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  • Why Are Luxury Car Makers Looking The Other Way While Tesla Eats Their Lunch? [View article]
    Look under the hood of a Model S and one will find storage space. Look in the trunk and one will find a motor with one moving part. Beyond that, the other commenters are doing an adequate job of refuting the claim that the Model S is more expensive to maintain than its ICE counterparts.
    May 11 02:51 AM | 4 Likes Like |Link to Comment
  • Why Are Luxury Car Makers Looking The Other Way While Tesla Eats Their Lunch? [View article]
    As implied by the introduction of the article, Tesla too often becomes a proxy for the decades old debate between value investors and growth investors. Value investors insist on profits and dividends. Growth companies, especially start-ups pioneering new and revolutionary products, do not produce profits or pay dividends early-on and frequently go far into debt. They take risk and go into the red confident that they will eventually become profitable and able to pay dividends. Most of the value companies that value investors hold so dear for their steady profitability and dividends once were growth companies, spending more money than they had and reinvesting what little profit there was. Therefore, it is very shortsighted for value investors to rail on growth companies and start-ups as they are the primary source of future value investments.

    If Tesla succeeds, someday it too will be a value company. In any case, one cannot argue successfully that only companies which are profitable out of the gate become successful. If someone believes that, they really need to take a few undergrad courses in business to understand how innovation and entrepreneurship works. If one does not have the risk appetite for investing in new growth companies with high burn rates, then one should stick to value companies. But don’t berate growth companies for not being value companies, because sooner or later, if they succeed, they will be.

    To the next point in the comment, the central thesis of the article is that it is not wise to assume that just because a car maker produces a hybrid or an all-electric that it is competing head-on with Tesla. There are lots of alternative fueled vehicles on the market, but few that compete with the Model S. A consumer that is interested in buying a luxury sedan like the Tesla Model S is not going to consider a little all-electric hatchback like a BMW i3, a Mercedes B-class, or an Audi A3 e-tron. Follow the links in the article and compare the photos of these cars to an image of a Tesla Model S or even the rendering of the Model E/Gen III and ask yourself “would a customer that is in the market for a car like the Tesla Model S honestly consider any of these cars?”

    This article is challenging people to look at Tesla from the customer’s perspective. Certainly an investor who is only impressed by profits can appreciate the importance of this exercise, since one cannot have profits if one does not have revenues, and without customers there are no revenues. The point being, a luxury sedan customer has no interest in a hatchback. It is as simple as that.

    Regarding the last point, the comment only bolsters the point of the article. The question the article is asking is why aren’t the major luxury car makers willing to go toe-to-toe with Tesla at the high (not middle, not low) end of their range with an all-electric flagship model like the Model S P85? The article answers the question by citing the perverse incentives created by emissions standards which prompt the major luxury manufacturers to build “compliance cars” (Google this to access the reams of information that were researched but did not make it into this article) and the sunk cost of their investments in the ICE. Citing the great profitability of these businesses only shores up the point that they have too much invested in ICE technology to cannibalize their flagship luxury sedans with an all-electric 7 series, S class, or A8.
    May 11 02:48 AM | 4 Likes Like |Link to Comment
  • Tesla's Success Bad News For Hybrids And EREVs, Good News For BEVs [View article]
    The appeal of hybrids is that they have one foot in an old familiar technology. That has a certain appeal, but there comes a tipping point when consumers move past a transitional technology. The year-over-year U.S. sales data presented in the article for the top selling BEV (Nissan Leaf), the hybrid (Toyota Prius), and EREV (Chevrolet Volt, which was introduced to the U.S. in the same month as the Nissan Leaf) suggest that the ability of hybrids and EREVs to compete with BEVs is diminishing as consumers get more comfortable with fully electric technology and the charging infrastructure that is there to support it (most notably Tesla’s Supercharger network, but also the thousands of public charging stations available and the most convenient of all stations, the one an EV owner installs in his garage).


    The Honda Accord hybrid may be a nice car, but is it experiencing the same initial sales growth as the Tesla Model S? A comparison like the one presented in the article comparing Tesla Model S sales to Cadillac ELR sales “off-the-line” using numbers from hybridcars.com shows that despite a much larger potential market for a lower priced car, the Honda Accord hybrid is not taking off like the Model S did:


    · First month: Honda 23, Tesla 450.

    · Second month: Honda 530, Tesla 800.

    · Third Month: Honda 426, Tesla 900.


