How a Low Share Price Would be Fatal for Tesla, and why Musk has to pump it up, come hell or high water.

Tesla shares are down 50% from last December and are back where they’d first been in September 2013. Bonds dropped to a new low on Friday, reflecting what the market thinks the probability is that Tesla will default, and what bondholders will get if it does. This poses a unique existential problem for Tesla.

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  94 comments for “THE WOLF STREET REPORT

  1. 2banana says:

    Huge amount of credit to Tesla for making EVs cool?

    Give me a few billion dollars in taxpayer subsidies and I could make AMC Pacer cool. Maybe even the Gremlin.

    Creating an entire industry that will never make a profit or makes any kind of economic sense based on QE, ZIRP, cheap/easy debt and billions in government subsidies is not an amazing feat. It is fraud and ponzi.

    • Wolf Richter says:

      Oh, the industry will make money, lots of money on EVs. Tesla won’t. Don’t confuse real automakers with Tesla.

      • 2banana says:

        The only way the “EV Industry” becomes economically viable, with current technology, is to continue the massive government subsidies and through government mandates to consumers.

        I.e. you must buy an EV no matter what.

        EVs are a niche. They make no sense for any consumer who needs a car in winter, who needs to drive more than 150 miles in a day or lives anywhere that is not flat, sunny and warm.

        And because EVs pay no gas tax, they are already being targeted for special taxes. Because public union pensions, I mean roads maintenance, needs to be paid.

        • sierra7 says:

          So, you are flatly stating (in other words) that there will be no appreciable or ANY technological improvements in future “batteries”?
          I don’t think we heard the same podcast.
          Thx Mr. Richter for a good synopsis on future financing for Tesla.

        • Max Power says:

          In term of long term competitiveness it’s not about government subsidies. It’s all about the cost of batteries. If the price of batteries keeps dropping at the current rate, EVs can become competitive with ICE vehicles sometime around the middle of the upcoming decade. Govt. subsidies or not.

          That said, Tesla will probably go belly up or merge with another company by then.

      • D.J. says:

        With the current level of battery technology, NO automaker can build EV’s at a profit. Tesla is an absolute fraud but we should be honest about the economic viability of the segment.

        • Laughing Eagle says:

          Musk made two mistakes. He is trying to mass produce a 4 door sedan model that is not selling like the old days. Second, he entered the electric car market which is also a small market. He cannot sell enough to pay back his bills.
          Only his hype and help from the US Government and Wall Street have kept his dream going.
          This company has no future but maybe someone will buy the S and X model, but with most companies now developing one, the longer he BS’s, the less his chances are for a partial buyout.

        • WES says:

          DJ: The lead acid battery was invented over 100 years ago.

          So far nobody has been able to improve on it!

        • DF says:

          Um, AGM batteries are a pretty good improvement to lead-acid batteries.

    • yngso says:

      Most of all it’s hubris. Enron the Lone Musketeer has bitten off much more than he can chew, and the resulting indigestion is fatal.

    • Jeff T. says:

      The five liter engine option made the Gremlin a very cool vehicle for anyone wanting to go really fast on a straight road.

  2. Javert Chip says:

    Musk is an impressive visionary, just as Jobs was, but Jobs surrounded himself with world-class supply-chain & design staff. Jobs was then free to obsess with the “goodness” of his many creations.

    Musk certainly never learned the lesson of surrounding himself with world-class people at Tesla (and, no, I’m absolutely not implying Apple should buy Tesla). Musk is quickly finding himself all alone on the car stage, with nobody to blame but himself.

    Rhetorical question: Musk’s Space-X is every bit as visionary, but it seems to have the “right stuff” to actually execute. Why couldn’t Musk apply that discipline across both companies?

    • nick kelly says:

      Or…not try to run a struggling car co AND a revolutionary space company at the same time.

      Ford Motor Co was Henry Ford’s third car company,the first two went bankrupt. But he hired a hard- nosed manager who forced him to focus and execute. This guy once nailed shut the door on a box car of Model T cars to stop Ford making last minute adjustments.

      It seems like Musk can’t go much longer than a week without announcing a new business or product.

    • yngso says:

      Because Tesla Cars was one bridge too far. The genius fell into the hubris trap.

    • Prairies says:

      Musk is a marketing genius, not a manufacturing genius. He is connected to a circle of millionaires and billionaires with a need to spend money they would rather write off as an investment expense instead of the alternative and get taxed on capital gains. Even the hyperloop is a dud.

