Gary Black Responds To Tesla Fanboys

Investment Strategy

🔍 Q: How should one approach investing in Tesla stock?
A: Invest with a long-term perspective of 10-20 years, focusing on the company's potential rather than short-term fluctuations, as exemplified by Steven Mark Ryan's strategy of buying Tesla stock annually since 2016 without selling.

💡 Q: What's a key principle for new investors?
A: Ignore the crowd and go against the consensus, as Gary Black advises, recognizing that consensus is often wrong and profitable investments often come from contrarian thinking.

🧠 Q: How can investors gain an edge in stock picking?
A: Always choose stocks where you have a research edge or informational advantage, as recommended by Gary Black, to make more informed and potentially profitable investment decisions.

Market Analysis

🔬 Q: What should investors study to understand a company's market position?
A: Be a "product junkie" by thoroughly studying competitors, suppliers, and customer behavior to gain comprehensive market insights, as suggested by Gary Black.

📊 Q: What should investors be cautious about in sales forecasts?
A: Be wary of "hockey stick" sales forecasts that lack support from new products or expansion into new distribution channels, as these may be overly optimistic projections.

💰 Q: How effective are price cuts as a business strategy?
A: Price cuts rarely add long-term value since competitors usually match them, making it an ineffective strategy for sustainable growth or market advantage.

Tesla-Specific Insights

🚗 Q: What is Tesla's current market position in vehicle sales?
A: Tesla's Model Y has been the world's bestselling vehicle for multiple years, highlighting the company's strong market presence in the automotive industry.

🤖 Q: How important is autonomy to Tesla's future?
A: Autonomy progress is crucial for Tesla's long-term success and is a key driver of its stock price, as it will become a fundamental requirement in the automotive industry.

🏭 Q: What recent strategic decision did Tesla make regarding expansion?
A: Tesla put its Gigafactory in Mexico on hold, prioritizing autonomy development over expanding production capacity for more affordable vehicles.

Future Projections

📈 Q: What is Gary Black's conservative forecast for Tesla's deliveries by 2030?
A: Gary Black conservatively forecasts 6 million deliveries per year by 2030, which is considered more realistic than his earlier 20 million estimate due to slower autonomy progress.

🤖 Q: How might Tesla monetize its Optimus humanoid robots?
A: Tesla's Optimus robots may require monthly software payments in addition to the initial hardware cost, potentially creating a new revenue stream for the company.

🚕 Q: Who are Tesla's competitors in autonomous ride-hailing services?
A: Companies like Waymo, Cruise, Pony AI, and WeRide are developing unsupervised ride-hailing services, competing with Tesla in the autonomous vehicle market.

Tesla's Valuation and Future Outlook

🚗 Tesla's 2030 delivery forecast of 6 million vehicles is more realistic than the overly optimistic 20 million, due to slower-than-expected cost reductions in producing compelling electric vehicles.

🤖 Since 2021, Tesla's valuation has been primarily driven by unsupervised autonomy, not vehicle sales, according to the author's valuation model.

🏭 Tesla's Gigafactory in Mexico, intended for affordable vehicle production at scale, was put on hold, contributing to production delays alongside pandemic-related supply chain disruptions.

Autonomous Driving and Robotics

🚘 Tesla's autonomy progress has been rapid and widespread, becoming the main value driver for Tesla stock since 2024.

🦾 The author expects monthly software subscriptions for Optimus humanoid robots, a concept not publicly addressed by Elon Musk, marking a significant point of disagreement.

🛣️ Tesla maintains the lowest cost per mile for hardware deployment on roads, potentially giving it a sustainable advantage in the autonomous ride market over the next decade.

Investment Strategies and Market Perspectives

📈 Steven Mark Ryan invests with a 10-20 year horizon, consistently buying Tesla stock since 2016 without selling, emphasizing long-term commitment.

💼 Gary Black's future fund has been up 13.37% since its August 2021 launch, though its long-term performance remains to be seen.

🧠 Gary Black's investment principles, including ignoring the crowd and investing in companies with the best products, align with Steven Mark Ryan's philosophy.

Contrasting Viewpoints and Predictions

🔮 Steven Mark Ryan's Tesla valuation model has strongly contradicted many of Tesla's own assertions since 2021, particularly regarding Tesla Bot and monthly software subscriptions.

⚖️ There's disagreement on whether other companies can solve generalized autonomy and compete sustainably with Tesla in the long term.

🕰️ Steven Mark Ryan believes that Tesla's predictions will eventually prove correct, contrasting with Gary Black's more conservative outlook on Tesla's future dominance in autonomy and robotics.

