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The NJ mafia puts contract hit on Tesla

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Elon Musk is always one step away from pushing the envelope further. Is calling New Jersey the mafia state enough of a wake up call?

Governor Chris Christie exemplifies modern politics clichés by turning around his previous decision legally working with Tesla Motors to follow suit with Texas and Arizona. Is there a pattern? Far from engaging in politics at Teslarati, we can’t help but wonder why those states known for their free markets ideals turned their back on the rhetoric? Where is competition and free market these days?

Does anybody remember freedom of choice?

Elon’s post rightfully reminds us of the disconnect between politicians and their constituents by saying: “the New Jersey Motor Vehicle Commission, composed of political appointees of the Governor, ended your right to purchase vehicles at a manufacturer store within the state” on his post. Governor Christie promised to put a vote to Tesla selling directly, but once the very big, and very powerful auto dealer lobby voiced their concerns, a backroom deal was cut, thus circumventing the legal process. Essentially, the auto dealer association pressures Chris Christie to force anyone buying a new vehicle through middlemen in New Jersey.

Essentially, Elon Musk accuses the Administration and the New Jersey Motor Vehicle Commission of: “going beyond their authority to implement the state’s laws at the behest of a special interest group looking to protect its monopoly at the expense of New Jersey consumers.”

Automotive Dealerships is a humongous lobby.

We’ll let you gauge how powerful the National Automotive Dealership Association is. Last year, there were 17,600 dealers of new cars and trucks in the US, yielding over $676 billion of sales, accounting for about 15 percent of all US retail activities. The automotive dealership is a substantial part of the country’s economy and its $86.8 million of dealership monies continuously spends $57 million funneled on state election across the country since 2003.

A few days back, we wrote about how the inevitable has to happen, bringing back our country to its foundation of freedom of choice. Dealerships don’t have the best reputation, and certainly very few people praise their services. Is it any wonder they push for an old, worn out self-serving business model? Tesla’s model is so modern, answers the needs of our current era and reflects a very real demand for freedom of choice. Simply put, dealerships do not offer the added services they once did, and are not able to change that quickly. Sounds familiar? Carmakers feel the same. Tesla Motors creeps under Detroit’s car manufacturers’ skin. They feel the inevitable, that change is a constant and you cannot turn around a big corporation instantly. Does that mean we don’t need car dealerships? Certainly not.

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Tesla Motors is about now.

If we put everything into perspective, we find Tesla Motors answers our urgent need for elegant performance cars that run on an efficient energy means, electricity. Carmakers are left in the less enviable position of making petroleum derivative powered cars that pollute, smell bad and make awful noises. What truly isn’t fair is to expect these big carmaker and their dealerships to turn on a dime and start manufacturing batteries and electric motors. They are not tooled for this, and the investments would be gargantuan.

The Tesla stores frighten auto dealerships.

Why wouldn’t they be frightened by the Tesla stores, conveniently located inside malls, at the mercy of any onlooker? If you are relegated to the outskirts of the city, next to other car dealerships, knowing how people dread going to look for that new car, carefully maneuvering pushy salesmen, deciphering the unintelligible jargon and financing pitfalls, wouldn’t you fear Tesla? What do you do against a Tesla store that has a list of Model S drivers who will let you ride and sometimes drive their personal car? Know anyone who that with the internal combustion engine (ICE) drivers? Neither do we. But, why would you fight this marvelous system?

In the meantime, it’s hard not to feel sorry for politicians seeing constituents losing faith and car dealership lobbies facing better business models. Would you be frightened, or would you take the opportunity to change and adapt, once and for all?

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Elon Musk

Tesla CEO Elon Musk reminds everyone about Roadster’s true meaning

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Elon Musk addresses the crowd next to the new Tesla Roadster, which Tesla offers in Performance, Thrust and Rocket versions. (Image: Tesla/X)
Elon Musk addresses the crowd next to the new Tesla Roadster, which Tesla offers in Performance, Thrust and Rocket versions. (Image: Tesla/X)

Tesla CEO Elon Musk took to his social media platform X on Sunday to remind everyone that the Roadster’s true meaning is not about company growth or adding dollars to shareholders’ pockets. Sometimes, you just do things because you can.

Following the Roadster’s epic unveiling event last Thursday, skeptics and critics of the company or the project itself came out to say that the vehicle is a pointless project because it is not geared toward growing the company, delivering supreme margins for profitability, nor does it contribute to the big picture of Artificial/Super Intelligence.

But that’s just the thing: Roadster is not meant to be some shareholder dream; it’s meant to be a vehicle that people buy just because it is something awesome, unique, and the first of its kind.

Tesla Roadster: Three configs, one can fly, 0-60 in 0.8 seconds

Musk had to remind those who are skeptical about the Roadster’s importance to the company mission that while it is not a major contributor to Tesla’s long-term goals, it is something that is being built just because it can be:

“Optimus and Cybercab will be the vast majority of Tesla’s value. The only things that will scale to incredible size (K2 and beyond) economically are super intelligence, robots, solar power, and mass to space. And, of course, if you have the first two, the rest will follow. But Roadster is super cool, so we’re doing it anyway.”

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Musk has said on many occasions that Optimus would be the project that would make up the vast majority of Tesla’s value in the coming years.

