$Lucid Group (LCID.US)$ The total MC of the auto sector is e...
$Lucid Group(LCID.US$ The total MC of the auto sector is exploding while the TAM of the sector will remain roughly the same over the coming years. Either the sector participants will be blessed with permanently much higher valuations, or the number of sector participants will need to be culled. Some investors must believe that these new EV players will supplant the legacy guys.
These naive investors see EVs as a new type of automobile. It’s not, it’s a new type of drivetrain. What’s unchanged is everything else, I.e. wheels, tires, body panels, bumpers, brakes, windows, interiors, etc.. Who has 100 years of manufacturing experience in making cars? Who already has the capacity to make millions of cars? Who has the parts manufacturing subcontractor contracts in place, at favorable costs due to large quantities ordered? Legacy car makers that’s who. Tesla has had growing pains in scaling up their operations, that according to Elon almost caused a bankruptcy. They were fortunate to be at that time the only EV manufacturer and was able to stay solvent without any competition by selling green credits. Anyone who thinks that these EV manufacturers are going to supplant the legacy guys is kidding themselves. What’s more likely to happen, that Legacy guys learn to make EV drivetrains, or that these new EV players flawlessly, economically and quickly are able to manufacture millions of their cars?
Other than $Tesla(TSLA.US$, who because of it’s huge lead and who can be a leader in EV compact sedans, the remainder of EV newbies will at best be niche players selling at most low six-figures of units/year. In a few years they will trade at a fraction of their current ridiculous share prices.
Finally, EV adoption will be slower than the optimists believe and Legacy selling both ICE and EV will turn out to be an advantage.
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Btyt1989 : With Pioneers comes new blood, avoiding pot holes from lessons learnt from Tesla will only expedite new EVS. What you see Tesla took 10 years ago will only take 5 years to reach. Secondly, you are again not talking about the quality of the Brand’s coming out. It makes Tesla an “average old player”.
Mikey_Vibez : With increasing demand from Wall Street for electric car manufacturers, Tesla's stock price has soared by more than 150% in the past 12 months.
THEWIZARD : Profits cashed out from Tesla shares, buys more shares in Lucid and RIVN.
LOL.
Teddy Willson : You can't win if you you don't play. In this market, valuations have gone out the window quite some time ago, certainly in select sectors. Yes, it will come back to earth, but it's impossible to time. Just diversify.
James Browny : this sector is beyond insanity. absolutely unreal price movements. the TAM of the auto sector is the same. where is the additional TAM for them to get to justify the $100-150bn priced tags? the likes of F and GM arent going to lose sales as they themselves are being reinvented
such a joke.
Stitch-fu : Where are the shorts?
Z9Gwqc14JU Stitch-fu: Getting squeezed. 9% short interest getting hit with a bat
ouySFiuuNu : Absurd.