• 00:00 💬 Gary Black responds to Tesla fanboys' hostility, recalling past criticism after exiting his Tesla stock in 2021, and notes Tesla's unique profitability despite competition.
  • Gary Black responds to hostility from Tesla fanboys, recalling past criticism he faced after exiting his Tesla stock in 2021.
  • Tesla remains the only electric vehicle manufacturer making a profit, despite competitors producing comparable vehicles, due to its existing brand equities and loyal customer base.
• 01:55 🚗 Gary Black doubts Tesla can reach 20M deliveries by 2030, predicts 25% market share with many vehicles as robo-taxis, driving valuation through autonomy.
  • Tesla is the only company making money selling electric vehicles at scale and also has the world's bestselling vehicle, despite having a higher starting price.
  • Gary Black believes Tesla cannot reach Elon Musk's goal of 20 million deliveries by 2030, which would require a 25% market share.
  • Supply chain issues, high interest rates, and halted Gigafactory plans have impacted Tesla's production and affordability goals.
  • Tesla's valuation is driven by autonomy, not vehicle deliveries, which will make their automotive business seem insignificant in comparison.
  • Gary Black predicts Tesla will likely have a 25% market share of all vehicles produced on Earth, with many being operated as robo taxis, amid a contraction of the personally owned vehicle market.
• 05:43 🤔 Gary Black revises his Tesla predictions, criticizes Elon's optimistic projections, and disputes Tesla's autonomous monopoly, predicting a sharp stock fall.
  • Gary Black admits being off by 6 months in his prediction, attributing Elon's overly optimistic 2030 delivery projections to underestimating the time needed to reduce production costs for a compelling electric vehicle.
  • Elon has not indicated plans to charge monthly for software on Optimus humanoid robots, which Gary Black sees as a significant disagreement.
  • Gary Black's conservative Tesla forecasts, including 6 million deliveries by 2030, drew criticism from Tesla fans, but his estimated average selling price for Tesla vehicles in 2030 appears overly optimistic.
  • Gary Black claims he exited Tesla 6 months before buying back in at a 30% lower price, and notes that by 2024, Tesla will likely dominate autonomy, validating his earlier stance.
  • Gary Black claims Tesla's autonomous technology lead is exaggerated, citing existing unsupervised ride-hailing businesses from competitors, and predicts Tesla stock will fall sharply.
  • Gary Black agrees with Tesla fanboys on autonomy being crucial for the auto industry, but disagrees on Tesla's monopoly, believing others like Waymo, Cruise, and Pony can compete with Tesla on autonomous technology at scale.
• 10:34 💰 Gary Black notes Tesla's low cost per mile makes it hard for competitors to match pricing, giving Tesla an edge over legacy automotive companies.
  • Legacy automotive companies, likened to the Titanic, take a long time to go bankrupt after hitting a financial "iceberg".
  • Tesla has the lowest cost per mile for electric vehicles, making it difficult for competitors to sustainably match that pricing, while predictions about short-term stock fluctuations are unreliable.
• 12:35 📊 Gary Black, a long-time Tesla investor, shares his investment strategies and fund's 13.37% return since August 2021, emphasizing a long-term view and research-driven approach.
  • Gary Black, a self-described Tesla fan, has continuously bought and never sold Tesla stock since 2016, investing with a long-term view of a decade or more, due to his belief that it presents the best risk-adjusted opportunity.
  • Gary Black shares his investment fund's 13.37% return since August 2021, while discussing differing investment timelines and philosophies with a Tesla supporter.
  • Gary Black shares his investment strategies, including having a research edge, investing in companies with the best products, being cautious of management's bullishness, and studying competitors and customer behavior.
• 15:16 💰 Gary Black explains his investment philosophy, prioritizing long-term unit growth over short-term gains, and why he won't sell his Tesla stock despite reaching price targets.
  • Gary Black outlines key investment principles, including valuing stocks, articulating ownership reasons, modeling scenarios, prioritizing unit growth, and exercising sell discipline.
  • Gary Black justifies selling a stock when it hits a price target, but his long-term investment philosophy doesn't change even if Tesla's stock price reaches his fair valuation estimate.
  • Gary Black explains that he doesn't plan to sell his Tesla stock because, based on his 10-year investment horizon, he believes it's reasonably priced and he doesn't want to make the common mistake of selling a potentially valuable asset too early.
• 17:29 💸 Gary Black shares his investment strategies and critiques Tesla's stock value and long-term competitiveness.
  • Gary Black shares his investment strategies, including shorting stocks with bad businesses, looking for growth stocks with controversies, leveraging mega trends, considering cannibalization of existing products, and being wary of overly optimistic sales forecasts.
  • Gary Black questions Tesla's stock value and long-term competitiveness, disagreeing with some investment points and sharing his own investment philosophy and modeling approach.

WatchUrl: https://www.youtube.com/watch?v=jd_UE3r6dio