Expansion and investment plans frozen, after deliveries of Teslas plunged in Q1.
The core of every Tesla is the battery, and the core of the battery is the battery cell technology, and that technology doesn’t belong to Tesla. It belongs to Panasonic, which makes the battery cells that Tesla packages into its battery packs. The Gigafactory in Nevada is a joint operation between Panasonic and Tesla.
But now, according to the Nikkei, the partners have frozen the planned 50% expansion of the Gigafactory in Nevada, and Panasonic has suspended its investment in Tesla’s Shanghai plant that is currently under construction.
These decisions are driven by the uncertainty about demand for Tesla vehicles, after the miserable first quarter, and the financial problems that arise from the decline in demand.
Panasonic has been the largest manufacturer of battery cells for EVs, along with a Chinese company, CATL, followed by a bunch of other Chinese companies. But the operating losses of Panasonic’s Tesla battery business grew to $180 million in its fiscal year through March 31, from a smaller loss in the prior year, according to the Nikkei, proving just how tough it is to make a profit in the EV space.
And now there is this awful question about demand for Tesla vehicles hanging over the battery plants, as deliveries plunged 31% globally in Q1 from Q4, to 63,000 vehicles:
- Model S and X in Q1 deliveries plunged 56% from Q4 to just 12,100 vehicles. And it’s not just a seasonal blip: this was down a catastrophic 44% from Q1 2018.
- Model 3 deliveries in Q1 dropped 19% from Q4 and 8% from Q3, to 50,900 cars.
After having saturated its Model 3 pent-up demand, created during years of hype, the company is now facing the issue that every automaker is facing in the US: Total car sales have plunged over 30% since 2014, while truck and SUV sales have boomed. “Carmageddon” is what I have long called this process. It’s an industry shift, and automakers are struggling with it.
With the Model S, Tesla faces an additional problem: it is an expensive luxury car that is seven years old and is getting stale and needs an update or redesign.
Now all hopes are on Tesla’s far-off compact SUV, the Model Y whose recent media dog-and-pony show had been totally underwhelming. It’s based on the Model 3. But the hopes are that it will be able to benefit from the generally strong demand for compact SUVs – if Tesla can get the price point down to where the market is.
Meanwhile back at the ranch in Nevada, so to speak, when demand for Tesla vehicles backs off, demand for the batteries in them automatically slows down. So it’s apparently time to be cautious and rethink the expansion plans of the Gigafactory.
Panasonic and Tesla had originally invested $4.5 billion in the plant and had planned to expand battery production from the current capacity of 35 gigawatt hours a year to 54 gigawatt hours a year by 2020.
Last October, Panasonic President Kazuhiro Tsuga said the company would consider “further investment in North America, keeping in step with Tesla.” According to the Nikkei, Panasonic had been considering investing between $900 million to $1.35 billion in the Gigafactory. But now it has frozen those plans.
Model Y production and deliveries are still on the distant horizon and – given Tesla’s rock-solid history of overpromising and underdelivering – will likely remain on the distant horizon for a lot longer than planned. But if and when sales reach sufficient momentum, proving that sustainable demand for the Model Y is there, the two companies will reevaluate their expansion plans for the Gigafactory.
And Panasonic will also suspend its planned investment in Tesla’s Gigafactory in Shanghai, which is currently being built. It’s an integrated battery production site and EV plant. According to the Nikkei, Panasonic will instead provide technical support and a small quantity of batteries from the Nevada Gigafactory. Tesla has already committed to buying the batteries for the cars it might assemble at the Shanghai plant from various Chinese battery makers.
Upon the good news, Tesla shares dropped 3% this morning to $267 a share.
Many Americans are priced out of the new-car market. Read... Used-Car Market Profits from Carmageddon
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“frozen”? Why?
Hype at inception said these plants would produce batteries for households to use with solar and other onsite power sources to free us from the grid.
Where’s the dream gone?
