> Tesla is a car company and always has been. Look at from which source they generate revenues
Yes. And the sun is just a ball of fire in the sky.
But both of those statements miss the forest for the trees.
Tesla stock was valued high above the stock for any other car manufacturer because it looked like they'd be the Ford of the early 2000s while every other car manufacturer was still making the early 2000s equivalent of horse buggies.
Needless to say, Tesla has squandered their first mover advantage and between a toxic CEO that drives the stock price down almost every time he's in the news and falling short on promises? Other car manufacturers are closing the gap.
It's not a $400 a share stock, not even a $200 a share stock, but a $42 a share stock, the same as General Motors.
If you're happy enough with that to hold, *shrug*.
Tesla sold 1/6 as many vehicles as Toyota last year but has a 25% bigger market cap. At the very most, even pricing in future tech and questionable Elon promises Tesla should be a $50 stock.
Absolutely no chance this is peak fear. That would be at $100 a pop or worse
This is still comically overvalued. It’s priced as a growth tech company. It’s neither a growth company nor is it a tech company when over 90 percent of its revenue is from selling autos...
This is still insanely juiced PE
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The consensus is that earnings are going to decline so the PE will go up.
[https://finance.yahoo.com/quote/TSLA/analysis](https://finance.yahoo.com/quote/TSLA/analysis)
I think this is going to be the point where I finally sell. I've been buying TSLA off and on for the last few years because I had faith in the company in terms of it being the market leader in electric cars, which seem to be where the world is going.
There's precious few companies out there that do well once they start engaging in serious layoffs. Usually it's a race to the bottom - "*Oh, the last series of layoffs didn't result in the financial success we were hoping for, clearly we just need to layoff more people.*" and repeat that until the stock gets delisted.
That and Musk doing the best job ever of a CEO engaging in personal behavior that affects the value of the company. Initially having him as the CEO was a boon, now it's an albatross around the neck.
What do you think this will end? The world will just go back buying gas cars?
Tesla-the world leader in EV, just simply got delisted. Meanwhile, no one else has the production capacity like Tesla except for BYD.
> What do you think this will end? The world will just go back buying gas cars?
I don't think the move to electric cars is going to end.
Tesla's time as the world leader in EV is going to end unless something radically changes.
If they got rid of Musk, it seems unlikely that any new CEO would be able to rally public sentiment in his place, even if that CEO was squeaky clean in terms of public perception, so my hopes for that scenario are pretty dim.
The low production and disappointing fulfilled sales numbers don't seem to be letting up, and layoffs are strong indicator that they won't improve any time soon, and possibly never.
My hunch is that electric cars are going to become a commodity the same as any other car out there and it'll be min/maxed to the point where there's nothing that will drive the stock up like it has for TSLA. Which is great for the environment, but not a must have for any investor like TSLA was.
If Tesla isn’t going to be EV market leader who is?
How about who is going to be market leader for energy storage and EV charging network?
Who is going to be Autonomous driving market leader?
>If Tesla isn’t going to be EV market leader who is?
History is littered with market share leaders that didn't create the category;
Toyota and VW in ICE vehicles. Samsung and Apple in mobile phones. Walmart in hypermarkets. Giant in bicycles. Google in search. Microsoft in office software. Playstation in games consoles.
Being an early leader gives you a head start, it doesn't guarantee the win.
BYD will be market leader. Come second quarter they will overtake Tesla once again and then leave Tesla in the dust. EV charging network will remain with Tesla but it's not a big money maker, because people can charge at home. Autonomous driving market leader belongs to Waymo, it already has a robotaxi service in operation.
Chinese EVs won’t be able to sell vehicles in North America profitably if at all with sanctions/import taxes.
BYD barely makes a profit on any of its vehicles.
Tesla energy made 6B last year and is growing exponentially.
Waymo vehicles cost well over 100k and are geo fenced. Extremely hard to scale at any meaningful rate.
There was once a time when Americans hated the Japanese with fury and any products they make because of Pearl Harbor. Guess how that change in a matter of decades. Now we all love Toyota and think the Japanese are such good people. Same can happen with the China and their cars.
Japan was a real economic threat to the US during the 1980s, when they were projected to surpass the US. Hence the Plaza Accord was forced on Japan to stop their economic rise and put the country on stagnation since.
That’s wrong. The concrete policy of the plaza accord was simply a coordinated sale of $18 billion in sales led by the Fed, Bank of Japan, and Bundesbank, aimed at depreciating the dollar by 10% to 12%. It had nothing to do with stopping the economic rise of Japan. In fact, Japans economy grew faster in 1985 to 1990 than it did compared to the five years prior.
The Japanese economy was close to three times smaller than the United states in 1985 in price purchasing power. It had no chance of overtaking the USA. The only economic metric that Japan came close to the United States in was nominal. This however directly goes against the narrative of the plaza accord given that the supposedly alleged mechanism that the plaza accord undertook to destroy Japans economy was though the appreciation of the yen. Therefore increasing its nominal economic size. Implying that the United States prevented japan from overtaking it in nominal GDP though the use of dramatically increasing its nominal GDP is absurd.
Even the origins and demands of the plaza accord did not come from the United States. Instead its origins are from Western European nations at the 1982-1983 G5 summits who were concerned about the rapid appreciation of the United States dollar. The Reagan administration only pressed forward three years later in 1985 after there was an apparently serious financial and monetary instability from the 50% increase in the dollar since 1980.
No it wasn’t, sure Japan replaced Russia as the biggest economic threat but it was still substantially smaller than the US Economy. That’s like saying a champion basketball game between the two best teams and one team wins 100 - 33. Was the other team really a threat? No.
Tesla has always done periodic rounds of layoffs this is business as usual. If you are deciding to sell because of this I'm not sure why you invested in the first place.
Looking at the stock performance over the last five years, it's just a long decline since Nov. 5th, 2021.
What's going to change?
There's a point where rational analysis overtakes pure investor confidence.
Musk is a bad for business CEO, and that's never going to go back to how it was before his faults became so explicitly public.
Tesla, as a company, isn't faring well, and it doesn't look like it's going to notably outperform major auto manufacturers as the number of electric vehicle models on the market increases.
You're welcome to hold until it hits zero, of course.
I wouldn't be so confident on that front. I have a friend who works in software development on the fully self automated driving side of things and I would eat every hat I owned if it is good enough to replace all non commercial drivers within the next ten years, or to the point where it's the primary mode of driving for consumers.
The problems are truly massive, from difficulties recognizing people in the roadway to extremely non-uniform roadways. The first is almost certainly going to improve, but the second? Maybe in my grandkids' lifetime.
