Thing is, everyone is looking for the next success story - very few are looking for the next train wreck. As a consequence, I have always found it easier to spot the train wrecks.... perhaps that makes me a temperamental bear as well...
Harley, Doordash and Tesla … can’t say anything about the other but for these three here are my 5cent.
Harley is in a tight spot. As you described it’s customer base (wealthy older men) is dying out or figuring out they look ridiculous after 1-2decades enjoying their harley. Harley is extremely fearful of loosing its identity and thus can’t really innovate. A solution would be to go back to the roots and build lighter smaller more nimble bikes like they did post WW2 but I doubt they are able to pull off the balancing act. To do this huge investments would be needed and the risk would be still there. Harley biggest danger is the sentence - it’s not a real harley.
Doordash is interesting because here in SEA all specialized food delivery services have been incorporated into ride sharing businesses … either by M&A or from the start. But transportation is also still mostly on 2 wheels and transportation costs very low. There is extremely fierce fighting between the different competitors. With enough funding it was allways possible to join the market and not go bankrupt. As a consumer imwould say the winner takes it all is not applying to this market. Maybe it’s a decade long evolution but it seems that single market dominance is not achievable and not required either. Drone delivery will soon become a reality in the us so I totally agree that Amazon is just airing for the right moment.
Tesla - not sure with this one bag. VW ist currently discussing to stop all its IT development and just give up and handing the keys to the kingdom to apple/Google. Reality is they burn funds and still can’t even get anything done. Maybe Elon is overrated but then everybody else needs to be downgraded. Tesla has a realistic chance of being a real dominant power in automotive in the future. Sure the sharks will take the first opportunity to take Tesla down - think political enemies/all other car makers - but I don’t see them achieving it. The future is electric (if we like it or not) and Tesla DNA is electric. Soon luxury car brands will be nothing else than tech versions of Gucci bags or Calvin Klein glasses. Not even produced in-house, all coming out of the same factory with huge profit margins. I have no doubt these brands will still survive 100years longer but not as real tech companies. They will just be brands on a standardized technology plattform (something all carmakers are allready doing) but way more extreme. That’s the reason you won’t see a Google or apple car. Google and Apple is allready in every car and soon the brands and their shells will just be Gadgets and accessories to apples/googles ecosystem. Tesla is the only company with a clear vision to not let that happen to their cars and that what makes them a different beasts. Maybe your prognosis is becoming reality but I would not underestimate them - and be it for the incompetence of the others - many would argue they just can’t change and become a tech company (I mean all car manufacturers) but in reality it’s just money and a will. Herber Dies for example to last CEO of VW was fired. He basically was a 10% Elon musk (and I don’t even mean that negative) he understood where things are going and believed VW could take the fight. Well they threw him under the bus. Hope that makes sense what I wrote
Seems we agree on Harley. As for Dash - I’m not so sure it’s “possible to join the market and not go bankrupt” Eventually you have to show profit, or you run out of money. Dash is not the only food delivery company hemorrhaging Cash - they are all losing money. That makes me question whether a viable market for food delivery exists.
As for Tesla, I have to wonder what the Bull case really is. The Car business is very low Margin thanks to many manufacturers. I can’t understand why Tesla is so special, that they get priced at 60x earnings, while the others are at 8x. The only thing which justifies the 60x multiple is expanding margins & increased production. They have neither … 14% less money on 2% more cars says it all.
Regarding Dash what I wrote is referencing SEA. But as I said they are integrated components of Ride sharing and more. So I basically agree if they don’t do money AND have no over secondary advantage like economies of scale and growing a customer base for one or the other … they are probably having the gate u described.
Regarding TESLA I am not so eloquent and I don’t doubt your number Bag BUT some of your arguments could also be made against Apple. For example they don’t even produce the core components. The iPhone is basically completely built by Samsung and Foxxcon and some others. I know it’s just one argument to counter what other people are claiming … ANYWAY I am not a Tesla fan (I don’t have doge nor do I have Tesla stock) but I think I really have a feeling of what their strengths are and these are stronger then you think. The „mistake“ is, you see Tesla as a car company but it is more. It’s a true technology company (sounds cheese but true) if it’s baked 60x of y instead of 8x of y then I can absolutely see why. Maybe it should be valued 8x of y but then no way would Toyota and VW be valued more than 2x (these are dying companies!) again they couldn’t built a RTOS (real time OS) if the fate of the whole company depends on it. They can’t even built their own shitty App Store. In tomorrows world that’s just not enough. Car become more and more somplistic. Mechanical Engineering less relevant and IT engineering the strategic capability. It’s 2023 the fight is over. They are toast. I wouldn’t touch this market and as long as the traditional car maker don’t get d evaluated I wouldn’t risk it with Tesla. You have to understand the pure arrogance the traditional manufacturers had. Seldom in history has an entire industry walked into doom on such a high horse. And now they are in wild action realizing the incoming doom. Again don’t want to convert you or anything just the advice it’s not as simple as you think. We talk about institutional innovation. Having this capability wie very very valuable.
Just to adress you numbers argument regarding price reduction and sales. What needs to be also taken into perspective is the pure electric sales numbers. As long as VW and co. Can produce Piston Engine powered cars the numbers are skewed. In Europe the party is over in 10years and considering that chinas only option for a successful or relevant national car manufacturing base is electric - they will follow. Tesla is dealing from day one without this strong drug (piston engine sales) … other companies just are dependent and whatever they say and do are in a tight spot. The idea to still built but also change to electric is probably very challenging. It’s like being half pregnant.
Hum, I think you make some very interesting points (and I enjoy your writing style).
My judgment, however, is completely useless : I have protected 10 of the last one recessions. I am temperamental a bear.
