“The Time To Buy Tesla Is NOW” - Billionaire Investor Ron Baron

New video with legendary billionaire investor Ron Baron talking Tesla. Don't mind if I do. >> We have a very special guest joining us on set for the next half hour. Ron Baron is the founder, the CEO, and portfolio manager of Baron Capital. Ron has long backed Elon Musk, first becoming a shareholder of SpaceX back in 2017. We've had him on lots of times to talk about Tesla, SpaceX, and much more. Ron, I want to welcome you and thank you for taking the time to sit down with us today. >> Thank you for inviting me again. Yeah, you've been talking to us for a long time since before you even owned any Elon Musk companies. >> You made me famous. >> Well, I don't know. >> It's amazing. You made me famous. I walk down the street and people recognize me because of your program. >> Well, actually, I think Ron Baron's investment track record is really what made him famous because that's the only reason that CNBS keep inviting him back and he keeps killing it, calling things a mile ahead. So, Ron's got to give himself a little bit of credit. A legendary multi-deade investor with incredible long-term returns. Gets invited repeatedly to appear on CNBS over the decades. Makes more incredible calls. Makes more billions and billions of dollars for his clients. Gets invited back because he's even more legendary. Rinse recycle repeat. >> Amazing. Not just in this country, in Asia, Middle East. It's amazing. Thank you. >> Well, now it's Elon Musk who is really spreading your fame. And I I looked at your holdings and I I've kind of known this over time. You have $25 billion worth of SpaceX shares, at least according to the latest holdings we've seen as of the end of June. >> Three billion more than Nvidia has. >> Wow. And and 5 billion in Tesla. So that's more than $30 billion um in assets under management in those two stocks. I >> just for the 17 people watching that don't already know, the Baron Capital Funds, all under Ron Baron's company umbrella, collectively their number one and two largest position. SpaceX and Tesla. And funnily enough, SpaceX stock and Tesla stock also my two lightest holdings. Although not in the same order as Baron Capital, although actually they're my only two holdings. So of course they're my top two. Look at your next 13 stocks and it's companies we've known for a long time that you've talked to us about. Hyatt, MCSI, uh Spotify, Charles Schwab, but all of those next 13 stocks combined, your holdings are only about 15.5 billion. So you are really an Elon Musk proxy at this point. Um, in terms of what you've done, a lot of that's been because the shares you've bought have risen so dramatically in price. >> So when we started our business at $10 million under management in 1982, hundred million in '92, in June it was 69 billion and we made our clients 71 billion in profits. >> Nice. So $10 million into over $70ish billion plus roughly another $70 billion of profits paid out to investors. So effectively 10 million into 140 billion. No wonder they keep inviting Ron back. Given this extraordinary multi-deade track record of massively compounding capital through incredible investment choices, I'm going to go out on a limb here and say that Ron's worth listening to if producing incredible long-term investment returns is something that you're attempting to do yourself because Ron has a multi-deade track record of doing exactly that. It's also worth considering the fact that SpaceX and Tesla are far and away the two largest positions in the Baron funds in total. No one has a gun to Ron's head saying, "You're not allowed to sell this." and quote unquote lock in some profits. In fact, he felt pressure from investors previously to do a little bit of this, but really wanted to retain as much as possible. At least when it comes to SpaceX and Tesla, I think the Baron Capital philosophy is let your winners ride. Of the 71 billion in profits, 30 billion came from Elon, 40 billion from other people. Wow. >> But Baron Partners Fund uh in part because of Elon Musk is the number one mutual fund in the United States since 2003 when it became a fund. not 1% number one out of all the funds. >> Tell us what you think about where things stand with Tesla, where things stand with SpaceX. You've been a longtime booster. >> So, before we get into the SpaceX and and AI and and and satellites, and I I just want to give you one little story about Tesla. And so, uh they made a car, the Model S, and they stopped making it. And they had 250 more that they made that were special. Cost twice as much as the ones they had before. And I bought one of them. And uh all the cars have self-driving. If you want it, you pay $100 a month. And uh so we have one out in East Hampton. And it is my favorite car I've ever had. It's a picture of the front of our quarterly report. And uh on Sunday mornings uh we go to breakfast uh in a little joint at the uh in East Hampton and we have pancakes and French toast and cereal and orange juice and uh I overslept on Sunday morning. So I said, "Oh my god, I'm looking at no one's there." So I u take a quick shower, run out to my car that's in the garage. Uh I didn't remember the address. I push the name of the store we're going of the restaurant we're going to uh that says self-driving opens up my garage door pulls out backwards drives around my driveway which is