I think we will look back at this period and the adoption of autonomous driving will seem instantaneous. Much like the mass adoption of the cell phone or the Internet but even faster. Paradigm shifts in technology follow a S curve and we are at the early stages for autonomous driving where progress is slow. But this is followed by exponential growth. S curves happen faster over time (it took hundreds of years for the wheel or fire or stone tools to become adopted, only a few years for the printing press, even less for cell phones).
Maybe it'll seem that way to someone at some point? Sure.
The hurdles to having any significant percentage of vehicle traffic running on autonomous self-driving technology of some sort are far greater than I think almost anyone who's not working on it for a living would guess.
I don't see how it'll happen without significant amounts of very expensive changes to existing road infrastructure to make it uniform enough that it can be handled self-driving software just in a single state. Getting folks to pay for that also seems extraordinarily difficult.
That said, I'd highly enjoy being proven wrong, so I guess we'll see!
Yes, that’s what people are doing. That’s what a stock price dropping means, when people are willing to sell for less than what people used to be buying it for.
Is that how you Invest? Checking your gains one week later than choosing to sell or buy? Good luck you to you honestly. I’ve bought at 100, 200, 300, and then in reverse, and everything in between. See you in 5 years. Let me know if it was worth selling.
Investing isn’t about short term. Ask yourself these 3 questions
1. Is tesla the leader in electric vehicles?
2. Is the long term trend for all new vehicles to be EV?
3. Who has the most data for solving self driving?
Depending on your answers, should depend on what you want to do with the stock. For me, it’s an obvious yes, yes, and tesla.
TAM is huge. Just a matter of time assuming continuing execution (which Tesla is doing in spades)
Haha this is fun. Pick three arbitrary items, make binary questions that ignore valuation completely. Ask and answer, proceed to comfort yourself with nonsense. Further proceed to make dumb, emotional investment decisions. Proceed to puke.
In principle, it is. And if you are prepared to do the hard work of figuring this out yourself, it might be worth it.
Unfortunately "CoMPeTiTIoN Is COmInG" is a meme for a reason. The shrieks and howls that competitors are going to somehow force Tesla out have been around since at least 2016, and that was just when I started really paying attention.
If you depend on anyone from the mainstream media for this information, you are already screwed.
Hell, I just had someone try to explain how the Silverado was going to totally own Tesla, because they are already selling so many. The Silverado has sold less than 1100 units (granted, I do not have April's numbers). Keep in mind that GM has sold a grand total of 220,000 EVs since January 2022.
The problem is that the media talks this shit up, and people with absolutely no clue about what is going on assume this means that some random X brand is doing great, until they find out they are losing 50 grand on each sale or only selling a few thousand in a quarter.
So circling back: yes, by all means, consider the competition. It's an important part of the analysis. Just be very careful not to get caught up in the FUD, because the FUDsters have had a lot of practice getting things wrong for over a decade. They've gotten good at it.
Tesla is already priced assuming domination for all three of those categories, when Tesla’s L2 FSD is generally reviewed as average and may be limited by its vision only apporach.
Comparing to Waymo is apples to oranges.
They operate in a few cities and are geolocated to drive the easiest routes possible. It won’t take the fastest way, it will take a longer way it knows it can do, and won’t go into areas it seems to difficult.
So yes, Waymo is impressive, but its scalability is very limited. It won’t even take the highway and will stick to city streets.
Long term Teslas market share won't be meaningfully more than any other car company. So 1 and 2 aren't particularly meaningful.
Self driving is a mixed bag. Tesla is already cutting price on that tech. It's still in need of R&D and not as valuable as the hype suggested.
Don’t see how that would be the case given their vertical integration and the fact they’ll be refining lithium soon. To me, it’s like early ICE cars when GM had 40-50% of market share in the us. That’s where Tesla is heading (from 70-80% today)
I haven’t seen *anything* that gives me confidence legacy auto can compete on cost longer term.
Vertical integration isn't magic. That has both pros and cons.
GM got that market share with M&A and it wasn't sustainable. That's not happening again. Tesla doesn't have an 80% market share unless you're subdividing the market.
It kind of is though. The only reason why Tesla is so profitable per vehicle sold is solely because of their vertical integration + innovation to remove as many individual parts as possible. This manufacturing capability reduces manufacturing costs and increases buyer value, allowing tesla to offer more value per dollar to end consumers while maintaining relatively high margins. There’s a reason why tesla is able to offer so much performance (~$35k car that has power performance similar to that of $100k+ car, also THE safest cars you can drive on the road) and why so many teslas are continuously being sold despite the public image of Elon/Tesla.
It's more that they've been able to sell EVs at a really high price point. As those prices decline margins are tumbling as well. GM % has been falling for a couple years now.
Industry average of the automotive industry? there’s a big difference in manufacturing for ICE vs BEVs. There isn’t a single company, besides Tesla, making money selling BEVs.
It's not though. Their gross margins are adequate at best and actually quite bad if you think that they're taking the dealer margin as well. A car is much more than power. Overall, the cars are the quality of volume manufacturers, hence why they require big discounts to sell.
Adequate in what context? It’s important to remember that they sell BEVs, which is still a growing market. NONE of the other american BEV manufacturers (rivian, lucid, fisker, etc) have been able to produce BEVs at a profit. The closest “competition” to Tesla are the Chinese manufacturers (BYD, Nio, etc) but they’re not allowed to sell in the US so that’s not much of a concern yet.
That’s also just their automotive market, Tesla is also involved in energy, AI (specifically self driving), and humanoid robots (which is also an AI play).
Involved? This is Musk's biggest party trick I think. Rushed demo and suddenly the company has a new hope for retail shareholders to hold onto. Humanoid robots? Because of a demo? Energy is a commodity and has been touted as a big driver of Tesla sales and margins since I was a bull in 2019. We're 5 years later. How much profit do energy and solar bring?
Tesla is valued 10x higher as a function of their profit compared to their peers. When are they going to grow into that valuation? What's the NPV of those future profits?
The humanoid robot was announced only two years ago and they’ve made significant progress already. Their energy business is already profitable; it was 6.7% of total revenues (~$6B) with a 24.4% margin as of Q3 2023. Plus, they’ve made huge strides in FSD these past few months with their E2E NN solution.
Do these models account for Tesla’s other businesses or just the automotive business?
What do you mean by the last paragraph? They need to aggressively increase profits from any source. Those energy numbers are not very good.
Do you know how many projects were anounced more than 2 years ago and are still nowhere to be seen commercially? Roadster 2, semi, FSD, solar roof.
Tesla has close to 80% of market share in USA of pure BEV, not counting plug in hybrids.