    Honda sold 910 Accord hybrids in the U.S. in February that’s just 2.98% of all hybrids – not even a top 10 competitor in its class. In the BEV camp, Nissan sold 1,425 Leafs and Tesla sold 1,400 Model S’s. The numbers simply do not support the contention that the Honda Accord can reinvigorate hybrid sales to match the growth rate of BEV sales.
    Mar 20 05:11 AM | 4 Likes Like |Link to Comment
  • Why Are Luxury Car Makers Looking The Other Way While Tesla Eats Their Lunch? [View article]
    We at Market Exclusive are flattered that you would see us as a threat to you shorting operations. It is doubtful, however, that sensible investors will be swayed to your point of view as a known Tesla shorter by painting those that disagree with you as newbies and labeling their views as “nonsense.” They will also not find your points more persuasive because you pepper your comments with all-caps shouting. It just makes you sound desperate. Stooping to this kind of behavior can only harm your credibility. Let’s give Seeking Alpha readers more credit than that. You may do as you like, but for your own benefit as a fellow contributor consider what I’ve said.

    I am well aware of the decrease in Model S delivery times in recent months, but there are many possible reasons why this may be that don’t involve jumping to the conclusion that Tesla is “clearly DEMAND constrained.” For example, those who are not new to covering the automotive industry know of the historical seasonality of automotive sales, which tend to slow down for everybody from about Q4 to Q1. Right now, lots of Tesla detractors are looking at the leveling-off of Tesla sales over the last six months or so and declaring this to be irrefutable proof that Tesla demand has peaked. Applying the same simplistic analysis to most other nameplates over the same time period, we must conclude the entire industry is in decline. In any case, with just 19 months of Tesla sales data, we do not have enough observations to work with from a standpoint of statistical rigor to conclude that Tesla demand is in some sort of freefall or that it is simply experiencing the same sales ebb flow to which all manufacturers are subject.

    Further, saying that the major luxury car makers are choosing not to compete directly with the Model S because they don’t see it as being worth the investment is not that much different from what the article is saying. They are too heavily invested in ICE technology and find it too profitable to change gears. It does not detract from the argument, it merely adds support. Plus, this business of “compliance cars” and the perverse incentives created by fleet emissions limits is easily observed. The bottom line is that there are several ways in which luxury car makers are leaving the door open for Tesla to steal market share with a very competitive car.
    May 12 11:25 AM | 3 Likes Like |Link to Comment
  • Why Are Luxury Car Makers Looking The Other Way While Tesla Eats Their Lunch? [View article]
    Regarding the environmental impact study referenced, for every one study dug up from a dubious source (the one linked to in the comment was authored by an insurance and securities brokerage firm publishing “sell ideas” it would no doubt profit from, masquerading as an unbiased research firm) that concludes BEVs are more polluting than ICE’s, there are ten studies published by actual scientists that disagree. Though in some parts of the world, a preponderance of coal-fired electricity production makes BEV’s less environmentally friendly than one might expect, in the U.S. on a well-to-wheels basis, the claims of this study are easily refuted. Please see the Apples to Apples section of an article Market Exclusive published on this site entitled “Power Surge – Will the EV Revolution Overwhelm the Grid?” for more information.
    May 11 02:52 AM | 3 Likes Like |Link to Comment
  • Why Are Luxury Car Makers Looking The Other Way While Tesla Eats Their Lunch? [View article]
    If Mercedes Benz can be forgiven for being between model years, one must also forgive Tesla for being supply constrained. Otherwise, perhaps someone should tell the editors at the highly reputable Economist, which broke the story, that they need to stop being so sloppy in their fact-checking.

    Moreover, Mercedes is not the only luxury car maker feeling the heat from the Tesla Model S. Forbes magazine reported (http://onforb.es/1hFjGzE) that Tesla is outselling BMW, Mercedes and Lexus in 8 of America’s 25 wealthiest zip codes, including locales far from Silicon Valley (in other words, the “hometown team effect” does not adequately explain Tesla’s popularity, and thus it is conceivable that its world-class performance and fuel economy might have a tiny bit of an influence on sales).

    Regarding the models not mentioned in this article, do not mistake the rigorous process of editing down the reams of research behind one of our published articles for a lack of knowledge. The planned Audi referenced in the comment is to be an SUV. The focus of this article is the luxury sedan segment.

    BMW does seem to have the biggest plans to compete with Tesla, though as the article suggests, this is also an exercise in compliance; more about lowering fleet emissions averages than building a great car. Moreover, there is little evidence that BMW has solid plans to compete directly with the Model S any time soon. Let’s review what we know of its plans so far: The i7 exists only as a placeholder trademark (along with i1 through i9), so it is as near to vaporware as one can get. With a starting price of about $136,000, the i8 actually overshoots the Model S P85. It is a two-door supercar. It is as far out of the consideration set for a luxury sedan customer as a little i3 hatchback.

