Tesla investor Ross Gerber is worried about the future of Tesla and believes the stock could drop by up to 50% by the end of 2025. Gerber, who runs a wealth management company, thinks that several issues could hurt Tesla.
Full Self-Driving Too Ambitious
Gerber thinks Elon Musk’s goal of having fully self-driving cars ready by June in Austin, Texas, is unrealistic. He believes the tech is not ready because Tesla relies on cameras while other companies, like Waymo, use more advanced lidar sensors. He said, “We’re well behind in robotaxis and self-driving cars,” and thinks lidar is necessary for safety.
Musk’s Divided Attention
Gerber believes Musk is distracted by other projects, including artificial intelligence and his other companies like SpaceX and xAI. He feels this is hurting Tesla because Musk’s focus on AI takes away from improving Tesla’s self-driving technology. Gerber stated, “Musk is not working at Tesla anymore,” and wished Musk would focus all his energy on Tesla.
Sales Slowing and Strong Competition
Gerber points out that Tesla’s car sales are falling. In fact, 2024 was the first year that Tesla’s electric vehicle sales decreased. He sees competition growing, especially from the Chinese company BYD, which poses a real threat to Tesla’s top spot in the EV market. Gerber noted that the Chinese government wants its companies to succeed over Tesla.
Sales Decline Linked to Musk’s Politics
Another problem for Tesla is Musk’s connection with former U.S. President Donald Trump. Gerber believes this has led to backlash in some markets like France and Germany. He mentioned that people have become frustrated, expressing their anger towards the brand because of Musk.
Overvalued Stock
Lastly, Gerber thinks Tesla’s stock price is way too high. At a market value of $1.1 trillion, Tesla is almost five times larger than Toyota, even though it makes much less profit. With a price-to-earnings ratio of 118, Gerber sees Tesla as too expensive compared to other big companies. He warned, “Tesla could drop by 50% if issues continue.” He mentioned that they are selling some Tesla stocks because of this overvaluation.
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