      • Lisa says:

        No, he’s a con-artist in a mutual admiration society, that is floating on the debt they are dumping onto everyone else, while they churn options based on the trading cues within their mutual admiration society. Public not invited.

      • Jack says:

        Thank you.

        That is all there is to the “ Fraud”!

        Now the business ( Tesla) is great business but with a huge caveat.

        – Mass production ( a must, to decrease the price of the unit to a palatable expenditure for the average customers)

        – concentrate your energy on specific markets that have the infrastructure to accept the move to this new technology.

        Bar the above you ask what will happen to Tesla?

        It’s shares will tank and it’ll get bought by either Ford, GM or one of the European contenders.

        These Automotive Manufacturers have the ability to produce the units to large market and bring the costs down.

        All the current shareholders and investors will have the conciliatory though of supporting a great new technology and helping Musk reach Jesus status ( or beyond! ) .

        Current customers will be left with new shiny useless pieces of crap with very shonky workmanship .

    • Max Power says:

      Space-X competed in an environment dominated by stodgy defense contractors used to a great deal of government largesse and constant missed deadlines. It is much easier to shake up that sort of environment than the consumer automobile industry where there is cut-throat competition for what are essentially commodity items. As such, Tesla has only been able to made money in the niche luxury segment — where the buyer is less cost-conscious.

      Along the way Tesla learned how to optimize the EV powertrain whereby its motors and other drivetrain components are still ahead of all its competitors. It also benefited from a clean-slate design optimized for an electric vehicle whereby the other manufacturers’ models, even the very latest ones, are still derivatives of ICE-based platforms. Personally, I am a bit surprised that the traditional carmakers, who have by now had plenty of time to reverse-engineer Tesla’s product have not yet come-up with better-designed EVs. I guess they figure that since the cost of batteries is still not competitive with ICE vehicles anyway they still have a few years to catch up because at this point it doesn’t really matter how much better Tesla’s vehicles might be, at the current cost of batteries they still have no hope of becoming mass-market products.

      • 2banana says:

        stodgy defense contractors = companies that actually make a profit, that actually pay a dividend to shareholders and that actually can sell bonds rated investment grade.

        • Max Power says:

          Ummm… more like bilking the US taxpayer.

          Oh, and Space-X is a profitable company (unlike Tesla).

        • alex in san jose AKA digital Detroit says:

          Yep Eisenhower definitely told us to build battleships instead of hospitals, tanks instead of schools …. I remember his speech well.

    • DF says:

      SpaceX competes in a less competitive, more sclerotic industry than does Tesla.

    • Pat McKim says:

      For the same reason. As a usna grad and 30 yr naval officer I have some friends that are astronauts. Some have worked for musk, all in NASA. A few observations:. Musk’s manic, narcissistic sociopath personality is good for hyping in silicon valley and Washington, but not the space program that is full of real engineers, not faux engineering; this is a profession where astronauts must trust their equipment implicitly. Musk will never build good cultures because very bright people want a collaborative environment where they share and get credit. This won’t happen with musk. This Apollo 13 ground ops run by musk. The result would be much different than it was. My friends left musk’s employ because of his egotistical culture and intellectual dishonesty. In addition musk was supported in DC because politicians like McCain, another narcissist, liked the limelight. There is an interesting photo of musk, Elizabeth Holmes of theranos, and disgraced former CEO of GE. You get the picture. The boring company and solar City are the same. All take govt handouts. None have much if any new technology. All burn huge amounts of money and a questionable product.

      Solar City’s shingles due a few years ago will never be released, as solar City will be shut down from within tesla saddling Tesla with more non-producing debt.

      The Boring company has a used boring drill and has not completed anything. It continues to lie about what it is doing and low bids contracts that are either never started or run out on money and never produce anything-like gov Brown’s folly in the SJ Valley.

      Tsla’s battery tech is panasonic’s and not leading. Tsla’s self driving or auto pilot was just slammed by consumer reports. Its cars continue to kill people at rate higher than any other luxury vehicle. And he touts this on his pivot.

      People, except zombie millennials are waking up to the fact that musk cannot produce anything of lasting value. He is only good at spending large amounts of money with no hope of real economic returns.

      This is also the legacy of the global warming movement. Musk only advances debt, himself, and govt intervention and losses.

      • alex in san jose AKA digital Detroit says:

        Well written!

        The culture here in “Silicon Valley” is akin to the culture of Las Vegas without the grace or charm.

