Friday, March 23, 2018

Tesla, Still a Buy and Hold, but

One thing I want to make sure everyone is aware of, is that I am not a financial planner, or investment adviser, or any other professional designated person, and I do not provide any type of financial or legal advisement.

That said, I am still suggesting that Tesla is a buy and hold for now, at least while they are still holding the orders for their commercial semi truck platform.  As long as they continue to develop in the areas of commercial transport, and commercial energy, they will continue to be a buy and hold prospect.

One thing I am going to say about Tesla and I am surprised about this (though not completely) is that they did not build on the platform.  Therefore I do not think that Tesla should invest in building a pick-up truck.  Here is why.  If they wanted to build a truck platform, that would be good, but it would have to be a heavy duty platform.  That should be their first goal, build the platform.  Once they have the platform, they could build a heavy duty truck on it, or just build the platform and have other third party companies build the body style.  By having the platform, software, and technology, they would provide a base on which other companies could design and build their own style of trucks.  They could build pick-up trucks, box trucks, ambulances, and the list goes on.

This is the failure of the Tesla system, they did not build platforms.  They should have a platform for the sedan (Model S) that is the same platform on which the Model X is built on, and the Roadster is built on.  The same for the compact platform, the Model 3 should be built on a compact platform that could have a sedan, a roadster, a crossover, even a small truck if they wanted.  Because they were platforms they could put just about any body they want on to the platform, tweak the motors if they wanted, but the platform stays the same.  This way they have a compact platform, a mid sized platform, and a heavy duty platform.

This then would give them all sorts of partnership opportunities with designers and builders to build on the platform, and make new styles of vehicles that suit many more needs, and they would be able to come to market much quicker with their designs as they would be on an established platform.

I know they do not like to build partnerships, and I understand that completely, but it can be done right, and if they do the right thing, they will succeed and they will definitely be upgraded to a buy and acquire.  Right now their long term prospects are based, in my opinion, on their commercial concerns, and that is a lot of top heavy projects sitting on top of a very competitive market.  I do hope they see that they have the opportunity to scrap their current way of doing things, see that a platform would be better for current and future growth.

I am still saying, get some, get in on the hype and buy some Tesla stock, hell, even buy some of their products, they are fairly good, though they could be better.  They are still on my buy list, but they have to change their isolation policy if they expect to grow enough to support more than just the first adopters.  Many other companies will come along, do it better and do it cheaper, and I would hate to see another Edsel.

Peace,
JD

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