really long opens up the gate to front of the property opens it up drives to the you know a little bit more of the street looks both ways pulls on to the street makes a left-hand turn goes for two blocks makes a right-hand turn goes for two blocks then makes a lefthand turn and I'm not even paying attention makes a left-hand turn and all of a sudden stops short. I say, "Oh my god, did I break something?" And then I look out and I'm watching the front of the car and there's a large duck walking across the road with six little ducklings behind it. It stopped for the ducks and then the ducks pass. The car starts up again, goes to Main Street, makes a right, goes into the parking lot and parks right next to the restaurant that was having stop for ducks. This car is unbelievable. >> That's a great story. Of course, not the first time. I've seen plenty of videos of exactly this. Tesla's featured them themselves in some of their presentations, stopping for ducks, geese, you name it. >> My sons have driven from New York to here. You drive in New York. You have to try this car. I'll get you a car to try if you want it. >> I won't. We're going to do it. >> It's amazing. >> Not for me, but but uh >> everyone's going to want it. And he says it's like driving a horse and buggy if you don't have this at some point. And your son is going to be this is great for children. Children have to learn to drive. such a worry that I don't want him, you know, worry about him, worry about other people. >> Don't worry about this stuff anymore. This is really cool. You got to have it. So, that's that's Tesla. Um, SpaceX. >> I want your I want the S, though. This new wine colored S. >> That's what I got. >> That's what you That's >> but there's there's uh >> if you really want me to get one. >> Well, they made 250 of them. >> There's no more. But in the market, they're now selling for used board a lot more than I actually paid for it. And it was I paid twice what the essence are. So, uh I'm never selling it. >> What would TW would that be? 200 two >> 160 170 something. >> Twice what it went for. >> It went for 80. >> Are you supposed to be Are you supposed to be driving it without paying attention? I thought the rules were still technically that >> you sort of look around and you're and if it um makes a shaking sound, you pick up the wheel and you start driving again, but you don't really need it. And then in driving at night in the Hamptons, it's dark and there's not lights and >> it sees more than you do. >> Yeah. Much better than you do. Um, so uh so SpaceX and Tesla, I assume you want to talk about that. And AI, assume you want to talk about >> Well, before we do, let let's let's talk about all of those things, but let's also talk about what people are looking Tesla at right now. And there's a huge question as to whether Elon Musk is going to wrap Tesla into SpaceX, buy it. he would >> I don't think there's any outstanding question about this. It's definitely going to be proposed. The only real question is will enough Tesla shareholders vote to approve this that it actually happens. Those who missed recently at the All-In Summit, Elon Musk was asked point blank, so why do you still have two companies? His answer to that question tells you everything you need to know. It's not a matter of if, but when this gets put to investors to vote on. was even asked that in a a podcast yesterday, I think that he and Gwen were on yesterday, the day before, and he kind of didn't knock the idea down. How How do you feel as somebody who owns, you know, $25 billion worth of SpaceX and more than $5 billion worth of Tesla? How do you feel about SpaceX making a bid for Tesla and wrapping it in? >> Um, I I told him that uh I gave him reasons why I thought it was good and why I thought it wasn't. And uh and I said that, you know, I'm not someone who makes a decision and you're the guy and whatever you decide is better is what I'm going to support. And so anything he says is better uh uh I'm supporting. And I gave him reasons why both it's good and why it's not good. >> What are those reasons? >> I don't want to say. >> Um by now the prediction was inroads would be uh occurring with the other automakers into Tesla's market share in the United States. Now, just a couple days ago, it it came out Tesla's market share is increasing again because a lot >> kind of wild to think, but many of the so-called competitors that we were told was going to kill Tesla. You know, the competition's coming. Just wait till the big boys arrive. Wait till the big automotive companies make their compelling electric vehicles and then Tesla's cooked. It turns out after lots of plans and publicly stated goals that sounded ridiculous at the time, at least in the United States, just about everyone of the so-called competitors, Ford, GM, pick your company, dip their toes in the water, talked a lot of about Tesla, suggested they'd have 400 trillion different models of electric vehicle yesterday, and have since done the whole Homer backing into the hedge meme, abandoning their plans, scaling back, and just giving the up, which honestly was the right thing to do. But they could have saved a lot of money by not attempting to pursue electric vehicles in the first place. Now, here's the key caveat. They were already too late trying. Back in 2012, when Tesla's Model S was released and won literally every award