Here’s what else you need to know about the world’s most valuable automaker: 

The Tesla essentials:

How much is Tesla stock?

Tesla keeps baffling Wall Street. The stock quadrupled this year—as of Sept 24, shares were trading at $387 after a stock split—allowing the company to raise an astounding $7.3 billion in 2020. In August, the investment bank RBC told investors Tesla is “fundamentally overvalued,” echoing widespread sentiment on Wall Street. 

For Tesla’s stratospheric share price to make sense, it argued, the carmaker must grow more than 30% per year for the next decade. And the comparable companies to pull off such a feat—Apple, Amazon, and Google—don’t operate under the auto industry’s razor-thin margins.

Yet nothing seems to dent investors’ faith in Musk, whose (mis)behavior as head of the company’s board has made him “effectively uninsurable.” And the showman always has more pyrotechnics for his fans: new autopilot features, expanding factories in Berlin and Shanghai, and who knows what’s next. 

Maybe that’s the point. Musk has never disputed today’s valuation makes little sense given Tesla’s track record. “Tesla is absurdly overvalued if based on the past, but that’s irrelevant,” Musk tweeted in 2017 when its valuation was a mere $70 billion. “A stock price represents risk-adjusted future cash flows.” And he knows investors are betting on a very, very bright future. 

What goes into a Tesla battery?

The batteries of electric vehicles are a minefield of environmental and human rights problems. They rely on a variety of metals and minerals—cobalt, nickel, lithium, and more—most often sourced from mines in developing countries that are rife with instances of child labor, corruption, toxic pollution, and deforestation. 

Tesla is no exception. On Sept. 22, Musk said Tesla would be redesigning its batteries to drop cobalt and other expensive metals. In the meantime, he’s shopping for better sources: Last week the company joined an alliance to support improved cobalt mining practices in the Democratic Republic of the Congo. It’s also in talks to buy low-carbon-footprint nickel from a specialized mine in Canada.

Elon Musk’s grand plans

Since Henry Ford’s first black Model T rolled off the assembly line in 1908, automakers have been building gasoline cars and trucks roughly along the same lines. Tesla was the first and only auto firm to envision itself as an energy company. As Musk wrote in his “Secret Tesla Motors Master Plan” in 2006, Tesla would “help expedite the move from a mine-and-burn hydrocarbon economy towards a solar electric economy.”

Since then, Tesla has ventured into batteries, solar panels, self-driving software, photovoltaic roof tiles, underground transportation (via The Boring Company), and even interplanetary travel. Musk hurled a Model 3 toward Mars aboard his SpaceX Falcon Heavy rocket in 2018. 

Some of those ambitions nearly bankrupted the company more than once. But they might also pay off. For Tesla, after having strong-armed the entire industry to commit to electric batteries, it now faces unprecedented competition. Despite all the detours and delay, Tesla has never wavered much from the “master plan” Musk laid out more than a decade ago:

The Tesla fan club

To spread the word, Tesla relies on super fans like Will Fealey. President of the Tesla Owners Club UK, Fealey and his fellow club members spend their spare weekends at car shows, offering “10,000 test drives” to prospective Tesla owners. “Staff from companies like Pagani, Aston Martin, BMW, and Porsche had to pick up their jaws from the floor once they realized we were volunteers from the official UK owners club and not employed by Tesla,” he tweeted 

No other car company can claim this. Tesla just isn’t like other car companies. It spends virtually nothing on paid advertisements. Ford must spend roughly $2,000 per sale advertising its Lincoln sedan. Even luxury heavyweights like BMW pony up about $200 a piece to move cars off the lot. 

That’s a durable competitive advantage, but Tesla still faces huge headwinds. It’s a new, relatively small automaker in a cutthroat market where EVs make up just 2.6% of global sales. Tesla’s zero-emission credit sales, rather than margins on vehicle sales, represent all of its profits and more. Next year, more than 30 new EV models from rival carmakers will hit the market, a “watershed year” for EVs, says Herbert Diess, Volkswagen’s CEO.

But when you have an army of customers ready to sell your car, maybe you’re doing something right. 

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