Tesla stock is a tech company. Which category does electric car manufacturer Tesla fit under, a technological company or an automaker? This question is of utmost significance for those who are investors. Do you wonder if Tesla can be considered a technology company? In 2020, Joel Feder’s tweets on Tesla triggered a heated discussion on Twitter. The following may be found in one of his tweets: “Reminder: Tesla is a car company. Tesla is not a tech company. It builds cars.” But is he absolutely right? First things first, let’s talk about what a tech company and an automobile company is. A technology company is a specific kind of business entity that focuses primarily on the research, design, and production of technological goods or the delivery of technology in service. On the other hand, a automobile company is a business that specializes in the production and sale of automobiles. Although it is obvious that the Palo Alto, California-based corporation manufactures and sells automobiles, the company’s stock performance in recent years has been very similar to that of a technology company. But does that make them also a Tech company? lets have a detailed look into that. What exactly makes Tesla a tech company? A significant amount of software is being developed by Tesla. Software is at the heart of everything that makes Tesla’s infotainment system, user experience, and autonomous-driving technologies stand apart from the competition. Over-the-air updates have been available for Tesla vehicles for years, but most other automakers are just getting ready to begin offering them.
Operating systems for Tesla automobiles are in the process of being designed, developed, and continuously enhanced by Tesla staff. Tesla also manufactures other forms of technology, such as solar panels, rooftop solar tiles, various types of batteries, charging stations, computers, and important components of computers that are used in Tesla automobiles. Teslas are cars and SUVs and soon we will have Tesla pickup trucks and semi-trucks. However, these vehicles incorporate software for our day-to-day use that was either developed in-house at Tesla or incorporated into Tesla’s system. With a Tesla car, you now have access to various entertainment alternatives, including TRAX, Caraoke, and numerous games which you can while you are parked and maybe someday Tesla will develop one you can play while in transit. The integration of Tesla hardware and software into a security system known as Sentry Mode has been of assistance to law enforcement in investigating and resolving various crimes, including vandalism. In addition, if there is a significant accident, your phone will receive a notification from the automobile because Tesla’s Sentry Mode is an exclusive function. Also, Tesla’s insurance will be an extension of the tech side, as the company will be leveraging the data it has collected on the actual behaviour of Tesla drivers and we all know that data collection is a significant part of the technological industry, particularly when it is direct like this and is not done through market research surveys. Tesla is focusing its research and development efforts on three primary areas of technology: battery technology, onboard software, and Autopilot, which will eventually be upgraded to “Full Self Driving.” When Tesla’s stock price increased by 382.5 per cent in a single year in 2013, the notion that the business is a technology corporation acquired credibility.
There was a mad dash among publications to discover technological businesses with growth rates comparable to Tesla’s. Even the online journal Slate published an article that compared Tesla and Apple and the Google division of Alphabet. There are many ways in which Tesla and the technology industry are comparable. To begin, despite Tesla’s long history of incurring losses, the company’s valuation in the markets has improved in recent times. Even though they are making a loss, several technology companies, such as Workday, have high market valuations. Additionally, Tesla has adopted the disruptive ideology prevalent in the technology sector. Like other tech businesses, Tesla is working toward the goal of directly selling to consumers to disrupt the traditional business structures used in the automotive sector. Its product pipeline and founder inspire the kind of fanaticism and loyalty that is typically associated with legendary technology businesses like Apple. Similarities between Tesla and the colossal technology company Apple According to a half-dozen former employees who worked for both Tesla and Apple and who spoke on the condition of anonymity due to the sensitive nature of the workplace dynamics and for fear of retaliation, it is not a coincidence that the companies share a lot of similarities in their business practices and operations. Apple’s design language and ethos were imported into Tesla when the company hired managers who brought members of their teams from Apple. According to a former employee of both firms who worked in the products department, “Tesla is not an automotive company; rather, it is a technology company that manufactures automobiles.” That observation also applies to the management of the organization. Some of the employees have stated that Elon Musk, who gave himself the title of “Technoking” at Tesla, has modelled his leadership style after that of Apple co-founder and Silicon Valley demigod Steve Jobs in more ways than one. The companies have the same goal in mind, and part of that goal is to place a premium on certain sorts of private technology. A singular charging connector is utilized by Tesla, reminiscent of the “Lightning” connectors utilized by Apple goods. It has constructed what it claims to be the greatest network of fast-charging stations globally, which comprises more than 25,000 Superchargers.
Because the automobiles are capable of revolutionary over-the-air updates, owners may be susceptible to unexpected changes in performance if products become out of the date. These adjustments may include battery throttling, for which Apple has received criticism. It has been difficult for government authorities investigating crashes to decode Tesla’s proprietary systems, an issue that is similar to the difficulty that federal investigators face in unlocking Apple gadgets. It is a long cry from the conventional auto business, which was built largely on standardization, from petrol pumps to windshield wipers and in-car infotainment systems with integration of Apple CarPlay and Android. There is a learning curve associated with using Tesla’s proprietary touch-screen interface, but it enables a user experience that is uniquely suited for the company’s automobiles and is reminiscent of Apple’s integration of hardware and software. New adopters may find this interface difficult to use at first. Investors have been blown away by Tesla’s performance. Musk tweeted in March that he sees Tesla becoming the world’s biggest firm, exceeding even Apple’s more than $2 trillion market valuation, which prompted the company’s stock to jump in recent months, causing Musk to say that he sees Tesla becoming the world’s biggest company. Is it going to achieve that? Time will tell. However, the product that Tesla offers reflects its origins in the capital-intensive automotive sector. In this regard, the company is distinct from technology companies, which often have large margins and cheap costs associated with scaling their operations. Tesla needs huge infusions of new capital to cover its production costs, and the company will have to make significant investments in order to expand its business. What exactly does this imply for individuals planning to invest their money in Tesla stock? It indicates that the company does not currently belong to any designated market sectors. This is because Tesla was one of the pioneers in the electric car sector, and the company’s success is closely tied to the success of the electric car industry as a whole. Tesla is a well-known and respected brand among those who are passionate about automobiles, which bodes well for the industry as a whole. In addition to being a manufacturer of automobiles, Tesla is also in the business of producing batteries, developing solar technology, and creating software. If there were just one word that could be used to describe Tesla, that word would be “technology.” Because of this, Tesla might be considered a technology company. Whether or not you like the firm, Tesla is always innovation, creating and integrating new softwares into their automobiles. Tesla is always working round the clock to develop computer chips, sophisticated hardware that any other manufacturer does not develop, and advanced software of various functions, and it is not stopping there. Outro That will be all for today’s video. What’s your thought about Tesla being a tech company? Do you agree with Feder or not? Let us know in the comment section below.