Invest
Tesla: Part of disruptor ‘cluster bomb’?
Elon Musk’s baby could be a toxic investment, a funds management firm has warned, describing Tesla and its “overhyped disruptor” ilk as a potential “cluster bomb”.
Tesla: Part of disruptor ‘cluster bomb’?
Elon Musk’s baby could be a toxic investment, a funds management firm has warned, describing Tesla and its “overhyped disruptor” ilk as a potential “cluster bomb”.

Speaking in Sydney this week, Antipodes Partners chief investment officer Jacob Mitchell said the firm was shorting Tesla because it sees a “cluster of opportunities in the overhyped disruptor cluster”.
Mr Mitchell said the current investment zeitgeist is to believe that companies growing now will continue growing, “So why fight it?”
“Maybe we've been foolish fighting it but maybe long term we'll get the payoff in being a bit more independent in our approach to these companies,” he said.
To Mr Mitchell, Tesla’s early successes have been extrapolated thanks to its charismatic leader, favourable early winds and the boon of an ex-Toyota production line.

“I think now though, the decision to move into storage batteries and the decision to move into a mass market vehicle we struggle with because you're going into a highly commoditised segment where, for all sorts of reasons, people really [are] going into price sensitive buys,” he said.
Mr Mitchell argued that Tesla’s strength doesn’t lie in production scale and should be cautious of attempting too many things at once.
“Internalising battery production is a pretty brave thing to do, it requires a lot of capital and they need to be able to invest that capital in, arguably, areas of competitive advantage, which is the assembly design,” he said.
Continuing, Mr Mitchell said original equipment manufacturer companies (OEMs) like Tesla are increasingly becoming design and assembly businesses with finance arms attached.
The OEM industry is also very out of favour.
“I don't think it's out of favour because people think Tesla's going to disrupt the incumbents, I think it's out of favour because investors are worried about where we are in the cycle, obviously trade issues are weighing on performance in the short term, potentially just de-rating it on the back of the fact that it's pretty competitive,” he said.
“But this is the industry that Tesla is interested in, so if the incumbents are worth very little, why should the upstart that's carrying a lot of execution risk – why should it be underrated?”
Nevertheless, Mr Mitchell conceded the difficulty of arguing a large part of the sector was wrong, especially given the current environment where disruption is celebrated.
“The risk here is that a big company feels quite threatened and decides that they must own Tesla and we think that's a very low probability event, but not a zero probability event.”

Property
North platform adds household reporting feature to boost adviser efficiency
AMP's North platform has launched consolidated household reporting across multiple client accounts, helping financial advisers streamline their client review processes. Read more

Property
What Adds The Most Value To Properties?
Wondering how to up the value of your property? Properties are worth a lot of money in general, but there’s always a way to maximise value. The good news is that most of the things you can do to ...Read more

Property
Centuria reports strong growth in alternative real estate sectors for FY24
Centuria Capital Group has reported significant growth in alternative real estate sectors for the 2024 financial year, driving stable performance and increased guidance for FY25. Read more

Property
How to leverage equity in your home for investment or renovation
Home equity, the value of your property minus any debts owed, is a powerful financial resource many homeowners in Australia can utilize to further their financial goals. Whether you're looking to ...Read more

Property
Exploring REITs: Real estate investment without buying property
Real Estate Investment Trusts (REITs) offer a compelling investment alternative for those interested in the real estate market but may not want to endure the complexities and capital requirements of ...Read more

Property
Retirement communities: a pivotal element in meeting Australia's housing targets
The Retirement Living Council (RLC) has recommended that retirement communities should be considered a vital part in the Australian Government's initiative to fulfill the Housing Australia Future Fund ...Read more

Property
Australians adjust financial strategies amid changing property market dynamics
The 2023 calendar year saw Australian borrowers acquiring a total of $300.9 billion in new loans for property purchases, marking a 12.7% decrease from the previous year. Read more

Property
Split home loans unlocking doors for Aussie buyers
Australians are teaming up to dive into the real estate market and seize the advantages of home ownership, with the trend of split home loans surging as family and friends unite to buy properties ...Read more

Property
North platform adds household reporting feature to boost adviser efficiency
AMP's North platform has launched consolidated household reporting across multiple client accounts, helping financial advisers streamline their client review processes. Read more

Property
What Adds The Most Value To Properties?
Wondering how to up the value of your property? Properties are worth a lot of money in general, but there’s always a way to maximise value. The good news is that most of the things you can do to ...Read more

Property
Centuria reports strong growth in alternative real estate sectors for FY24
Centuria Capital Group has reported significant growth in alternative real estate sectors for the 2024 financial year, driving stable performance and increased guidance for FY25. Read more

Property
How to leverage equity in your home for investment or renovation
Home equity, the value of your property minus any debts owed, is a powerful financial resource many homeowners in Australia can utilize to further their financial goals. Whether you're looking to ...Read more

Property
Exploring REITs: Real estate investment without buying property
Real Estate Investment Trusts (REITs) offer a compelling investment alternative for those interested in the real estate market but may not want to endure the complexities and capital requirements of ...Read more

Property
Retirement communities: a pivotal element in meeting Australia's housing targets
The Retirement Living Council (RLC) has recommended that retirement communities should be considered a vital part in the Australian Government's initiative to fulfill the Housing Australia Future Fund ...Read more

Property
Australians adjust financial strategies amid changing property market dynamics
The 2023 calendar year saw Australian borrowers acquiring a total of $300.9 billion in new loans for property purchases, marking a 12.7% decrease from the previous year. Read more

Property
Split home loans unlocking doors for Aussie buyers
Australians are teaming up to dive into the real estate market and seize the advantages of home ownership, with the trend of split home loans surging as family and friends unite to buy properties ...Read more