    From what little has been released by BMW through its blog, the i5 does not look like it will compete directly with the Model S and as the name implies, will pose little threat to BMW’s flagship luxury 7 Series sedan. It looks more like a crossover, so it will compete with the Model X for consumer mindshare. Therefore, the article’s thesis still stands: The major luxury makers are not willing to go toe-to-toe with Tesla by producing a flagship, high-performance all-electric luxury sedan that might cannibalize their bread-and-butter ICE-powered models, such as the Mercedes S-Class, BMW 7 Series, or Audi A8. In any event, it is unlikely that they will build the i5 in large quantities, because in the final analysis it is a “compliance car” (the motivation for which the article quite adequately explains).
    May 11 02:50 AM | 3 Likes Like |Link to Comment
  • Tesla's Success Bad News For Hybrids And EREVs, Good News For BEVs [View article]
    @Tales From the Future

    A fair point regarding assessing the global market, particularly regarding investability. However, right now, global sales do not provide an apples-to-apples comparison in the same way it would be unfair to compare the recent sales of the Tesla (a new and popular model experiencing explosive initial growth) to the Volt which is more mature (albeit not by much). That's why emphasized the comparison of Leaf sales to Volt sales. Telsa is still in the process of establishing its presence in foreign markets, so current lighter sales in countries where competitors are well established could mislead investors as to Tesla’s global sales potential.

    Thanks for mentioning VW’s plans, which shows how a major auto maker has recognized the need to square its development plans with the increasing popularity of the BEV. It is Tesla that lit that fire under them, which is one of the main points of this article. Tesla shouldn’t be nervous. If Tesla has proven to VW that it can make profits selling BEVs, why can’t VW’s efforts to expand the market for the BEV also be good for Tesla? Please keep in mind the last point in the article about the standards battle not necessarily being a zero sum game for auto manufacturers. If VW can make the contribution of extending battery range by 50% in just two years (as you mentioned); that can only be good news for the BEV industry in general. It also brings up an interesting question: If reputable VW says it can double the range delivered by batteries in the next two years, why do those who have a negative view of Tesla assume that in the next 10-20 years Tesla won’t be able to come up with any innovations to improve the design and manufacture of batteries that might compensate for the resource constraints implied by the current state of battery technology?
    Mar 20 01:58 PM | 3 Likes Like |Link to Comment
  • In California, Car Charging Group Charges Ahead While NRG Energy Stumbles [View article]
    @vman: Thank you for making my point about the incoherence of your comments. Regarding Zacks ads, automation is precisely the problem. Search for any random symbol on Seeking Alpha and see how often the same exact ad comes up suggesting you should sell that symbol -- just as it does when viewing an article about CCGI. Your suggestion that auto manufacturers are backing away from EVs is simply false. Finally, two questions regarding your integrity:

    1) Please tell the readers the logic behind suggesting that EVs are on the decline while you yourself hold shares of CCGI.

    2) Referencing the exact line-item in Seeking Alpha's Comment Guidelines, please explain to readers exactly why your first comment on this article was apparently deleted by Seeking Alpha.
    Jun 23 02:15 AM | 2 Likes Like |Link to Comment
  • In California, Car Charging Group Charges Ahead While NRG Energy Stumbles [View article]
    On a well-to-wheels basis, yes, the EV fleet is not pollution-free but several unbiased studies have found that EVs are less polluting than gas-powered cars. The U.S. grid is cleaner than one might think. There are a host of variables that must be taken into consideration, such as the fact that most EV charging occurs overnight during off-peak energy production hours. Well-to-wheels emissions is a much more complex subject than EV detractors wish it to be. Please see one of our earlier Seeking Alpha articles, entited "Power Surge: Will the EV Revolution Overwhelm the Grid?" for a more detailed discussion of this topic.
    Jun 22 11:51 AM | 2 Likes Like |Link to Comment
  • In California, Car Charging Group Charges Ahead While NRG Energy Stumbles [View article]
    That comment was not directed at you, it was directed at vman for a comment that tried to incoherently bring the war in Iraq into the conversation. Sorry for the confusion. Your comments are appreciated.

