Tesla made more money than VW selling 10 times less cars in September 2022.

Tesla sells luxury vehicles (by world standards) and there are only so many people who can afford them.

Either Tesla stops growing at this rate, or they will have to "stoop" to cars costing $15k, in which case their profit margins will drop like a rock.

So why doesn't VW just sell premium cars if it would make them more money?

Because there is a lot of money to be made selling lots of a cheaper product if you can produce it profitably. Besides that dealers are typically willing to sell such smaller vehicles at or near their own purchase price counting on the recurring income for service and fleet sales of such vehicles tend to be quite profitable because there is only one signature but a very large amount of money involved.

Mercedes is a nice example of a premium brand, they make more money per car and a bit more money in total on lower volume. VW (or rather, the VAG group) is simply a different kind of company. But their profits are nothing to sneeze at.

> VW (or rather, the VAG group) is simply a different kind of company.

Exactly. Which is why comparing unit sales and expecting that to correlate to stock price is not logical.

Because it would make them more money per car but not overall. And they aren't competitive in that segment with the assets they have. They would have to design different models, scale down production etc, a pivot of the company.

A better comparison is Mercedes or BMW, they're in a similar market segment and not selling 10x more cars at 1/5th the price live VW is. Still their market caps are lower than Tesla and their profits are in the same region (depends on which quarter you look at which one is ahead).

BMW and Mercedes aren't showing any real YoY growth. They have some token electric offerings, but don't seem particularly committed.

This is HN, the difference in value between a growth company and an incumbent should be at the front of our minds at all time.

You haven't been paying attention to Mercedes' EVs, especially. Quick, how many models do they have?

Edit: I'll skip the suspense, they have 10 models, more than Tesla. And several more are on the way.

> They have some token electric offerings, but don't seem particularly committed.

The Mercedes EQS achieves greater range than any Tesla in real world highway range tests:

https://insideevs.com/reviews/443791/ev-range-test-results/

So your claim is that can't Tesla can't match Mercedes' token EV offering? Why isn't Tesla showing more commitment?

Tesla doesn't match the BMW iX either. Or the Lucid Air. Or the Hummer EV:

https://insideevs.com/reviews/612030/hummer-ev-range-test/

It's like Tesla's not even trying.

That growth is only interesting for two types of companies. One software companies or similar industries where marginal costs are nearly zero, so rapid growth promises huge future profits. And two, companies that could form a monopoly out of that growth to be hugely profitable.

Tesla is neither of those things. So it's not a good long term investment, only a good short term one if the hype continues long enough and you can sell to someone else before profit realities kick in. The tricky thing is that you don't know when that will happen, could be 15 years from now, could be next month.

Considering VW owns Audi, Bentley, Porche, and Lamborghini they obviously do sell upmarket cars.

VW is Audi Porsche Bentley and Lamborghini. I dont know if this ownership is reflected in the stock price of the company listed as VW. Porsche EVs have a better battery performance as measured empirically than Tesla - but they make more modest claims and outperform them, in contrast to Tesla who are essentially lying about battery performance. They are much nicer cars. Porche dealers take care of you very well. Porsche makes very good margin on their cars.