Robotics will be a major focus of Tesla over the coming years, especially as Musk believes Optimus will enable work to be optional for humans and will enable what he calls “High Universal Income.”

Cybercab will be a passive income opportunity for owners, Musk and Tesla have said for a very long time, as a fleet of self-driving vehicles will operate within a ride-hailing Robotaxi service that won’t require a human driver to be present.

Tesla investors are more than enthusiastic about the company’s future projects, at least from a general consensus perspective. However, it is important to note that the Roadster is a fun and cool project that pushes the boundaries of what people thought was possible for an automobile.

What we saw last week was the first true example of a flying car, and despite the backlash about how it might not contribute to Tesla’s grand ambitions, it’s okay to have fun sometimes, too.

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Investor's Corner

SpaceX’s biggest earnings test yet lands Tuesday, and Tesla shareholders should be watching

SpaceX reports earnings Tuesday as Wall Street watches AI spending, Starlink growth and Tesla merger

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SpaceX reports third quarter results after the market closes Tuesday, with a webcast at 4:30 p.m. ET streamed on X, and Tesla follows a day later. Bloomberg consensus, cited by Pepperstone, calls for revenue of $12.89 billion, adjusted EBITDA of $6.62 billion and adjusted EPS near $0.15. That would be about 65% growth from the second quarter and SpaceX’s first profitable quarter since its IPO. Analysts expect roughly $6.4 billion from AI and $4.9 billion from Starlink, which is projected to reach 14.3 million consumer subscribers. Capital spending is forecast at $19.6 billion, leaving free cash flow near negative $11.6 billion.

The numbers matter because SpaceX has spent months trying to win over a skeptical market. It priced its record IPO at $135, spiked to $225.64, then sank near $105 in early August. Friday’s close of $146.03 sits about 28% below the June high. The Q2 report beat on revenue at $7.8 billion and put Starlink at 12 million subscribers, but $18.4 billion of capex hurt the stock. Since then SpaceX reached orbit on Starship Flight 14 with 26 Starlink V3 satellites, agreed to buy 800 MHz spectrum for about $8 billion as part of its Starlink Mobile push, and signed a fourth compute hosting deal in four months worth roughly $13 billion a year from December. Management is targeting more than 2 gigawatts of compute by year end and a $100 billion annualized revenue run rate. Evercore ISI, which raised its target to $275, said the quarter may be judged more on those targets than the reported figures

All of this sits under the Tesla merger question. Barclays analyst Dan Levy expects an all stock deal in which SpaceX buys Tesla at a premium, using reference values of $2.1 trillion and $1.5 trillion, and said an announcement would need to come by late October or early November to be voted on at Tesla’s December 6 annual meeting. Barclays estimates Musk would hold about 37% of the combined company and 56% of the votes. Musk said in July that combining companies cannot be discussed on an earnings call, but an investor question asking when SpaceX will merge with Tesla is sitting on SpaceX’s Q&A platform, and Teslarati has tracked how the Roadster demo revived the talk.

If a deal happens, Tuesday’s result would effectively set the price Tesla holders would receive. Their shares would convert into SpaceX stock, along with exposure to a company with a heavy investment on AI, while Tesla itself expects 2026 capex above $25 billion. A strong quarter and calmer spending would make that exchange easier to sell. Another round of heavy capex and a falling stock would make it harder.

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SpaceX’s Gwynne Shotwell just made a quiet gesture toward Tesla

SpaceX president Gwynne Shotwell quietly followed Tesla on X, and merger watchers noticed right away.

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SpaceX President and COO Gwynne Shotwell has started following Tesla’s official account on X, a small change that landed in the middle of a very loud merger conversation. Whole Mars Catalog joked about it on Sunday.

A follow is not an announcement, and neither company has said anything about a deal. What gives the moment weight is the timing. Barclays analyst Dan Levy has told clients that an agreement could come before Tesla’s annual meeting, which must be held by December 6, with SpaceX as the buyer in an all stock deal, as we reported after the Roadster unveiling. Wedbush’s Dan Ives has stuck with a 2027 timeline.

Shotwell is the executive most worth watching if the two companies do move closer. When Musk was asked at the All In Summit why Tesla and SpaceX remain separate, Shotwell sat next to him and said SpaceX personnel had already moved into xAI to fill leadership and engineering gaps. The businesses were integrating “faster than I thought,” she said, though “not fully integrated yet.” Her responsibilities have also grown since SpaceX absorbed xAI, and she now oversees operations that include Grok and the company’s AI compute buildout.

The financial links are already there. Tesla’s $2 billion xAI investment turned into a stake of less than one percent in SpaceX, the two share the Terafab chip project in Austin, and Musk exercised his 2018 Tesla options a week after SpaceX began trading, a sequence analysts flagged as giving SpaceX public shares to use in a deal. Musk holds about 20 percent of Tesla and controls 85.1 percent of SpaceX’s voting power, according to our earlier breakdown.

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The next test is close at hand. SpaceX reports its second earnings as a public company on Tuesday after the close, and Tesla follows on Wednesday. Musk told analysts in July that “we can’t talk about combining companies and that kind of thing on an earnings call,” so a direct answer is unlikely from either stage. Tesla shareholders can still submit and vote on questions through the Say portal until 4 p.m. EDT on Monday, and the merger is a recurring theme in the queue.

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