Billionaire Ron Baron Says Tesla Will Become One Of World’s Largest Companies (w/video)

1 year ago by Eric Loveday 30

Tesla Model X & S

Tesla Model X & S

Billionaire investor Ron Baron spoke at length on CNBC’s Squawk Box in regards to Tesla Motors last week.

Baron basically concluded that TSLA could be a stock he holds onto for the next 20 years. He stated:

“I think in this one investment we can make $6 or $7 billion.”

“I think this could be one of the largest companies in the United States and the whole world.”

Baron doesn’t think short-term. Rather, he’s a long-term investor. As CNBC states:

“Baron said it’s taken three years to amass a $300 million stake in Tesla, with an average cost per share of $210. “So we’ve made very little so far. But often times it takes us a very long time to [make money].”

Since Baron has a lot of money invested in Tesla, he’s able to visit the factory and see what’s going on. Quoting Baron:

“I go there every three or four months. I look at the factory and see how much is changing.”

As for why Baron thinks Tesla is a solid long-term investment, he says it’s mostly due to lack of competition:

“The competition is not anywhere. They could have caught him four or five years ago. But they can’t catch him now. he’s too far ahead.”

Check out the full interview with Baron on Squawk Box in the video below:


Source: CNBC

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30 responses to "Billionaire Ron Baron Says Tesla Will Become One Of World’s Largest Companies (w/video)"

  1. DangerHV says:

    2 hours and no reply’s? Wow! I guess there really are a lot of nay sayer’s posting here that are shorting Tesla stock.
    I think this story is very encouraging! Thank you Ron and inside ev’s for this.

    1. ffbj says:

      Yes, it is good news.

  2. evcarnut says:

    Very Significant ………

  3. theflew says:

    Sounds like they are coming out to try to push the stock price higher based on potential future stock performance. Based on the current stock price and their average purchase price it hasn’t been the best investment.

    Tesla definitely has potential. But this sounds like an investor trying to recoup their investment.

  4. Pushmi-Pullyu says:

    Tesla Motors will become one of the world’s largest companies?

    Well, either that or they’re gonna crash and burn in a spectacular fashion. Of course, being a Tesla fan, I hope they’ll succeed and soon grow to the size of Ford Motors. After that… who knows? Will Tesla grow to the size of GM? Seems unlikely, but certainly not impossible.

    But industry leaders seldom remain far ahead of the pack for long. The iPhone was soon challenged by Android; no clear leader ever emerged in the digital camera revolution.

    Sooner or later, some other company will challenge Tesla for the lead in the EV revolution. Who knows? Maybe Apple really will start making a mass produced EV, altho that would be very far outside Apple’s comfort zone of consumer electronics.

    1. Delta says:

      TSLA is a moving target. In order to compete, a deep pocketed company has to target the TSLA of 2020. Ubiquitous super chargers. Largest battery manufacturer. 350 mile batteries. 5 or 6 models of EV from 35 k to 150 k. Full autonomous driving.

  5. Agzand says:

    Let’s see, so Panasonic will give their batteries to Tesla to put in a box and sell them and become one of the largest companies in a world! Hmm, it makes a lot of sense for sure, they either don’t have a box or don’t want to be one of the largest companies in the world.

    1. Mxs says:

      I think you need to give Tesla a lot more credit than ” just putting Pana batteries in a box”.

      But I don’t disagree with your pessimism over the guy’s statement.

      1. Agzand says:

        Bottom line is that no compan becomes that large unless they have a proprietary technology or resource. The reason is competition. Tesla has very little proprietary technology. Their batteries are from Panasonic. The forefront of electric propulsion is not tesla, but formula 1. What gives them a competitive advantage to make that kind of money? The technology in a Toyota Prius is much more complex and harder to duplicate than a tesla model S.

        1. Tech01x says:

          You sad, sad, person. You truly have no idea what you are talking about.

          1. Agzand says:

            If you had anything with substance to say you would have said it instead of personal attacks.

