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Is Tesla A Game Changer?

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  • Mr_ShiftrightMr_Shiftright Member Posts: 64,481

    Oh I think they did, because this business model has always failed (at least in the past).

  • steverstever Guest Posts: 52,454

    You'd think they'd enjoy seeing Tesla fail big time then.

    Meanwhile, Tesla is appealing NJ's court ruling banning their direct sales. (autonews.com)

  • Mr_ShiftrightMr_Shiftright Member Posts: 64,481
    edited April 2014

    Exactly. I'd just let Tesla do it. I think that's the best weapon in the dealer's arsenal.

    Besides, people aren't just standing still waiting for Tesla to act:

    http://shopgomoto.com/

  • steverstever Guest Posts: 52,454
    edited May 2014

    This rig is a non-starter among the rocket box and kayaking crowd.

    Tesla Model X Faces Another Delay

  • hpmctorquehpmctorque Member Posts: 4,600

    Reference my messages from 4/10...

    "Listed for sale by private seller in the Washington Post: "2013 S, 85kw, pearl white w/blk lthr, pan roof, tech pkg, Obeche wood, only 700 mi, showroom cond, $92,000."

    The price was reduced to $89,000 in a 4/14 ad. I assumed the car had sold when the ad didn't reappear, but it showed up again in today's Washington Post for $89,000.

    If it didn't sell at that price before why would it sell now? I guess it only takes one committed buyer, and this is a niche car, so the seller's logic is probably "let's give it another try." However, as far as I know, the buyer of this slightly used Model S wouldn't even get the green car tax benefit that the original buyer reaped.

    Your thoughts?

  • Mr_ShiftrightMr_Shiftright Member Posts: 64,481

    Tesla is going to discontinue selling batteries to Toyota for their RAV 4 EV. No doubt this is because Tesla's Model X and the RAV 4 EV will be competitors, although the Model X will cost about 2X as much and no doubt be a lot more spiffy, gadgety and cool.

  • fintailfintail Member Posts: 57,072

    That gullwing illustration is a hilariously bad rendering, like something a school kid would do these days. Seems too close to the right side wall, too.

    Seller of the 700 mile S will be sitting on it for some time at that price. No incentive to buy it over a new one, unless one is impatient, wants one configured identically, and doesn't want the undeserved tax gift.

  • Mr_ShiftrightMr_Shiftright Member Posts: 64,481

    Tesla stock still sinking these past 6 months---dropped as low as 177 last week. Needs to rationalize around 40-60 I think.

  • isellhondasisellhondas Member Posts: 20,342

    I can't go a day without seeing at least two Teslas.

    Every Sunday at a XXX Drive In in my town they have a car show during the spring/summer months. Today, it was an Electric Car Shop.

    Several home made cars, a converted VW Rabbit Convertible and at least a half dozen S Model Teslas. They seem to attract a "different" sort of customer and all of them appeared to be
    very proud of their rides. I learned that Seattle may be their biggest market and here on the east side with all of the affluent Microsoft, Amazon, Google and other tech companies, I'm not surprised.

    I still don't get it.

  • steverstever Guest Posts: 52,454

    "Tesla said Friday in a regulatory filing that it expected the supply deal to end this year. Toyota said it would keep its stake in Tesla for now.

    “It’s obvious Toyota doesn’t see a market for electric vehicles,” said John O’Dell, green-car analyst at the auto-research site Edmunds.com. “They really see the future of the zero-emission vehicle as the hydrogen vehicle,” he said.

    “In partnering with Tesla, there might have been a message there that Toyota was looking at the possibility” of a wider partnership with the Silicon Valley manufacturer, he said. “But they can’t even give these cars away. Why continue doing this?”

    Seeing Future in Fuel Cells, Toyota Ends Tesla Deal (NY Times)

  • texasestexases Member Posts: 10,669

    @Stever@Edmunds said:
    “It’s obvious Toyota doesn’t see a market for electric vehicles,” said John O’Dell, green-car analyst at the auto-research site Edmunds.com. “They really see the future of the zero-emission vehicle as the hydrogen vehicle,” he said.

    Toyota must be really looking a LONG WAY into the future. Hydrogen? Where from? What infrastructure? If from electricity, why not just use the electricity?

    LOTS of questions...

