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do you think investing in Tesla stock is a worthwhile Endeavor many believe that investing is an art while there could be substantial returns Investments also come with certain risks that said some believe that investing in Tesla stock may not be a good decision as risks over shuttle returns you surely would not want to miss this in an interview with Fox Business Network in 2018 Buffett said that if there is something Apple should definitely not do it is investing in Tesla Buffett called the prospect of Apple's investing in or buying up Tesla a very poor idea mainly because of the nature of the automotive industry in which Apple has never had any involvement in it's not an easy business Buffett said you can win an auto one year and lose the next you've got a dozen big companies out there with resources they're going to keep coming they're going to copy what you do at the time there was on and off speculation that Apple might want to acquire Tesla in Parts because with its 244 billion dollars in cash on hand apple is one of the few companies that could buy Tesla outright and feel almost no impact on its balance sheet also Apple has been said to be exploring self-driving car technology for some time and in August of that year it rehired Doug field a former Apple Hardware engineer executive who had joined Tesla two years prior to help with its autonomous driving technology efforts today it appears that news of Warren Buffett saying the Tesla stock is a terrible investment is circulating at the same time there is rising speculation which started last year that Buffett has been secretly buying up Tesla shares when previously asked about his thoughts on Tesla and its controversial CEO Elon Musk Buffett vaguely answered he's done some remarkable things Buffett also said this about the famous EV maker Elon may turn the world on its head in several sectors Buffett has previously hailed musk as a wonderful individual but has also stated that he has room for improvement and should be more judicial in his tweeting it is no secret just how controversial musk is especially with how he exchanges tweets with his followers some may even argue that at least half the time Tesla trended was not actually because of the brand itself but because of its leader on the other hand musk responded to a Twitter thread claiming that he was worth more than Warren Buffett and Bill Gates he joked perhaps Warren Buffett should invest in Tesla however despite his positive outlook for Tesla and good words for its CEO Elon Musk Buffett appears to be a believer in byd and GM while Berkshire has never invested in Tesla the company held 6.1 billion dollars of Chinese electric vehicle stock byd company ADR and 2.2 billion dollars of General Motors Company stock as of the end of 2021 however things took a turn when Buffett started selling his byd shares because of this people have been speculating that Buffett has secretly been buying Tesla shares in a previous interview with former CBS anchor Charlie Rose Buffett raises musk's accomplishments at Tesla I mean Elon didn't he's taking on General Motors Ford Toyota all these people who've got all the stuff and he's got an idea and he's winning that's America you can't dream it up it's astounding Buffett said recent news shows that Warren Buffett's Berkshire Hathaway is continuing to unwind its long position in byd China's largest homegrown EV maker and Tesla's major rival after holding it for 14 years this led people to assume that Warren Buffett is selling byd to buy Tesla stock recent statements from Berkshire Hathaway's Vice chairman did not help quiet down suspicions that the company is buying or at least preparing to buy Tesla shares it can be noted that Buffett's right-hand Man Charlie Munger recently stated that what Tesla has done in the car business is a minor miracle in a recent CNBC Squawk Box episode Monger spoke highly of Elon musk's electric vehicle company Tesla calling it an amazing feat in the American Auto industry I was certainly surprised that Tesla did as well as it did Munger said in the interview however Munger noted that he does not equate Tesla with Bitcoin according to him Tesla has made some real contributions to this civilization and that its CEO Elon Musk has done some good things that others couldn't do we haven't had a successful new auto company in a long long time what Tesla has done in the car business is a minor miracle Munger said in light of this many are speculating that Buffett's Berkshire Hathaway has been or at least planning to load up on Tesla shares if not experts believe that several things could in theory put Tesla on Warren Buffett's radar in 2023 for one Tesla is considered an industry leader and not just because of its market cap which surpasses all other Auto stocks during the third quarter Tesla accounted for a 65 share of EVS registered in the United States according to SNP Global Mobility a division of SMP Global Buffett it is a strong believer that industry leaders tend to keep winning as long as they have a sustainable moat also Tesla can sustain its industry leading share by significantly boosting production to meet the growing demand for EVS in 2022 the Austin Texas and Berlin Germany gigafactories came online although supply chain issues could disrupt production in 2023 it's feasible that Tesla could surpass 1.5 million EVS produced this year after pacing more than one million EV deliveries in 2022 the third Beacon for Warren Buffett and his investment team would be the company's income statements Tesla has been profitable on the basis of generally accepted accounting principles gaap in each of the past three years over the trailing five quarters gaap net income has ranged from 1.62 billion dollars to 3.32 billion even though regulatory credits are aiding Tesla's profits these emission credits are no longer necessary to achieve profitability the fourth and final factor that could draw the the Oracle of Omaha's attention is Tesla's balance sheet which ended in September with 21.1 billion dollars in cash cash equivalents and marketable securities CEO Elon Musk has suggested the Tesla board of directors would consider a share buyback once the U.S and global economic Outlook stabilizes a bit on the other hand Tesla does not tick Warren Buffett's checklist for a worthy investment as much as Buffett has hung up on moats Tesla lacks a true moat it can be noted that Tesla CEO Elon Musk explained why he has not like Warren Buffett as two of the world's richest men have Divergent approaches to business the Tesla boss has in the past dismissed Buffett's advice to investors to find companies with moats or buffers around them in 2018 musk said moats are lame and it is the speed of innovation that matters CNBC reported in light of this Tesla's competitive advantages aren't as rock solid as its market share entails the company's us and Global Market sure have been shrinking AS Global automakers aggressively spend on EV autonomous vehicle AV research and Battery production in the U.S General Motors a current Berkshire Hathaway holding and Ford Motor Company have earmarked 35 billion dollars and 50 billion respectively for Ev avav and Battery research by the end of 2025 GM and Ford are each expected to have unveiled 30 new EV models worldwide to add to this point even though Tesla is the most popular EV sold in North America it lacks the brand history and awareness that stalwartz like General Motors in Ford bring to the table building vehicles for American workers for more than a century is an intangible advantage that market cap simply doesn't trounce furthermore Tesla's competitive edges are already being toppled by newer entrants in the EV space for instance china-based Neo brought two sedans the et7 and et5 to Market this year that offered 621 miles of range with the top tier battery pack upgrade that literally end metaphorically runs circles around the range offered by Tesla's Flagship model 3 sedan without a clear-cut moat Tesla wouldn't make the grade with Warren Buffett and his investment team another reason Warren Buffett May steer clear of Tesla stock is Tesla CEO Elon Musk himself many are convinced that Elon Musk doesn't evoke trust from shareholders for Buffett strong management teams are a luxury not a necessity as long as the business he's investing in is sound however if that management team threatens consumer and shareholder trust or could adversely impact its operating performance it's a big red flag over the past few years it's becoming readily apparent that musk is a Legal Financial and operating liability for Tesla although he's an innovator who has helped build Tesla from an upstart into the world's most valuable auto company he's also drawn the ire of U.S Regulators on more than one occasion and has made a habit of over-promising and under delivering when it comes to new Innovations and products simply put many view must guess too much of a wild card to be trusted in a leadership role for that reason Warren Buffett and his investment probably wouldn't touch Tesla stock content
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