Wed 08 Jul 2020
Here is an interesting comparison of Toyota v. Tesla. Toyota builds practical, reliable and energy efficient automobiles, while Tesla sells a dream of “green” energy.
“Currently, Tesla’s market cap is worth $259 billion compared to $206 billion for Toyota. Why did investors push Tesla’s stock up to $1,400 a share ($259 billion market cap) when its total revenues in 2019 were only a little more than Toyota’s net income profits? As you can see, Toyota posted $19 billion in net income profits on total revenues of $278 billion compared to Tesla’s $862 million net income loss on $24.3 billion in revenues.
Again, a perfect example of the investor mindset today. Profits don’t matter, just technology, regardless if it continues to lose money.
And, if we look at the comparison of car sales, Tesla’s U.S. EV sales were only 8% of Toyota’s North American sales in 2019. Toyota sold nearly 2.4 million cars and trucks versus 192,500 units for Tesla.”
I realize that a Tesla has no emissions at its tail pipe, so it looks good, but there are emissions. The emissions just take place out of sight. Think of the emissions involved in the mining and shipping of the materials for the batteries. There are emissions from generating the electricity to charge the batteries. Most electricity is still generated by some fossil fuel. Many people don’t realize that wind power and solar power actually cause us to burn more fossil fuel.
We are accustomed to having a constant supply of electricity, so that when we flip a light switch, the light immediately shines. We also want a steady supply of electricity at a relatively constant voltage for our computers and televisions. If the voltage dips too much they shut off. Wind and solar do not provide a steady supply of electricity, like we
desire. The reason we have a steady supply is fossil fuel power plants.
Fossil fuel power plants cannot come on line and begin to deliver electricity at the “flick of a switch”. It takes substantial time to get them up and running. Therefore, fossil fuel power plants have to be “standing by” to take up the slack when the wind stops blowing or the sun goes behind clouds and the output from “green” sources drops. This means that we are burning fossil fuels just to keep the “back-up” power plants idling. This is very inefficient.
Another question is how much fossil fuel does it take to build the equipment for solar and wind and then to put it in place along with all the wires for transmission.
Here you can watch a former “green” energy reformer explain why “green” energy does not work and damages the environment.
He had data that showed nuclear power is cheaper and safer than all the other competitors, including wind. He compared Germany, which has a lot of wind and solar, with France, which is mostly nuclear. France had much lower electricity costs and had a steady supply of it, consistent with modern demands. Nuclear power plants emit nothing to the atmosphere.
If our aim is to reduce CO2 emissions, our best bet is probably nuclear power plants. They produce steady power, as we demand, and produce no CO2 while running. They cost less, are more efficient and their waste is contained.
I think what we are seeing with Tesla stock is a maniacal bubble, like the Dutch Tulip mania.