Tesla in 2023: Can TSLA Recover? This You NEED To Know!!

Last year was a bloodbath for the Markets and growth stocks took one heck Of a beating the only investors who made Meaningful profits were those who were Bold enough to aggressively short Tech Now Tesla was the most profitable short Of them all with investors reportedly Raking in over 14 billion dollars by Betting against the EV maker this has Left everyone wondering what 2023 has in Store for Tesla today I'm going to give You a bit of background about Tesla tell You why its stock has been crashing over The last year and why the next 12 months Could bring about a recovery rally Unlike any other Okay I'll start by saying that nothing In this video is financial advice I'll Also caution that I am by no means an Expert on Tesla OR tech stocks in General in fact I'm pretty sure this is My first in-depth public company Analysis as such take everything I say With a grain of salt and make sure you Do your own research That said Tesla was founded in 2003 by Martin Eberhard and mark tarpening the Company takes its name from Nikola Tesla The serbian-born inventor whose Creations were crucial to Humanity's Harnessing of electricity Back when Tesla began it was called Tesla Motors and it was essentially Nothing more than a shell company this

Is according to Elon Musk who needs no Introduction Elon invested 6.5 million Dollars in Tesla in early 2004 less than A year after it was founded elon's Investment made him the largest Shareholder in the company and he became CEO in 2008. Elon is also technically a Co-founder due to a lawsuit settlement Now Tesla has raised more than 20 Billion dollars since its founding Investors include a who's who of Wall Street and Chinese firms such as the Industrial and Commercial Bank of China As a fun fact the Industrial and Commercial Bank of China has the most Assets under management of any Bank in The world with over 5.5 trillion USD Anyhow the initial public offering for Tesla stock took place way back in 2010 And as you can see it's been a wild ride Ever since anyone who bought the bottom And sold the top in November 2021 made a Whopping 350X return on investment or More and Elon seems to be one of these Lucky people more about that later now As some of you will know Tesla actually Wasn't a profitable company until fairly Recently its first car was called the Roadster and only 2500 were sold despite Government subsidies and incentives on Electric vehicles in many countries Tesla's Model S and model X likewise got Off to slow starts and yes Tesla's range Of models s3x and Y spelled sexy sort of

And well you've got to love that haven't You Anyway it wasn't until 2020 that Tesla Saw its first year of profit something That was probably facilitated by all the Pandemic stimulus around the world it's Probable that the pandemic restrictions Also contributed because it meant that Most people could only spend their money On Goods hence the rally in Auto Sales Now contrary to popular belief not all Tesla cars are made in China Tesla Actually has four so-called Gigafactories the first is Tesla's Iconic Fremont Factory in California Which was opened in 2010 The second gigafactory is in Shanghai China which only opened in 2019. Remember this second date The third gigafactory is in Austin Texas And it was announced in early 2020 after Pandemic restrictions prevented the Fremont Factory from operating Tesla Subsequently moved its headquarters from California to Texas in 2021. the Texas Gigafactory opened early last year now The fourth Tesla gigafactory is located In Berlin Germany and it likewise opened Last year now before the Tesla Fanboys Freak out I know that Tesla has Additional gigafactories in the United States and elsewhere but these are Focused on producing electric batteries And car parts not the cars themselves

Anyways Tesla's last quarterly earnings Report was released in September 2022 it Revealed that the car maker had made Over 21 billion dollars in Q3 last year With almost 5.4 billion in profit This brought Tesla's yearly earnings to A staggering 75 billion dollars with Almost 20 billion as profit Tesla's Quarterly report for Q4 2022 isn't due Until later this month but it's already Been confirmed that a record number of Tesla cars were sold last year over 1.3 Million Teslas were sold in 2022 Compared to 930 000 in 2021 that's a 40 Increase in car sales which is truly Incredible growth and yet Tesla's stock Has continued to slide This is for many reasons and the first Is Supply although Tesla sold over 1.3 Million cars last year its gigafactories Produced almost 1.4 million cars during The same period as basic economics Dictates an increase in Supply tends to Cause prices to drop this of course Assumes that demand stays the same or Increases in Tesla's case investors are Concerned that demand for its cutting Air GVS has been dropping now this is in Large part due to the upcoming recession We're likely to see a recession Elon Himself has said could last until early 2024. speaking of which the second Reason for the drop in demand is the bad Press around elon's acquisition of

Twitter if you watched our video about Elon's Twitter acquisition you'll know That governments and Wall Street have Been aggressively pushing back against His attempts to create a free speech Platform that's why it's no coincidence That the United States the the European Union and others have been finding every Excuse to investigate Tesla most of These efforts have been focused on Tesla's controversial self-driving Autopilot feature that has resulted in Multiple accidents almost all of which Are due to user misuse as for Wall Street the S P 500 kicked Tesla out of Its ESG Index this is despite the fact That Tesla's mission is to quote Accelerate the Advent of sustainable Transport and electric technology that's Because ESG investors don't truly care About the E they care about the G which Is code for control more about the ESG Ideology in the description moving on Now another thing that Wall Street has Been doing is relentlessly shorting Tesla stock to be clear shorting a stock Does not cause it to go down however the Optics of seeing big names bet against The car maker causes the average Investor to follow suit and Tesla has Actually experienced this before if you Watched elon's Ted interview about his Twitter acquisition you might recall him Talking about how Tesla stock was being