You can run a home off grid on batteries, but this relies on massively reducing energy demand. Current tract houses are nowhere near efficient enough to do this. I have solar for electricity coupled with wood for heat, but I’ve considerably reno’ed my home, and have degrees in engineering and physics. If you pay a contractor to do the conversions, then no way is it economic. It is only economic for grid-tied if you have high sunshine hours, AND don’t use electric for heating, AND have grid tie subsidies.
And I use top quality lead acid batteries, not lithium ion, which I get at a big discount.
“… have grid tie subsidies …”
My son is going that route, without anything else, except he also heats with wood. His solar installation will pay for itself in about eight years.
When I built my house in 1977, I set roof pitch equal to our latitude and faced it South with no encumbrances (chimneys, dormers etc.) but it will have to benefit younger folks who will eventually own it – I’m too old for it to make economic sense for me.
Where I live shade trees and other radiant barriers have a much better return than trying to harvest sunlight. This is true in most of the world at this time.
All good simple design steps which 99.9% of architects and house builders ignore totally.
This has always been the case since I first started checking the numbers.
As you know electrical heating is extremely inefficient. Similarly, there is a map showing the economic benefit of a location on the earth for solar power which correlates with (wait for it): sunshine hours. Hint- the only places really good for solar are deserts (also advantaged to run AC).
So, the laws of physics don’t change.
(I have more years and degrees in physics and chemistry than I want to admit.)
I’ll add this, evaporative coolers are more efficient in dry desert climates.
Also, when I built my house I installed picture windows in the south elevation and left pre-existing walnut trees in front of them, which leaf out late and drop their leaves early, so they allow passive solar heat in the cold months when the leaves are absent and warming sunlight floods into the windows in the cold months.
I heat with firewood so, in a way, that’s solar heat – the wood comes from from solar photosyntheseis.
Also, when I built my house I installed picture windows in the south elevation and left pre-existing walnut trees in front of them, which leaf out late and drop their leaves early, so they allow passive solar heat in the cold months when the leaves are absent and warming sunlight floods into the windows in the cold months.
I heat with firewood so, in a way, that’s solar heat – the wood comes from solar photosyntheseis.
TruckMan, if you’re burning “wood for heat,” doesn’t that defeat the purpose of this EV revolution to eliminate fossil fuels and stop the “greenhouse effect”? If we all start doing that, especially in the cold northern climates, then there won’t be any trees left pretty soon, right?
Jack2: But … don’t you know burning wood is part of switching back towards using renewable energy!
You see in reality Truckman is really a secret card carrying member of the greens!
Being an engineer, Truckman is merely using his green engineering skills in applying green science!
You see Truckman, with an eye towards increasing efficiencies, is merely helping to speed up Mother Nature’s rather slow natural processes!
You see if left totally to her own devices, Mother Nature would let the tree grow old, die, and then fall down, to decompose slowly over time all the while releasing the same green gases that Truckman creates more quickly by burning the wood!
You see by burning the wood quickly instead of allowing the wood to rot, Truckman ensures that the resulting green gases trapped, against their will in the wood, are released quickly and made available for young trees to grow more quickly so they can be cut quicker thus speeding up this virtuous renewable green cycle!
This is truely green engineering at its finest! You just didn’t know that Truckman’s is a green genius!
Congratulations Green Truckman!
P.S. It is good to see that your applied science engineering skills weren’t totally wasted after all!
replant the trees harvested and it’s carbon neutral
I have a solar panel system with a lead acid battery backup. The batteries needed to be replaced last year, and the cost of a lithium battery replacement was about 5x the cost of lead acid batteries. Lithium batteries are a must for things where size and weight are mission critical. For a house, they don’t make economic sense
To Wes and Truckman:
I remember when stationed at Miramar Naval Air Station in the early 1950’s and flying up over the LA Basin when burning in fireplaces had not yet been “banned”; you couldn’t see that Basin for the all the polluting smoke…….It was total bowl of gray/brown.
