Tesla Had The Best Performing Automotive Stock Of The Decade

Illustration for article titled Tesla Had The Best Performing Automotive Stock Of The Decade
Photo: Getty Images
The Morning ShiftAll your daily car news in one convenient place. Isn't your time more important?

Tesla’s real owners do well, Nissan is heading into 2020 on the downswing, and automakers really aren’t keen on SUV taxes. All this and more in The Morning Shift for Friday, December 27, 2019.


1st: People Who Bet Early On Tesla Win Big, For Now

It’s hard to think of an automaker who rocked the automotive scene quite as much as Tesla. While the company was founded back in 2003, it wasn’t really until 2011 and beyond that it really took off. Since then, Tesla and Musk have pretty much dominated public consciousness. And the hard work has paid off, as Tesla has been the best-performing stock of any automaker this decade, Automotive News reports:

The Model 3 now outsells every vehicle from Germany or Japan in the U.S. entry luxury category, and Musk last month said his company had received more than 200,000 pre-orders three days after unveiling the Cybertruck.

Such assurance is the constant element driving Tesla to a record $419 a share this week, or a $75.6 billion valuation that is greater than all but Toyota ($231 billion) and Volkswagen ($97 billion) among 38 automakers across the globe. Tesla is worth 44 percent more than General Motors and is almost twice the value of Ford Motor Co. ($37 billion) because nothing gets stock pickers more excited than unprecedented growth. Since the first Model S was purchased in 2012, Tesla sales have increased 52 times while the rest of the industry has averaged 46 percent.

Unprecedented growth gets “stock pickers” excited, you see, because they like making money. Deep economic concepts here, I know.

Here are some more numbers to quantify it all:

During the past six months, Tesla appreciated 85 percent and would be the best performer in the S&P 500 if it was included. It’s also No. 1 among its 38 peers in the Bloomberg Intelligence Global Automobile Index.


Anyone who purchased Tesla when it went public in 2010 has a bonanza of 1,190 percent. The auto industry during the past 10 years appreciated 158 percent, according to data compiled by Bloomberg.

No automaker can match Tesla’s growth. After increasing 10 times since 2014, Tesla revenue will advance an additional 14 percent in 2019, 21 percent in 2020 and 18 percent in 2021, according to 27 analysts contributing their forecasts to Bloomberg. The average growth for the 10 largest automakers will be 1 percent, 4 percent and 3 percent for the comparable periods.

Elon Musk drives people nuts, but this is why every car maker is trying to horn in on Tesla’s greatest marketing gimmick of all – that it’s a “tech company” and not a “carmaker.” Even though it makes cars.

All the insane share price increases, though, reflect a bet more than anything. It’s a bet that Tesla will soon be one of the biggest car companies in the world. There’s a lot that could cause that bet to blow up in people’s faces, from other carmakers finally getting into the electric game to Musk’s own irascibility, so it’s far from a sure bet at all.


2nd: Nissan Is Slashing Spending Across The Board

Nissan has had one hell of a disastrous 2019, but things aren’t over yet. In an exclusive from Reuters, it has been revealed that Nissan is desperately cutting spending in order to temper the marque’s disastrous auto sales and subsequent hemorrhaging of profits. The whole goal here is to preserve every single yen possible, with efforts predicted to continue into March of 2020:

Managers have been told to put the kibosh on unnecessary travel, sales incentives and promotional events to “conserve every yen,” as one source put it.

Meetings that three or four people would once have traveled to attend in person, might now only have one Nissan representative, the sources said, while other gatherings and dinners have been canceled altogether or replaced by video-conferencing. The extensive spending cuts come in tandem with Nissan’s decision this month to order a two-day furlough for U.S. employees Jan. 2-3. There is also an effective travel ban for staff in the United States, where sales have been particularly hard hit, one source said.


That’s very intense stuff. These aren’t the actions of a healthy automaker, but we’ve all known for quite some time that Nissan has been desperately struggling in what seems like a hurricane of disaster. Saving every single nonessential yen makes sense.

Here’s more:

In April, it embarked on a wide-ranging turnaround plan to revive sales and boost profits but the business outlook has worsened more than anticipated, the sources said. In November, it reported 70% slide in second-quarter operating profit and cut its full-year forecast to an 11-year low.

