In Defense of Tesla: The Top 10 Reasons Why The Automaker Will Probably Not Go Bankrupt Last week, I wrote a controversial analysis on $TSLAQ, an organized group of short sellers who believe Tesla will go bankrupt. The issue caused a stir: one person even claimed I was a Tesla short seller. Believe it or not, while I wouldn’t consider myself to be a “Tesla fanboy,” as someone who closely follows the automotive industry, I do really think Tesla will be around for a while. I came up with a short list of 10 reasons why. Please let me know if you have any other reasons I can add by hitting reply to this email. Thanks again for reading and I hope you enjoy. 1. Gas prices are volatile and vehicle innovation may stall: Drivers of gas-powered vehicles in the U.S. have been able to enjoy low gas prices for quite some time. But as we saw last week, that can change quickly. Right after an attack on Saudi Arabian oil facilities, oil prices instantly spiked (although not to an insane level, as some expected). But still, drivers in Los Angeles experienced about a 10 cent spike per gallon in gas prices, showing just how external factors can create volatility with gasoline prices. Bundle this with the Trump Administration’s efforts to curb vehicle-emissions regulations that have made cars more efficient, and capable of running more miles per gallon, and gasoline-powered vehicle drivers may eventually see the number of miles they are able to drive per each gallon stall, potentially convincing them to look at options like electric vehicles in the market. 2. Growing environmental concerns: A recent global protest demanded 185 countries to take action in an effort to tackle global warming. One of the ways some giant corporations are addressing these concerns is by adopting electric vehicles. It is likely as Tesla rolls out a new line of products that are geared toward the enterprise space, like the Tesla Semi and upcoming pickup truck, the company may see substantial fleet orders from companies and government entities looking to reduce their climate footprint. Of course, Tesla may face some competition from other competitors in this space, as Rivian recently said it received an order from Amazon for 10,000 electric delivery vehicles. 3. Shopping and service experience: The one factor I think people undervalue about Tesla is the company’s ability to completely disrupt the traditional dealership model when it comes to sales and delivery. Tesla has built its sales infrastructure centered around the digital experience, which is how younger consumers do the majority of their research before they buy a vehicle. Price are transparent, like buying an item on Amazon, and vehicles can be customized, much like buying a laptop from Apple. Unlike other automakers, consumers can buy a Tesla vehicle entirely online, with no need to haggle pricing or work with a dealer. Tesla has also built out its own service infrastructure, as traditional automakers rely entirely on independent networks of dealers. These may serve as competitive advantages in customer experience, which may serve as a bright spot for Tesla in the future. 4. Safety and performance of vehicles: It seems that Tesla has consistently been improving the quality of its vehicles, as highlighted by its recent safety rating from the Insurance Institute for Highway Safety (IIHS) for the Model 3. The automaker has also impressed on the performance end of the spectrum, putting up a solid lap time at the Nürburgring race track with a “Plaid mode” Model S, staying competitive with Porsche’s latest EV sports car entrant, the Taycan. Tesla performance vehicles often beat luxury sports cars, like the Ferrari 458, when stacked against each other. Not a bad sign for Tesla, considering its vehicles cost a fraction of what a Ferrari or Lamborghini would cost to the average consumer. 5. Upcoming government caps on “ICE” vehicles: Nine countries (and about a dozen individual states and cities) around the globe have already committed to banning vehicles that use internal combustion engines. It is likely that number will grow as concerns about emissions grow. It is likely that as a result, companies on the forefront of electric vehicle technology, like Tesla, will be well-positioned to grow in those markets in the future. 6. Charging network: In an earlier feature, we plotted a trip from coast-to-coast solely using Tesla Superchargers. Tesla’s network of fast vehicle chargers is robust and largely unmatched by any other EV maker at the moment. In fact, I have driven from Los Angeles to Las Vegas in a Tesla Model S and only had to stop once along the way for a charge. The vehicle topped off in about an hour. An account from the New York Times indicated it took about 2.5 hours to charge a Chevrolet Bolt each way. 7. Lack of disruption: No other automaker currently has as many compelling electric vehicle options on the market as Tesla does. Tesla is clearly the leader right now in the electric vehicle space, in terms of variety, offering an electric entry-level sedan, luxury sedan and luxury SUV. With the entry-level price point of the Model 3 starting at $35,000, the vehicle is competitive with other electric options on the market, including the Chevrolet Bolt. Tesla vehicles offer more advanced technology than the competition, with Autopilot serving as a standard feature on all its vehicles. 8. The community: Tesla’s fanbase distinguishes it from other automakers. Diehard Tesla fans will literally do anything to help support the company, whether it is volunteering to help new Tesla customers understand their vehicles or donating advertising space in Times Square. It would be really hard for any company with a loyal fanbase like Tesla to go down without a fight. 9. Track record of sales: Tesla is actually pushing out a decent amount of vehicles. Looking at estimated U.S. deliveries for Q2 - based on this data from GoodCarBadCar - the automaker reportedly delivered 53,300 vehicles. In that quarter, Tesla delivered more cars than Cadillac, Acura, Chrysler, Land Rover and other automakers. While the automaker is still growing, it is clearly posting some real sales numbers that are competitive with luxury automakers. 10. Elon Musk: Some people love him, others despise him. But it would be tough to find someone else who is more product-focused than Elon Musk. There had not been a “new” automaker, not backed by any giant existing automaker, that has entered the U.S. market in decades. Tesla broke through. Many investors believe in the vision of Musk, and know that Tesla is a long-term play and a bet on the future of EVs. This newsletter was written and curated by Johan Moreno. Johan is based out of Los Angeles, CA and has covered technology and automotive extensively for a variety of publications, including Forbes and The Orange County Register. Follow him on Twitter @dudejohan Editor: David Stegon (senior editor at Inside, whose reporting experience includes cryptocurrency and technology).