Billionaire Tesla investor Ron Baron continues to be bullish on Tesla, and he's got a few reasons why.
Baron, who is the CEO and chairman of Baron Capital and has been investing in Tesla since 2014, gave his thoughts about Tesla on NBC's Squawk Box on Friday.
He said that what sets Tesla apart from the rest of the growing pack of automobile companies looking to tap into the electric vehicle market is that Tesla's data and technology allows it to be efficient with its costs.
"[Tesla] can't possibly be matched by anyone else. They have data, technology, they make cars cheaper than [the rest,]" Baron said. "When Ford makes one of these cars, every car they make, they lose $36,000 on ... Our company now makes about $8,000 or $9,000 of profit a car."
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Baron also added that Tesla gets about 100 million miles a day which will only improve its technology versus the rest of the competition.
When asked about the slowdown in demand of the total electric vehicle space the country, Baron cited that he still expects all cars to become electric down the line. However, the pace has slowed for a few reasons: quality, price, and the dealers.
"The reason there's not more demand is that cars that are out there are not very attractive and they're expensive," Baron said. "In addition, the dealers who sell them, they don't want to sell them because there's nothing to service. The dealers make all their money on servicing."
Baron was also asked about Tesla's market in China and whether he sees that market as key for the company moving forward. The billionaire did not give a direct response on the business growth in the country, instead saying that the relationship between Musk and China is strong with a purpose that goes beyond Tesla's sales in the market.
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"The idea is that China invited Musk in and invited him in because the Chinese car companies have done very poorly for a long time, and the promise was that he is going to help become better car manufacturers — he's not trying to take over the market in China — and develop a local supply chain," Baron said. "I think the relations they have with China are exceptionally good. Both people are getting something from it. I think that that business will continue to grow."
Baron then cited Tesla's looming Model 2 launch which he expects will be good for markets like China and in making EVs more accessible for the masses.
"Wait until you see what's going to happen when all of a sudden they start selling cars instead of for $40,000 apiece for $25,000 apiece, which is going to happen in about a year, year and a half from their new model," Baron said. "The new model, they think, is going to do 5 million cars a year for the Model 2. That's coming."
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