Tesla Motors Inc (NASDAQ:TSLA) continues to make headlines as big name after big name weighs in on the company and / or its vehicles. This time, Jeremy Grantham of GMO had something to say about the Model S. He got to ride in one a while back, and he actually liked it. He talked about the car in the firm’s latest quarterly letter.
Not a “car freak”
Grantham said he’s “about as far from a car freak as you will easily find,” but he also called his ride in a Tesla Motors Inc (NASDAQ:TSLA) Model S was his “#1 car experience ever.” He apparently test-drove a Tesla three years ago in Boston, and at that time, he saw it as nothing but a “tinny, rattly, super-expensive toy” with a battery that cost $50,000.
However, he said last month Tesla Motors Inc (NASDAQ:TSLA)’s chief engineers suggested that the battery costs $22,000, which means that they have significantly trimmed the price of it. The automaker expects that within three years, the cost of the battery will be less than $15,000.
Cheapskates like Tesla’s cars?
Grantham also said that Tesla Motors Inc (NASDAQ:TSLA)’s Model S feels like it should be a $75,000 in its own right without adding the fact that it is all-electric. He compared his ride in the vehicle to his “first iPad moment: ‘Wow, that’s cool!'” He believes that “even die-hard cheapskates” like him will probably have to buy Tesla’s Generation III $40,000 vehicle when it comes out.
He speculates that within the next decade, the entire car industry could be different. Although he thinks oil prices will be higher in 10 years, he’s unsure about them after that point because he sees demand for oil as declining thanks to the efforts of Tesla Motors Inc (NASDAQ:TSLA) and other sustainable transportation options. He also suggested that times could be changing more quickly than we think they are and that we should be prepared for such change.