Could Pickup Trucks Be Gamechanger For Tesla & Elon Musk

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Elon Musk on a podcast recently leaked information about the future Tesla pickup truck. Elon said the trucks would start just under $50,000 and be better than a Ford F series truck as well as the Tesla pickup truck would be faster than a porche 911! I want to discuss how big the market opportunity is for Tesla in the United States for Tesla pickup trucks.

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Well, good day subscribers Hope you guys are all having a great day out there. As always, yesterday, we did a video on the channel where I talked about Tesla stock in that video toward the end, I mentioned, Hey, would you like me to do a video about Tesla and their new truck, they’re going to have coming in about a year or two, and what the potential demand could be for that truck.

And I’m probably showing you guys a whole bunch of comments right now. But we got a flood of comments that you guys would be interested in that video. So that’s what we’re going to do today, we’re gonna go ahead and dive into the subject, or we’re gonna kind of look at it from a few different angles.

Like what’s the realistic market opportunity for Tesla in the space over the coming years, and in this video, we’re only focusing on the United States because internationally gets much more complicated, okay. But in the US, there’s a massive truck market. Needless to say, it’s much bigger than I think a lot of people even think about.

Okay, so currently, if you have a look at the US truck market, it’s kind of separated into two categories. You have like the smaller trucks, okay? The smaller pickup trucks would be things like Nissan frontiers, for Rangers trucks like that, that are you know, smaller, and usually a lot of those trucks are going to start in the low 20s.

Okay, somewhere in that price range. And then you have the bigger trucks, okay, which would be like the Nissan Titan, the Ford Raptor, you know, the Dodge Ram, the F 150, silverados, those sorts of trucks, okay. And those are kind of more like the full size trucks as they’re called.

And so for focusing on like Tesla, what market they’re going to be going after, they’re really going to be go after the big truck sector, okay. Those ones are the ones that are doing the big numbers, those ones have much higher average selling prices.

So if we’re looking at what Tesla is going to be competing with, these are really the guys that Tesla is going to be competing with the F 150s, the Rams, the Raptors, all those sorts of trucks, okay, there’s silverados and things like that. Okay, now, trucks are not just for work.

I know some people think like, if you have a pickup truck, that means you do like some manly job or something like that. And it’s just not true. Okay, a lot of people like work nine to five desk jobs and drive a big like lifted truck or something around.

Okay, so trucks are just for people that actually need a truck for work now then people just like drive trucks just to drive trucks as they’re like their commuter vehicle. And I mean, you guys have probably seen there’s like those huge lifted trucks and things like that, the way they kind of think about it is, you know, the bigger the truck, the smaller the penis size. Jeremy, you cannot be making jokes like that.

You know, we live in this highly sensitive environment nowadays, everybody gets offended over everything. You’re on here making a small penis joke. Are you kidding me? Get your act together. Dude, though, let’s go ahead and talk about numbers. Okay, concrete numbers that some of these companies are doing right now.

Right? We look at 2018 in the United States of America, there are around 900,000 f series Ford sold, okay, meaning like Ford F 150s. For you know, f 250s, Ford, f 350s. All those different types of Ford’s 900,000 that might shock some of you guys. That number is insanely high.

Okay, if we think about Tesla’s total vehicles, like if we add up all the model three sold last year, and that’s even, you know, the ones that might have been sold internationally, which model three wasn’t sold much internationally. It was mostly US based, okay, but we can even add up all the S’s in all the x’s, whether they were sold in the United States or international. Tesla’s total amount of vehicles delivered last year was somewhere around 245,000.

Okay, that just takes into context like how big the truck market really is. Ford F series alone did 900,000 sales in the United States of America in 2018. Okay, that’s an incredible number. Chevy Silverado, we’re looking at about 585,000 sold in 2018, and dodge RAMs, about 540,000 sold in 2018.