  • Mr_ShiftrightMr_Shiftright Member Posts: 64,481

    Yep it's a longterm view, but that's never been an American strong suit. I read somewhere that Japanese automakers even hold seminars now and then to discuss a world where they don't even make cars anymore. I think the human brain has evolved to mostly deal with short-term planning. I know mine has, especially as I age :)

  • MichaellMichaell Moderator Posts: 239,555

    @MrShift@Edmunds said:
    Yep it's a longterm view, but that's never been an American strong suit. I read somewhere that Japanese automakers even hold seminars now and then to discuss a world where they don't even make cars anymore. I think the human brain has evolved to mostly deal with short-term planning. I know mine has, especially as I age :)

    I'm guessing you don't even buy green bananas, eh, shifty?

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  • Mr_ShiftrightMr_Shiftright Member Posts: 64,481
    edited May 2014

    I even buy milk in pints. Growing older is like bat radar--the closer you get to the wall, the faster the pings.

    Tesla himself was a longterm thinker:

    “The present is theirs; the future, for which I really worked, is mine.”
    ― Nikola Tesla

  • steverstever Guest Posts: 52,454

    "As quietly as one of its electric cars, Tesla Motors Inc. has become the biggest auto industry employer in California.

    Tesla now employs more than 6,000 people in the state, the automaker said, offering the first public snapshot of its workforce this year. That moves the fast-growing company well ahead of Toyota Motor Corp., the world’s biggest automaker, which has 5,300 direct employees in California — a count set to fall after the Japan-based company said it will move most of those jobs to Texas by 2017."

    Tesla hands California most auto jobs as Toyota plans exit (Detroit News)

  • texasestexases Member Posts: 10,669
    edited May 2014

    Good news! Tesla's the biggest employer in California!
    Bad news! That's because manufacturers are running away from the high tax high cost environment!

    I'm happy, the new Toyota campus will be a few miles from my house. Good for property values...

  • hpmctorquehpmctorque Member Posts: 4,600

    @stever said:
    "As quietly as one of its electric cars, Tesla Motors Inc. has become the biggest auto industry employer in California.

    Tesla now employs more than 6,000 people in the state, the automaker said, offering the first public snapshot of its workforce this year. That moves the fast-growing company well ahead of Toyota Motor Corp., the world’s biggest automaker, which has 5,300 direct employees in California — a count set to fall after the Japan-based company said it will move most of those jobs to Texas by 2017."

    Tesla has the most employees, but it's far from the top in terms of revenues generated from car sales in California.

  • Mr_ShiftrightMr_Shiftright Member Posts: 64,481
    edited May 2014

    RE: Moving out of California due to costs:

    Probably not in this case though. This is one of those "mole hill into mountain" political dances going on.

    Toyota said that their move had nothing to do with taxes but with rationalizing having management closer to production facilities. Tax structure for corporations doing business in Texas and California is roughly the same, they said.

    "It may seem like a juicy story to have this confrontation between California and Texas, but that was not the case," said Jim Lentz, Toyota's North American chief executive.

    "It doesn't make sense to have oversight of manufacturing 2,000 miles away from where the cars were made," Lentz said. "Geography is the reason not to have our headquarters in California."

    The Public Policy Institute of California studied this phenomenon over a 15-year period, from 1992 to 2006. It found that less than 2% of jobs lost in California were due to companies leaving, and only 1% of jobs created were due to companies moving in.

    Essentially, job-poaching is done by states, to and fro, at tax payer's expense. It's not a big economic factor if you job-poach with tax carrots.

    So I think Tesla is going to stay put unless geography rationalizes a move.

    Besides, they still need to demonstrate that they can make a profit selling cars....or move into something else.

  • hpmctorquehpmctorque Member Posts: 4,600

    Musk announced that Tesla may share its Supercharger Station technology. He didn't provide enough details to really evaluate the proposal, but it could result in significant tradeoffs. What's your perception regarding whether this would be a net plus for Tesla? Are competitors likely to accept such an offer? The devil is in the details, but I'm puzzled about this. My immediate reaction is that it's a sign of weakness.

    Your thoughts?

  • steverstever Guest Posts: 52,454

    Tesla may require some licensing fees as part of the "sharing". If the fees are modest then maybe the industry would standardize on one setup. That would be nice if you want to see the EV industry grow.

  • Mr_ShiftrightMr_Shiftright Member Posts: 64,481

    Well you wouldn't be the first person to notice that Tesla may finally end up making money as a utility company rather than a car builder.

  • steverstever Guest Posts: 52,454
    edited June 2014

    "A bill that would allow Tesla Motors Inc. to open four sales outlets selling the company’s electric cars in New Jersey gained approval from an assembly committee Thursday amid strong support from the environmental community."

