I don’t buy many individual stocks these days. Index funds are simple, effective, and the right choice for the overwhelming majority.
However, sometimes I see a company that has such incredible potential, I can’t help but buy the stock. Tesla is one of these companies. As I type this in October of 2020:
- Tesla is on pace to sell close to 500,000 cars this year
- Tesla is the clear leader in battery technology
- Tesla’s lead in manufacturing technology is significant
Traditional automakers are struggling to pivot to a future where transportation will be fueled by electrons instead of hydrocarbons.
Writing down my thoughts helps me think about them on a deeper level and that is what I’m doing here. I’ll update this page annually to see how accurate my predictions were.
Tesla In Ten Years
2020: Tesla completes the initial phase of its China factory expansion and starts selling Model Ys in China. Other notable developments:
- 500,000 vehicles sold
- FSD launched
- 11/16: Tesla is added to the S&P 500
2021: This is a building year. There will be many developments for Tesla nerds to get excited about like factory expansions, Dojo, and Full Self Driving improvements. However, Wall Street likes to see shiny new things and there will be none, so the stock may not move much.
- Completes Berlin factory: first Euro Model Ys delivered in Q2
- Completes Austin factory: first Cybertruck delivered in Q4
- Dojo comes online
- Tesla perfects 4680 battery production
- At least one new Gigafactory announced
- Vehicles sold: 700,000 (40% increase)
2022: The $25,000 Model 2 is announced and will initially be produced in China and Berlin. Tesla starts producing 4680 batteries in large quantities.
- More Gigafactories announced
- Some form of a Robotaxi service launches
- The Tesla Semi launches
- Vehicles sold: 980,000 (40% increase)
2023: At least one variant of the Model 2 ($25,000 vehicle) launches, probably the Chinese one.
- Vehicles sold: 1,372,000 (40% increase)
2024: The Model 2 expands into Europe.
- Vehicles sold: 1,920,800 (40% increase)
2025 and beyond
At this point, it gets difficult to predict what Tesla will do. I do think that Tesla’s market capitalization has a chance to reach 1 trillion before the end of 2025. I also expect Tesla to be selling 2-3 million consumer vehicles annually. Other products and services that will contribute to profits include:
- Tesla’s market capitalization reaches 2 trillion
- Tesla records sales of 10,000,000 vehicles annually
- About half of new vehicles sold in the United States are electric (not all will be Teslas, even though Tesla will lead)
- Car ownership is drastically reduced as humans rely on super cheap, automated Robotaxi services to get around
- At least a couple of traditional auto manufacturers go bankrupt
- Batteries reach a point where cheap, VTOL air transportation becomes reality
Tesla has a chance of becoming the biggest company in the world. This would imply a market cap of considerably more than 2 trillion since as I write this in 2020, Apple is already near the mark. By 2030, I expect that Apple will be worth considerably more.
Much has to go right for Tesla to achieve these goals:
- Tesla will have to stay ahead of the competition. This will require constant innovation.
- Tesla’s energy business will have to grow considerably. This includes solar panels, solar roofs, and storage.
- Tesla’s services business will have to grow considerably. This includes software-based products like Full Self Driving and infotainment. It also includes support services like supercharging and insurance.
- Much of Tesla’s ambitions depend on China. China and the United States have a tense relationship now and it could further deteriorate.
As the years go by, I’ll fill in the following:
I don’t plan on selling any shares before 2030. If my 2 trillion dollar dreams come true, that would mean my 1015 Tesla shares would be worth about $2,141,574. I can dream, can’t I? But, if there is one thing I know, it’s that you shouldn’t bet against Musk.
And if I had to guess, I’d say that my estimates are on the conservative side. Watch out ahead.
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