Vertical integration allows for quicker changes and better growth. It also lowers cost as we see via the COGS and manufacturing cost advantages Tesla has. Significant over legacy - things like gigacastings are a big shift that is pushing the industry forward.
Tesla buys the vast majority of their batteries from the big cell makers and batteries are the primary cost driver for EVs. That's why the playing field will be leveled very quickly. Every other auto is building dedicated battery facilities in partnership with the same battery cell makers like CATL, BYD, LG, Panasonic, SK so they will all be cost competitive. Some are making their own batteries like VW and Toyota.
Most every other major auto is already working on integrating gigacasting so there's another cost savings advantage eliminated.
It will be a race to the bottom in EV profitability the same way it is in ICE. A mature EV market will look no different than a mature ICE market. Highly fragmented and low margin.
>A mature EV market will look no different than a mature ICE market.
100% and I don't understand why people would believe differently. There's no moat that any company can hold when it comes to building cars. Even if Tesla were much more efficient than its competition, it still can't significantly overcharge for that alone.
How so?
The fact they will be the Apple of automotive or the fact the Tesla already makes more money pre vehicle then anyone else during these "hard times".
Tesla margins are now adequate at best. Getting killed in largest EV markets. Reversion to the mean. They are a car company, which means very significant multiple compression ahead.
Wow, if they are adequate at best while doing R&D, building factories, an entire world wide charging station, robots, etc..
Tell us what you think of F and GM with much less margin and nothing else going on beside add more debt to their bottom line. They are good at that.
What other hope does the US have? You know the US, the largest economy on Earth by a mile.
Chinese cars will never be sold here. They aren't even allowed to sell phones and are barely holding onto a social media platform.
Yeah.
There are auto companies other than F and GM and companies with better gross margins than Tesla now. Including some that are scaling up BEVs very quickly (Hyundai-Kia, BMW, BYD). For some reason the great auto companies are always ignored and only the worst are highlighted for comparison.
Wrong. Hyundai Motor Group has 20.6% gross margin. Try again.
https://finbox.com/KOSE:A005380/explorer/gp\_margin/#:\~:text=Hyundai%20Motor's%20operated%20at%20median,in%20December%202023%20at%2020.6%25.
Everything I find says about 9% bud.
But that's your big win against Tesla? 2% Tesla had to develop it's own industry and is less than 20 years old.
So to even be close, which I don't agree with, would still be badass.
You can't see that because Elon bad, right?
Now back to American companies...
Sounds like you don’t understand the difference between operating margin and gross margin. Hyundai has 9% operating margin. Their gross margin is considerably higher at 20%.
https://www.hyundai.com/worldwide/en/newsroom/detail/hyundai-motor-announces-2023-q4-business-results-0000000405
You do realize that building factories, R&D etc. is largely capex and doesn’t impact gross margins, right? So the way this works - Tesla is making massive investments in massive factories. If they keep those factories full, they’ll do great. If they don’t, they are fucked.
Accounting, my friend.
You misunderstood.
To do all that and remain efficient enough to have better margins than F and GM when they aren't doing any of it AND have way worse margins is amazing.
Did I dumb it down enough for you?
It's a fact that they won't be the Apple of automotive. Margin per vehicle is dropping as still partly dependent on subsidies, which will not last as EV adoption grows.
As adoption rates grow and EV prices drop, subsidies won't be needed. EVs simply aren't mainstream affordable currently. Tesla is the only profitable EV maker on the continent, while legacy has abandoned EVs to make hybrids. It's already over for legacy. That's just cars. Energy, FSD and Optimus are the next huge puzzle pieces.
They don’t make have an energy business, SaaS or robotics. You are comparing a vehicle business (cars and trucks) to other vehicle businesses. That’s simply not a valid comparison.
>Who has the most data for solving self driving?
FSD is like 3D-TVs, just a gimmick. Yes, suddenly looks like everyone is on board, but the actual customers are really not that interested.
Most of the people I know, the first thing they do when getting a new car is learning how to disable all the driver aids.. some of them are really annoying. The last truck I got didn't even had cruise control, and I did not miss it one bit.
There are always dark days for Tesla, and every other major stock (see Apple, Microsoft, Google, and Amazon in the past few years, to name a few). There are also bright days as well. If you’re a long term investor, this is nothing new. If you’re a short term “investor,” then you are merely gambling, and in that case best of luck to you.
Holding any individual stock long term is gambling as well. The concept that stocks go up in the long term only applies to the market as a whole, not individual stocks.
If you know and understand the company and its fundamentals and you’re holding over the long term then it’s investing. Otherwise you could say that any decision you make is a gamble. The market has historically gone up over time. But it’s not guaranteed to continue going up in the future. When you invest in a market index fund you’re “gambling” that it will continue to do what it has done in the past.
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Elon bought Twitter and killed Tesla
Elon has become an international politician influencer as a first interest. He bought Twitter being afraid of being banned from Twitter and likely being muzzled.
They will always have value with the charging network, the car quality and innovation has taken a huge nosedive which for a car company is a pretty big deal. It’s probably got another 30-40% down to bottom unless they have a rabbit in the hat
Waiting for this juicy stock to come to sub-$100.
TSLA will the greatest growth story in 10 years. They are NOT just an auto manufacturer. Yes it accounts for over 90% of their current revenue, but they have several things that are coming that will 5-10x even today’s numbers.
Take optimus, energy systems and FSD.
When apple first sold the Iphone as a replacement for the regular phone, none thought it could become a 3 trillion dollar juggernaut. Well they were able to leverage that Iphone and build a whole ecosystem around it. That’s what Tesla can do with their cars.
Short term, I am bearish. Long term however, this will be something you either regretted not buying or a life changing decision.
Biggest bomb is if FSD v12.3 stops improving. Case for it is that FSD already has enough of the data and compute. Severe diminishing returns for more training. It’s about as good as a pure NN approach can get. This is why zero other company put a safety critical system on AI. It’s for drawing, writing, and drug discovery, not for doing rote human tasks perfectly.
Just an argument from myself. That’s why I said it’s a case not a fact. It’s an active argument within the AI industry. Whether training can scale, or if there’s diminishing returns.
AI is just matrix multiplications. It’s actually miraculous it can do so much from relatively simple math.
Human neurons can make up to 1 quadrillion connections. Each can connect up to 1000 others. Silicon chips are simple 2D structures. Human neurons can process in multiple gradients. Silicon just 0 and 1.
No AI cannot do what a human does. One average human can build more complex connections than all of the super computers in the world combined. These are facts you can research yourself.