Until the housing industry is totally changed to build for “conservation” we will not make a drop in the bucket influence on “climate change”……as to the housing factor.
If we make the necessary changes the prices of “homes” will escalate into the stratosphere. Follow the money.
Wes
Despite all the snark, Truckman never said he was a “green”. He was simply describing what’s required to live off-grid with batteries. He also indicated that you probably have to know what you’re doing to achieve various economies & savings.
Always amusing to see an argument with one side putting words in the mouth of the other party…kinda like the sound of one hand clapping.
I’m getting used to it
Exactly, when I explained here how much energy is necessary to just run a heat pump I was called a liar. People just don’t have any idea of the concepts of energy consumption.
Bullseye, Truck. We live offgrid as well, and have done our own home improvements and energy reduction management over the years. Have had many friends ask us about the powerwall, and have told them that, after looking into it, it doesn’t pencil out any better than our tried/tested lead-acid based system with no additional benefits. A better day to all…
The future is coal.
Harrold: Yes coal is the future! I spend the first 8 years of my working life helping to increase coal production all around the world!
Now, in my old age, I am waiting for global warming to arrive!
So far it has been a rather cold wait!
The global warmists, …… promised that Canada would warm up and to be honest I am getting rather tired of waiting for them to deliver!
After all I did more than my share to help global warming!
I’d rather see massive quantities of stable power from a scrubbed coal plant than a bunch of plaid shirted yahoos spewing fireplace and wood stove emissions directly into the ground-level atmosphere.
Clean coal!
For a stationary installation (where weight and to a degree, space aren’t an issue) deep-cycle lead acid batteries are probably a much more cost efficient solution than lithium batteries.
You might be right re:L/A in which case I have much more experience and familiarity with enough to say I’d never go that route. I watched on youtube some noob thought he could run an ac on batteries, the resylt was an impressive one hour.
Tesla has a serious cash crisis, and will likely be bankrupt in 3 months, 6 at the outside. It always was a company that relied on Government subsidy, and that’s now largely gone. The SUV, like the Class 8 truck proposal, is a smoke-and-mirrors trick by Musk, who doesn’t want people looking behind the curtain.
Tesla tried to grow to fast to satiate Wall Street’s endless desire for speculative stock price growth.
I admire Toyota’s success with the Prius. Innovate, but don’t try to do too much too fast. Come out with a solid innovative concept and milk it over time, while enjoying subsidies. Make sure the concept can stand on its own, without subsidies, before trying to produce and saturate the market with many new models.
Congress just voted to extend the tax credit–$7,000–for up to 400K cars. This was a bipartisan mistake (mostly to benefit GM).
California Bob,
“Congress just voted to extend the tax credit…”
That’s not how I understand it. My understanding is that a bi-partisan group of legislators has introduced legislation to extend the tax credit. This is far from a done deal. In addition to all the problems it faces in Congress, it also faces Trump who wants to get rid of the tax credit. So I’m not betting on it just yet.
Do all the CNBC apologists (anchors and contributors), who defend Musk on a daily basis, get a free Tesla to do so??? Ever notice how all the CNBC apologists stumble over each other to convince the viewers how smart Musk is, how innovative Musk is, what a genius Musk is despite the growing number of Tesla owners burning to death in these rechargeable coffins???
Or freezing to death when the car quits fifty miles down the road in the wintertime?
Lots of ppl have gotten and get electrocuted, burnt and blown up producing and using electricity. I’m quite sure this doesn’t make Tesla and Edison dolts.
After Experience with Tesla’s and actually listening to Musk talk, I’m quite sure he’s no dolt either.
Ragnar: If I read your comment correctly, “Volts Jolt Dolts” !
Sorry I my funny bone just couldn’t resist!
Rogan gave Musk the kid gloves treatment on his podcast and only a month later he had a new Tesla in his driveway. No smoke and mirrors there, these guys do their dealing in broad daylight.
