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Is Tesla A Game Changer?

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  • "And what would I do with the time spent on oil changes, coolant and transmission flushes, etc.?"

    You'd worry about the degradation of your battery pack and how you're going to pay for that.

    Aside from a flip-phone, can you thing of any technology that will depreciate more rapidly than an old generation EV? What's a 5 year old Nissan Leaf going to be worth?

  • fintailfintail Posts: 32,917

    In a world that subsidizes toy cars for the top few (aka the Model S), Tesla indeed has room to grow. Whether or not it justifies the stock price is another matter - but the markets are a casino anyway, so maybe it fits.

    Produce a model with less bugs for half the price, and then we'll see.

    @hpmctorque said: Tesla reported surprisingly strong results yesterday, and predicted rapid expansion for 2014 and beyond, including battery production. The potential implications, including environmental and geopolitical ones, are significant. Should the established automakers be worried?

  • Stever@EdmundsStever@Edmunds YooperlandPosts: 38,983

    "This will allow us to achieve a major reduction in the cost of our battery packs and accelerate the pace of battery innovation," the Tesla shareholder letter said. "Working in partnership with our suppliers, we plan to integrate precursor material, cell, module and pack production into one facility."

    Tesla Gigafactory May Turn Out More Affordable Electric Vehicles

  • I like all the future talk for investors. "will", "we plan", "may turn out".

    It's going to boil down to the same old argument we had way back when ---the day an EV can do EXACTLY what a similarly priced gasoline car can do, in terms of performance, range and comfort, THEN it will be ready to COMPETE with gas cars---not dominate them, but just have a place in the race, so to speak.

    But take away the tax credits and take away the cheap KwH, and level the playing field.

  • hpmctorquehpmctorque Posts: 4,120

    @MrShift@Edmunds said: I like all the future talk for investors. "will", "we plan", "may turn out". But take away the tax credits and take away the cheap KwH, and level the playing field.

    Tesla's latest results provide a strong argument for removing the incentives. Not some time in the future, but in 2014. A reporter asked an financial analyst what effect removing the incentives would have on Tesla's gross margins, and he responded that gross margins would be 25% instead of 28%. Given that, it seems to me there's little justification for tax incentives, subsidized KwH, privileged access to HOV lanes, and prime parking spots at reduced prices. Those of us who don't drive EVs pay and are inconvenienced for these special privileges.

  • hpmctorquehpmctorque Posts: 4,120

    @MrShift@Edmunds said: "And what would I do with the time spent on oil changes, coolant and transmission flushes, etc.?"

    You'd worry about the degradation of your battery pack and how you're going to pay for that.

    Aside from a flip-phone, can you thing of any technology that will depreciate more rapidly than an old generation EV? What's a 5 year old Nissan Leaf going to be worth?

    Used Leafs may be transportation bargains for limited range driving, then. I wouldn't want one, but it may be a good solution for someone who just drives locally. Not so the Model S, though, since used ones have actually appreciated, from what I've read. It's hard to believe that the demand is that strong. My guess is that the sample wasn't representative. Let's see what happens to 2013 model S prices with some miles on them in the next few months.

  • I did read that. Makes some sense since there is a waiting list, but also most of the used ones that are selling for "more than new" are in fact higher optioned models that sold for over $100K new, so those in fact are not selling for "more than new". Nonetheless, all used car prices are driven by the supply and demand equation.

    What would be interesting to know is why those people with high-option cars sold them after one year, since there is no new model to buy as a replacement.

  • hpmctorquehpmctorque Posts: 4,120

    @MrShift@Edmunds said: What would be interesting to know is why those people with high-option cars sold them after one year, since there is no new model to buy as a replacement.

    Great question! Related to that, it would be interesting to know whether the proportion of Model S cars sold or for sale is proportionately higher, lower, or about the same as that of other luxury cars in the same general price range.

  • bwiabwia Boston Posts: 1,061
    edited February 22

    @MrShift@Edmunds said: EVs are a technological dead-end IMO as a mainstream product. Tesla will go on the curiosity shelf of history.

    Why the hang-up with range limitation. The Model S has a range of 265+ miles on a single charge. In addition, Tesla has demonstrated the effectiveness of battery swapping technology as well as fast charging stations. If the same aversion was applied to the Smart Phone no one would buy it. No one minds charging their smart phones every night.