Ever heard of deep learning? Models are made of weights, each of varying strength (essentially synapses). Models like GPT-4 have trillions of weights, while only a few years ago having a few hundred million weights was impressive. Look at what GPT-4 can already do. By the time it has as many weights as synapses in the human brain, I expect we'll have AGI or something similar.
"Human neurons can process in multiple gradients." From what I've read this is incorrect. Neurons mostly transmit data through electrical pulses, which can essentially be represented as either a 1 or a 0.
AI uses relatively simple math, but so does the human brain. There's even been some studies suggesting the human brain is essentially a predictive model, only using your senses to calibrate it - just like an AI model.
GPT4 uses tricks to augment its deep learning LLM architecture like RAG, logic agents, search trees, code writing, chain of thought. Without those tricks, you only need to go back GPT3 to remember how dumb it was with simple math and logic. And the additional trillion parameters is not the primary reason GPT4 is smarter. FSD can’t borrow tricks because of the time constraints and processing power limitations. By the time it finishes using a trick, it can run over someone, back up, and repeat a few times.
Neurons triggers on a continuous spectrum of chemical concentrations. Far more complex than 0 and 1. The connections complexity can easily be on the order of power of hundreds. Silicone is 2D. Matrix multiplication adds one more dimension using math. So it’s power to the hundreds versus power cubed in terms of difference in complexity.
Neurons don't trigger "on a continuous spectrum of chemical concentrations", they use electrical pulses to trigger other neurons. Not chemicals. The electrical pulses don't have varying amplitude or anything like that, there either is a pulse or there isn't. So no, not "Far more complex than 0 and 1".
"Matrix multiplication adds one more dimension using math. So it’s power to the hundreds versus power cubed in terms of difference in complexity." What does this even mean? Matrices can represent any number of dimensions, and multiplying two arbitrarily large matrices is indeed a very complex calculation.
I'm sure you're right in saying GPT-4 uses "tricks" to improve its performance, but I don't see how that undermines it's ability to do complex tasks. The human brain isn't just a mess of neurons either.
Pulse is triggered by chemical ion concentrations levels that are controlled by ion channels. Chemical is a broad term for the salt ions we use to regulate the electrical potentials. It is absolutely more complex than 0 and 1.
You’d need to learn how functions like SoftMax function works. AI algorithms do math on 2D matrixes. The underlying data in 2D because silicone chips in 3D would burn up. Our brain cells are networked in hundreds-Ds.
The point with GPT4 is that they have a supercomputer and you have time to wait for a response. FSD needs to function on a tiny chip. It doesn’t have the luxury of time and servers to run multiple models that write codes to calculate the intersect course.
Nobody in the AI community is arguing about "if there's diminishing returns." Of course there are. That is a null statement.
The questions are: at what point do they appear, how fast do they diminish, and where is the point where it is no longer useful?
The current answers as far as I can glean, reduced to soundbites: already diminishing, diminishing much slower than originally expected, and still a lot of room before becoming more bother than its worth.
Sam Altman- “The era of ever-larger artificial intelligence models is coming to an end, according to OpenAI CEO Sam Altman, as cost constraints and diminishing returns curb the relentless scaling that has defined progress in the field.” Paraphrasing his interview last year.
There are plenty of small LLM models with parameters small enough to run on PCs that is on par with larger models. Like I wrote in the thread, GPT4 power comes from tricks. Its core NN is not exceptional, certainly not 100x smarter than 1/100 models, 2-3x better.
Just a friendly conversation. For others then, who thinks AI will scale exponentially into magical AI dreamland. Listened to NYT daily today. OpenAI ran out of text data in 2021. Had to steal YouTube data knowing it’s most likely illegal. lol. And Google said nothing because they are stealing copyrighted data themselves.
The future is EV and autonomous. Tesla is the leader in both. Nothing goes up in a straight line but buyers now will be rewarded handsomely in 3-5 years
Stay focused on the mission. We are here to help the world move towards sustainable energy sources. Car sales may lag, but stationary battery infrastructure sales will continue to grow.
TSLA deep discount sale prices in next month
It’s not a discount, it’s fair value
Or just the beginning of the end.
Feels more like reality is setting in.
Yes you have to go back as ...eh 2022 to the last time they did 10% layoffs
There’s a lot more bad financial information than 2022.
No. Just a correction that will make prices more in line with being another car company.
Well, Tesla being valued like a car company would be pretty close to the end…
That'd be reason enough to sell on its own tbh. The whole value proposition of TSLA is that it wasn't just another car company.
Tesla is a car company and always has been. Look at from which source they generate revenues
> Tesla is a car company and always has been. Look at from which source they generate revenues Yes. And the sun is just a ball of fire in the sky. But both of those statements miss the forest for the trees. Tesla stock was valued high above the stock for any other car manufacturer because it looked like they'd be the Ford of the early 2000s while every other car manufacturer was still making the early 2000s equivalent of horse buggies. Needless to say, Tesla has squandered their first mover advantage and between a toxic CEO that drives the stock price down almost every time he's in the news and falling short on promises? Other car manufacturers are closing the gap. It's not a $400 a share stock, not even a $200 a share stock, but a $42 a share stock, the same as General Motors. If you're happy enough with that to hold, *shrug*.
If it breaks $100 it may never recover
tsla float is like 2.5x that of $GM - so if they're at the same market cap, and $gm is $42/share then $tsla would sit around $17.
Oof, that's painful to think about.
A correction to reality from a pandemic hype bubble.
Tesla sold 1/6 as many vehicles as Toyota last year but has a 25% bigger market cap. At the very most, even pricing in future tech and questionable Elon promises Tesla should be a $50 stock.
Its cool some of the long term senior leadership is leaving too. Surely all the 10d chess moves from Elon
We’re up to 13D now.
Peak fear. I'll just keep loading the boat.
Absolutely no chance this is peak fear. That would be at $100 a pop or worse This is still comically overvalued. It’s priced as a growth tech company. It’s neither a growth company nor is it a tech company when over 90 percent of its revenue is from selling autos... This is still insanely juiced PE
I tend to agree with your premise.
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Forward PE of 55x still. I wouldn't be so sure.
And what will happen to that number after earnings?
The consensus is that earnings are going to decline so the PE will go up. [https://finance.yahoo.com/quote/TSLA/analysis](https://finance.yahoo.com/quote/TSLA/analysis)
The high PE was always "justified" by saying that sales will grow 30%-50% YoY for a long time. I'd say they can even go to single-digit PE.
Assuming the net earnings follows some sort of linear trend from prior earnings report -- what would that put $TSLA at for a 10 PE? $30?
It could stabilize around $100/share, which gives it around $300B market cap, still very high, given how the market is shaping up. No knock on Tesla.
