COMPANIES EXPLAINED

1. History and Founding

Tesla Inc. was founded in 2003 by Martin Eberhard and Marc Tarpenning in Palo Alto, California. Elon Musk joined shortly after as chairman and became the largest investor. Initially focused on electric vehicles, Tesla has since expanded into energy storage and solar products.

Tesla’s first car, the Roadster, was launched in 2008, followed by the Model S in 2012, the Model X in 2015, the Model 3 in 2017, and the Model Y in 2020. The company also introduced the Cybertruck and Tesla Semi as part of its diversified product lineup.

2. Sector and Industry

Tesla operates in the automotive and energy sectors, specifically in:

• Electric Vehicles (EVs) – Model S, Model 3, Model X, Model Y, Cybertruck, and Semi
• Energy Generation and Storage – Solar Roof, Solar Panels, Powerwall, Powerpack, and Megapack
• Autonomous Driving Software – Full Self-Driving (FSD) and Autopilot

Tesla’s competition includes legacy automakers like Ford and General Motors, as well as EV-focused companies such as Rivian and Lucid Motors.

3. Revenue Streams – How Tesla Makes Money

a) Automotive Sales (Major Contributor - ~85% of Revenue)

• Electric Vehicle Sales – Primary revenue from Model 3, Y, S, and X
• Full Self-Driving (FSD) Software – Sold as an upgrade or subscription
• Leasing and Vehicle Financing

b) Energy Generation and Storage (Around 10% of Revenue)

• Solar Panel and Solar Roof Sales
• Energy Storage Solutions – Powerwall and Megapack

c) Other Revenue (Around 5% of Revenue)

• Regulatory Credits – Selling carbon credits to other automakers
• Service Revenue – Maintenance and repair services

4. Competitive Advantage & Strengths

• Brand Loyalty – A cult following and strong brand recognition
• Vertical Integration – Manufacturing, software, and energy solutions all in-house
• Leader in Autonomous Driving – FSD and Autopilot advancements
• Innovation and R&D – Continual innovation in battery technology and software
• Elon Musk’s Vision – Inspirational leadership driving the brand

5. Risks & Challenges for Investors

• Production Delays – Past issues with ramping up production
• Regulatory Scrutiny – Safety concerns over FSD and Autopilot
• Intense Competition – Legacy automakers entering the EV space aggressively
• Overvaluation Concerns – Tesla's high market capitalization compared to peers

6. Future Growth Opportunities

• Battery Innovation – Increasing range and reducing costs
• Expansion in Emerging Markets – Giga Shanghai and Giga Berlin boosting global presence
• Energy Business Growth – Expansion of solar and battery storage solutions
• Autonomous Driving – Monetizing Full Self-Driving subscriptions and robotaxi networks

7. Conclusion – Why Investors Care

Tesla’s relentless focus on innovation and its strong brand make it a dominant player in the EV and energy markets. Despite facing challenges, its potential in autonomous driving and energy solutions positions it as a long-term growth opportunity.