Relentlessly shorted by Wall Street Because of a lawsuit by the SEC Elon Claimed that he was pressured by Wall Street into settling with the SEC and It's why he hates them both for context The SEC sued Elon in 2018 for claiming On Twitter that he could take Tesla Private at a price of 420 per share and That the funding for this had been Secured Elon contends that the funding Was in fact secured and implied that he Was punished by Wall Street for trying To take Tesla private more about that in A moment Now the third reason why Tesla stock has Been struggling ties into the second and That's competition Tesla is no longer the only EV show in Town and many existing car companies Have shifted their focus to EVS too in Terms of Total Car Sales Tesla's biggest Competitor is a Chinese automaker called Byd Auto byd auto is a subsidiary of byd Which stands for build your dreams byd Was founded in 1995 by Wang Chan Fu who Has since become China's richest man Funnily enough byd Auto was also founded In 2003. last year byd Auto sold over 1.85 million EVs and unprecedented 3x Increase compared to 2021. this Exponential growth makes sense when you Consider that China has been buying more EVS than every other country combined Since 2016. as you can see Chinese EV

Sales exploded during the pandemic Partially for the same reasons I Mentioned earlier easy money being spent On Goods however byd's primary advantage Is in its price point in China most Bydevs cost less than 30 000 US Dollars Whereas the cheapest Tesla car started At almost forty thousand dollars Tesla Recently announced that it had slashed The price of its cheapest car to 33k Which will impact profit margins this Incredible infographic by Counterpoint Research reveals that byd auto flipped Tesla as the largest electric car Company in less than a year specifically Between Q2 2021 and Q2 2022 byd Auto has Been outselling Tesla ever since and It's expected byd's Q4 earnings will Show a continuation of this trend before Any byd Bulls get too excited I should Caution that EV sales in China could Fall because of the country's reopening Keep in mind most of China has been in Lockdown since early 2020. that's almost Three years of pent-up demand for Services like tourism which people will Likely now want to spend their money on On that note byd was reportedly Unaffected by China's zero covert policy By contrast Tesla was greatly affected And was experiencing issues as recently As December when I saw this my first Thought was that it might be done to Differences in restrictions byd's

Factory is in Shenzhen whereas Teslas is In Shanghai after doing some digging However it looks like byd may have Received preferential treatment from the Chinese Communist party this makes sense Given that large Chinese companies are Assumed to be indirectly controlled by The CCP and there appears to be a History of this kind of preferential Treatment Byd also had a more practical advantage And that's that both its Supply chains And its main customer base were within The same country this meant that Pandemic restrictions had a minimal Effect on production and distribution This is the official reason why byd Outperformed Tesla but I don't buy it It's even possible that byd managed to Gain access to sensitive information About Tesla's manufacturing process with The help of the CCP and others the CCP Is known for stealing such sensitive Info and it would have been very easy to Do given that the Shanghai gigafactory Opened in 2019 just my speculation Though Now here is where things get interesting Believe it or not but the biggest Shareholder in byd's parent company is None other than Berkshire Hathaway the Famous investment firm headed by Warren Buffett Berkshire Hathaway recently sold 25 off its byd stake but still holds

Around 15 of its total shares the fact That many mainstream media Outlets have Been boasting about berkshire's byd Outperforming Tesla ever since Elon Announced his Twitter acquisition Suggests the two factors are related After all Elon funded his Twitter Acquisition with his Tesla stake Crushing Tesla would therefore kill Elon's Twitter This ties in to the fourth reason why Tesla stock has been in a downtrend and That's all the cell pressure that's been Coming from Elon and others elon's most Infamous Tesla sale took place in early November 2021 when he dumped 6.9 billion Dollars worth of shares it's believed That this was the primary cause of the 15 crash that week Now Elon is a lucky guy because this Sale took place within days of Tesla's Top it looks like elon's brother was Even luckier because he sold 100 million Dollars of Tesla stock right at the top This was one day before Elon published a Twitter poll asking if he should sell Tesla stock which resulted in the Subsequent sale just a few weeks later Fed chairman Jerome Powell announced That inflation was no longer transitory Markets have been tumbling ever since Due to a combination of more expensive Debts and the expectation of lower Future earnings due to higher interest