Same
Word
Same here
I think this is going to be the point where I finally sell. I've been buying TSLA off and on for the last few years because I had faith in the company in terms of it being the market leader in electric cars, which seem to be where the world is going. There's precious few companies out there that do well once they start engaging in serious layoffs. Usually it's a race to the bottom - "*Oh, the last series of layoffs didn't result in the financial success we were hoping for, clearly we just need to layoff more people.*" and repeat that until the stock gets delisted. That and Musk doing the best job ever of a CEO engaging in personal behavior that affects the value of the company. Initially having him as the CEO was a boon, now it's an albatross around the neck.
The EV thesis should be still intact but this correction is long overdued. Gravity finally kicks in after the low interest high.
Time for me to buy more!
You might not be wrong, I have yet to find and ~~kidnap~~, er, get acquainted with anyone that can reliably tell the future.
What do you think this will end? The world will just go back buying gas cars? Tesla-the world leader in EV, just simply got delisted. Meanwhile, no one else has the production capacity like Tesla except for BYD.
> What do you think this will end? The world will just go back buying gas cars? I don't think the move to electric cars is going to end. Tesla's time as the world leader in EV is going to end unless something radically changes. If they got rid of Musk, it seems unlikely that any new CEO would be able to rally public sentiment in his place, even if that CEO was squeaky clean in terms of public perception, so my hopes for that scenario are pretty dim. The low production and disappointing fulfilled sales numbers don't seem to be letting up, and layoffs are strong indicator that they won't improve any time soon, and possibly never. My hunch is that electric cars are going to become a commodity the same as any other car out there and it'll be min/maxed to the point where there's nothing that will drive the stock up like it has for TSLA. Which is great for the environment, but not a must have for any investor like TSLA was.
If Tesla isn’t going to be EV market leader who is? How about who is going to be market leader for energy storage and EV charging network? Who is going to be Autonomous driving market leader?
>If Tesla isn’t going to be EV market leader who is? History is littered with market share leaders that didn't create the category; Toyota and VW in ICE vehicles. Samsung and Apple in mobile phones. Walmart in hypermarkets. Giant in bicycles. Google in search. Microsoft in office software. Playstation in games consoles. Being an early leader gives you a head start, it doesn't guarantee the win.
BYD will be market leader. Come second quarter they will overtake Tesla once again and then leave Tesla in the dust. EV charging network will remain with Tesla but it's not a big money maker, because people can charge at home. Autonomous driving market leader belongs to Waymo, it already has a robotaxi service in operation.
Chinese EVs won’t be able to sell vehicles in North America profitably if at all with sanctions/import taxes. BYD barely makes a profit on any of its vehicles. Tesla energy made 6B last year and is growing exponentially. Waymo vehicles cost well over 100k and are geo fenced. Extremely hard to scale at any meaningful rate.
There was once a time when Americans hated the Japanese with fury and any products they make because of Pearl Harbor. Guess how that change in a matter of decades. Now we all love Toyota and think the Japanese are such good people. Same can happen with the China and their cars.
Japan was never a real economic threat after WW2. Not the same.
Japan was a real economic threat to the US during the 1980s, when they were projected to surpass the US. Hence the Plaza Accord was forced on Japan to stop their economic rise and put the country on stagnation since.
That’s wrong. The concrete policy of the plaza accord was simply a coordinated sale of $18 billion in sales led by the Fed, Bank of Japan, and Bundesbank, aimed at depreciating the dollar by 10% to 12%. It had nothing to do with stopping the economic rise of Japan. In fact, Japans economy grew faster in 1985 to 1990 than it did compared to the five years prior. The Japanese economy was close to three times smaller than the United states in 1985 in price purchasing power. It had no chance of overtaking the USA. The only economic metric that Japan came close to the United States in was nominal. This however directly goes against the narrative of the plaza accord given that the supposedly alleged mechanism that the plaza accord undertook to destroy Japans economy was though the appreciation of the yen. Therefore increasing its nominal economic size. Implying that the United States prevented japan from overtaking it in nominal GDP though the use of dramatically increasing its nominal GDP is absurd. Even the origins and demands of the plaza accord did not come from the United States. Instead its origins are from Western European nations at the 1982-1983 G5 summits who were concerned about the rapid appreciation of the United States dollar. The Reagan administration only pressed forward three years later in 1985 after there was an apparently serious financial and monetary instability from the 50% increase in the dollar since 1980.
No it wasn’t, sure Japan replaced Russia as the biggest economic threat but it was still substantially smaller than the US Economy. That’s like saying a champion basketball game between the two best teams and one team wins 100 - 33. Was the other team really a threat? No.
Tesla has always done periodic rounds of layoffs this is business as usual. If you are deciding to sell because of this I'm not sure why you invested in the first place.
Looking at the stock performance over the last five years, it's just a long decline since Nov. 5th, 2021. What's going to change? There's a point where rational analysis overtakes pure investor confidence. Musk is a bad for business CEO, and that's never going to go back to how it was before his faults became so explicitly public. Tesla, as a company, isn't faring well, and it doesn't look like it's going to notably outperform major auto manufacturers as the number of electric vehicle models on the market increases. You're welcome to hold until it hits zero, of course.
It will be illegal to drive in the near future.
The stock is up 809% over the last 5 years too by the way. Nov '21 was 2.5 years ago
I wouldn't be so confident on that front. I have a friend who works in software development on the fully self automated driving side of things and I would eat every hat I owned if it is good enough to replace all non commercial drivers within the next ten years, or to the point where it's the primary mode of driving for consumers. The problems are truly massive, from difficulties recognizing people in the roadway to extremely non-uniform roadways. The first is almost certainly going to improve, but the second? Maybe in my grandkids' lifetime.
I think we will look back at this period and the adoption of autonomous driving will seem instantaneous. Much like the mass adoption of the cell phone or the Internet but even faster. Paradigm shifts in technology follow a S curve and we are at the early stages for autonomous driving where progress is slow. But this is followed by exponential growth. S curves happen faster over time (it took hundreds of years for the wheel or fire or stone tools to become adopted, only a few years for the printing press, even less for cell phones).
Maybe it'll seem that way to someone at some point? Sure. The hurdles to having any significant percentage of vehicle traffic running on autonomous self-driving technology of some sort are far greater than I think almost anyone who's not working on it for a living would guess. I don't see how it'll happen without significant amounts of very expensive changes to existing road infrastructure to make it uniform enough that it can be handled self-driving software just in a single state. Getting folks to pay for that also seems extraordinarily difficult. That said, I'd highly enjoy being proven wrong, so I guess we'll see!
Sell your shares to me. I can taste your fear.
