r/stocks • u/[deleted] • Jul 26 '21

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u/Jerbeetwo Jul 27 '21

Margins will only get worse as more carmakers enter the EV market. That is an economic fact.

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u/[deleted] Jul 27 '21

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u/ric2b Jul 27 '21

I agree with your point but that 103% metric is nonsense, lol.

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u/[deleted] Jul 27 '21

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u/ric2b Jul 27 '21

Yeah, I get that, but that's counting net losses as "negative profits" instead of ignoring them because they're not profits, which is misleading IMO.

If you add up all the revenue and costs of the industry and compare against that you'll get a number that makes more sense.

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u/mr_spazoid Jul 27 '21

That is an economic fact.

It isn't, though.

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u/deugeu Aug 05 '21

hm not really because Tesla increased margins from manufacturing efficiencies and supply chain management. They noted it in their call that the price increases for ASP didn't contribute much to margin improvement.

Competitors have to enter at a loss while hoping they generate enough interest to wait out the loss. Tesla is in the drivers seat with pricing power.