Investor's Corner
Tesla highlights Morgan Stanley’s EV sector strengths by outselling OEM competitors
Tesla (NASDAQ: TSLA) highlights a new Morgan Stanely note that reveals a slowly developing and recovering combustion engine sector, along with growing electric vehicle numbers compared to 2020. The note, headed by analyst Adam Jonas, reflects Tesla’s strengths in a sector that is still growing but becoming more concentrated and competitive nearly every quarter as OEMs fight to dethrone the undisputed champion of the EV sector.
Examining figures out of the traditional dealership model indicates that consumers may be dealing with automotive inflation, which could contribute to low-end sales and inventory figures despite strong demand. Jonas writes that selling days were up one day to 27 total days this year in July, compared to 26 days in 2020. However, inventory is “hovering at record low levels,” with three fewer days of supply than last year. Some OEMs are struggling with even larger deficits, however. Ford is estimated to have 36 days of inventory, down 50% compared to last year’s 72 days of inventory. Stallantis is down to 35 days from 60 days last year.
The root cause of the drop could be attributed to several factors, including the ongoing semiconductor shortage that continues to stump automakers. Basic features like “push-to-start” in ICE cars are being eliminated to conserve semiconductor chips. Additionally, a transition in the preferred powertrain of consumers may also be happening, based on Tesla’s increasing sales data points, which include nominal sales, total market share, EV sector penetration, and basic sales figures.
Morgan Stanley on Autos & Shared Mobility ??
“Tesla nominal sales estimated to have grown +66% y/y”
“Tesla’s 26,200 estimated US sales compares to the rest of the OEM BEV
US sales of 14,379. Tesla appears to be outselling the rest of the OEMs in
BEVs by ~1.8x.”$TSLA pic.twitter.com/FvnqhXxPsx— David Tayar (@davidtayar5) August 4, 2021
Jonas said in the note that total industry sales on a selling day for ICE vehicles were +0.8% year-over-year, while BEV sales were up +98.5% year-over-year.
Tesla continues to be the EV maker with the most impressive sales statistics. In July, Tesla’s estimated 26,200 U.S. sales outshine the 14,379 total BEV sales from OEMs during the month. Outselling the world’s largest automakers by around 1.8x, it is no surprise Tesla continues to help grow the sector altogether, achieving the well-known company goal of “accelerating the world’s transition to sustainable energy.”
July 2021’s BEV penetration was 3.1%, nearly double that of the same month last year at 1.6%. With more competitors and models from other manufacturers in the United States, especially with the Chevy Bolt EV and Ford Mustang Mach-E, Tesla’s market share has decreased from 80% last year to just 65% in 2021, still making up the majority of U.S. EV sales. The increased competition is not unwelcomed, especially as the concentration of the EV sector is continuing to grow at a rate that should have ICE manufacturers slightly concerned.
After reporting the best quarter in company history in production and deliveries in Q2, Tesla extended its streak of profitable quarters to eight straight after beating Wall Street consensus estimates. With the emerging EV sector in the United States, Tesla is at the forefront and outsells competing automakers at a generous rate. The company’s robust July sales figures point toward more domination from Elon Musk’s company, while OEM figures show promise moving forward.
Disclosure: Joey Klender is a TSLA Shareholder.
Don’t hesitate to contact us with tips! Email us at tips@teslarati.com, or you can email me directly at joey@teslarati.com.
Investor's Corner
Elon Musk’s 2025 pay package gets support from Tesla’s biggest bull
ARK Invest founder Cathie Wood has previously stated that she is quite confident that the vote on Elon Musk’s 2025 Performance Award would pass.
Cathie Wood, CEO of ARK Invest and one of Tesla’s most ardent bulls, reiterated her support for Elon Musk’s 2025 CEO Performance Award.
Wood highlighted that Musk’s leadership attracts incredible talent, and it has allowed the companies he leads such as Tesla to become disruptors in their respective fields.
ARK Invest supports Musk’s leadership
Elon Musk’s 2025 CEO Performance Award has received a mixed reception. Proxy firms such as Glass Lewis and Institutional Shareholder Services (ISS) have stated that they would be voting against Musk’s pay package. Other entities, such as the State Board of Administration of Florida (SBA), have stated that they would be voting in favor of Tesla’s proposals.
ARK Invest founder Cathie Wood, for her part, has previously stated that she is quite confident that the vote on Elon Musk’s 2025 Performance Award would pass. She also stated that a favorable result to the vote for Musk’s 2025 pay plan would be beneficial for Tesla.
“Elon Musk is the most productive human being on earth. And a human being who attracts incredible talent, people who want to solve the world’s hardest problems. This is a win-win for all of us if Elon succeeds this time,” Wood stated. Musk appreciated Wood’s comments, stating, “Thanks Cathie!” In a post on X.
