00:00The real reason that people should have been shorting Tesla and perhaps why some of them were shorting Tesla and the real reason that car companies new car companies cannot succeed or why it's very hard for them to succeed. And this was first told to me by this automotive investor when I was at Axel Springer headquarters getting a golden steering wheel award. And this guy is apparently like the best automotive investor in the world, you know, comes up to me and like, he's like, hi, I know why you're going to fail. I'm like, well, please tell me. I can think of several reasons.
00:29He said that the car companies don't make any money on the new car sales. They make all of their money selling parts to cars to the existing fleet. So if you've got a steady state fleet, it means that 80% of your fleet is not under warranty. So you can sell high margin parts, replacement parts for the existing fleet. And you can sell your new cars at effectively zero margin. A massive barrier to entry for any new car company because you have no existing fleet.
