The point is that Tesla doesn't move anywhere near enough volume or generate anywhere near enough sales to justify its market cap. Its previous valuation was almost entirely a prediction of future revenues rather than a reflection of current ones.

And it's hard to say what class the Model S fits in. I don't think 7 or S is right, despite the price point. Those are both full-size luxury sedans, and while the Model S may be a full-size sedan, it's hardly luxury. Its interior is closer to a 3-series or E-class than the top-of-the range luxobarges. That's not a knock on build quality, just the reality of battery power currently being much more expensive than ICE. You've got to shave cost somewhere, and Tesla shaved it off luxury.

>The point is that Tesla doesn't move anywhere near enough volume or generate anywhere near enough sales to justify its market cap.

Buying TSLA right now is making a big bet on the Model 3. If Tesla comes out with a popular car (likely) and can make enough of them to turn a profit (little more skeptical on that one), it may end up justifying valuations. I wouldn't put my money on it, but I'm not surprised other people do.

I think that's a fair point. I suspect Tesla will end up being very much like Amazon: a company that ships physical goods but acts like a tech company. That is, they'll operate on razor-thin margins and dump every penny of profit into R&D in perpetuity. That will probably give them a leg up on companies that pay dividends, at least in the short-medium term. Ultimately, though, they run the "risk" of being Apple: a company that has to spend inordinate sums on R&D in order to gain a 1- or 2-year window of exclusivity before the competition commoditizes their product.