    Bill to allow Tesla to sell cars in New Jersey advances (NorthJersey.com)

  • Mr_ShiftrightMr_Shiftright Member Posts: 64,481

    I wonder if Tesla is ever going to turn a profit? 1st quarter 2014 was a net loss of $49.8 million bucks. The plan is to "make money by spending money".

    depends on the burn rate I guess, if time is on your side or not.

  • hpmctorquehpmctorque Member Posts: 4,600

    @Mr_Shiftright said:
    I wonder if Tesla is ever going to turn a profit? 1st quarter 2014 was a net loss of $49.8 million bucks. The plan is to "make money by spending money".

    depends on the burn rate I guess, if time is on your side or not.

    I believe Tesla could be profitable, and probably will be, but the potential range of profitability varies greatly. It depends on how well they execute, favorable legislation, and some luck.

    You could also say that Amazon's plan is to make money by spending, to get and stay out in front.

    The more relevant question, in my opinion, is whether Tesla's earnings will justify it's current valuation within the next many years. I don't think anyone knows the answer to that, although many, both those who are long and short the stock, presume to know.

  • texasestexases Member Posts: 10,669

    I've yet to see why Tesla's battery factory will be a money maker. So much of the cost is materials, nothing like making cheap computer chips. We'll see...

  • Mr_ShiftrightMr_Shiftright Member Posts: 64,481

    I don't think Tesla earnings could justify their current valuation unless it produced about 20X the number of cars it makes now. If you use the ratio of stock value per car produced, Tesla's ratio, compared to other automakers, borders on the ridiculous at the moment. As for shorting the stock, well over 1/3 of Tesla's investors are doing just that right now, I've read.

  • steverstever Guest Posts: 52,454

    Think dealers are over-reaching?

    "At the request of local dealer groups, states set up a labyrinth of protectionist laws that make the car-buying experience difficult and costly for our customers," said Gloria Bergquist, a spokeswoman for the Alliance of Automobile Manufacturers, which represents 12 automakers but not Tesla.

    "It's understandable why Tesla or future competitors would want a simpler sales process. When we look at the big picture, we may be at a tipping point. If dealer groups continue their push for more onerous franchise laws, we will be forced to keep an open mind about how best to serve new-car buyers in the future."

    State franchise laws, sparked by Tesla, go too far, other automakers charge (autonews.com)

  • hpmctorquehpmctorque Member Posts: 4,600

    Cadillac sold 52 (electric) ELRs in May, according to Morgan Stanley analyst Adam Jones. He added that Tesla sells more S models than that in one day.

    Jones also stated that, "in his view, the push for hydrogen fuel cell vehicles is a 'diversionary tactic' aimed at disrupting regulation to support mass adoption of electric vehicles."

    It should be noted that Jones has been, and continues to be, very bullish on Tesla.

  • Mr_ShiftrightMr_Shiftright Member Posts: 64,481

    Well the ELR isn't the same type of vehicle as a Tesla. It was designed to relieve the range-anxiety issue in full EVs. Tesla sort of leap-frogged the ELR--- I view the ELR as more of a transitional technology.

    It's also not as powerful as the Tesla---but it's certainly just as good-looking, if not more so.

    Once again, GM is there...too little, too late.

  • bwiabwia Member Posts: 2,913

    @Mr_Shiftright said:

    Once again, GM is there...too little, too late.

    I agree to a certain extent. The ELR is certainly late to the party but I believe the Volt is exactly what the market wants. An EV without the range anxiety at a reasonable price. With a target price of $31,500 (Carsdirect.com) less the $7,500 federal tax credit, that is a net price of $24,000, and even lower with state tax credits.

    Why isn't Chevy selling more of these is a mystery. Nonetheless, I hope Harley Davidson does much better with their EV bikes. A bike without pipes is like an opera singer on a diet.

  • texasestexases Member Posts: 10,669

    Biggest problem with the ELR (besides the astronomical price - $75k base!) is those stupid TV ads...

  • laurasdadalaurasdada Member Posts: 4,674
    edited June 2014

    And the ELR is a different type of vehicle, functionally/demographically. The Volt would be more Tesla-functionally competitive (if not as luxurious or performance oriented) as it is a four door hatchback vs. the 2+2-ish design of the ELR. Unfortunately for GM, the ELR is a Volt in a (very, very nice) tuxedo at twice the cost and half the functionality. I wonder if GM will put a different, perhaps ICE in the ELR at some point?

    And, if anyone is interested, Boston area Caddy dealer taking $15k off the msrp of their ELR inventory. Good start!

    '21 Dark Blue/Black Audi A7 PHEV (mine); '22 White/Beige BMW X3 (hers); '20 Estoril Blue/Oyster BMW M240xi 'Vert (Ours, read: hers in 'vert weather; mine during Nor'easters...)

