But Tesla is like Apple.

Gary Fung
Gary Fung
Jul 22, 2017 · 2 min read

On reading some drivel from Einhorn, a hedge fund activist, I have a few counter-points (in blockquotes):

  • “When Apple launched the iPhone, it was immediately profitable,” Greenlight wrote. But Tesla “does not make money selling cars and Mr. Musk shows little interest in profits.”

He means, like Amazon? And Tesla have 20%+ profit margins on current luxury cars they sell, easily twice that of mainstream carmakers.

  • “When one person buys an Apple product, it makes the experience for other Apple customers better by supporting the developer ecosystem. This network effect attracts a stable and growing user base. TSLA is unlikely to sustain a competitive advantage by having a network of charging stations or by accumulating driver data.”

Wrong. Autonomous driving sensor data that’s always on, even when Autopilot isn’t engaged, gives Tesla more data collection than any carmaker or otherwise, more than even Google with their “small” test fleet. AI/machine learning algorithms is being commoditized; data to train machine learning models then is the new oil for developing the best self driving system.

  • “Competition was very slow to develop for Apple … By contrast, every major car company in the world intends to compete with TSLA in electric vehicles.”

Like, how GM is jumping in yelling “me first!” with the Chevy Bolt, trying to sell a mass market EV that’s selling less than Tesla is doing with their luxury EVs? What competition have ~500,000 deposits lined up with clear intent to buy?

Even discounting all the design, technology and Apple-esque cult following Tesla is enjoying. The biggest moat that even big carmakers have to start from scratch in overcoming, and pour profitless billions into, is in building their own batteries supply. No one on Earth have the batteries to supply any mass market EV right now. Tesla isn’t building Gigafactor(ies) for just fun and show.

  • “Steve Jobs attracted and retained a senior team of loyal lieutenants who implemented his vision … Mr. Musk is a one-man show (and one distracted with many ventures at that).”

Don’t be jealous when the man can juggle so many balls.


And I look forward to seeing what Apple is really up to with self-driving EVs. There’s been too much smoke with their Project Titan for it to be vapor.

Written by

Gary Fung

Creator of isoHunt & WonderSwipe

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