Great post. I always thought Carvana was a terrible idea. This further validated it (with data and scary info on their qual process) that I didn’t know about.
Disruptor for the used car biz is about like meeting your new “girlfriend” at a casino nightclub. A “disruptor” for an industry that has forever been cliche as being one big grift shop is a double red flag. Add in how capex heavy the model is and it just seemed like a disaster of a concept. I guess we’ll always have WeWork, and Beyond Meat, and Frank 😬
When beyond meat IPO’d I was in college and I was like maybe that’s a good investment so I bought a package of there seed oil pea protein stuff, got one wiff of it and didn’t invest.
Ironically, two days ago I sold a car to Carvana. A twenty something kid pulled up, turned the car on, took a photo of the title, removed the license, and paid me. No joke, that’s it. No inspection, no test drive. It was hard to believe.
I like the Carvana short idea - it does remind me of TSLA awhile back though actually. A car company that has an insane unjustified P/E multiple. and we know how bad of an idea it was to short TSLA. I could see CVNA go way up before it goes down.
Gonna short a few shares here at 242 and see what happens. Thanks for sharing - enjoying your writing!
I know. The underlying is different, but the story is similar. I remember people were screaming about mischievous accounting practices for tsla as well in the late 2010s. The stock market works in very counterintuitive ways - you could be (and probably are) right, but the market can disagree with you forever. Just playing the role of devil's advocate here.
Regardless, I'm taking the short with you. I like the thesis and think it makes sense.
Right. In the short term it’s a voting machine, in the long term it’s a weighing machine. I’m prepared to hold the short for 2+ years. My price target is $5.
I babysit and tutor a little girl for a few hours a night each week day while her parents are working. They bought me a Tesla to drive her around and gave it to me for my own personal use. I must say, I love many of the features — the fact I don’t have to use the brakes to stop is one I’m addicted to now. Lol. When I use a gas operated vehicle, I’m like — oh that’s right I have to use the brakes. Lazy me! 😂
Thank you for writing this; it’s the most informative I’ve read about Tesla ownership.
The big question in auto is who gets widespread approval for unsupervised driving. That's the only thing that can teleport Tesla out of the competitive landscape. The competition has finally arrived in the form of hybrids with autopilot domestically, and Chinese EVs in the international markets.
My somewhat ridiculous level of investing success is thanks to independent analysts online. I recently joined an X spaces with some brilliant analysts, and I realized how much I’m craving conversation on these topics, which people in my IRL life are largely unable to provide. X spaces has been a next-level experience for me.
It’s unclear how AI stuff plays out. If it’s true that DeepSeek has made a breakthrough, maybe Tesla replicate that with their driving data/metadata, lowering costs and accelerating development. Question is, how difficult is it for others to acquire equally worthy driving data sets?
One thing I didn’t mention in this piece is Comma AI. I might buy a Comma 3X for $1k to add autopilot to my hybrid car. It runs open source software.
Overall I think Elon/Tesla knows the price of the data and software will trend down and their durable long term advantage is in manufacturing. Interesting analogy is Apple. They have faced hardcore competition in phones and computers but through superior software/hardware/customer service experience, captured the bulk of the market cap. Not sure that strategy works as well for the car market.
A note on Amazon: their customer experience is incredible. They are also building a satellite internet constellation as a Starlink competitor - probably the only real US competitor in the long term.
The humanoid market is a huge question mark. I don't know of a single useful humanoid robot in the hands of an analyst.
I am holding tesla shares and will buy more at a price i think is fair or below fair. I am short Carvana.
Great post. I always thought Carvana was a terrible idea. This further validated it (with data and scary info on their qual process) that I didn’t know about.
Disruptor for the used car biz is about like meeting your new “girlfriend” at a casino nightclub. A “disruptor” for an industry that has forever been cliche as being one big grift shop is a double red flag. Add in how capex heavy the model is and it just seemed like a disaster of a concept. I guess we’ll always have WeWork, and Beyond Meat, and Frank 😬
Haha, yes
When beyond meat IPO’d I was in college and I was like maybe that’s a good investment so I bought a package of there seed oil pea protein stuff, got one wiff of it and didn’t invest.