ever in the automotive industry, that was the moment all leaders at Legacy Auto Company should have said, "Holy these things are possible. They can be amazing. We need to pursue. We need to go all in, otherwise we're cooked." Instead, they didn't do for about a decade. then started panicking around 2020 or so, taking almost no action. At that point, it was already too late. But they hadn't realized that. I guess they're slow to realize everything. So, they poured tens and tens and tens of billions of dollars into attempting to compete with Tesla in electric vehicles. And now they're just giving up. This is why Tesla's quote unquote market share is miraculously growing again in the US despite all the so-called competition. A lot of the legacy makers are not going to go in full in on on the EV. So suddenly it's Tesla and to buy a Tesla you may not the other ones need people need to buy them just to migrate to EV with a Tesla you just want to own a Tesla >> they lost billions of dollars other people they and they just try to uh do shortcuts. >> So it's on the upswing again >> the Tesla market share market share and in Europe it's incredible and everywhere in the world it's incredible everywhere. Uh so they're the best >> because you might not want an EV you might you might want a Tesla. I don't want to spend too much time on Tesla, but I think Tesla is the time to buy the stock is now. Uh all this FSD is is catching on and it's going to be bigger and bigger and bigger and this is going to drive uh you know they have a billion a million for people. Now we're on this driving. They're growing 55% overall uh increase a year and and everyone 55% of the new people that are getting it are buying this with the uh with a self-drive and uh it's going to be everywhere. >> Are you buying more if you think this is the time or do you think you're overexposed or at least as exposed as >> $30 billion invest 25 and five >> huge amount a year. >> Um that's that's enough. Uh but personally uh the biggest >> that's pretty funny. The $30 billion of Tesla stock. I think that's enough too. So just want to take a moment here zoom out remind everybody the phenomenal long-term multi-deade track record that Bron Baron has in identifying purchasing and going heavy in incredible investments. Hence the Baron Capital funds have produced over 140ish billion of total returns over a few decades. The reason SpaceX and Tesla such enormous positions in their funds wasn't because they bought those positions all the way up. It's just they bought heavy and the positions grew phenomenally. And Ron just said that he believes that now is the time to be buying Tesla stock. Or if you happen to hold a few tens of billions of dollars of Tesla stock, maybe you've already got enough. Maybe he would then just suggest continue to hold. And for what it's worth, I am doing exactly that. The FSD take rate in the United States last quarter on all new Tesla vehicles sold was over 50%. It was 55% exactly. And this is before it's unsupervised. I remind you that FSD supervised is still not available in most countries on Earth. Tesla has an existing fleet of about 10 million vehicles out there. Imagine what happens as FSD supervised gets approved in country after country after country. More people obviously will now subscribe. And as it becomes more capable, the take rate will increase on new vehicles plus existing owners. There'll be a step change increase in adoption everywhere that it goes from supervised to unsupervised. And at the same time this is happening, they're also scaling their cyber caps. So just quietly, I think Ron might have a bit of a point about where Tesla's headed over the next half decade or so. investments I have are uh SpaceX >> um which is about5 billion dollars and then a billion and a half personally personally yeah a billion and a half in Tesla >> and about a billion8 in our mutual funds and uh which is pretty cool considering that 1970 my net worth was - $15,000 and I didn't have enough credit to buy a telephone. >> Yeah, Ron has done extremely well. Interesting. He just told the size of the positions in SpaceX, which is significantly more than his Tesla holdings. This is personal, not Baron Capitals, but his own personal holdings. He's got a shitload more SpaceX than he does Tesla. But the Baron Mutual fund, his own product, isn't the number one holding. Ron just disclosed $8.3 billion in positions, $1.5 billion in Tesla stock, 1.8 billion in the Baron Mutual fund, and 5 billion in SpaceX stock. That makes SpaceX stock alone about 60% by weight. I'm not including the additional SpaceX stock held in the Baron mutual fund. Incredible. For what it's worth, I'd like my stock portfolio, if I had a magic wand, at least to be somewhere around 69% SpaceX stock and 42% Tesla. Thanks for watching. If you appreciate the content and want to support the channel, check out the links below where you can get early access to daily videos, unlock hundreds of exclusive pieces of content, and plenty more. My new 20-year Tesla and SpaceX valuation model is now also live on Patreon to supporters at the investor level and above. AG1 has been part of my daily health protocol for half a decade. It's packed full of vitamins and minerals and helps me fill in nutritional gaps while supporting energy, digestion, and immune function. 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