  • Mr_ShiftrightMr_Shiftright Member Posts: 64,481
    edited June 2014

    Part of the problem is the marketing of the ELR. (what a surprise!) It needs to stress the car's strong points over a Tesla--and it has some. I think a super salesman could sell an ELR over a Tesla if they were being cross-shopped. Biggest stumbling block is that Cadillacs arent "cool", in the same way that a Kindle Fire is not as cool as an iPad.

    I think you have to sell these EVs and hybrids as technologies, not as cars.

  • laurasdadalaurasdada Member Posts: 4,674

    Yes, market the ELR's relative "freedom" factor. Don't have to follow the Supercharger highway! As long as the dinosaurs keep giving up their ghosts, I kinda like the plugin hybrid concept of the ELR/Volt/i8 et. al. Enough electricity for my daily commute, and the dino-generator for road trips. Cool. Maybe if Caddy started a space program, that would add to their cool factor? Although, would you trust hopping on a GM spaceship? ;)

    Test drove the ELR at the Greenwich Concours. Nice interior, quiet (all the way in electric drive), not as torquey as I expected. Brakes took a bit of getting used to. Of course, it wasn't my $80k car, so I didn't really put it through any paces, but if I had the disposable income, I could add such a toy to the fleet. To me,though, stress Toy. For that much coin, a lot of cool cars to be had, with likely much more of a fun factor (I'm looking at you, Jag F-Type!).

    '21 Dark Blue/Black Audi A7 PHEV (mine); '22 White/Beige BMW X3 (hers); '20 Estoril Blue/Oyster BMW M240xi 'Vert (Ours, read: hers in 'vert weather; mine during Nor'easters...)

  • Mr_ShiftrightMr_Shiftright Member Posts: 64,481

    the ELR is not quick like the Tesla. It's a leisurely performer.

  • hpmctorquehpmctorque Member Posts: 4,600

    Toyota's announced this week that it will begin selling a new hydrogen fuel cell powered car in Japan and California later this year. Coupled with it's previous announcement that it will discontinue it's cooperative arrangement with Tesla for electric RAV 4s, it seems that a competitive race for green car supremacy lies ahead. The issue is which technology will prevail over the long term. Several of the major auto manufacturers, including Toyota, Nissan and Tesla, consider hybrids to be an interim green vehicle solution.

    My take is that Tesla is trying to head off Toyota's and Hyundai's potential success with hydrogen fuel cell cars by rushing to build its network of supercharging stations as quickly as possible. Meanwhile, California expects to have 60 hydrogen charging stations by year end.

    Toyota is expected to price it hydrogen fuel cell car competitively with Tesla's Model S.

    Because of price and the fact that most people are resistant to change, the market for non polluting cars is expected to remain small for the next few years. If Tesla and Nissan, the primary manufacturers of pure EVs currently, can achieve economies of scale at the expense of Toyota and Hyundai's Hydrogen fuel cell cars, it'll be a major competitive advantage for them. The reverse is also true, of course. It'll be an interesting contest, for sure.

    Does Tesla's $29B market valuation suggest that Tesla bulls are underestimating Toyota and Hyundai's bet on hydrogen fuel cell vehicles?

  • texasestexases Member Posts: 10,669

    I have no idea how folks could economically get hydrogen. There is zero infrastructure. And I don't see how there's a major advantage over EVs. I don't get it.

  • Mr_ShiftrightMr_Shiftright Member Posts: 64,481
    edited June 2014

    The ace in the hole here is carbon emissions reductions. As the climate change situation becomes more glaring and obvious you'll see more and more countries putting the squeeze on the internal combustion engine. If I were a betting man, I'd bet on hybrids and biofuels up to about 2030, then push all my chips onto EVs and hydrogen power, when both will be much improved.

    This all reminds me of the "great race" around 1900--when nobody knew if ICE, diesel, steam or electric power would propel the world's automobiles. To us 100 years in the future, the answer seems obvious, but it wasn't then. Gasoline cars were "cranky" (literally), EVs were short range, and you had to be a junior engineer to operate a steam car without blowing yourself up. Yet EVs were reliable, gas cars were cheap to build and steam cars were tremendously more powerful than the other two.

  • hpmctorquehpmctorque Member Posts: 4,600

    @texases said:

    "I have no idea how folks could economically get hydrogen. There is zero infrastructure. And I don't see how there's a major advantage over EVs. I don't get it."