  • Stever@EdmundsStever@Edmunds YooperlandPosts: 38,983
    edited February 22

    If your phone dies, you can keep driving until you find a plug-in. If the car runs out of juice, will the power port even be able to charge your phone so you can call for a tow?

    If the cars don't work out, Tesla should still be viable as a battery company. That may wind up being its main business in fact. (qz.com)

  • I have posed the Tesla as a viable alternative to a number of well-to-do friends, with as straight a poker face as I could muster, and each and every one voiced a concern for range anxiety. A Tesla is, in reality, a Lexus 460 with a 10 gallon gas tank that needs to be "gassed up" every single night. The Lexus can deliver 24 mpg, (22 gallon gas tank) very quiet ride, outstanding reliability, 0-60 in 5.8 seconds, and a price tag $20K under a high option Tesla.

  • hpmctorquehpmctorque Posts: 4,120

    @MrShift@Edmunds said: I have posed the Tesla as a viable alternative to a number of well-to-do friends, with as straight a poker face as I could muster, and each and every one voiced a concern for range anxiety. A Tesla is, in reality, a Lexus 460 with a 10 gallon gas tank that needs to be "gassed up" every single night. The Lexus can deliver 24 mpg, (22 gallon gas tank) very quiet ride, outstanding reliability, 0-60 in 5.8 seconds, and a price tag $20K under a high option Tesla.

    Yeah, but nobody notices the bland Lexus, while friends and neighbors are wowed by the Model S. I know because my friend's S gets comments and questions everywhere he goes. After a party at my house everyone wanted to check out my friend's car. One guest, who drives a Lexus ES350, was so impressed he bought Tesla stock the next morning. He still owns it and, of course, has a big paper profit.

    Getting noticed isn't my thing, but it makes a lot of people who spend 70-100 large feel good. And let's face it, admiration, approval and the desire to stand out and look cool is one of the main reasons people buy luxury cars instead of one of the many excellent mass market cars that are on the market. To the individual with deep pockets, the $20,000 difference you mentioned may be a bargain. It's like,"hey, look at me; look at what I can afford; notice how smart and environmentally conscious I am?"

    Your comments reflect the considerations of a value buyer. Buying a luxury car is more of an emotional act than an objective one. A Tesla stirs more emotions than a Lexus, just as a Ferrari buys more excitement than, say, a Camaro SS. Sorry, Chevy; you're pretty good, but not outstanding.

  • fintailfintail Posts: 32,917

    "Yeah, but nobody notices the bland Lexus, while friends and neighbors are wowed by the Model S"

    Indeed, that's as big a sales driver as anything right now. It's a fun showy toy car, showy in design and price. And when you can get a tax break for a toy, all the better.

  • I wouldn't call the reaction to the Tesla "emotional" at all. The car is as dull as a bag of rocks in stirring "passion". It is much more about intellectual interest and sobriety. A Lexus is, as you say, is the reflection of a value buyer---also not an emotional response. Porsches, Corvettes, Ferraris, Camaros--those are all emotional buys.

    To me, a Lexus and a Tesla are in the same basic buying arena. WHICH is why I pitched the possibility of a Tesla to the same kind of people who buy Lexi and Cadillacs. I wouldn't pitch a Tesla to a Porsche buyer, although I'm sure there is a few percent overlap of course.

  • fintailfintail Posts: 32,917

    I have no doubt some Porsche people buy Teslas - but not as a replacement, as a new toy. I don't see much evidence of these replacing luxobarges or high end sports cars, rather, supplementing them.

  • Agreed. The Tesla is not a car for car enthusiasts, just like a Prius is not.

  • Stever@EdmundsStever@Edmunds YooperlandPosts: 38,983
    edited February 22

    Different kind of enthusiasm. Don't forget that Tesla buyers are also buyers of exotics (and Prii). (link)

  • fintailfintail Posts: 32,917

    I can see tech geek non-car people who buy Prius moving up to a Tesla if finances permit.

  • It's consumer enthusiasm, it's certainly not driver enthusiasm. I mean, isn't a Tesla sort of a huge iPhone?

  • Stever@EdmundsStever@Edmunds YooperlandPosts: 38,983

    How many comments do you see around here where people are talking about their fun commute anyway?

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