        When I started studying and working in tech, the tech work force was much more diverse than now. Now, apparently, female engineers have an extremely hard time. It’s psychopathic tech bro’s all the way down around here.

        And indeed, most of their shit would not fly with real engineers.

  3. 2banana says:

    Easy to be a “visionary” when given billions in essentially free money and not expected to ever make a profit.

    Madoff and Enron were “visionary” too – at one point in time.

    How about a Wolf Street report on if anything that Elon Musk controls will not got bankrupt?

    • doug says:

      those billions did not just show up in his inbox…

      • Randolf says:

        After selling PayPal, Musk was worth something like $200 million.
        After running Tesla and SpaceX he’s worth some $24 Billion.
        Neither company makes a profit. His money comes from rocketing stock prices. Investors have been lured to invest in Musk enterprises because the US government gave it’s full faith and credit along with over $5 Billion in direct grants and fees. Tesla buyers get a massive tax credit as do the suppliers of Green Energy products. Local grants and gifts to the companies from local governments are huge. Nevada gave Gigafactory nearly $2 billion in give-away’s.

      • Pat McKim says:

        It’s amazing what you can do in an easy money / money printing environment when the truth is irrelavant to you.

  4. ooe says:

    the fundamental problem for Tesla that it never made a yearly profit during this expansion so it does not have a cushion when the recession hits this fall.

    Also, what other companies have electric cars in the market besides GM-Volt & the Nissan leaf; what I hear in the corporate press is plans for electric cars that will be built in the future. Those other car companies act like Dad who said when I asked for toy, he would say, I will be giving it to you next week.

  5. Trinacria says:

    The hole Tesla dug is simply too deep. Tesla is bankrupt, they just haven’t filed the papers yet.
    Wolf mentions short term treasury bills yielding around 2.3%. I have been parking cash there is the last year or so and, since the states cannot tax federal instruments, here in Oregon, with it’s almost flat tax of 9%, the effective treasury yield is 2.52% – not too bad for parking money.

  6. Kasadour says:

    I think it was a mistake for Tesla to introduce the Model 3 before firmly establishing the Model S and X in the luxury market. That said, the Tesla luxury models had the biggest decline in sales- over 50%- in Q119, which exacerbates the problem because the Model S and X have the highest profit margins whereas Model 3 has no profit margin- is it any wonder Tesla stopped promoting it? Musk squandered a good thing due to his over-ambition.

  7. Eamonn Harter says:

    The collapse of TSLA could take down the whole NASDAQ with it as the hopium bubble in profit-less tech stocks disappears.

    • yngso says:

      Yup, 2000 all over again, but this time there’s the everything bubble. Is Tesla the Grey Swan trigger of the Great Deflation?

      • alex in san jose AKA digital Detroit says:

        They just said on NPR that “the housing slowdown is officially a year old” so this may be the year or so of “meh” in 2006-early 2007 before it all came falling down.

  8. Neal Woods says:

    Tesla’s market cap can drop to and past the value of its competitors’ smelly EV divisions and still be worth an investment.

    It also doesn’t need the bond market, so it’s a no-brainer to snap the bonds up at a 9.3% yield and you can own a limited edition.

    The bear case on Tesla is ALL financial, and based on some noisy, noisy data. Tesla has just tripled its market, but the numbers haven’t detected impact yet, so the growth story is over! isn’t a case any bobblehead is making.

    It is unbelievable to me to think there isn’t an institutional investor that would invest in a Tesla equity issue at any price.

    • Wolf Richter says:

      “It is unbelievable to me to think there isn’t an institutional investor that would invest in a Tesla equity issue at any price.”

      Well, not sure… But we know some are dumping their holdings, including T. Rowe Price which sold about 81% (or 7.2 million shares) of its Tesla stake in Q1. At some point, hype alone just isn’t enough anymore, not even for institutional investors.

    • Kasadour says:

      Yet the $2.Billion + infusion of cash Tesla raised in the debt markets that it so desperately needed did nothing to help it’s stock price.

      As for the genius CEO Elon Musk- he could be having some personality issues and credibility issues, that are separate from his car company, that could end up turning investors off.

      • yngso says:

        Kasadour, you state it much too politely…

      • Neal Woods says:

        “Yet the $2.Billion + infusion of cash Tesla raised in the debt markets that it so desperately needed did nothing to help it’s stock price.”

        When shares outstanding increases, what are the mechanisms that make the share price correct?