Just for context, the number of Tesla fire deaths per billion miles driven would have to increase 11-fold to equal the ICE fire death ratios.
source: https://insideevs.com/number-of-fire-related-deaths-per-year-caused-by-evs/
It seemed so obvious to me for a long, long time that Tesla was eventually going to go bankrupt. I just never saw how it was ever going to be possible for them to deliver on the promises made in an industry filled to over-flowing with deep-pocketed and experienced competitors with vast physical capital at their command. In the end, all Tesla was doing was making and selling a car, and a much more expensive and lower-performing one at that.
….look for an emergency tweet from Musk discussing a new Tesla flame thrower, Tesla frisbee, Tesla drone etc. etc. etc. etc. to divert attention. I see CNBC is being extra, extra quiet this morning not to discuss this Panasonic bomb shell report.
Your deposit on the frisbee will promote the flamethrower, which in turn will collect deposits on the drone. Rinse and repeat, the classic ponzi.
I actually paid $500 for one of those Boring Company flamethrowers when it was first announced. After months on end of repeated delays, promised delivery at a later time, etc. I got fed up and wrote them a nasty email demanding a refund for failure to deliver. I was thinking exactly that, my money was being held to finance Musk’s Boring Company projects.
They did refund the money. Paypal is pretty good about enforcing non deliveries
Panasonic realizes that Musk and company burn money a lot better than they make it. There is only so far you can go with Musk’s boasting and bluffing. All the senior management quit and left the children in charge. I would start looking for the door myself.
Looks like all that hype didn’t translate into actual demand. The real question is whether Tesla is circling the drain or whether Musk and pull another miracle.
It’s my opinion that if Tesla does cease to exist we’re going to see a massive loss of public trust in these types of firms.
Yep, all those NPCs with more money than brainz are gonna freak and their virtue signaling (which is just wealth aggrandizement) will turn to bitter vitriol against their green messiah fElon.
Its going to be delicious to see this guy taken down. My money is he offs himself or disappears.
Stick a fork in it, Tesla is done. The losses Panasonic is racking up shows that costs for these batteries is not coming down as promised but perhaps even going up as the costs of its main inputs, minerals and energy are going up. Panasonic knows there is no way Tesla can survive in an environment of decreasing sales and increasing costs and they are moving to cut their losses. Every time I see someone driving a Tesla now I think about what will happen to them soon when they can no longer get parts or service for their overgrown golf cart. The bright side is that when Teslas start to mysteriously catch fire and get insurance payouts it will be very hard to prove it was not an accident.
They can’t get parts or service now without long delays.
Battery engineering research is very difficult, and has been for decades. Many efforts, companies, etc. have been shuttered. It looks like we have to be satisfied with small improvements in this technology.
There might be some breakthrough in a different kind of energy storage, kind of like going from mechanical to electronic time pieces: a totally different design concept.
Not knowing much about physics the main difference between the ICE and the EV is that the ICE energy storage device (tank) is fairly cheap and durable, while in the EV it is half the cost of the vehicle. Just to store energy? Both vehicles use fossil fuel, the EV uses it to make electricity. Why don’t we use NG, no CAFE standards, (oh but transit in urban areas do use CNG, just no retail) With long electric grids power is lost and the source of pollution gets moved (oh wait is that what climate change is about?) It seems there should be a way to create a single use product, Propane and NG which would trade off the bad refinery issues for good pollution outcomes.
A bazillion brand new ICE powered vehicles some that are now a few years old still sitting on lots EVERY WHERE waiting for some stooge to plunk down huge dollars with ‘incentives’ to ease the pain of sticker shock, or EV vehicles that make sense in certain market environments or conditions.
I live in a so called ‘carbon tax’ environment where the msm propaganda is suppose to convince me of a smooth transition to a ‘cleaner’ environment.