So needless to say, these numbers are absolutely massive. These are not some kind of small segments or something like that, like even the Dodge Ram, which of those three is the least selling one of them. Okay, that’s still basically, you know, a double up of what tests are sold total for vehicles last year.

Okay, so these numbers are pretty incredible. That test is going to be going after in the truck marketing, you can see why if you’re a company like Tesla, and your goal is to you know, electrify the world and you know, make all these electric vehicles and you know, go this route, right.

And also, hopefully expand your business like you have to go back to the truck market. There’s just massive, massive demand there. Okay, so Ford F series, those one start a round $30,000 you got to kind of think about where these vehicles start at, because then you can kind of figure out average selling prices.

What’s the realistic market Tesla’s gonna be going after so the F series starts a little under 30,000 but a lot of people that buy him are paying 3540 Some even up to 50 grand, you know, depending on you know, all the features, you get motors, all those sorts of things. Okay. The Silverado starts just under 30,000 as well.

The Dodge Ram starts right around 33,500 and as far as Tesla, the Tesla truck should start somewhere around $49,000 according to Ilan musk on that podcast just a few days ago. You He mentioned somewhere under $50,000, he’s like, we got to have a really good starting truck somewhere around $49,000 or so.

Okay, so needless to say, the Tesla truck is going to be priced quite ahead of where the other trucks start out, okay, now keep in mind, Tesla will probably have like a $49,000 option probably like a $59,000 option, and probably like a $69,000 option known Tesla, and kind of the way they do pricing and whatnot.

So needless to say, it’s gonna be pretty expensive if you’re looking at base models versus some of these competitors. But once again, this is going to be an electric truck probably could save a lot on gas. And it’s going to have some, you know, form of, you know, autonomous driving in there for that price point. Okay.

So it’s something to think about the can’t really go after the whole market, because some of these price brackets are just not there. Okay, so there’s about 2.5 million, you know, big trucks sold every year in the United States around 2.5 million, roughly. Okay. So if you look at it, you can say, well, that’s Tesla’s real opportunity there, I don’t think that’s really the real opportunity.

Because, you know, some people can’t afford a truck that starts at $50,000, roughly, okay, some people have to buy that pickup truck that starts around $30,000, or $35,000, because that’s what they can afford. Okay, so not everybody can afford 50,000.

So essentially, in my opinion, you got to take about a million truck sales off of that number to get the real opportunity, because about a million those folks just either aren’t willing to go up to that type of price point, or literally, they get like financially, they can’t afford, you know, a $50,000 truck, but they can afford a $30,000 truck for their business or just for commuting around.

So 1.5 million vehicles, as far as you know, trucks is really, in my opinion, the real opportunity, the real market that Tesla is going after in this pickup truck market. Okay, so with that number in mind, 1.5 million, let’s talk about the 2025 in my opinion, best case.

And worst case scenario, keep in mind, this truck probably won’t go into production until late late 2021, or at some point in 2022. Meaning that, you know, 2025, by that time the truck should be at full scale production. By that time, you know, a lot of customers should already have it, it should be well known in the market in a competitive force by 2025. So let’s talk about best case.

And worst case scenario for Tesla as far as the pickup truck goes in 2025 already, guys, now let’s go ahead and talk about worst case scenario, best case scenario, and what I believe is the most realistic scenario for how this Tesla truck will do in the market.

All right, a lot of it’s gonna depend on how this truck is perceived in the market, do actual truck buyers want to go out and get this truck and things like that? Okay, so I got my best case, I got the worst case and I got the realistic case, keep in mind the opportunity.

So it’s going after is around 1.5 million. Okay, that’s about the realistic opportunity, as far as you know, what Tesla is going after and trying to build market share. So best case scenario 2025 for Tesla truck is that they have around 20% market share in North America, okay.

And the United States will say specifically Okay, about 20% market share in United States, that would mean that we’d be moving around 300,000 trucks pickup trucks per year, I think average selling price will will be around $57,000. If we take into account that trucks gonna start around 49.

