Tesla’s Master Plan Part 4

Key Takeaways

When you're hearing the master plan part 4, are you seeing that Optimus could really be 80% of revenue? >> Well, Optimus is about, you know, creating like humanoid robots that could take billions of jobs uh on the planet. So as long as you remain vague on timeline and what the scenario looks like, yes, it's very easy to imagine that um Tesla would be first like expanded in terms of valuation with like a successful robot taxi operation and then of course like uh a fleet of like hundreds of millions of human robots would dwarf actually the economic value of even a robot taxi business. So you have to remember that you know this this plan Tesla publishes and Elen likes to comment on uh is really like a vision uh like a stretch vision. He's always been managing uh man managing his businesses bringing up like these very long-term visions and he has this way of presented presenting these versions very often with like a slightly distorted uh time time scale you know when he talks about like Mars and the conquest of Mars on the SpaceX and thing like that ship. So you have to put the comments in in the right context. So today uh we know that the robot taxi business in the most bullish case which should be Tesla can scale out with robot taxis doesn't really have significant competition uh given like the the the quality of their cost base that business would be worth multiple trillions and would be already like a multiple of the existing motor business. Uh and yes uh on top of that a human aid robot bulcase where Tesla dominates the the space again and human robots uh can take over hundreds of millions of jobs you you can easily get like you know to uh like the large number of trillions like close to 10 trillion dollars of uh of valuation. Does that mean this is what I have in my model and what you should dang on bet on today? Maybe not. I spent a lot of time reading the document. Uh it's like an economic theory, right? They're basically arguing that because Tesla can scale, if they do build all of these things, there will be this sort of great economic impact around the world to people of all class economic classes. Is that something Pierre that as an analyst covering a specific name or specific stock that you kind of model for? You go, okay, in the future Tesla is going to change the world economy as we know it. Yeah, it's a very good uh it's a great question, Ed. So let's look at you know like what is tangible at Tesla today that's the auto business and let's look at what good analysis do covering Tesla you understand Tesla's uh technological um you know leadership you know how early they come into the market with what kind of performance what kind of features uh and then you measure also the performance of Tesla's uh cost base like their cost efficiency uh and so that's what we've done over the last five years looking at Tesla and what you've seen is that Tesla came into the market five years ago in large scale um with really like a cosplay that was not um uh that nobody could approach and also with like a performance like a a quality of innovation that nobody could approach. Today as you see in China local Chinese competitors are actually capable of being very competitive with Tesla uh in terms of innovation and in terms of cost as well. We've done very detailed analysis of the the cost of manufacturing a car at BYD and others versus Tesla and what you see is that they are about uh on par. So that type of analytical work you can do it on a business that is actually ramping today if you look at it like uh in the longer term it's more difficult to do but what you can get from Tesla is is very interesting perspective that by having a very very proactive and very integrated model and vision they can actually hit technological and innovation leadership with by far the most advanced cost base which is exactly where they are today on the robot taxi in front they have the the cheapest platform and the platform that today is you know the jurist is slightly out but probably like the highest performing platform as well and then of course Elon's bet is to put Tesla in the same position with a human robot in two three years from now >> Pierre you mentioned China several times there I just want to broad out the conversation briefly when you're looking at TSMC being limited for what equipment it can get in you cover KLA I see you cover Tokyo Electron you cover Lamb Research How much are these companies going to be impacted by US China? >> Well, they're all going to uh you know be sitting on their hands waiting for like directions of how the negotiation and the relationship between the US and China is going to be um uh uh is going to be handled. Um if you take specifically like semicap equipment players, they are generating a lot of their revenues still above 20% of their revenues is coming from China today. And to us it's an overhang. is a concern. It's it's probably coming down normalizing over time. So, we see that as a potential, you know, headwind on uh on their financial performance. But you have to take things back to what they are. It's only 20% of the of their business. Yeah. That's >> kind of like a peakish um uh at a peak. So it's it's not like a a game changer for for them.