I believe that Tesla in particular is being absolutely vilified in the public realm. It would not surprise me to find out that Musk and his vision has been and is still being actively hacked and sabotaged to prevent a smoother transition to alternative energy usage.
All you have to do is look around you with everything going on to see an oil based out of control behemoth oil companies tied in with virtually every CORRUPT govt. around the world to figure this one out. There are petro-chemically imbalanced rats skulking around in the shadows right now that are not going to let go of the levers of power and control.
Alternative energy is in the future, just not in the foreseeable future.
Mechanically rechargeable zinc air batteries look promising.
IdahoPotato: Surely you jest! Mechanically rechargeable!?!?!?
My hearing aids use zinc air batteries and they come with a warning that they will explode if you try to recharge them!
Throwing a used hearing aid battery into a camp fire is a sure fired way to surprise the hell out of everybody!
What I find interesting is that for quite some time now, its the ‘light-truck’ frames that sell. This of course is what a SUV is, they take the frame of a ‘light truck’ (ie, pickup truck) and build an enclosed passenger compartment onto it.
In this world, Tesla followed a product path of producing only cars and neglecting to do anything on a light truck frame. And now Tesla is having to play catch up in this area to try to get their SUV out the door. And the bad part about the path Tesla has chosen is that they must accomplish this at the time when they need to show quarterly profits and not be selling deposits on unicorns which will eventually be delivered, some day, yeah, later.
Clay: As for ways to torching your Testla for the insurance!
Let me count the ways to do this ……………………………………………………..
Clay, sorry, I think I will have to get back to you on this!
It seems like with my electrical engineering skills. …. I haven’t yet run out of practical ways in which to torch your Testla!
Wes, “…practical ways in which to torch your Testla!” hell, just drive the damn thing–it’ll happen soon enough on its own, won’t it? (That’s what I call planned obsolescence.)
@WES
Google the company NantEnergy.
Panasonic has a cash crunch and huge corporate debts. In an environment of rising interest rates, their actions are hardly surprising.
It seems like the pool of people with enough money to afford one of these things, but are dumb enough to not see what is coming has got to be dwindling fast.
Clay: You are not implying that the pool of greater fools is limited are you?
And the big giant freight train of the big major car companies pouring into EVs is rolling up from behind, and pity on any poor fool still on the tracks when it arrives.
Elon will figure something out. He has help from artificial intelligence. The cars will put their best minds to work, and surely come up with a plan.
I know – he’ll announce his candidacy in Iowa next year. Elon’s twitter-presence will win him the presidency!
So many Teslas in Newport Beach. So many. I bet the rich will rush to trade them in.
What car dealer in their right mind would take one of these in trade for anything but scrap value. I predict the eventual home for all Elon’s creations will be parked beside farmhouses in the desert where they will be hooked to a set of solar panels on the roof as a sort of jerry rigged battery and charge controller, and home for chickens and goats. But they will have to keep them a safe distance from the house, like a propane tank, so no one will get hurt when they burst in to flames.
clay – All of the negative reports in the main stream media are being paid for by the oil and ICE automotive industries.
Teslas are the only luxury vehicles that are still selling. Don’t you think with the quality of product and brand value Apple or another cash rich company will buy them for pennies on the dollar? Tesla is going nowhere. In fact, as many people have mentioned, I see an increasing number of Teslas on the roadways every single day.
Luxury vehicle?
You gotta be kidding!
Teslas are Sedans.
Hop into a BMW or Mercedes to refresh your concept of luxury!
Whenever i read stuff like this on Tesla, i go check it’s top line growth, then i remind myself of the phenomenal innovation and brand equity that is at the core of this company.. and then i stop. My balanced thinking is intact.
Tesla’s sales in Germany are growing like a weed. Meanwhile Porsche’s sales are tanking.
Porsche, Audi and Bentley are coming out with electric sports and luxury cars in the near future; how do you think TSLA’s sales will do after that?
https://www.roadandtrack.com/new-cars/future-cars/a12778510/2020-porsche-mission-e-news-photos-price-release/
Even better.
