America. However, even if the profit margin of the Chinese market is 2-3 times higher than that of the North American market, the size of the 300,000 vehicles in the Chinese plant is still far from the North American plant.
Some people may think that as long as Tesla can increase its production capacity to 3,000 units a week, the goal can be achieved, and increasing production capacity is not difficult for Tesla.
However, the biggest problem for Tesla to increase production capacity is that Tesla, which features direct sales, does not have a buffer zone for production capacity. Once production capacity exceeds sales volume, Tesla will soon be in the Chinese market The formation of “blocking sales.”
In fact, Tesla has not encountered the problem of “blockage in sales” in the Chinese market, and Tesla’s approach is to drive sales with large discounts.
Tesla has previously changed the sales price several times-although Tesla’s explanation in China is “in line with Musk’s” first-principles “”-but the psychological impact on Chinese consumers is not small The so-called “Tesla Leek” and “Wait Party” appeared.
Therefore, it is not difficult for Tesla to increase its production capacity from 1,000 vehicles / week to 3,000 vehicles / week, but the direct sales model requires Tesla to be very cautious in scheduling, not a single dimension produce. At the same time, considering the production support for Model Y, the production capacity of the entire Tesla China plant may not be greatly expanded in 2020.
03
With the full delivery of domestic Model 3, the biggest problem for Tesla is actually that the consumption logic of the Chinese market is different from that of the North American market. That is to say, if you want to sell in the Chinese market multiple times,Model 3 is obviously not as easy as it is in the North American market.
In the North American market, the average selling price of a car is about 32,000 US dollars, so the main sales models are focused on pickups and mid-to-high-end models. Tesla Model 3 is also priced at this average price level.
The average selling price of cars in the Chinese market is about RMB 147,000, of which the average selling price of Chinese brands that occupy 40% of the market is only RMB 89,000.
Therefore, Tesla’s domestically produced Model 3 in the Chinese market is a real luxury brand in China. Its rival is not just the three major pickups in the North American market or the premium cars of mainstream brands, but BBA in the The luxury brands in this category are the BMW 3 Series, Mercedes C-Class and Audi A4L.
Tesla is a leading BBA in the U.S. market. It is mainly due to the intelligent and digital experience established in previous years and the scarce experience of early electric vehicles. Consumers in developed markets do not feel new to BBA. , But really feel fresh to Tesla.
But in China, a large number of Chinese consumers have not experienced luxury brands. Tesla actually has the same existence as BBA and has no additional advantages.
In fact, the product perception delivered by the Tesla Model 3 in the Chinese market has not brought about the “luxury” expected by consumers. It is mainly focused on electrification, OTA, and autonomous driving.
A noteworthy phenomenon is that these terms represent the unique concept of smart cars in overseas markets, but they are nothing new to Chinese consumers. This is related to the many new car building forces gathered in the Chinese market. Tesla, which has no rivals in overseas markets, has no fewer than ten competitors and imitators in China, which has greatly weakened Tesla’s uniqueness in the Chinese market.
As for the upgraded version of the Model 3 standard battery life that Tesla currently puts in the Chinese market, its insufficient product power and product reputation have declined in the 300,000 yuan market, which is also the reason that Tesla can quickly increase its volume in the Chinese market.
This content is already appearing on social media quickly, and the controversy expected is also expected to affect Tesla’s delivery in the Chinese market in the first quarter.
04
However, many investors have completely ignored these shortcomings of Tesla in the Chinese market, focusing only on the information point that Tesla has put into production in the Chinese market and entered the Chinese new energy market.Gives Tesla’s market value expectations of nearly 100 billion.
Dan Bin, a well-known investor in Weibo, wrote when Tesla’s stock price exceeded $ 500: “Tesla surged 9.77%. Last night my friend and I said that Tesla became an apple in the automotive industry. But once it becomes, its potential is greater than that of Apple. First of all, it will continue to upgrade paid content services, just like Apple’s APP … and Tesla’s charging piles and charging stations, which are like high-speed expansion and networking, can make it a fuel Station-like service format, and it is world-class, and in most countries and regions is environmentally friendly, you can use solar energy to charge … “
Obviously, their investment logic in Tesla is to copy an Apple company, but the breadth and basicity of Apple are not available to Tesla.
Unfortunately, short sellers are always lonely, and short selling is always the most dangerous business. Tesla’s stock price now has no pressure line. It may take a while after breaking through $ 500, but the logic of the industry will not change due to the rise in stock price. Let’s end with the words of Mark Twain from the movie “Big Short”:
“It’s not the unknown that’s causing you trouble, but the thing you are sure is not what you think.”