Posted on 04/12/2017 3:49:38 AM PDT by IBD editorial writer
Motor City: The big news in the auto world was that Tesla topped the market value of General Motors. That means the car company that gets massive taxpayer subsidies is now worth more than the car company taxpayers bailed out a few years ago. Welcome to the world of crony capitalism.
On Monday, Tesla's stock closed at $312.39, which meant the startup electric car company, which sold a grand total of fewer than 80,000 cars last year, was worth more than GM, which sold 80,000 Chevy Silverados every eight weeks. (Tesla's market cap edged below GM's on Tuesday.)
Is this a case of irrational exuberance gripping investors? Or the electric car version of the 1990s internet bubble? Is the future of Tesla really that bright? We tend not to second guess the wisdom of the markets to get things right, at least over the long term.
But it's worth noting that whatever Tesla's growth potential, at the moment the company is heavily reliant on taxpayer support.
(Excerpt) Read more at investors.com ...
Yeah...
Sure...
Kinda makes me feel sorry for today’s Tesla owners.
Oh?
Can your truck get to 60MPH in 2.37 seconds?
That will save you 6 seconds. Life is short, but not that short.
Musk is pretty good at technology but he’s a genius of the first order at rentseeking.
Cut the parasite off.
The EPAs war on small diesels is a national disgrace.
The rest of the world thrives with fuel efficient, modern small diesel engines.
The stupid EPA rules prevent them from being used in the U.S.A.
Not because they pollute too much, but because of arcane rules the penalize diesels. A car that gets 50 mpg but a slightly higher output of “pollutants” per gallon of fuel, is deemed unacceptable.
A car that gets 20 mpg, but has a little less “pollution” per gallon than the 50 mpg vehicle is ok.
That is not logical, it is insane. The logical standard would be based on a cost benefit ratio, something the EPA is absolutely terrible at.
What car do you have?
Elon Musk’s growing empire is fueled by $4.9 billion in government subsidies
http://www.latimes.com/business/la-fi-hy-musk-subsidies-20150531-story.html
You shouldn’t.
They, as has been pointed out, are basically receiving taxpayer funded gifts even at the prices they pay.
In addition to being too damned small, they are far too expensive for what you get.
I do agree with the writer’s point that these private ventures should never receive tax payer subsidies. Winnowing out winners from losers is what private capital is for. But I had to laugh about how he decided to drive the point home. Today’s price for an individual stock and the overall value of an entire company aren’t at all the same. Of such things bubbles are made to burst. I’m no fan of GM, or Tesla for that matter, and neither should receive a dime of my money unless I freely decide to invest or buy a product from them. But the latter is microscopic in comparison to the former.
“Crying about Tesla subsidies and CAFE standards is a bit disingenuous when the entire industry in complicit in maintaining their government-sponsored monopolies. Another shot of Ethanol, anyone?”
I agree completely. It’s impossible to sum up all the problems the car industry has and the impact of legislation in less than three 900 page tomes.
Over the years Congress has asked for reports on why such-and-such is happening. They get them and find in the conclusion that it was something, or a combination of somethings, that Congress did. They promptly shelve the report and go on with corruption as usual.
Can that Tesla haul anything other than ass?
Ping.
Agreed. And it isn't just subsidies and CAFE standards. It's a huge plethora of standards and regulations that serve to block new entrants into the industry, thus solidifying the quasi-monipoly status that the handful of large car companies have.
In a free market, Tesla and others would have no government barriers to entering the market and would provide competition to the other entities already present.
Investors believe Tesla is the next Apple.
They are wrong.
Most everybody can afford an Apple product or two.
Hardly anyone can afford a single Tesla product.................
I live in a condo. There are no charging stations or even curbside power outlets at the parking lots. Elec cars are definitely not for condo or apartment dwellers.
Plus, who wants to wait around for an hour(s) getting a charge? That only works for overnight charging in a free-standing home, preferably with a garage. Normal cars fill up in < 5 minutes anywhere in the world where there are roads.
No, and neither can your Tesla if you are behind me. ;o)
“In addition to being too damned small, they are far too expensive for what you get. “
Many new cars have no oil or transmission dipstick. In my Jetta the dealer charged $1000 to change just 4 of the 12 liters of fluid and the filter. There was no way to check how much you needed without draining the pan and measuring the amount that came out and adding the difference by a ridiculous special pump. The car was made so as to be unserviceable by anybody but the dealer, or somebody who had invested heavily in ridiculously specialized and expensive tools. The actual maintenance cost per 100,000 miles as done by the dealer would be around $5-6 thousand dollars. A former service writer told me they were instructed not to let the customer out of there without finding at least $1000 worth of things to change. Oh, want the dealer to change your oil? Around $100. They quote $59 or so, then, without having mentioned it, they add an oil disposal fee, shop towel fee and some others and after taxes it’s $97.
Who do they think they are? BMW?
What's the point? Tesla owners rave about their acceleration. I rarely ever wish I had that, usually in an emergency situation. So far, the lacked of it has never been a problem in many years of driving.
If it's for the thrill and to impress other people, that's nice. Just driving in freeway traffic where some people are going 85 while weaving back and forth across five lanes, others 60, others 45, combined with jerks who come onto the road while driving 35 from the entrance are enough daily thrill for me.
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