Bob – None of those companies have the technology or talent to compete with Telsa. It’s like comparing an Iphone to a flip phone. The Telsa 3 performance edition will destroy any luxury vehicle in it’s price range. Same for Model S and Model X. Telsa just makes hands down superior vehicles .
i agree that tesla has a significant technological edge. i read a breakdown of how much better their technology is than the competition.
i think they have two huge issues. the first is they are essentially beta testing their products on paying customers. that’s not acceptable in the auto industry. secondly, they appear to be cooking the books. tesla stock is essentially a ponzi scheme.
somebody is going to get great technology on the cheap after they go belly up.
they sound like my father when I asked for a toy. He would say, ” I will give it you next week.” Next week, never came…
I read those articles too so when exactly the vehicle will be in the showrooms? Specific date? Please advise.
If innovation was the primary hallmark of a successful car company than France’s Citroen would rule the automotive world.
Then, there was the hugely popular Edsel, many advanced features in it’s day, no subsidies either. Oh, wait……
CreditGB: ……… yeah, she wasn’t very pretty either!
If innovation means an ugly car you can keep them.
+1 on citroen.
Phenomenal innovation? The only innovation was the invention of a tax credit that allowed them to sell old fashioned technology to the unsuspecting masses.
You can thank “al-gore’s” disease For that.
If you really follow the whole economics of the energy sector to the bottom you’ll find that the public ( that’s us) have been short changed in both scenarios,
On the old fossil fuel economy, the hard at work lobbying have caused much stagnation ( a near century) of stalled innovation and caused ( still causing) immense damage to the economic health of the world in general. While pouring billions upon billions into the coffers of the sublime few ( Shell, chevron, BP, …. etc).
Takings a leaf of their cousin’s book , the ( green) lobbyists spearheaded by the sublime Al have done great damage to the Economies of the developed countries.
by skewing the Natural process of ( progress & development) by the awful model of ( Subsidies) to gain advantage have only created ;
unrealistic, unreliable and unviable second grade technology that the likes of (water walking Jesus) used to preach to the masses !
All the while to the detriment of:
Self sustaining genuine solutions that could’ve been priced more appropriately and affordably to the end users.
So again real development of the future energy solutions have been killed off by the
“ false economic wizardry “ pushed by the same old lobbyists ( only changing suits) to promote cleaner air , renewable resources.
This is what happens when ( good science) is hijacked ,and solid concepts are turned into a :
FAKE watered down piece of crap, and marketed by the political elite who have been paid handsomely from both sides of the energy divide .
And who pay for all this shambles?
The forever suffering Mr & Mrs Tax payers.
PS ! Wonder what will the Norwegians do now that their beloved Tesla won’t have spare parts?! :)
there is plenty of innovation in a tesla. for example, the electric motor is something like 30% more efficient than anybody else’s. the networking of electrical components is done in a way to centralize everything. it greatly reduces complexity in the assembly process and keeps costs down.
Everyone here in Texas is driving those 4-door cowboy cadillacs. $40k for basic entry model? No thanks!
Thanks Wolf for your cynic coverage of Tesla. P. T. Musk never fooled you like his groupie followers. I happily sitting on my January 2021 Puts and feeling better as the saga unfolds. I may “gamble” on a few more.
Now and then, I see a local Model 3 on the street. I get the same blah feeling as seeing a Saturn…..ho hum… Starting to look dated IMHO.
Maybe it’s just me but this can’t bode well for demand…for TSLA cars or batteries.
Hmmm, one thing the marketing folk over at the car majors have learned is to update the body style at least a bit every year. And to completely change it over every five to ten years. Yet another place the big majors run over a little fantasy effort like Tesla.
I wonder what went through horses minds the first time a horseless carriage rolled by.
