Is Tesla A Game Changer?

bwia

I don't remember if this angle was discussed earlier but Tesla is an unmistakable game changer. Not as another car company but as a utility company. Tesla is building recharging stations at a rapid rate and some of these stations are not necessarily on the major routes.

As we all know the 85 kWh batteries can be recharged at a Tesla charging station free of charge but not so for lesser batteries. And that's how Tesla has changed the game. With other companies joining the electric car bandwagon their limited range cars will need to be recharged. Rather than build their own infrastructure they will simply equip their cars to be "filled up" at a Tesla charging station. Two streams of revenue will be generated from this strategy. A licensing agreement for a conversion kit for non-Tesla cars that want free charging and a tariff for the cost electricity used for those those not wanting to buy the upgraded conversion kit.

What a beautiful concept. Tesla can change the driving habits of motorists to drive on less congested roads to take advantage of the new charging stations and to revitalize routes once abandoned by motorists such as Route 66.

And guess what, Tesla will be generating even more money from Uncle Sam and State governments to build this infrastructure since it would help alievate the congestion problem around major cities.

Michaell

@isellhondas said:
The Seattle/Eastside area HAS to be the Tesla capital of the U.S.!

I can't go a day now without seeing at least two or three. Yesterday I followed one.

It's license plate said NO FUMES

There is a Volt in my town with plates "1.21 GHZ"

fintail

Once there's a model that isn't a subsidized toy for usually coddled rich guys to cruise around town (tons of these in my area, and I seldom see them on the highway), then the game has changed.

Governments paying for them means taxpayers paying for them.

hpmctorque

@bwia said:
I don't remember if this angle was discussed earlier but Tesla is an unmistakable game changer. Not as another car company but as a utility company. Tesla is building recharging stations at a rapid rate and some of these stations are not necessarily on the major routes.

As we all know the 85 kWh batteries can be recharged at a Tesla charging station free of charge but not so for lesser batteries. And that's how Tesla has changed the game. With other companies joining the electric car bandwagon their limited range cars will need to be recharged. Rather than build their own infrastructure they will simply equip their cars to be "filled up" at a Tesla charging station. Two streams of revenue will be generated from this strategy. A licensing agreement for a conversion kit for non-Tesla cars that want free charging and a tariff for the cost electricity used for those those not wanting to buy the upgraded conversion kit.

What a beautiful concept. Tesla can change the driving habits of motorists to drive on less congested roads to take advantage of the new charging stations and to revitalize routes once abandoned by motorists such as Route 66.

And guess what, Tesla will be generating even more money from Uncle Sam and State governments to build this infrastructure since it would help alievate the congestion problem around major cities.

Your comments are all positive, with no negatives. I think the term "game changer" means different things to different people. Partly due to this, and partly because it's too early to determine the eventual market penetration of EVs in general, and Tesla in particular, it's premature to declare that Tesla is a game changer.

Let's see whether the battery giga factory is scaled back, or even built. Let's also see whether the mass market Model E succeeds before deciding whether Tesla is an automotive or power utility game changer.

Mr_Shiftright

"Tesla is building recharging stations at a rapid rate"

WELL....not so rapid but not bad........73 stations as of Feb. 2014

Two Tesla sedans went coast to coast using only Tesla stations and made it in 76.5 hours (multiple drivers of course).

That's about 2X as long as a pack of drivers in a gas car could do but it could be a record time for an electric vehicle.

However, if you took the southern route, you'd still be out there. Not many stations in some states, or none.

hpmctorque

@MrShift@Edmunds said:
"Tesla is building recharging stations at a rapid rate"

WELL....not so rapid but not bad........73 stations as of Feb. 2014

Two Tesla sedans went coast to coast using only Tesla stations and made it in 76.5 hours (multiple drivers of course).

That's about 2X as long as a pack of drivers in a gas car could do but it could be a record time for an electric vehicle.

However, if you took the southern route, you'd still be out there. Not many stations in some states, or none.

I'd describe this as quite impressive, because I don't think it's fair to compare Tesla's recharging station network to one the petroleum and auto complex have developed over the past 110 years.

While I think that, for the first time in almost a century, EVs are proving themselves to be viable niche market contenders, the jury is still out regarding whether they'll disrupt the existing IC- centric model.

Mr_Shiftright

Also, remember these free charging stations do cost you $2000 bucks up front. That's a lot of gasoline. Think of it as the first class lounge at an airport--not everybody gets to use it.

Ultimately I think we'll see charging stations operated by credit cards. There's no way this is going to be "free", although I suppose a municipality could work EV charging stations into their tax-supported budget.

stever

"American consumers and businesses benefit from a dynamic and diverse economy where new technologies and business models can and have disrupted stable and stagnant industries, often by responding to unmet or under-served consumer needs. When that occurs in an industry long subject to extensive regulation, existing businesses—like automobile dealers—often respond by urging legislators or regulators to restrict or even bar the new firms that threaten to shake up their market."

Who said that?

The FCC.

Mr_Shiftright

direct factory sales of new cars isn't a new business model, though. It's an old one that everyone has just forgotten about.

stever

The dealer lobby didn't forget.

Mr_Shiftright

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

stever

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_Shiftright

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/

stever

Missouri The Latest State To Add Legislation That Would Bar Direct Sales Of Tesla Cars (Consumerist)

stever

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

Tesla Model X Faces Another Delay

hpmctorque

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_Shiftright

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.

fintail

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_Shiftright

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

isellhondas

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.

stever

"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)

texases

@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_Shiftright

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

Michaell

@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?

Mr_Shiftright

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

stever

"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)

texases

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...

hpmctorque

@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_Shiftright

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.

hpmctorque

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?