How can analysts and institutions pretend Tesla is worth its present market cap despite the obvious lies and that its only real business is in decline and should be valued around 5%

I've been following tesla for a long time and have never invested directly in it (aside from indirect retirement account / roth account contributions)

Tesla's actual businesses

Tesla's only real business is the automotive sales business. Their energy business has shifted from Panasonic/Tesla batteries to Tesla buying batteries from CATL and now LG.

Any model that adds AI, a robotaxi network, humanoid robots is extremely naive as these promises exist only to prop the stock price, and has been pushed back year after year (in the case of FSD it's been 9+ years).

Tesla spends a lot of time and effort talking about fantasy businesses that it is not making meaningful progress towards achieving because it knows that the automotive business absolutely cannot justify its current price.

Automotive Comparisons

Company	Market cap (millions)	Revenue (billions)	gross margin	units (millions)
toyota	239	309.2	19.94%	10.8
tesla	1,000+	97.7	17.9%	1.79
honda	43.1	135	21.7	3.8
ford	43	185	14.0	3.8
VW group	53	353	5.9	9.0

Looking at comps, it's pretty clear that Tesla's valuation is insane for an automotive company and it's not unreasonable to suggest it is 20x overvalued. Comparing with Honda, for example, Tesla's stock is worth more than 20x as much, despite half as many sales at a lower gross margin and much less revenue.

From an automotive-only perspective, even with software sales and regulatory credits, it would be impossible to value tesla significantly above Honda or Ford.

And that's after accounting tricks, ZEV sales / regulatory credits in general, etc. Not only that, but Tesla's business is in steep decline.

"Without FSD, Tesla is a zero" - Elon Musk

Pipe dreams, lies and assumptions

The car business is a tough business. The reason it is difficult is because you have very high costs and require efficiency and scale, and must match production to demand very closely. A factor producing 60% of its capacity will struggle to be profitable.

The challenge isn't "can we make electric cars" the challenge is: "how can we make this sustainably profitable." All car companies will get there eventually (or die) and we've seen legacy automakers can make electric drive trains that beat tesla in reliability and make or buy batteries that can match or beat tesla in longevity.

Tesla has benefited in many ways from generosity: they got the freemont plant nearly free from Toyota. They were seemingly gifted an auto factory near Shanghai that was built in record time. They benefit from the ZEV credit scheme whereby Tesla sells 'credits' to other companies allowing them to avoid making electric vehicles (in direct contradiction to tesla's stated mission).

Despite that, all of tesla's real profit comes from a combination of credits and software sales. Software that is largely a promise for the future: "your car will make you money when you're asleep" elon promises. He even promised, in 2017, then again in 2019 that you could sleep in the back of your tesla and wake up having been delivered somewhere.

[owners will be] essentially safe to fall asleep and wake up at their destination towards the end of (2020)

The failed promises of FSD, year after year, show that the point is to be dishonest and misleading. Even now, Tesla is launching a 'robotaxi' service in a very limited domain with a safety driver in car and an extremely limited number of vehicles. Elon promises it will scale quickly, but in the first day of operations we saw serious safety issues.

This pattern of lies extends to future products too. The 'Roadster 2020' is nowhere in sight, the Semi, originally promised for 2020/2021 was 'delivered' to Pepsi at the end of 2022 and we now know that was a stock promotion launch as Tesla is still looking for a place to manufacture it.

The humanoid robot business doesn't even deserve comment. it's simply absurd.

Battery swap is a well known fake launch which gave tesla hundreds of millions in subsidies.

But why was tesla successful at making EVs before anyone else

The answer, simply, is money. This is always the answer. As i stated, other companies need to create a sustainable, profitable product. Tesla has sold tens of billions in stock and gotten as much in government subsidies in the US alone.

Right now we're about to find out how sustainable Tesla's business actually is and despite it wobbling and looking extremely vulnerable, Tesla's valuation remains at least 20x overvalued.