In BriefElon Musk is ramping up production and plans to be worth as much as Apple in 10 years. How exactly does he plan to do this, and how financially dominant are Apple over other tech companies?
Elon Musk has boldly claimed that within 10 years, Tesla could be as big as Apple, with a market cap of $700 Billion. He stated, “If we’re able to maintain a 50% growth rate for 10 years and achieve 10% profitability number and have a 20 P/E, our market cap would be basically the same as Apple’s is today.” His prediction is based on the technology he is releasing this year, which includes battery and solar panel production lines as well as the more affordable Tesla Model 3.
His plan is not to outsource production to other countries, as Apple does. Rather, he wants Tesla to construct the “machine that builds the machine.” His determination is shown by the 467 weird and wonderful Kuka robots that form the “alien dreadnought” which will build the model 3.
Despite these bold claims, futuristic robots, huge production lines, and Tesla’s ascension to America’s most valuable car manufacturer, Musk still has an awful lot of catching up to do. Apple’s quarterly profit, announced this past Tuesday, eclipsed Tesla’s total profit for 2016, and to date, they have sold over a billion iPhones. In contrast, Musk hasn’t yet sold a million cars. In fact, Tesla is struggling to reach its production goal of 1 million by 2020. Especially because of Apple’s recently acquired “cash pile,” it seems like Tesla might have a long way to go. Musk may have been right when he followed up his claims by saying, “I could be delusional.”