    As for the ads, they are automated and will appear alongside any ticker you search for on Seeking Alpha. They give the same advice about every stock, hoping that readers will panic and subscribe. Who would subscribe if the ads said "You're holding a great stock! There's nothing better you could own!"
    Jun 22 11:51 AM | 2 Likes Like |Link to Comment
  • In California, Car Charging Group Charges Ahead While NRG Energy Stumbles [View article]

    Your comment is plainly incoherent but the point of the last paragraph of the article is not. NRG is far behind Car Charging in the very important state of California and it is reasonable to suggest that NRG, if it is serious about competing in the EV charging services space, may want to consider acquiring Car Charging Group. It is perfectly normal for a company that is pioneering a new market to be unprofitable, and it would be disingenuous to not point out this fact for the benefit of Seeking Alpha readers. A cursory review of your comments on other articles reveals that you have a deep concern about "pump and dump" options scams. This is admirable, but in all candor, this article is not a part of some such conspiracy.
    Jun 21 02:20 PM | 2 Likes Like |Link to Comment
  • In California, Car Charging Group Charges Ahead While NRG Energy Stumbles [View article]

    If there was something that needed clarification or verification, the CPUC would have been contacted. As it is, the requirements of the settlement were clearly spelled out in black and white, as were the problems NRG has had in fulfilling them in the first annual review. Both of these documents are linked in the article.

    The article does not exclusively blame the slow progress on the CPUC. It leaves open the possibility that the most onerous requirement, that all the Make-Readies must be associated with a unique eVgo subscriber, may have been NRG's idea. The point being, when a company sets out to develop a new market, it is bound to make mistakes. When correcting those mistakes requires altering a settlement with a government entity, in will more than likely be a long and difficult process. Ultimately, it doesn't matter who made the mistake. The issue is how much longer it will take to correct it given the situation.
    Jun 21 02:20 PM | 2 Likes Like |Link to Comment
  • Why Are Luxury Car Makers Looking The Other Way While Tesla Eats Their Lunch? [View article]
    No, I have not, but I have no reason to doubt that customers interested in a hatchback will be interested in them though I maintain a hatchback is a far cry from a luxury sedan. The question is, will Audi, Mercedes-Benz, and BMW build as many as people want, or will they just build enough to keep their fleet emissions within regulatory standards?
    May 12 11:24 AM | 2 Likes Like |Link to Comment
  • Why Are Luxury Car Makers Looking The Other Way While Tesla Eats Their Lunch? [View article]
    One of the central points of the article is that the heart of luxury is performance, not the superficial trapping of luxury like leather and wood. Serious luxury car makers that want to stay competitive do not waste time competing on the amount and quality of leather and wood in their cars, or even the number of massage settings in their seats. Those things are easily imitated, which is why they seek to differentiate by investing in better engines, braking, gearboxes, etc.

    The comparisons in the table presented were based on similar price point, basic performance measures, and car type (they are all sedans). One may disagree with these criteria, but they are consistently applied. In-house, performance-tuned versions of these cars that sport the AMG, M, or S badge are priced much higher than the Model S P85 and so were excluded from the comparison.

    In any event, bringing up those models only undermines the argument that these cars are more about luxury than performance. AMG and BMW’s M are in-house tuning shops. When they go to work on an existing model, they don’t add more leather and wood – if anything, they tend to strip those superficial trapping of luxury out of the car because their job is to greatly increase performance, primarily by increasing horsepower and decreasing weight. When they do that, they arrive at better performance than a Model S P85, but they also price themselves out of consideration.
    May 11 02:54 AM | 2 Likes Like |Link to Comment
  • Why Are Luxury Car Makers Looking The Other Way While Tesla Eats Their Lunch? [View article]
    What is the largest brand of gas station in the U.S.? Is it ExxonMobil or is it a supplier like Gilbarco Veeder-Root, which makes the gas pumps owner/operators of gas stations purchase? What company is the largest retailer in the U.S.? Is it Wal-Mart, or is it Visa, MasterCard, Discover, or American Express because they own the networks that process all of the credit card transactions that occur at Wal-mart?

    Chargepoint can no more claim to be the largest owner and operator of public EV charging stations in the U.S. than Gilbarco Veeder-Root can claim to be the largest brand of gas station or Visa could claim to be the largest retailer. Similar to Gilbarco Veeder-Root, Chargepoint sells EV charging equipment to property owners. After that sale, they no longer own them. Like Visa, they own the network behind the points of sale that processes and aggregates transactions (among other things), but they have no control over the point of sale itself.

    The Chargepoint web site currently says Chargepoint has over 17,000 “places to charge.” Chargepoint does not own and operate any of those “places.” In fact, Car Charging Group (which does own and operate each of its public locations in partnership with property owners) is the largest owner of Chargepoint hardware in the U.S. (800-900 units according to conversations we have had with Car Charging Group CEO, Michael Farkas). The rest are owned and operated by a myriad of Chargepoint customers who bought equipment from Chargepoint and pay Chargepoint fees to have that equipment on the Chargepoint network. None of the true owner/operators of Chargepoint equipment on the Chargepoint network have more charging points than Car Charging Group.
    May 11 02:54 AM | 2 Likes Like |Link to Comment
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