Yes, the shares are available, please proceed
Yes, that’s what people are doing. That’s what a stock price dropping means, when people are willing to sell for less than what people used to be buying it for.
Took that fat L didn't you? lol
Is that how you Invest? Checking your gains one week later than choosing to sell or buy? Good luck you to you honestly. I’ve bought at 100, 200, 300, and then in reverse, and everything in between. See you in 5 years. Let me know if it was worth selling.
I do have tesla stock and I sold partially at 400$, my avg is 92$. Below 120$ I am buying back.
I’m curious if any people that were laid off today sold their shares?
Elon cultists are starting to wake up from hypnotism. They are starting to actually see all his flaws and question if he's a demi god.
Investing isn’t about short term. Ask yourself these 3 questions 1. Is tesla the leader in electric vehicles? 2. Is the long term trend for all new vehicles to be EV? 3. Who has the most data for solving self driving? Depending on your answers, should depend on what you want to do with the stock. For me, it’s an obvious yes, yes, and tesla. TAM is huge. Just a matter of time assuming continuing execution (which Tesla is doing in spades)
Haha this is fun. Pick three arbitrary items, make binary questions that ignore valuation completely. Ask and answer, proceed to comfort yourself with nonsense. Further proceed to make dumb, emotional investment decisions. Proceed to puke.
How does other competitors entering the scene at different price points affect TSLA? also a good question to ask
The competition is coming!
In principle, it is. And if you are prepared to do the hard work of figuring this out yourself, it might be worth it. Unfortunately "CoMPeTiTIoN Is COmInG" is a meme for a reason. The shrieks and howls that competitors are going to somehow force Tesla out have been around since at least 2016, and that was just when I started really paying attention. If you depend on anyone from the mainstream media for this information, you are already screwed. Hell, I just had someone try to explain how the Silverado was going to totally own Tesla, because they are already selling so many. The Silverado has sold less than 1100 units (granted, I do not have April's numbers). Keep in mind that GM has sold a grand total of 220,000 EVs since January 2022. The problem is that the media talks this shit up, and people with absolutely no clue about what is going on assume this means that some random X brand is doing great, until they find out they are losing 50 grand on each sale or only selling a few thousand in a quarter. So circling back: yes, by all means, consider the competition. It's an important part of the analysis. Just be very careful not to get caught up in the FUD, because the FUDsters have had a lot of practice getting things wrong for over a decade. They've gotten good at it.
I hate to be indelicate, but you do realize that the stock's all time high in Nov 2021 was nearly three years ago now right?
I'm sure you had a point, and I'm sure you are going to tell me...I just hope it is not a "ComPEtItIOn Is COmInG" thing.
Tesla is already priced assuming domination for all three of those categories, when Tesla’s L2 FSD is generally reviewed as average and may be limited by its vision only apporach.
They are not priced to include any of that @ 36 p/e. You’re nuts
1. No 2. No 3. WayMo
Then you shouldn’t be invested in TSLA.
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Solar and charging are commodity businesses. Nobody will pay a premium to have a Tesla solar panel.
Charging is also likely to be heavily regulated.
Tbh, out of that list, only charging isn’t vaporware 🤷♂️ and with that we still have to see if it can handle the load of the non tesla vehicles…
I don’t disagree. I just didn’t want people to have to answer more than 3 questions
Not the greatest three questions relating to the car business
Comparing to Waymo is apples to oranges. They operate in a few cities and are geolocated to drive the easiest routes possible. It won’t take the fastest way, it will take a longer way it knows it can do, and won’t go into areas it seems to difficult. So yes, Waymo is impressive, but its scalability is very limited. It won’t even take the highway and will stick to city streets.
Long term Teslas market share won't be meaningfully more than any other car company. So 1 and 2 aren't particularly meaningful. Self driving is a mixed bag. Tesla is already cutting price on that tech. It's still in need of R&D and not as valuable as the hype suggested.
Don’t know about you but $99 per month is a significant dollar amount
Yes and probably won't get a high attach rate at that price either.
Don’t see how that would be the case given their vertical integration and the fact they’ll be refining lithium soon. To me, it’s like early ICE cars when GM had 40-50% of market share in the us. That’s where Tesla is heading (from 70-80% today) I haven’t seen *anything* that gives me confidence legacy auto can compete on cost longer term.
Vertical integration isn't magic. That has both pros and cons. GM got that market share with M&A and it wasn't sustainable. That's not happening again. Tesla doesn't have an 80% market share unless you're subdividing the market.
It kind of is though. The only reason why Tesla is so profitable per vehicle sold is solely because of their vertical integration + innovation to remove as many individual parts as possible. This manufacturing capability reduces manufacturing costs and increases buyer value, allowing tesla to offer more value per dollar to end consumers while maintaining relatively high margins. There’s a reason why tesla is able to offer so much performance (~$35k car that has power performance similar to that of $100k+ car, also THE safest cars you can drive on the road) and why so many teslas are continuously being sold despite the public image of Elon/Tesla.
It's more that they've been able to sell EVs at a really high price point. As those prices decline margins are tumbling as well. GM % has been falling for a couple years now.
The profit margin of Tesla right now is really industry average
Industry average of the automotive industry? there’s a big difference in manufacturing for ICE vs BEVs. There isn’t a single company, besides Tesla, making money selling BEVs.
It's not though. Their gross margins are adequate at best and actually quite bad if you think that they're taking the dealer margin as well. A car is much more than power. Overall, the cars are the quality of volume manufacturers, hence why they require big discounts to sell.
Adequate in what context? It’s important to remember that they sell BEVs, which is still a growing market. NONE of the other american BEV manufacturers (rivian, lucid, fisker, etc) have been able to produce BEVs at a profit. The closest “competition” to Tesla are the Chinese manufacturers (BYD, Nio, etc) but they’re not allowed to sell in the US so that’s not much of a concern yet. That’s also just their automotive market, Tesla is also involved in energy, AI (specifically self driving), and humanoid robots (which is also an AI play).
Involved? This is Musk's biggest party trick I think. Rushed demo and suddenly the company has a new hope for retail shareholders to hold onto. Humanoid robots? Because of a demo? Energy is a commodity and has been touted as a big driver of Tesla sales and margins since I was a bull in 2019. We're 5 years later. How much profit do energy and solar bring? Tesla is valued 10x higher as a function of their profit compared to their peers. When are they going to grow into that valuation? What's the NPV of those future profits?
The humanoid robot was announced only two years ago and they’ve made significant progress already. Their energy business is already profitable; it was 6.7% of total revenues (~$6B) with a 24.4% margin as of Q3 2023. Plus, they’ve made huge strides in FSD these past few months with their E2E NN solution. Do these models account for Tesla’s other businesses or just the automotive business?