    • Bobber says:

      I just wanted to make sure you knew that Tesla may live on, but it’s current shareholders may lose 100% of their investment. In a Chapter 11 bankruptcy reorganization, the bondholder become new owners of the company and the existing shareholders get wiped out. The company may live on and even prosper some day, but current shareholders likely will not.

      People who buy Tesla’s stock in two or three years after a bankruptcy reorganization has taken place and valuations are corrected have a much better chance of making money.

  9. Lion says:

    I’m waiting for end of June when the $3,750 Fed tax credit drops (and eventually ends at EOY). I think many Tesla buyers are buying now to get the free Fed money. Let’s see what sales are like in July.

  10. nicko2 says:

    Tesla gigafactory in China is ahead of schedule. Tesla will go from strength to strength.

    • roddy6667 says:

      What will Tesla do in China? They have at least 10X the competition there, and lots of EV’s that everyday people can afford. The “trade war” is making the Chinese steer away from American branded products.
      China didn’t insist on any transfer of IP with a partner company because there is nothing proprietary. It’s all off-the -shelf. They gave Musk a setup to employ Chinese workers for a while, at least until Tesla folds. Then they can put another company into the gigafactory building.

      • CreditGB says:

        EV megafactory in China eh? Do we suppose that Chinese business/government will sit around doing noting and watch TSLA’s “megafactory” produce/sell EVs.

        Once Tesla technology is stolen, and it will be, the market will be flooded with “megafactory” knock offs. Do I correctly recall BikeSharing in China as a an example of Chinese head over heels over production? No expert here, just observing.

      • doug says:

        yes, if the ‘trade war’ is a thing, then american products will NOT be bought I suspect, leaving the brand new mega place with no customers…

        • robt says:

          Apparently it’s uncool to whip out an iPhone in China now … and the sales collapse confirms it.

        • alex in san jose AKA digital Detroit says:

          robt – the correct answer for “phone cool” is a Kyocera flip like I’ve got. Also doubles as a door stop and I’m pretty sure I can crack walnuts with the thing.

    • yngso says:

      Car sales are collapsing in China, and Teslas are too expensive.

  11. sami says:

    According to my point of view it was a mistake for Tesla to introduce the Model 3

  12. TooJunkForJunk says:

    TSLA is such trash that even HYG dropped its TSLA bond holdings these past two weeks, and that’s filled with 97% Junk with most bound to go the way of TSLA soon.

  13. David Hall says:

    Nissan is developing hands free driving for its cars to compete with Tesla:

    • yngso says:

      Nissan is just another drain circler with turn around whiz Ghosn AND Renault gone.

  14. Michael Engel says:

    The superman of making America great again, might be fine.
    Trillions in the banks waiting for the slump.
    Under a killing fire, Ilan will duck and buy time.
    When higher prices and inflation takeover, after 2020, while the Fed don’t respond, Tesla will get a second chance.
    Tesla will solve their mfg problems, introduce Model 5i to replace the ugly duck Model 3, and takeoff with the blast of a new energy boom.

    • yngso says:

      The very least that must be done is to hire a real CEO who is willing to work for little money until results are achienved, but it’s probably too late.

    • Pat McKim says:

      You should back up the truck and bet the farm rather than suggest the behavior to others.

      When resla.goes bk, you undoubtedly will have.wxcuses why OPM and the govt did come through. This is the best performing short I’ve ever done is gross profits to me

  15. nick kelly says:

    VW has just taken the first 10,000 orders for a 35, 000 dollar EV. (the response crashed the server)

    Imagine if a car company actually delivers for 35 K instead of promising one that costs closer to 50 K.

  16. CreditGB says:

    If the Chinese Government can “invest” hundreds of billions to build….what, 19 now? …..ghost cities largely uninhabited, investing a couple billion in a Chinese EV “megafactory” or two, or ten, to keep China Chinese, seems to be inevitable.

    And as Nick points out, the tidal wave of established competitors is now getting close to the beach. I can see TSLA being totally swept away by more choices, better styling, better service, and ultimately prices well below the still subsidized Tesla. Remember, global auto makers can do “loss leaders” subsidized at least temporarily by existing profitable model lines to establish a market for their EVs.. Not sure TSLA can say the same.

    • Prairies says:

      The mark up on the truck market that is booming will cover the losses on the 1% sales volume of EV. Don’t have to charity fund raising like Mr. Musk, the shareholders might lose a few pennies per dividend just to take the EV lead.