            1. Pushmi-Pullyu says:

              Hardly. When someone says something as clueless and absurd as “Tesla has very little proprietary technology”, then it’s a waste of time to respond in detail.

              You are either someone who has chosen to post on a subject about which he knows very little, or else — and much more likely — you’re yet another of the TSLA short-selling FUDsters that have lately come to infest InsideEVs for the sole purpose of spreading lies and half-truths about Tesla Motors.

              1. Agzand says:

                In that case please enlighten us, name one aspect of Model S that cannot be duplicated by putting a bigger battery in something like BMW i3 or VW eGolf.

                1. Tech01x says:

                  What drivel. If VW could stuff a larger capacity battery in the e-Golf at the right price and at the right weight, they would have done it. They didn’t because they can’t. They even left off liquid thermal management in that car. Right now, Tesla has the highest specific energy cells obtained at the lowest price per kWh. Further,my hey also have the highest production capacity with Panasonic’s Osaka plants now, and will extend that lead dramatically with the Gigafactory.

                  1. agzand says:

                    It is hard to believe they cannot do it, because they have done it already. Chevy Bolt is 30% smaller than a Model S yet it has a 60kWh battery at a lower price point. Nissan has been testing a similar battery on Leaf platform for a couple of years now. Besides as I said Tesla doesn’t make their battery cells. Even if they have the highest density at lowest cost it is Panasonic commodity cell technology, not Tesla.

                2. Pushmi-Pullyu says:

                  “…name one aspect of Model S that cannot be duplicated by putting a bigger battery in something like BMW i3 or VW eGolf.”

                  How about four? I could easily list a lot more, but no point wasting too much of our readers’ time. 😉

                  1. A body so strong it broke a crash test company’s roof crush testing machine.

                  2. An overall quality so superior it “broke” Consumer Reports’ test drive rating system

                  3. An innovative EV powertrain — including a proprietary tech “smart fuse” — which gives the Model S a faster 0-60 time than virtually any other production car, even limited production million-dollar sports “supercars”.

                  4. More “Best Car of the Year” awards than any other car model… ever.

    2. Pushmi-Pullyu says:

      Agzand said:

      “…they [Panasonic]… don’t want to be one of the largest companies in the world.”

      Rather, Panasonic isn’t willing to take the risk of “betting the farm”, as Tesla has repeatedly done, on growing quickly.

      Tesla has been blessed with luck or good leadership, or both, in confounding the vast majority of financial analysts, in not only making a success of being a new company mass producing cars in the U.S., but also growing much, much more rapidly than any other auto maker of any size, anywhere in the world.

      Looks like Tesla has stumbled with the Model X; perhaps a minor stumble, perhaps a major one. We don’t yet know. But a stumble isn’t a fall. Despite that stumble, Tesla is running hard toward the goal of Model ≡ production.

      Contrariwise, Panasonic has been dragging its feet about ramping up battery cell production to meet Tesla’s demand, and is still reluctantly dragging its feet on investing in the Gigafactory project. One can’t really blame Panasonic for being cautious, after the glut on the market of commodity li-ion cells a very few years ago; a glut which drove Envia out of business, and nearly caused A123 to do the same.

      1. Agzand says:

        Panasonic has been burned by Tesla’s over promising and under delivering already. They have already publicly said that Tesla has not fulfilled their battery supply contract terms due to Model X underperforming.

        1. Tech01x says:

          Please tell us exactly what contract terms were not fulfilled. I am looking at the redacted agreement and don’t see it.

        2. Pushmi-Pullyu says:

          Agzand started a new anti-Tesla FUD campaign:

          “Panasonic… have already publicly said that Tesla has not fulfilled their battery supply contract terms due to Model X underperforming.”

          I have a very strong suspicion that you won’t be able to back up that Tesla bashing claim with any real evidence or actual facts. Hint: Linking to a serial Tesla bashing blogger post on Seeking Alpha isn’t real evidence.