ARK Invest has been one of Tesla’s most loyal bulls
Tesla is ARK Invest’s single largest holding, with the firm holding an estimated $1 billion worth of TSLA, as noted in an Insider report. Wood previously said she expects the approval of Musk’s pay package to trigger “super-exponential growth” for the automaker, as new products like the Cybercab and Optimus expand Tesla’s offerings.
“Because think about it. It is a convergence among three of our major platforms. So, robots, energy storage, AI, and it’s not stopping with Robotaxis. There’s a story beyond that with humanoid robots, and our $2,600 number has nothing for humanoid robots. We just thought it’d be an investment, period,” Wood stated during an appearance at Steven Bartlett’s podcast The Diary Of A CEO.
Investor's Corner
Tesla VP for AI software makes a case for upcoming Elon Musk shareholder vote
Elluswamy reiterated the idea that Tesla is indeed at a critical point in its history.
Tesla’s Director of Autopilot Software and VP of AI Software Ashok Elluswamy has shared his thoughts about CEO Elon Musk’s 2025 performance award. While the executive typically discusses topics related to the company’s tech and AI initiaives, Elluswamy made it a point to make a case for Musk’s proposed pay package.
Tesla’s VP for AI Software shares his insights
In a post on X, Elluswamy reiterated the idea that Tesla is indeed at a critical point in its history. This is because the company is changing from a leader in electric vehicles and a major player in the energy storage market to a powerhouse pioneer in robotics that are powered by real-world AI. As per the executive, Elon Musk’s leadership of Tesla is more relevant now more than ever. He also reported an X article he previously wrote about Elon Musk and Tesla.
“This note regarding the importance of Elon leading Tesla is more relevant now than ever. Tesla is at a critical juncture, as it is metamorphosing into the world leader in robotics. Creating large-scale, useful robots requires expertise across engineering design, manufacturing, real-world AI software, chips for AI, and more. Elon is, quite likely, the only person on Earth with deep skills and the right instincts across all these domains,” Elluswamy stated.
A push to support Musk’s 2025 performance award
In recent weeks, Tesla executives such as Board Chair Robyn Denholm have been encouraging TSLA shareholders to vote in favor of Elon Musk’s 2025 performance award, as well as other proposals that the company’s directors have argued are critical to the future of the company. These proposals, Tesla executives noted, are necessary to ensure that the company can achieve the ambitious targets of Elon Musk’s Master Plan Part IV.
Elon Musk’s pay package, as well as the company’s proposals, would be decided at the upcoming 2025 Annual Shareholders Meeting, which would be held at Giga Texas on November 6, 2025. Needless to say, Tesla’s future might very well be decided during the event.
Investor's Corner
Tesla investor Calpers opposes Elon Musk’s 2025 performance award
Musk’s 2025 pay plan will be decided at Tesla’s 2025 Annual Shareholder Meeting, which will be held on November 6 in Giga Texas.
One of the United States’ largest pension funds, the California Public Employees’ Retirement System (Calpers), has stated that it will be voting against Elon Musk’s 2025 Tesla CEO performance award.
Musk’s 2025 pay plan will be decided at Tesla’s 2025 Annual Shareholder Meeting, which will be held on November 6 in Giga Texas. Company executives have stated that the upcoming vote will decide Tesla’s fate in the years to come.
Why Calpers opposes Musk’s 2025 performance award
In a statement shared with Bloomberg News, a Calpers spokesperson criticized the scale of Musk’s proposed deal. Calpers currently holds about 5 million Tesla shares, giving its stance meaningful influence among institutional investors.
“The CEO pay package proposed by Tesla is larger than pay packages for CEOs in comparable companies by many orders of magnitude. It would also further concentrate power in a single shareholder,” the spokesperson stated.
This is not the first time Calpers has opposed a major Musk pay deal. The fund previously voted against a $56 billion package proposed for Musk and criticized the CEO’s 2018 performance-based plan, which was perceived as unrealistic due to its ambitious nature at the time. Musk’s 2018 pay plan was later struck down by a Delaware court, though Tesla is currently appealing the decision.
Musk’s 2025 CEO Performance Award
While Elon Musk’s 2025 performance award will result in him becoming a trillionaire, he would not be able to receive any compensation from Tesla unless aggressive operational and financial targets are met. For Musk to receive his full compensation, for example, he would have to grow Tesla’s market cap from today’s $1.1 trillion to $8.5 trillion, effectively making it the world’s most valuable company by a mile.
Musk has also maintained that his 2025 performance award is not about compensation. It’s about his controlling stake at Tesla. “If I can just get kicked out in the future by activist shareholder advisory firms who don’t even own Tesla shares themselves, I’m not comfortable with that future,” Musk wrote in a post on X.
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