Rates which began increasing last March This valuation reset has hit Tesla Particularly hard now this is not Surprising given that Tesla's price to Earnings or p e ratio peaked at over 1400 in 2021 and was in the hundreds Until last September in plain English Tesla stock was extremely and I mean Extremely overvalued relative to its Earnings and some would say it still is To put things into perspective Elon has Reportedly sold over 40 billion dollars Of Tesla stock since November 2021. That's around double the profit Tesla Made during the same period it's also a Figure not far off from the 44 billion Dollars that Elon paid for Twitter in October when the deal closed the thing Is that Elon didn't put up all the money For Twitter if I understand correctly he Only put up 33 billion dollars and not All of it was cash this begs the obvious Question of what Elon spent the rest of The money on especially because his only Possession is his private jet he Apparently doesn't own anything else The answer is as obvious as the question If you listen to Elon instead of reading The headlines in another Ted interview He explained that philanthropy that is Donating money is very difficult to do Effectively that's why elon's approach Is to invest in creating new companies That solve real-world problems in case

You missed the memo Elon isn't just the CEO of Tesla or the owner of Twitter Elon is also the CEO of SpaceX the Creator of the boring company and Co-founder of openai and the founder of Neurolink for anyone wondering elon's Initial wealth came from his being a Co-founder of PayPal his initial 6.5 Million dollar investment in Tesla Actually came from his 100 million Dollar stake in PayPal and it Underscores his history of using funds From current and previous companies to Create new ones note that SpaceX Recently hit evaluation of 130 7 billion And open AI also recently hit a Valuation of 29 billion this suggests That elon's record net worth loss of 200 Billion is likely to be short-lived and That he could soon regain the title of Richest person on the planet more Importantly it means that he should have The capital he needs to continue Expanding and improving his current and Future companies Now this brings me to the reason why Tesla could eventually see a strong Recovery rally and the short of it is That Tesla is not a car company as Elon And other Executives have repeatedly Stated Tesla is a tech company and not Just any tech company either Tesla is Arguably the largest publicly traded AI Company that's because the thing that

Makes Tesla cars different from the Other EVS is it's aforementioned Autopilot feature as Elon has mentioned In many interviews perfecting Tesla's Autopilot feature requires solving Real-world Ai and once you solve real World AI the logical thing is to build a Robot say did you know that Tesla Presented its Optimus robot last September Probably nothing In all seriousness the significance of This cannot be understated and the case For Tesla becomes unbearably bullish When you realize how elon's other Companies fit into this equation For starters there's open AI which is Literally building Ai and is on the Brink of real world AI with stuff like Chat GPT Then there's the boring company whose Purpose is to create transport Infrastructure specifically for Tesla Vehicles Spacex's role becomes immediately Apparent when you remember that the Company is behind the starlink internet Service Elon confirmed last year that Starlink will soon support Tesla cars Now neurolink is where things get a Little crazy Elon claims that one of his Motivations for creating neuralink is to Ensure that the AI made by Tesla and Others doesn't become anti-human in

Practical terms this means interfacing And integrating with AI through Microchips implanted in your brain yikes If that wasn't crazy enough Elon Believes it's inevitable that Adversarial AI systems will be created And they will Target people with Neuralink implants that's why Elon is Working on creating what are basically AI self-defense systems which will Protect you against say the AI being Developed by Google for instance This relates to another important point And that is that Elon is hyper aware That whoever develops AI first will have A potentially undefeatable first mover Advantage this is why he is so hyper Focused on AI and why he's been directly And indirectly pouring so much time and Money into this particular niche from Where I'm standing it looks like Tesla Is on track to be this first mover in The AI space thanks to its close Relationship to elon's other companies If I'm correct then Tesla may become the Most valuable company in the world by The end of the decade But it's not all sunshine and rainbows As much as Elon loves to talk about his Love of humanity there are real concerns To be had about a single person Controlling what could eventually be the World's entire physical and digital Infrastructure even if Elon ends up

Being good whoever takes over his Empire When he passes may not be for what it's Worth I happen to think that Elon has Been walking the walk in other words I Think he truly does love humanity and Wants to improve it He has managed to piss off all the right People and it sounds like he wishes he'd Never gotten involved with them in the First place by taking Tesla public to be Fair it could all be for sure and Elon Also has a track record of being a Showman at the same time I'm highly Suspicious of his aversion to nuclear Power and his focus on solar wind and Energy storage most panels turbines and Batteries are made in China recall that He received lots of Chinese money Still I can't shake my gut feeling that The guy is genuine at least about his Stuff relating to his love for Humanity He's the only billionaire that talks About abundance not scarcity he's the Only billionaire concerned about Population collapse he's also the only Billionaire that isn't trying to live Forever if you're wondering why that's Because he believes that people need to Die for new ideas to come about so that Society can continue to evolve he Pointed to the dinosaur politicians as Proof of what happens when old ideas Aren't allowed to replace new ones and I Must say this insight has been rattling

Around in my brain ever since I heard it All I can say is that every time Elon Talks I find myself agreeing with most Most of what he says and he's been Consistent in his views across all his Interviews every time I'm Amazed by how Obsessed he is with ensuring Humanity Survives and how optimistic he is about The future of our speech And the planet and so I'll leave you With this clip there's a there's a whole Generation coming through who seem Really sad about the future and what Would you say To them Well I think if you want the future to Be good you must make it so Take action To make it good and it will be I couldn't have said it better myself [Music]