In Reply to: Re: Elon predicted sales of 250-500k/year to shareholders posted by russsmith on November 07, 2026 at 12:36:59
He's combining Tesla and SpaceX for the same reason he previously folded his other companies into SpaceX: he wants to mask the declining value of his struggling companies by folding them into the one company he can still sell investors on as having enormous growth potential.
That's why he's pitching this mega-company not as a mission-to-Mars company, an automobile manufacturer, or a robotics company, but as an AI company. It's also why the opening pages of its IPO filings were filled with science fiction, grandiose visions, and promises of the future rather than simply focusing on the underlying business.
Tesla's P/E ratio is roughly 50 to 60 times what I believe its underlying business justifies. Once investors recognize how disconnected its valuation is from its actual earnings, the stock could plummet.
That's also why Musk doesn't want his struggling companies valued and traded independently. By folding them into a single corporate entity, he can use the perceived value and potential of SpaceX to prop up the others, making it harder for investors to see what each business is actually worth.
Company P/E ratio
Tesla 394
Ferrari 38
BYD 26
General Motors 20
Toyota 10
Mercedes-Benz 8
Hyundai 7
BMW 5
Kia 5
Ford Negative
Honda Negative
Stellantis Negative
Kara Swisher predicted this very strategy three years ago.