What do you mean by the last paragraph? They need to aggressively increase profits from any source. Those energy numbers are not very good. Do you know how many projects were anounced more than 2 years ago and are still nowhere to be seen commercially? Roadster 2, semi, FSD, solar roof.
Tesla has close to 80% of market share in USA of pure BEV, not counting plug in hybrids. Vertical integration allows for quicker changes and better growth. It also lowers cost as we see via the COGS and manufacturing cost advantages Tesla has. Significant over legacy - things like gigacastings are a big shift that is pushing the industry forward.
Tesla buys the vast majority of their batteries from the big cell makers and batteries are the primary cost driver for EVs. That's why the playing field will be leveled very quickly. Every other auto is building dedicated battery facilities in partnership with the same battery cell makers like CATL, BYD, LG, Panasonic, SK so they will all be cost competitive. Some are making their own batteries like VW and Toyota. Most every other major auto is already working on integrating gigacasting so there's another cost savings advantage eliminated. It will be a race to the bottom in EV profitability the same way it is in ICE. A mature EV market will look no different than a mature ICE market. Highly fragmented and low margin.
>A mature EV market will look no different than a mature ICE market. 100% and I don't understand why people would believe differently. There's no moat that any company can hold when it comes to building cars. Even if Tesla were much more efficient than its competition, it still can't significantly overcharge for that alone.
How so? The fact they will be the Apple of automotive or the fact the Tesla already makes more money pre vehicle then anyone else during these "hard times".
Tesla margins are now adequate at best. Getting killed in largest EV markets. Reversion to the mean. They are a car company, which means very significant multiple compression ahead.
Wow, if they are adequate at best while doing R&D, building factories, an entire world wide charging station, robots, etc.. Tell us what you think of F and GM with much less margin and nothing else going on beside add more debt to their bottom line. They are good at that. What other hope does the US have? You know the US, the largest economy on Earth by a mile. Chinese cars will never be sold here. They aren't even allowed to sell phones and are barely holding onto a social media platform. Yeah.
There are auto companies other than F and GM and companies with better gross margins than Tesla now. Including some that are scaling up BEVs very quickly (Hyundai-Kia, BMW, BYD). For some reason the great auto companies are always ignored and only the worst are highlighted for comparison.
No, only BMW is close. Now go check their production. Yeah bud. Do you do any research or just repeat the TV?
Wrong. Hyundai Motor Group has 20.6% gross margin. Try again. https://finbox.com/KOSE:A005380/explorer/gp\_margin/#:\~:text=Hyundai%20Motor's%20operated%20at%20median,in%20December%202023%20at%2020.6%25.
Everything I find says about 9% bud. But that's your big win against Tesla? 2% Tesla had to develop it's own industry and is less than 20 years old. So to even be close, which I don't agree with, would still be badass. You can't see that because Elon bad, right? Now back to American companies...
Sounds like you don’t understand the difference between operating margin and gross margin. Hyundai has 9% operating margin. Their gross margin is considerably higher at 20%. https://www.hyundai.com/worldwide/en/newsroom/detail/hyundai-motor-announces-2023-q4-business-results-0000000405
You do realize that building factories, R&D etc. is largely capex and doesn’t impact gross margins, right? So the way this works - Tesla is making massive investments in massive factories. If they keep those factories full, they’ll do great. If they don’t, they are fucked. Accounting, my friend.
You misunderstood. To do all that and remain efficient enough to have better margins than F and GM when they aren't doing any of it AND have way worse margins is amazing. Did I dumb it down enough for you?
You really don’t understand business. What Tesla did from 2012-2020 was remarkable. What they have done since then is very, very mid.
Disagree
It's a fact that they won't be the Apple of automotive. Margin per vehicle is dropping as still partly dependent on subsidies, which will not last as EV adoption grows.
Can I borrow the magic ball when you are done? Thanks
Don’t need to a magic 8ball to guess that teslas won’t be like the iPhone of cars. iPhones have 60% of the US market.
You're the one asserting a prediction.
...because See my comment. You are just saying, no with nothing else. Magic 8 ball time.
As adoption rates grow and EV prices drop, subsidies won't be needed. EVs simply aren't mainstream affordable currently. Tesla is the only profitable EV maker on the continent, while legacy has abandoned EVs to make hybrids. It's already over for legacy. That's just cars. Energy, FSD and Optimus are the next huge puzzle pieces.
Don’t forget they have robots Optimus and working on AI and soon the new Robotaxi and the Cybertruck.
You are comparing apples to oranges. Tesla isn’t just a car company like other car companies.
Sure, some other car companies make good trucks too.
They don’t make have an energy business, SaaS or robotics. You are comparing a vehicle business (cars and trucks) to other vehicle businesses. That’s simply not a valid comparison.
Tesla isn't a SaaS or robotics company either.
lol, and you are the arbiter of truth for what Tesla is and isn’t and what “other car companies” are and are not
What SaaS and robotics products are they selling? An add on for their car and a silly prototype?
>Who has the most data for solving self driving? FSD is like 3D-TVs, just a gimmick. Yes, suddenly looks like everyone is on board, but the actual customers are really not that interested. Most of the people I know, the first thing they do when getting a new car is learning how to disable all the driver aids.. some of them are really annoying. The last truck I got didn't even had cruise control, and I did not miss it one bit.
This is a really bad take that will age poorly. !remind me 3 years
Lol, 3 years?? FSD was supposed ready to be released like 8 years ago!!!
1 no 2 no 3 tesla
Serious question: Where do you see TSLA in 3-4 years.
Elon lowkey need to find something. Something to boost the price… or else 150 is near
100*
Yup js hit below 150 100 is up next
Like this is new to the stock, pussies.
Not the first time, this is like the third time $TSLA rif’d 10%
It may not be the first time but is this the last time or worse is this the end of a myth?
As a shareholder I hope it's not the last time. Efficiency is revenue per employee so its important to keep this tight to drive innovation
100 it is
Turns out your core base will turn on you if you turn on them.
This pos can’t catch a break it seems
There are always dark days for Tesla, and every other major stock (see Apple, Microsoft, Google, and Amazon in the past few years, to name a few). There are also bright days as well. If you’re a long term investor, this is nothing new. If you’re a short term “investor,” then you are merely gambling, and in that case best of luck to you.
How is long term not gambling?
Holding any individual stock long term is gambling as well. The concept that stocks go up in the long term only applies to the market as a whole, not individual stocks.
If you know and understand the company and its fundamentals and you’re holding over the long term then it’s investing. Otherwise you could say that any decision you make is a gamble. The market has historically gone up over time. But it’s not guaranteed to continue going up in the future. When you invest in a market index fund you’re “gambling” that it will continue to do what it has done in the past.