    • roddy6667 says:

      Before you repeat the “ghost cities”meme again, you should travel to China and visit one or two. Most of them are not cities. They are just apartment complexes or neighborhoods. Americans are not used to seeing things on the scale they are done in China. A lot of those photos are 5 years old and the buildings are occupied. One of the most famous “ghost cities”, Ordos New District, was 100% sold before it was built. Most sales were cash. Now the development is 50% full and has thriving businesses, yet people keep repeating the hype they read in the American media, especially the Times.

  17. vap says:

    Ev’s are every where, and gaining steam. The Tesla is still the 3 rd most demanded car out there. The ultimate EV, sexy, sleek and speedy.
    No one has ever designed a more superb car.

    • Wolf Richter says:

      “Tesla is still the 3 rd most demanded car out there.”

      LOL. Only in your own mind. This kind of hilarious unadulterated fabricated BS nonsense is part of the cauldron of Tesla hype on the internet.

    • roddy6667 says:

      You must have Internet access in the dayroom of the mental hospital you live in.

  18. Paulo says:

    Every vehicle ever constructed has been built on the shoulders of precedence. For the IC auto, the first was Karl Benz in 1885, then Daimler. Henry Ford isn’t even on the list. The first electric car was 1835, and Elon Musk’s offering is a collection of hype, existing styling, and mostly off-the-shelf parts. Oh yeah, forgot to add the low interest rates forcing investors to chase yield and buy Tesla stock. Even the name, Tesla, is a rip off.

    When the big boys start mass producing (like VW, Toy, Nissan, etc) the Tesla story will be history, but his supporters will still make claims for pioneering status. Even the Ford Model T was assembled in a building as opposed to a tent.

    Apologies for my cynicism, I just get fed up with Musk and all the hype. It’s like he is a pop culture inventor. I lost all respect when he called the Thai Cave rescue diver a paedophile just because he wouldn’t use Musk’s mini sub and his bevy of experts.

    quick search: “The newly constructed production tent, right, at the Tesla factory in Fremont, California. The temporary structure is home to a general assembly line needed to help the electric-car maker reach its production targets for the Model 3 sedan. Tesla has had a heck of a time making the leap. … Hence, apparently, the tent.Jun 25, 2018”

    MECGA: Make Electric Cars Great Again

    Or: There’s nothing new under the sun – you just get a can of paint out.
    (Robert Plant )

  19. yngso says:

    One of the German engineering innovation companies has started to work on hydrogen tech, which is much better than battery tech. The only obstacle is a high price, but that’s coming down, because my FB newsfeed is full of hydrogen powered transport projects poppin’ up all over the place.

    • vap says:

      Musk has already said it stupid and doesn’t work/

    • alex in san jose AKA digital Detroit says:

      Hydrogen goes ‘way back too. I remember a write up about it in OMNI Magazine back in the 70s or 80s.

      Hydrogen is not a fuel, it has to be made, pressurized, and then used. Yeah it’s only water coming out of the tail pipe, but you had to spend a lot of BTU’s making that hydrogen. Essentially it’s like charging batteries.

      Find a cheap way to make hydrogen and you’ll be rich. Tons have tried.

  20. I would prefer Uber or Lyft only because they have broad transportation interests. What happened to Musk and his LA subway project? Space X? Why Tesla isn’t a more widely integrated company I am not sure. There is also the possibility of an offer from a major tech company. Tesla’s problems as an automaker are small potatoes. If you own Tesla just what do you own? Tesla (and its investors) suffer from a lack of vision?

  21. wkevinw says:

    I saw videos of the Musk hyperloop tests- with a Tesla car in a tunnel? I don’t know if that was real. If so, I am speechless.

    Large scale engineering is much more difficult than small scale (i.e. transportation>desktops>tablets>phones>software). Virtually all of the tech boom has been small scale engineering.

    Most of these genius-types have obvious mental/emotional issues of some sort.

    • Prairies says:

      It was real, he has had engineering students attending competitions to try and create a shuttle that can operate in the hyperloop but nothing has worked so far. All designs are forfeited to The Boring Company upon entering the competition so Musk gets free schematics for future projects as well.

      The only thing that has worked is running an EV in the tunnel but that just shows he made a project for a two lane highway underground. Such a genius, who ever thought about making roads before Musk.