All of this is consistent with a plateau in demand for batteries that go into cars and other things. If the prices on the latter drop, the demand will recover.
Tesla doesn’t lose money on producing the marginal car anymore so it can drop prices and revenue will continue to shoot higher.
The company is following Amazon’s playbook and isn’t going anywhere. Sorry Panamabob to hear about your puts.
Neal Woods, I’m putting a few chips on an Enron outcome, actually a $50 strike. It’s a long shot bet against a bunch of unmet promises from Peak Musk.
My business partner recently ordered a Tesla. I mentioned that he might find himself without support for his vehicle if the whole show goes tits up. He had read about the Q4 earnings without looking more deeply at the situation, and had gotten the impression that they were currently turning growth into profits. It’ll be interesting to see how his customer satisfaction level works out over time.
Saltcreep: If your business partner’s Testla ever drives him crazy, I have a SEC approved copy of Musk’s “Lock Em Up” software if you ever need it!
Saltcreep – Tesla is one of the most valuable brands in the world right now. A cash rich tech company (Apple, Google, Microsoft) will certainly purchase the company if it drops below $150. There is zero risk of the company going out of business and an owner not being able to get parts of service.
To me the Testla saga is just a sign of how zombitized the central banks have made the world with their free money.
When money is free people do stupid things with it because there are no direct consequences for them if they are wrong.
Free money is just another form of socialism that governments use to force the consequences onto others.
Wolf, another great insight.
I also must comment on the commenters you have attracted to your site.
They always provide great comments and many times they make me laugh, but not at them, but with them. And with you keeping some inline, you do not have the outrageous or untruthful trolls which comment just to stir emotions.
Your site is the best of any internet site I follow. (34)
Agree this site is my #1 internet destination
“…Tesla has already committed to buying the batteries for the cars it might assemble at the Shanghai plant from various Chinese battery makers…..”
Wouldn’t this explain Panasonic’s cold feet. Why invest 100’s of millions of dollars if Tesla intends to buy from the competition.
A friend of ours dropped a $100K on a Tesla last year. She was so proud and bragging to everyone how nice it is. Fast forward a year later after numerous quality issues and repairs, she now avoids talking about her Tesla.
The Tesla’s used to have a certain cool factor, but now driving one exudes more of an embarrassment factor.
Our friend could have purchased 2 decent (mid-price range) model Lexus’ for the price of one junk Tesla.
Important point, Chris. I live near a very affluent area with a lot of Wall St folks. During the Hummer craze, these vehicles were cool for a very brief time and it was not uncommon to see 3 or 4 at a stop light with a dozen cars.
When cool suddenly turned to embarrassing, they disappeared seemingly overnight! Imagine dumped in markets ‘behind the curve cool-wise’ at a tremendous loss, and new sales stopped on a dime.
Lots of Teslas around here now…Suspect same is going to happen to them soon.
MB732 – Nobody is embarrassed to be driving a Tesla. My take is the haters on the board are mad that people are much more successful than they are and they can’t afford anything nice.
I hate cars. I’ve always walked to work and owned budget compact cars. I’m now relatively rich as a result of my hatred for the car and oil industries.
I will buy a Tesla purely as an anti-establishment play. I would love to see our fake economy burn to the ground, and autonomous vehicles are going to be the spark to ignite the flame. Once autonomous electric vehicles go mainstream, the entire economy will collapse. All jobs will vanish and we will be free from toiling 8 hours a day doing meaningless work.
Wait, electric autonomous vehicles are going to be the spark that ignites the flames that burn the economy to the ground?
You’re talking some serious highway safety issues there… and is that really the metaphor you want to use for Tesla?
Most of the Model 3s I’ve seen have a young man at the wheel. This makes me wonder if it’s having a problem reaching the broader market because it’s a sedan. Women make 70%+ of vehicle purchase decisions, and they prefer SUVs & CUVs. Couples making joint decisions generally land on a pickup as a compromise. This leaves little room for sedans.