Prediction, predicted not projected
Thing is, everyone is looking for the next success story - very few are looking for the next train wreck. As a consequence, I have always found it easier to spot the train wrecks.... perhaps that makes me a temperamental bear as well...
Ya! I find it hard to overlook the pomposity and bullshit which leads me to some pessimism and lots of poor judgement as pertains investments.
Harley, Doordash and Tesla … can’t say anything about the other but for these three here are my 5cent.
Harley is in a tight spot. As you described it’s customer base (wealthy older men) is dying out or figuring out they look ridiculous after 1-2decades enjoying their harley. Harley is extremely fearful of loosing its identity and thus can’t really innovate. A solution would be to go back to the roots and build lighter smaller more nimble bikes like they did post WW2 but I doubt they are able to pull off the balancing act. To do this huge investments would be needed and the risk would be still there. Harley biggest danger is the sentence - it’s not a real harley.
Doordash is interesting because here in SEA all specialized food delivery services have been incorporated into ride sharing businesses … either by M&A or from the start. But transportation is also still mostly on 2 wheels and transportation costs very low. There is extremely fierce fighting between the different competitors. With enough funding it was allways possible to join the market and not go bankrupt. As a consumer imwould say the winner takes it all is not applying to this market. Maybe it’s a decade long evolution but it seems that single market dominance is not achievable and not required either. Drone delivery will soon become a reality in the us so I totally agree that Amazon is just airing for the right moment.
Tesla - not sure with this one bag. VW ist currently discussing to stop all its IT development and just give up and handing the keys to the kingdom to apple/Google. Reality is they burn funds and still can’t even get anything done. Maybe Elon is overrated but then everybody else needs to be downgraded. Tesla has a realistic chance of being a real dominant power in automotive in the future. Sure the sharks will take the first opportunity to take Tesla down - think political enemies/all other car makers - but I don’t see them achieving it. The future is electric (if we like it or not) and Tesla DNA is electric. Soon luxury car brands will be nothing else than tech versions of Gucci bags or Calvin Klein glasses. Not even produced in-house, all coming out of the same factory with huge profit margins. I have no doubt these brands will still survive 100years longer but not as real tech companies. They will just be brands on a standardized technology plattform (something all carmakers are allready doing) but way more extreme. That’s the reason you won’t see a Google or apple car. Google and Apple is allready in every car and soon the brands and their shells will just be Gadgets and accessories to apples/googles ecosystem. Tesla is the only company with a clear vision to not let that happen to their cars and that what makes them a different beasts. Maybe your prognosis is becoming reality but I would not underestimate them - and be it for the incompetence of the others - many would argue they just can’t change and become a tech company (I mean all car manufacturers) but in reality it’s just money and a will. Herber Dies for example to last CEO of VW was fired. He basically was a 10% Elon musk (and I don’t even mean that negative) he understood where things are going and believed VW could take the fight. Well they threw him under the bus. Hope that makes sense what I wrote
Seems we agree on Harley. As for Dash - I’m not so sure it’s “possible to join the market and not go bankrupt” Eventually you have to show profit, or you run out of money. Dash is not the only food delivery company hemorrhaging Cash - they are all losing money. That makes me question whether a viable market for food delivery exists.
As for Tesla, I have to wonder what the Bull case really is. The Car business is very low Margin thanks to many manufacturers. I can’t understand why Tesla is so special, that they get priced at 60x earnings, while the others are at 8x. The only thing which justifies the 60x multiple is expanding margins & increased production. They have neither … 14% less money on 2% more cars says it all.
Regarding Dash what I wrote is referencing SEA. But as I said they are integrated components of Ride sharing and more. So I basically agree if they don’t do money AND have no over secondary advantage like economies of scale and growing a customer base for one or the other … they are probably having the gate u described.
Regarding TESLA I am not so eloquent and I don’t doubt your number Bag BUT some of your arguments could also be made against Apple. For example they don’t even produce the core components. The iPhone is basically completely built by Samsung and Foxxcon and some others. I know it’s just one argument to counter what other people are claiming … ANYWAY I am not a Tesla fan (I don’t have doge nor do I have Tesla stock) but I think I really have a feeling of what their strengths are and these are stronger then you think. The „mistake“ is, you see Tesla as a car company but it is more. It’s a true technology company (sounds cheese but true) if it’s baked 60x of y instead of 8x of y then I can absolutely see why. Maybe it should be valued 8x of y but then no way would Toyota and VW be valued more than 2x (these are dying companies!) again they couldn’t built a RTOS (real time OS) if the fate of the whole company depends on it. They can’t even built their own shitty App Store. In tomorrows world that’s just not enough. Car become more and more somplistic. Mechanical Engineering less relevant and IT engineering the strategic capability. It’s 2023 the fight is over. They are toast. I wouldn’t touch this market and as long as the traditional car maker don’t get d evaluated I wouldn’t risk it with Tesla. You have to understand the pure arrogance the traditional manufacturers had. Seldom in history has an entire industry walked into doom on such a high horse. And now they are in wild action realizing the incoming doom. Again don’t want to convert you or anything just the advice it’s not as simple as you think. We talk about institutional innovation. Having this capability wie very very valuable.
Just to adress you numbers argument regarding price reduction and sales. What needs to be also taken into perspective is the pure electric sales numbers. As long as VW and co. Can produce Piston Engine powered cars the numbers are skewed. In Europe the party is over in 10years and considering that chinas only option for a successful or relevant national car manufacturing base is electric - they will follow. Tesla is dealing from day one without this strong drug (piston engine sales) … other companies just are dependent and whatever they say and do are in a tight spot. The idea to still built but also change to electric is probably very challenging. It’s like being half pregnant.