Ironically, two days ago I sold a car to Carvana. A twenty something kid pulled up, turned the car on, took a photo of the title, removed the license, and paid me. No joke, that’s it. No inspection, no test drive. It was hard to believe.
Will use the money to add to my short
I mean, that’s some quality due diligence on your part. That’s wild though. Wonder how many retail (or inst) investors know how they do what they do.
I guess it’s like SBF, if the right dudes in fleece vests show up and tell you it’s a winner, people think it’s a winner. Ponzi gonna ponz
I like the Carvana short idea - it does remind me of TSLA awhile back though actually. A car company that has an insane unjustified P/E multiple. and we know how bad of an idea it was to short TSLA. I could see CVNA go way up before it goes down.
Gonna short a few shares here at 242 and see what happens. Thanks for sharing - enjoying your writing!
Thanks for the comment
If you look at the underlying product, it’s night and day difference between Tesla and Carvana.
Tesla develops on owns the worlds largest car factories
Carvana develops and owns a website, an app, parking lots, and sketchy accounting practices
I know. The underlying is different, but the story is similar. I remember people were screaming about mischievous accounting practices for tsla as well in the late 2010s. The stock market works in very counterintuitive ways - you could be (and probably are) right, but the market can disagree with you forever. Just playing the role of devil's advocate here.
Regardless, I'm taking the short with you. I like the thesis and think it makes sense.
Right. In the short term it’s a voting machine, in the long term it’s a weighing machine. I’m prepared to hold the short for 2+ years. My price target is $5.
Excited you are taking the short with me
Haha that’s what I was going for
I babysit and tutor a little girl for a few hours a night each week day while her parents are working. They bought me a Tesla to drive her around and gave it to me for my own personal use. I must say, I love many of the features — the fact I don’t have to use the brakes to stop is one I’m addicted to now. Lol. When I use a gas operated vehicle, I’m like — oh that’s right I have to use the brakes. Lazy me! 😂
Thank you for writing this; it’s the most informative I’ve read about Tesla ownership.
interesting to see you cash out on tesla - especially as such a stan of the stock and company
it does feel like car tech is going to commoditized and im not sure software is a moat anymore
i rather have amzn data centers and customer experience...
The big question in auto is who gets widespread approval for unsupervised driving. That's the only thing that can teleport Tesla out of the competitive landscape. The competition has finally arrived in the form of hybrids with autopilot domestically, and Chinese EVs in the international markets.
My somewhat ridiculous level of investing success is thanks to independent analysts online. I recently joined an X spaces with some brilliant analysts, and I realized how much I’m craving conversation on these topics, which people in my IRL life are largely unable to provide. X spaces has been a next-level experience for me.
It’s unclear how AI stuff plays out. If it’s true that DeepSeek has made a breakthrough, maybe Tesla replicate that with their driving data/metadata, lowering costs and accelerating development. Question is, how difficult is it for others to acquire equally worthy driving data sets?
One thing I didn’t mention in this piece is Comma AI. I might buy a Comma 3X for $1k to add autopilot to my hybrid car. It runs open source software.
Overall I think Elon/Tesla knows the price of the data and software will trend down and their durable long term advantage is in manufacturing. Interesting analogy is Apple. They have faced hardcore competition in phones and computers but through superior software/hardware/customer service experience, captured the bulk of the market cap. Not sure that strategy works as well for the car market.
A note on Amazon: their customer experience is incredible. They are also building a satellite internet constellation as a Starlink competitor - probably the only real US competitor in the long term.
The humanoid market is a huge question mark. I don't know of a single useful humanoid robot in the hands of an analyst.
I am holding tesla shares and will buy more at a price i think is fair or below fair. I am short Carvana.
that last meme was a personal attack lmao