Keep in mind, a lot of people are gonna try to keep it as cheap as possible, especially a lot of the workforce that will be buying this truck, they’re going to try to get like the base base model, right? So you know, they’re gonna have a lot of folks down there, but you’ll have some folks that upgrade and buy, you know, one that’s in the $60,000 range, or 70,000.

So I think average selling price will be around $57,000, regardless of its best case scenario, worst case scenario, or anything in between. So if they’re doing around 300,000 units, they have about 20% market share on the you know, the premium pickup truck market that they’re really going after, that would mean they’re doing around $17 billion a year in at that type of scale.

I can see about two to $4 billion actually reaching down to that net income line. Okay, positive net income of two to $4 billion contribution just from the truck business, if it is the at that type of scale. Okay, so we’re talking about, you know, really like a potential game changer for Tesla. But that’s best case scenario, okay.

And I can’t really see them getting 50% market share by 2025, as far as the premium pickup trucks go or anything close to that, you know, and so that’s kind of in my opinion, like best case scenario, the absolute worst case disaster this would be if the truck is perceived super negative, and the only people you can get to buy this pickup truck are like the people that are super, super like diehard like Tesla fans.

Worst case scenario is they would get about 1% market share of that 1.5 million opportunity there. That would equal about 15,000 units roughly Okay, at a still an average selling price of about $57,000. That would mean revenue about 150 million sounds like a big number. It’s not really big.

And in my opinion, at that point, they would be taking losses because the business was just wouldn’t be at the scale they needed to be at to make this a profitable business. So if If the business is is, you know, at 1% market share in 2025 of new, you know, premium pickup trucks sold in the United States, like, like they’re gonna lose money on that bottom line.

Okay, my realistic estimate for 2025 is I think they could have about 10% market share, okay, this is assuming the truck is perceived as you know, a good quality truck, it’s got really good power, you get a lot of bang for your buck, people really like it not that people are going crazy for it, okay, or something like that, you know, which was like a model three type of scenario.

So this is just assuming people really like it, they think it’s good quality, they think it’s good bang for your buck, it goes pretty fast, able to carry a lot of weight and all those sorts of things. Okay, in that scenario, I see them having about 10% market share, that would be about 150,000 trucks they’d be selling in 2025 $57,000 would be a business out brings in between eight and $9 billion, roughly as far as revenue.

And in that scenario, I can see about a billion dollars or so going down to net net income line. But keep in mind, the more this business scales, the more it will throw off money to that bottom line. Okay, so that’s why there’s a massive difference between what this one could potentially throw off which is maybe up to 4 billion, which is this one.

It’s probably going to be about a billion or so it would actually flow down to the net income in my personal opinion there Okay, so that’s kind of 2025 Now if we look down further down the road you know, if you’re looking at 2028 or 2030 you know, things can totally change and maybe Tesla can get even a bigger market share we’ll have to see how all that shakes out but it should be very interesting because.

Tesla is going to have one of the first you know electric trucks in the market rivian supposed to be you know entering the market now as far as electric trucks go they’re a brand new upstart what to see how they do they haven’t proven they can scale anything yet they haven’t even built vehicles yet so we’ll have to see what they end up doing if they’re successful or not.

But it looks like Tesla could have possibly the first mass production pickup truck that’s electric out there okay in the market and with Tesla’s brand name this could get you know, you know known all over the United States in a very quick amount of time okay, because you know, the way word spreads around.

Tesla so we’ll have to see how it all shakes out guys but I think that’s the type of market opportunity test is going after so hope you guys got a lot of value kind of looking at these numbers what’s what’s being produced out there and what’s the realistic you know, amounts a test was really going to be going after in this business. Okay, so hope you guys enjoy this.

Always make sure you hit that thumbs up button. Let me know if you have any other opinions on videos I should do in the comment section. Thank you for watching, and have a great day.

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