The de facto freeze on non-essential spending is “increasingly a modus operandi at Nissan globally,” a second source said, adding: “The house is not on fire, but there’s something smoldering.”


I don’t know about that, Nissan. This is definitely the move of someone watching their house go up in flames.

3rd: Automakers Aren’t A Fan Of France’s SUV Tax, Here Is Our Shocked Face

Implementing taxes on larger, heavier vehicles that are more prone to polluting has been proposed as one possible way in which to convince car consumers to opt for, say, a small and efficient electric car. France has become one of the first to really hike up those taxes. If your vehicle emits carbon dioxide above a certain threshold, that car will be fined 20,000 euros ($22,240) in 2020, Automotive News Europe reports.


And automakers are not pleased, because of course they aren’t:

“It’s a double penalty for consumers,” Luc Chatel, head of French automotive organization PFA, said in a statement, which called the policy “incoherent.”

“The electric-car market won’t take off without strong purchasing incentives,” Chatel said. “Everyone has something to lose: The industry, the environment and the purchasing power of the French.”


Next year, Europe generally is aiming to implement a system that will penalize automakers whose fleet of annual vehicle sales exceeds the proposed carbon dioxide limit. Automakers are arguing that it’s unfair to consumers, that consumers would be better off gaining an education regarding the ecological impact of their vehicles rather than just be punished for it.

In many ways, though, the tax makes sense. Many people will opt for the cheaper choice, not necessarily the cleaner choice. Think about, say, how expensive it can be to stock up a grocery cart filled with healthy products when you can spend three dollars at McDonald’s. Not everyone has the luxury of doing the “right” thing.


Income from the tax, too, will be going directly to the government, where it will be reallocated to automakers to be used on the production of eco-friendly vehicles.

4th: Tesla Is “Delivering” Its First China-Built Cars On Monday But Of Course It’s Not What You Think

There’s still more big news for Tesla today. On Monday, the automaker will be making “deliveries” of its first China-built cars. But let’s put “deliveries” in quotes, because as it often is when it comes to Tesla, it’s a lot of not quite accurate hype.


Only 15 Model 3 sedans will be delivered to company employees, Bloomberg reports, which is far from actually making deliveries to customers. You know who “customers” are, after all. Finicky types, who might not keep their traps shut if everything isn’t up to snuff. These are the first of Tesla’s cars ever to be manufactured outside of the United States.

Here’s more from the article:

With Tesla’s volatile stock price and strained finances, investors will be watching closely how the ramp-up unfolds. The multibillion-dollar investment will be a deciding factor to determine whether Tesla will be able to take on local competitors and fend off challenges by the likes of Mercedes-Benz, BMW and Audi.

The launch will also provide clues about Tesla’s ability to truly go global. The company is planning to follow up with a production facility in Europe, where it is enjoying burgeoning sales growth in several markets.


It’s a small step forward, but the Shanghai factory is going to be crucial. Musk is hoping to produce 1,000 cars a week there in his bid to secure a significant foothold in a rapidly growing electric market.

5th: Turkey Unveils $3.7 Billion Domestic Car Production Plan

Turkey is planning on mounting its own charge when it comes to domestic car production. The prototype will be revealed later today, but the details of the $3.7 billion project have already been revealed, Bloomberg reports:

Turkey’s Automobile Joint Venture Group Inc., or TOGG, which comprises five companies and a business umbrella organization, will establish a factory in the manufacturing hub of Bursa, according to a presidential decree in the official gazette. The 22 billion liras ($3.7 billion) investment will enable the production of five models and a total output of 175,000 vehicles a year.

The first vehicle, a C-SUV, will be introduced in 2022, according to TOGG’s website.


. A $3.7 billion investment—along with tax cuts, free land allocation, interest rate reduction, and guaranteed government purchases of certain amounts of vehicles—isn’t a bad start, but it’s still probably not enough to establish an entire car company.

Reverse: Rationing Begins For Automobile Tires In 1941


Neutral: What Good Car Things Did You Get For Christmas?

And why was it a Lexus with a giant bow on top?

Weekends at Jalopnik. Managing editor at A Girl's Guide to Cars. Lead IndyCar writer and assistant editor at Frontstretch. Novelist. Motorsport fanatic.



Neutral: Behold, my Christmas present to myself. No red bow, but it did come pretty well loaded. Happy holidays, everyone!