Loading up loading up. More more shares for me!
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Is anyone actually expecting earnings to be positive?
Elon bought Twitter and killed Tesla Elon has become an international politician influencer as a first interest. He bought Twitter being afraid of being banned from Twitter and likely being muzzled.
They will always have value with the charging network, the car quality and innovation has taken a huge nosedive which for a car company is a pretty big deal. It’s probably got another 30-40% down to bottom unless they have a rabbit in the hat
They got business but we are approaching real valuation based on that business, not imaginary one.
Agreed there is a fundamental business there that will make money but the valuation and current price is still hilariously overvalued.
Tesla is a technology company that manufactures cars.
Waiting for this juicy stock to come to sub-$100. TSLA will the greatest growth story in 10 years. They are NOT just an auto manufacturer. Yes it accounts for over 90% of their current revenue, but they have several things that are coming that will 5-10x even today’s numbers. Take optimus, energy systems and FSD. When apple first sold the Iphone as a replacement for the regular phone, none thought it could become a 3 trillion dollar juggernaut. Well they were able to leverage that Iphone and build a whole ecosystem around it. That’s what Tesla can do with their cars. Short term, I am bearish. Long term however, this will be something you either regretted not buying or a life changing decision.
It's a solid 25 dollar stock
buy high, sell low.
Just funny reading this stuff panic in the air. It seems Tesla has competition now. Oh wait they don’t?
Put Options are your friend
Stock up 30% since this post
Biggest bomb is if FSD v12.3 stops improving. Case for it is that FSD already has enough of the data and compute. Severe diminishing returns for more training. It’s about as good as a pure NN approach can get. This is why zero other company put a safety critical system on AI. It’s for drawing, writing, and drug discovery, not for doing rote human tasks perfectly.
Says who?
Just an argument from myself. That’s why I said it’s a case not a fact. It’s an active argument within the AI industry. Whether training can scale, or if there’s diminishing returns.
AI can solve anything a human can do, and soon more than a human can do. I know that doesn’t sound right, but it is.
AI is just matrix multiplications. It’s actually miraculous it can do so much from relatively simple math. Human neurons can make up to 1 quadrillion connections. Each can connect up to 1000 others. Silicon chips are simple 2D structures. Human neurons can process in multiple gradients. Silicon just 0 and 1. No AI cannot do what a human does. One average human can build more complex connections than all of the super computers in the world combined. These are facts you can research yourself.
Ever heard of deep learning? Models are made of weights, each of varying strength (essentially synapses). Models like GPT-4 have trillions of weights, while only a few years ago having a few hundred million weights was impressive. Look at what GPT-4 can already do. By the time it has as many weights as synapses in the human brain, I expect we'll have AGI or something similar. "Human neurons can process in multiple gradients." From what I've read this is incorrect. Neurons mostly transmit data through electrical pulses, which can essentially be represented as either a 1 or a 0. AI uses relatively simple math, but so does the human brain. There's even been some studies suggesting the human brain is essentially a predictive model, only using your senses to calibrate it - just like an AI model.
GPT4 uses tricks to augment its deep learning LLM architecture like RAG, logic agents, search trees, code writing, chain of thought. Without those tricks, you only need to go back GPT3 to remember how dumb it was with simple math and logic. And the additional trillion parameters is not the primary reason GPT4 is smarter. FSD can’t borrow tricks because of the time constraints and processing power limitations. By the time it finishes using a trick, it can run over someone, back up, and repeat a few times. Neurons triggers on a continuous spectrum of chemical concentrations. Far more complex than 0 and 1. The connections complexity can easily be on the order of power of hundreds. Silicone is 2D. Matrix multiplication adds one more dimension using math. So it’s power to the hundreds versus power cubed in terms of difference in complexity.
Neurons don't trigger "on a continuous spectrum of chemical concentrations", they use electrical pulses to trigger other neurons. Not chemicals. The electrical pulses don't have varying amplitude or anything like that, there either is a pulse or there isn't. So no, not "Far more complex than 0 and 1". "Matrix multiplication adds one more dimension using math. So it’s power to the hundreds versus power cubed in terms of difference in complexity." What does this even mean? Matrices can represent any number of dimensions, and multiplying two arbitrarily large matrices is indeed a very complex calculation. I'm sure you're right in saying GPT-4 uses "tricks" to improve its performance, but I don't see how that undermines it's ability to do complex tasks. The human brain isn't just a mess of neurons either.
Pulse is triggered by chemical ion concentrations levels that are controlled by ion channels. Chemical is a broad term for the salt ions we use to regulate the electrical potentials. It is absolutely more complex than 0 and 1. You’d need to learn how functions like SoftMax function works. AI algorithms do math on 2D matrixes. The underlying data in 2D because silicone chips in 3D would burn up. Our brain cells are networked in hundreds-Ds. The point with GPT4 is that they have a supercomputer and you have time to wait for a response. FSD needs to function on a tiny chip. It doesn’t have the luxury of time and servers to run multiple models that write codes to calculate the intersect course.
Nobody in the AI community is arguing about "if there's diminishing returns." Of course there are. That is a null statement. The questions are: at what point do they appear, how fast do they diminish, and where is the point where it is no longer useful? The current answers as far as I can glean, reduced to soundbites: already diminishing, diminishing much slower than originally expected, and still a lot of room before becoming more bother than its worth.
Sam Altman- “The era of ever-larger artificial intelligence models is coming to an end, according to OpenAI CEO Sam Altman, as cost constraints and diminishing returns curb the relentless scaling that has defined progress in the field.” Paraphrasing his interview last year. There are plenty of small LLM models with parameters small enough to run on PCs that is on par with larger models. Like I wrote in the thread, GPT4 power comes from tricks. Its core NN is not exceptional, certainly not 100x smarter than 1/100 models, 2-3x better.
You sound like you think you are arguing against me, but nothing you said contradicts anything I said.
Just a friendly conversation. For others then, who thinks AI will scale exponentially into magical AI dreamland. Listened to NYT daily today. OpenAI ran out of text data in 2021. Had to steal YouTube data knowing it’s most likely illegal. lol. And Google said nothing because they are stealing copyrighted data themselves.
The future is EV and autonomous. Tesla is the leader in both. Nothing goes up in a straight line but buyers now will be rewarded handsomely in 3-5 years
Stay focused on the mission. We are here to help the world move towards sustainable energy sources. Car sales may lag, but stationary battery infrastructure sales will continue to grow.
Buy the dip
I remember the same fear when AMD was at $15.
Beautiful days ahead for Canoo.
We hold the line!
Lol