    I certainly wouldn't presume to guess how the competing technologies will evolve in the next 20+ years, but I'm confident that Toyota, Hyundai and others (I believe GM also has a hydrogen fuel cell research program) understand the challenges of hydrogen, and believe they can be surmounted. Similarly, the major EV manufacturers understand their challenges. Maybe both technologies could coexist, and serve different markets. However, if I were to guess, I'd bet that at some time in the future one technology will prevail over the other(s), just as occurred 100 years ago, when the ICE won out..

  • texasestexases Member Posts: 10,669

    I'm not concerned with using hydrogen, it's the generation step that I don't see being efficient. I'm a chemical engineer, and the costs involved to generate hydrogen are large. Using electricity seems like a waste of electricity, just plug in an EV. Getting it from natural gas creates CO2, and makes me ask why not use the natural gas in a CNG vehicle. So I don't see where using hydrogen is better than EVs or CNG.

  • hpmctorquehpmctorque Member Posts: 4,600
    edited June 2014

    @texases said:
    I'm not concerned with using hydrogen, it's the generation step that I don't see being efficient. I'm a chemical engineer, and the costs involved to generate hydrogen are large. Using electricity seems like a waste of electricity, just plug in an EV. Getting it from natural gas creates CO2, and makes me ask why not use the natural gas in a CNG vehicle. So I don't see where using hydrogen is better than EVs or CNG.

    I'm not an engineer, so I understand your point from a layman's perspective. You may be right, but logic suggests that Toyota and Hyundai must believe that they can compensate for the inefficiencies you listed.

    Please let us know if you come across new information to support or refute your current position regarding hydrogen powered vehicles.

  • Mr_ShiftrightMr_Shiftright Member Posts: 64,481

    I think someone has to figure out how to make hydrogen "fuel" efficiently, without burning fossil fuel to do it---or, to make the net gain worthwhile enough to burn the fossil fuel.

  • steverstever Guest Posts: 52,454

    "Considering that Tesla Motors' site claims: "With just one moving piece in the motor, compared to hundreds in a gas engine, there are fewer things that can go wrong. That translates to less maintenance and service over time," the road test results ... aren't the best news.

    If Edmunds.com's problems with its Model S were an outlier, it'd be easy to say this singular car is a "lemon." Unfortunately, when MotorTrend.com also tested the Model S, it too had to have the drivetrain replaced"

    Will a Major Drive Unit Problem Decimate Tesla Motors, Inc.? (fool.com)

  • texasestexases Member Posts: 10,669

    Yeah, I was stunned by Edmunds having to replace 3 drive units. Not 3 different problems, but 3 problems drive units, all completely replaced, which isn't the 'lemon' kind of failure. And a battery pack on top of it. Yikes!

  • steverstever Guest Posts: 52,454

    "Here’s the litany of complaints according to Edmunds: The touchscreen froze twice, the steering wheel starting creaking, the sunroof wouldn’t open at one point, the hinges on the vanity mirror cracked twice, the taillights fogged up, and the car simply died on the side of the road on two different occasions, requiring a drive unit and a main battery. Perhaps most ominously, the driver-side door spontaneously opened, which Tesla addressed by installing a new handle.

    All the fixes were covered under warranty, but people spending six figures on a cutting-edge car don’t have much tolerance for these kind of glitches, no matter how beautiful and green and fast the vehicle is. The solace for Tesla drivers (and shareholders) is that Edmunds got one of the earlier sedans. Many of the problems it encountered have been ironed out in the months since."

    As the Oldest Teslas Turn Two, Nagging Questions About Reliability (businessweek.com)

  • steverstever Guest Posts: 52,454

    "A 17-month review of the $105,005 sedan, published this week by car-critic Edmunds.com, yielded one chief complaint -- parts of the car needed to be replaced too frequently. Tesla's chief executive countered the critique, saying the electric carmaker's Formula 1-trained service teams were overattentive, swapping out parts that had even the potential to be faulty.

    “This maybe ended up being counterproductive, but the service team was ultra proactive with the Edmunds car, so they were doing their best to make Edmunds happy,” Musk said during an hour-long call with analysts after announcing the company's second-quarter earnings. “Unfortunately that resulted in them changing things out just on the off-chance that something might go wrong.”

    Elon Musk Defends Tesla After Getting A Terrible Review (huffingtonpost.com)

  • texasestexases Member Posts: 10,669

    Well, the 'grinding noises' indicated some kind of problem, right?

  • steverstever Guest Posts: 52,454

    Are you referring to the drive unit or Elon's teeth?

    Have to wonder if Tesla will "lose" Edmunds' deposit on the Model X. :p

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