          And I no longer wonder if you’re just here to spread lies about Tesla. Clearly you’re here only to do that, and not to learn anything or share truths.

          1. agzand says:

            Please, get real. I am not a kid sitting here on my mum’s coach. Here is the link:

            http://www.irbroadstreaming.net/ir/6752/2015_4q_e/#index=1

            Go and listen from minute 13.00.

            No need to apologize.

  6. Mxs says:

    It’s all good coming from heavy investor. I would not certainly expect less from someone like that .. But, I wish he would tell us why he thinks that the other 5 or so car manufacturers “cannot catch him” ?????

    I am all ears, pls …..

    1. ffbj says:

      The Tortoise would not have caught the Hare except that the Hare became overconfident and fell asleep. I think, he thinks, that Tesla will not fall asleep.

    2. Gerhard Hauer says:

      Traditional car companies are not focussed enough on EV.
      And Tesla will have billions of miles of experience against the new ones.
      And Tesla has Elon Musk.

      Could be enough.

    3. Pushmi-Pullyu says:

      There are many different ways to look at the situation. Here’s one:

      Legacy auto makers keep talking about what car they’re gonna put into production within a few years to compete with where Tesla is now. Not a single one of ’em is talking about aiming for where Tesla will be when their supposed competitor finally goes on the market.

      And when an auto maker does put something like the Bolt into production, something which might actually compete with a Tesla car, the company (GM in this case) limits production so there’s absolutely no hope of dominating the market the way Tesla is rapidly moving to do.

      Things in the auto industry move slowly. We’ll never see the sort of rapid advancements we see in computers or the iPhone. Manufacturing automobiles is heavy industry. It takes massive amounts of capital investment and lots of time to build factories and significantly ramp up production of automobiles, unlike making computer chips and iPhones.

      So if some auto maker does rise up to challenge Tesla, we’ll all see it coming years in advance.

      Let’s remember that at one time, back in the days of the Ford Model T, Ford had 90% of the market. Ford only lost their market dominance because they became complacent and refused to make the innovations and offer the options which other auto makers were using to entice customers to switch brands.

      Remember the saying “You can have your Model T in any color you want, as long as it’s black”? 😉 I suspect Ron Baron thinks Tesla won’t make the same mistake.

      1. Loboc says:

        “We’ll never see the sort of rapid advancements we see in computers or the iPhone. Manufacturing automobiles is heavy industry. It takes massive amounts of capital investment and lots of time to build factories and significantly ramp up production of automobiles, unlike making computer chips and iPhones.”

        Most advances in automobiles is in the area of the electronics you quote. Apple Car-Play is not in Tesla’s vocabulary, for example. People (especially younger folks) want integration with their devices. Tesla is rolling their own but is behind GM in this area.

        GM and Tesla don’t compete in the high-end car arena, except maybe Escalade, and Cadillac is killing it in that market. What would you rather have? Cadillac with Apple and 4G, or Tesla with x-wing doors?

  7. jmac says:

    Buffet invested in BYD, Now, Baron has invested in Tesla. Both are billionaires and must be doing something right to get where they are. I think Buffet sunk about 300 to 400 million in BYD and Baron has matched him with money to Tesla.

    It will take some time for these investments to mature. Investing in the future takes patience something that Day Traders and Short Sellers just don’t have time for in their rush to get rich quick.

    1. Pushmi-Pullyu says:

      Re short vs. long investments:

      Right. Those long investors who invested early in Tesla stock are the ones who have really made huge wodges of cash. Short-sellers, by comparison, well…

      “Tesla envy happens when other people have, ahem, long positions and yours is too short.” –Jim Whitehead
      😉

  8. Vassi says:

    Tesla is certainly the company of the future. They is here to change the auto industry because other automakers don’t want to. And this is not easy as this is a heavy industry. If someone is investing millions of dollars, and this someone is a billionaire something must be happening the right way.