Many here on SA have been writing of the prospects for Tesla Motors (NASDAQ:TSLA) including ourselves. We remain long TSLA and have been made aware of a proprietary yet simple solution which could literally expand the amount of Supercharging Stations virtually overnight without the lengthy and expensive need for real estate. Moreover, the solution uses readily available, inexpensive solar panels in a creative fashion that is easy to implement. We know that the inventor has reached out to Elon Musk, but do not know if there has been a dialog. We believe that the lack of charging stations is the only real impediment to the widespread use of electrical vehicles -EV- in the future. Given Tesla's leadership position in this profitable niche automobile market, whether or not it dominates EV car production or licenses the valuable intellectual property it is developing, TSLA is a buy and hold stock for planet earths future which is tied to climate change (more on this later). Even Bob Lutz, an old school former GM Vice Chairman admits that EVs are here to stay in an interview with CNBC:
"You need cars that can go at least 300 miles on a charge," he told the network. "You need rapid recharging capability. And you need affordable pricing. So far Elon Musk [Chairman and CEO of Tesla] has achieved two out of the three. They're a long ways away from mass-market pricing."
Although he does not believe EVs will have more than a 10% market share by 2025, we would like to ask him that question again if there was a ubiquitous Supercharging infrastructure in place. The range factor is what Lutz hangs his hat on, and we think there are clever ways around this problem on the near term horizon.
Global warming is a very controversial topic. We think it's really a bad name for the real problem, "Climate Change" or CC. CC is really the changing positioning of the jet streams which affect everything from cell phone signals to turbulence in air travel. A recent Guardian article "Climate change will lead to bumpier flights, say scientists" reports:
There is evidence that clear-air turbulence has already risen by 40-90% over Europe and North America since 1958, but that is set to increase further due to global warming. The jet streams, which meander for thousands of miles, are driven by the temperature difference between the poles and the tropics, Williams explained. Climate change is heating the Arctic faster than lower latitudes, because of the rapid loss of reflective sea ice, so the temperature difference at the altitude passenger jets fly at is increasing. That leads to stronger jet streams and greater turbulence. The modelling done by Williams and Joshi assumed that carbon dioxide levels will double from pre-industrial levels by 2050, which is in the mid-range of current projections for future emissions.
We know there are a lot of skeptics on this issue, but, given the recent violent weather here in the US with damaging tornadoes and massive flooding, we think it's not wise to ignore the science we are being presented by experts.
When Elon Musk was interviewed on Friday May 31 on CNBC, he said there was going to another important announcement on June 20 for TSLA. We think this may be related to the strategic exclusivity it currently has with Daimler (OTCPK:DDAIF) as we wrote about in "Tesla's 'Mirror Mirror On The Wall' Stock Can Fly Until July" and TSLA has been flying since May 7th publish date.
In the interview, Jim Cramer candidly reports that the car is very cool and that:
"I can totally understand why someone that test drives a Tesla wants to buy the stock, because it's about as cool of a thing as I have seen."
What we found intriguing was the "hyperloop" travel concept. Doing a little digging, we think we know what Elon is concocting: a Vactrain.
According to Wikipedia:
Vactrain tunnels could permit very rapid intercontinental travel. Vactrains could use gravity to assist their acceleration. If such trains went as fast as predicted, the trip between London and New York would take less than an hour, supplanting aircraft as the world's fastest mode of public transportation.
The modern concept of a vactrain, with evacuated tubes and maglev technology, was explored in the 1910s by American engineer Robert Goddard, who designed detailed prototypes with a university student. His train would have traveled from Boston to New York in 12 minutes, averaging 1,000 mph (1,600 km/h). The train designs were found only after Goddard's death in 1945 and his wife filed for the patents.
Whether or not this is Elon's next entrepreneurial endeavor, the idea is captivating and we would like to buy a ticket on the Vactrain if it becomes a reality. As for TSLA, we are long and think the stock's volatility will keep it in the news and a favorite for traders for some time to come.
Disclosure: I am long TSLA. I wrote this article myself, and it expresses my own opinions. I am not receiving compensation for it. I have no business relationship with any company whose stock is mentioned in this article.