Tesla Cut Prices and STILL Fails to Grow
The Tesla stock story is like the 1997 James Cameron movie Titanic. It’s going to end in disaster but there will be a seemingly never ending drama before hand. And many characters in the story will erroneously think it’s unsinkable.
2022 was already disastrous for Tesla shareholders that bought in January. Those poor souls lost about 70% of their investment. And now in 2023 the share price has recovered in January and February. But these unlucky buyers are probably on course to lose most of their investment as well if the information coming out about Tesla this week is any indication.
Check out this tweet by the always level headed Montana Skeptic.
Check out this tweet by the always level headed Montana Skeptic.
The Tesla stock price is valued at total market domination not being just another car company. In fact, it’s actually worse for Tesla. The market cap is so high that analysts from places such as JP Morgan have models that actually priced Tesla as dominating other industries like ride-sharing and energy. Why? Because even if Tesla put all the major automakers out of business, there isn’t enough profit in the entire auto industry to justify the market cap.
The aforementioned stock price recovery of Jan/Feb came after Tesla made some fairly drastic price cuts. Now that alone was alarming. Decreasing demand necessitating price cuts is nothing to warrant optimism. But the optimistic take was that this would lead to Tesla stealing market share and lowering costs via greater volume.
Surprise! It’s not working. Not only is Tesla failing to steal market share, they are actually shrinking. Nothing is more kryptonite to the Tesla stock price than the end of the growth story. And just wait til the market finds out that Tesla has destroyed their gross margins by lowering prices in a period when raw material prices are going up.
Tesla is priced so high that you can’t win betting on it. But before we get to the big finale where the wreckage sinks to the bottom of the ocean we’ll have to sit through hours of a fat bozo dancing for dollars in a futile attempt to stave off disaster.
The aforementioned stock price recovery of Jan/Feb came after Tesla made some fairly drastic price cuts. Now that alone was alarming. Decreasing demand necessitating price cuts is nothing to warrant optimism. But the optimistic take was that this would lead to Tesla stealing market share and lowering costs via greater volume.
Surprise! It’s not working. Not only is Tesla failing to steal market share, they are actually shrinking. Nothing is more kryptonite to the Tesla stock price than the end of the growth story. And just wait til the market finds out that Tesla has destroyed their gross margins by lowering prices in a period when raw material prices are going up.
Tesla is priced so high that you can’t win betting on it. But before we get to the big finale where the wreckage sinks to the bottom of the ocean we’ll have to sit through hours of a fat bozo dancing for dollars in a futile attempt to stave off disaster.
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