Tesla’s growing pains 🩹

Ahh, they grow up so fast! One minute Tesla (TSLA) is a snappy young startup, the next it is old enough to hit the bars, in Aotearoa at least. In true Tesla style, the company has indulged by launching their own brew, a NZ$160 German brewed pilsner called GigaBier. 🍻

But the electric vehicle industry is maturing too. Competition is ramping up, prices are coming down and there are even electric car shows now! ⚡ After being the industry’s child star for many years, Tesla is starting to face some growing pains as they jostle for market share. 

And just like us at 19, Tesla is experimenting to see what works. That includes cutting prices six times this year, which has slimmed down Tesla’s profit margins. But while Tesla’s share price fell almost 10% on the news, Elon Musk ain’t bothered. In fact, Musk says it’s better to sacrifice money today to get more cars on the road, even at lower margins. That’s because cars on the road could one day be put to work harvesting revenue as autonomous robotaxis. 🚕

The idea of an armada of self-driving Teslas cruising the streets was music to the ears of Tesla superfan ARK Invest. 🎶 Fund manager Cathie Wood bought large amounts of Tesla shares for their flagship ARK innovation ETF (ARKK) and thinks Tesla shares could be valued at US$2,000 per share by 2027. That would potentially value the company at a casual US$5 trillion. 

Needless to say, some other analysts aren’t so optimistic. ARK Invest’s opinion leans heavily on Tesla becoming a robotaxi behemoth. But competition is creeping in. GM’s (GM) Cruise robotaxi division is testing autonomous cars on the road, along with Alphabet’s (GOOGL, GOOG) Waymo division… when they’re not trying to run from the law. The industry still has a long way to go, but that’s just part of growing up. 🎸