  22. Michael Engel says:

    1) “BA in the sky with DIA”.
    The DOW index is calculated by accumulating every price of its 30 components and multiply the total by x6.7822. That how u got the
    DOW @ 25,585.69 on Fri close.
    BA is by far the most expensive stock in the DOW.
    When BA price drop it affect the DOW the most.
    2) The FANG led the charge until June 18 2018. FANG ETF==> FDN. Tesla is not helping.
    If u divide FDN by $SPX, FDN became a liability for almost a year. FDN: $SPX made a lower high, while the SPX made a new all time high.
    3) SPX monthly chart : May (not over) is a bearish Engulf candle.
    Its high near the open. It made an all time high, turned around, landed on top of the big red bar from Dec 2018, and bounced back up.
    4) Option #1 : the SPX engaged in one or two backup, push ups to pump muscles, on the way to a new all time high, just like Brexit(L) and the pre Nov 2016(L) periods led to jump over the previous all time high on May 2015.
    5) Option #2 : Its the beginning of the slump, therefor Tesla & Musk and all of us duck to buy time to make few important changes in order to survive.

    • Prairies says:

      BA if looked at over the past 10 yrs is the scariest bubble on the market. Nearly flat until 2016 and then The Beatles sing their tune.

  23. Rowen says:

    TSLA’s mistake is that it went to the consumer sector first. Should have marketed a military grade EV and sold to the DoD.

    Musk’s old buddy Thiel is doing just that with Palantir.

  24. Nels Nelson says:

    I think it can be summed up with the saying: “The early bird catches the worm but the second mouse gets the cheese”.

  25. gary says:

    “They’re cheap to make”

    Please explain why Tesla EV’s cost double ICE cars? What good is “cheap” then?

    • Wolf Richter says:

      Compare an electric motor to an ice (motor, clutch or torque converter, oil system including oil pump, oil pan, and oil filter; transmission, cooling system including water pump, belts and hoses, radiator, temperature regulators; starter, emission control systems, exhaust system with emission controls, catalytic converter, and muffler; black boxes galore; sensors and actuators; the entire fuel system including fuel tank, fuel lines, fuel pump, fuel injection system, fuel filter; air intake system including air filter, tubing, and throttle….

      Open the hood of an ICE car: it’s packed with these components. These things are expensive to manufacture and maintain. Open the hood of a Tesla, and there’s a storage compartment.

      An ICE is an incredibly complex, high-tech, and expensive system, compared to en electric motor.

      What’s expensive on an EV is the battery, and those prices are coming down rapidly.

      Also don’t compare the cost structure of Tesla to the cost structure of a real automaker.

      • yngso says:

        Now the cost of hydrogen is coming down, so soon the need for batteries will be eliminated.

      • Most of the stuff on an ICE is emission controls. Anyone who owned one of those presmogged vehicles can tell you what a joy it is to get under the hood. You can do away with emissions if you run CNG which is common in public transportation. EVs cars are about all we have seen. I can’t imagine an electric garbage truck without a pretty long extension cord since that would bypass the hydraulic systems. From a physics point of view you put energy in, and convert it to brute force, or you put energy in, transport the energy over thousands of miles of grid, and then store the energy in an expensive difficult to recycle battery then convert it to brute force. One secret of the EV is that you use less energy, which you could also do with an ICE but what consumer will buy that when they can have an 800 hp muscle car?

        • roddy6667 says:

          We have electric garbage trucks in China now. they are not full-sized yet. They are the smaller ones that go down narrow old streets and go inside gated communities. Big ones coming soon. About 25% of the large city buses now are battery electric.

      • gary says:

        I think you missed my sarcasm.

        O.K., show me a cheap electric.

      • Prairies says:

        You are over simplifying the EV. With all the automation going into cars, both ICE and EV have crazy amounts of expensive electronics to compensate for safety in all cars and emissions in ICE cars. Maintaining the self driving features, the electric heating and cooling systems, etc. The cars aren’t bare bones like the good ol days of a model T. A barn burning 20mph, and 2 mile stopping distance to show for it too. So you don’t have a simple electric motor and a battery, look under the actual “hood” of an EV and you will find yourself lost in a electrical engineers wet dream or nightmare. The open up the hood analogy also goes out the window if you compare it to a old school fan cooled porsche or VW bug. Open up the front hood on those cars, so bare bones a tesla would be jealous.

        • alex in san jose AKA digital Detroit says:

          Yup amazing the T had less power than a Honda 250cc Rebel.

        • Wolf Richter says:

          I was talking about the differences, not what they have in common. I agree in terms of the electronics modern cars have (whether ICE or EV): they are immensely complicated. And they are the largest source of consumer complaints.

  26. raxadian says:

    There is a huge problem no one is talking about, what the heck do we do with all the used batteries?

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