Tesla Patent Release to Fuel Gigafactory, SuperCharger Partnerships: StockTwits

NEW YORK (TheStreet) -- Giving away the store could be a good thing, say Tesla (TSLA) investors. On StockTwits.com, investors remained largely bullish on the electric car company after Tesla CEO Elon Musk announced he would share patented technologies with competing vehicle manufacturers.

“Our true competition is not the small trickle of non-Tesla electric cars being produced, but rather the enormous flood of gasoline cars pouring out of the world's factories every day,” wrote Musk in a blog post on Tesla's site explaining why he would not initiate patent lawsuits against any car company that used Tesla technology in good faith. “We believe that Tesla, other companies making electric cars, and the world would all benefit from a common, rapidly-evolving technology platform.”

Sentiment on Tesla was 78% bullish, according to StockTwits' analytics.

$TSLA long term: if Elon can expand ecar market his gigfactory will succeed.

— T D (@seattle427) Jun. 12 at 04:57 PM

Investors expressed hope that more car makers would use Tesla patents to build electric vehicles, giving Tesla competitors a stake in supporting the global infrastructure necessary to enable electric vehicles to rival gasoline powered automobiles. Tesla has 97 supercharger stations in the U.S., 20 in Europe and three in Asia, according to the company Web site. For comparison, there were 156,065 gasoline stations in the U.S. in 2012, according to National Petroleum News.

Recharging stations are one major hurdle to electric car adoption. Until consumers can travel wherever they want without fear of running out of juice, many will see gasoline cars as the more reliable option.

The other barrier to mass electric car adoption is price. Only the wealthy can afford Tesla's Model S's $70,000-plus price tag. Tesla wants to build a mass market vehicle by 2017, but Musk has said the company needs a massive battery factory to do it that will both drive down the cost of lithium ion batteries and increase efficiency. The so-called Gigafactory will cost $5 billion. Tesla is putting about $2 billion toward that cost.

Conceivably, competing car manufacturers could be willing to invest if they make cars that will take Tesla's batteries. And, even if other car manufacturers don't invest directly, the possibility that more car companies will need to take Tesla's batteries could encourage more battery makers to get on board.

$HPJ Musk sharing patents is genius move. People will design & adapt to his system. He will be the standard bearer, which will enrich $TSLA

— Monsieur Le President (@Easy_Money_Sniper) Jun. 12 at 11:52 PM

$TSLA by releasing patents Elon just created a lot of potential customers for it's gigafactory. Think!!!

— Strategytrader (@Showmethemoneyx6) Jun. 12 at 09:08 PM

Though most investors remained bullish, positive conversations about Tesla shares did decline 6.6% after the press conference. Some investors worried that car companies with an attractive electric offering, namely BMW, would use the technology to make a vehicle capable of stealing the Model S or coming Model X’s thunder.

@bengman007 I guess you havent heard of the BMW i3 ? $TSLA

— VB (@lucky_trader) Jun. 12 at 02:33 PM

Others doubted Musk's stated motivations for releasing Tesla's patents. At least one trader argued that Musk might have opened up the patents because he is concerned that Tesla may face patent suits in the future and wants to paint the company in a positive light.

$TSLA when CEO publicly devalues patents then he clearly 1) has no valuable patents and 2) is violating someone else's patents

— Terry Spookeson (@spookytrades) Jun. 12 at 02:24 PM

Still others doubted that Tesla's CEO cared about shareholder value. They argued that Musk wants his legacy to be saving the environment -- shareholders be damned.

$TSLA !i told u guys he does not care about making money he wants to be the Steve jobs of the environment save world yea shorted it

— Michael Pickering (@illianamike) Jun. 12 at 06:01 PM

Most investors, however, believed that Musk's move would drive demand for electric cars and batteries. Either way, they said, Tesla wins.

$TSLA Opening patent portfolio allows Tesla to become a 'platform' company radically opening prospects 4 other 'form factors' by competitors

— Sri (@vatsid) Jun. 12 at 03:28 PM

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At the time of publication, the author held no positions in any of the stocks mentioned.

This article represents the opinion of a contributor and not necessarily that of TheStreet or its editorial staff.

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