The Next Big Thing: Tesla Motors

Tesla

Tesla Motors (TSLA) has been in the news a lot lately, and for good reason — the future has arrived. I live in the Bay Area, and it has become impossible for me to drive around town for a day without seeing a Model S on the road. Just like with what Apple (AAPL) was able to accomplish with the iphone and ipad, I really believe that the future of the automotive industry belongs to Tesla.

Check out this video below!

http://www.youtube.com/watch?v=yzEQZBImhpY

For the most part, people are skeptical to the idea of an all electric vehicle becoming mainstream. They cite range limitation, lack of charging stations, high price tag, etc. These concerns are all valid, but Tesla has a plan in place to address all these so called “limitations”. BlueStar (Gen III) will be more affordable, at around $30,000, battery technology will improve charge density over time, supercharger stations are being built all across the country, and the just unveiled battery swap feature will allow you to fill up faster than you could pump a full tank of gas! It always seems like Tesla is one step ahead of the critics. With Elon Musk leading the way, can this thing really fail? Does Tesla have too much momentum to be stopped?

I’m truly excited for the future. I’m also a huge fan of technology and revolutions. I like seeing industries disrupted by new players who bring in fresh ideas. This is how progress is made. This is how humanity moves forward.

modelx
Model X-Falcon Wings!

I’m also an investor. And right now, TSLA at $125/share looks expensive! From almost any valuation stand point, it’s overpriced. But who really knows? We’re talking about a potential hyper-growth story here! Maybe like Apple, and Google before it. By no means am I encouraging anyone to go out and buy 1000 shares of Tesla immediately. However, I am keeping in my mind the endless possibilities that do exist for such a game changing company. This is a stock worth watching, for sure. I currently own 72 shares (bought back on the dip to $90 in June) after selling 260 shares back in May. Tesla is more than just a car company — it’s a technology company. And even though I swear by the strategy of dividend growth investing, that does not imply that I’m just going to close my eyes and let a potential revolution pass me by.

Disclosure: I am long on TSLA.

Just look at the sheer number of supercharger stations being built in 2013 alone:

Supercharger Stations (Currently Available):

Tesla_2013
http://www.teslamotors.com/supercharger

Supercharger Stations (Available by the End of 2013):

tesla_2014
http://www.teslamotors.com/supercharger

The people have spoken… and they want Tesla to be able to sell direct to customers!

White House Petition:

tesla_petition
https://petitions.whitehouse.gov/petition/allow-tesla-motors-sell-directly-consumers-all-50-states/bFN7NHQR

Please share your thoughts!

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Kurt @ Money Counselor

I recently spent a long weekend in the Palo Alto area and Teslas are everywhere. With oil hitting $105/bbl today (and higher in the future), the market inevitably will move to electric vehicles. I can’t afford a Tesla, but my next car will definitely be all-electric.

Martin
7 years ago

Do you know for how much do they sell those cars? If the price is too high it may defy all benefits of having electric car. Also I am interested in how much does it cost to charge the car and the mileage. I’ll try to check it out, unless you know and help the lazy man out by telling me right away…

Martin
7 years ago
Reply to  FI Fighter

So you are saying I can charge the car for free for life? Wow, that makes it an interesting deal I guess. the mileage isn’t that bet either, considering it is an electric car. A typical pick up truck can get you around 350. The price is like a large SUV, if you travel a lot it may be saving you some money on gas. Not sure however. I might do some number crunching… (but not now, I am lazy right now)

Compounding Income
7 years ago

I’ve personally never seen one of these. They don’t exist here.

However, if they can get the price down to 20k-30k and saturate recharging stations, then we are talking about something!

Still never seen one…

Compounding Income
7 years ago
Reply to  FI Fighter

You know I’m an income investor and would not consider TSLA because owning shares would not increase my income stream. What else stands to gain from electric cars and increased electricity usage? Electric utilites. Natural gas producers (raw material to make electricity). Natural gas pipeline companies. Perhaps stocking up on these types of companies could make sense to an income investor if this does happen. SO, KMI, PPL, etc? With less risk and less potential gains though too. Just a though. Articles like this one are definitely worth thinking about! I wonder how far off TSLA is from moving the… Read more »

Martin
7 years ago

I agree. It may be a great company, but it doesn’t pay dividends, so i must pass it on as well.

The First Million is the Hardest

They’re an interesting story to say the least. The technology is exciting & I’m pulling for them to succeed and drive change within the industry. As an investment I feel like the stock price has been run up really high over the recent excitement, but it’s a real temping company if the price comes back down to earth a little bit.

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[…] Back in 2013, I bought up shares of Tesla Motors (TSLA) aggressively, and made a pretty penny in a very short period of time. Because the Model 3 seemed so far away, I kind of lost track of the whole EV story, and thought that I had much more time to get well situated for the upturn. […]

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[…] days, I would be remiss if I didn’t at least give them their due credit… Back in 2013, I started tuning into the Tesla story, and really believed that if anyone out there could pull off massive success with the Model S, it […]