But then I see that Model X is suffering too. Then I go “hmmm”. Is the high-gloss Tesla image looking more like a satin finish these days?
MF – Tesla 3 is literally the best selling luxury sedan in the world. Not sure there is any type of demand problem.
Whats amazing is that they are the number one selling sedan and haven’t even started leasing the vehicles yet. Once leasing ramps up, they will be outselling the BMW 3 series by 3X-4X.
The problem is the Model X costs $100K. If they could get the Model X down to $75K they would crush the luxury SUV market as well.
Model 3 is NOT “the number one selling sedan” — your second mention — not by a long shot. Not even close. That must have been a typo. In your first mention, the world “luxury” was in it, and that was probably correct.
Tesla sold 27,000 total vehicles (S, X and 3) in Q1 (Automotive News est. since it doesn’t disclose US sales). I don’t know what the best-selling car in the US was in Q1, probably the Toyota Camry. I have trouble getting a Q1 number. Instead here is the Ford Focus, which is certainly NOT the best-selling car in the US, but Ford sold 41,600 Focus models in Q1. In total, Ford 587,000 vehicles in Q1.
The other luxury sedan makers split up their cars over many models. In total sales, the luxury automakers BMW and Mercedes blew away Tesla in Q1: BMW sold 83,000 vehicles; Mercedes 78,000 vehicles.
The reason is there’s literally an army of Marley crankers out there.
Makers of electric vehicles in particular, and alternative energy in general, are going to find it extremely difficult to compete so long as they are officially suppressed and fossil fuels get trillions in subsidies, and so long as militaries run on fossil fuels, that will happen until the planet becomes uninhabitable.
Transistion to alternative energy would require the construction of an alternative infrastructure, and that’s never going to happen. Imperial policy, sorry.
Unamused: My take on taxpayer subsidized solar panels, windmills, electric cars, etc., is it just seems to be a sop to soothe the guilty conscience of the rich!
The rich are using their power over government via socialism to make the less rich pay while placing the pollution in somebody’s else’s backyard!
You have to give full credit to Musk and Tesla, at least he brought a battery powered vehicle to market. Which in my opinion is a pioneering spark that won’t go away. Just out of curiosity, has any one seen a chevy volt lately?
N-49,
Battery EVs competed with steam-powered vehicles in the late 1800’s and early 1900s until the ICE car came along and became useful and eventually killed both the steam-powered car (the Stanley Steemer was last manufactured in 1924) and the EV. So EVs have been on the road a lot longer than ICE cars. Musk didn’t invent them.
But he is a genius in marketing. He made EVs cool. He made people want to own EVs. That is his real accomplishment. No one before him accomplished that. He put EVs into the minds of people as something desirable, even if it costs a lot. Now everyone is making or planning to make EVs. He essentially created an industry. I give him HUGE and TOTAL credit for that.
Concerning your last question: The Volt (with a V) was a hybrid with an ICE built in, and has been discontinued. The Chevy Bolt with B is the EV and it’s alive and well. I see them all the time.
Thank-you for clarifying that to me.
On a side note, I haven’t seen any video’s of a volt or bolt beat a Dodge demon off the line recently.
That’s what I call “cool”.
Nobody hears you coming or going, now if only you can get that with a radar/laser speed defying stealth paint job.
Having worked in the over-hyped EV industry in the 90’s, let me just say: Well imagine my shock.
I hung out in the 90’s, ’emission-control’ we have a problem.
All hype and no range make EVs a dull ride, IMHO.
Wolf: I know you own a Testla so it must be awfully hard to take us Eeyores!
So my apologies in advance!
I hope your humor will be sufficient to out survive your Testla!
Sadly, in my engineering career, I have never once succeeded in defying the laws of science and finance like Musk has repeatedly done.
In retrospect, I think my problem stemmed from the fact that I lacked the backing of unlimited money from both central bankers and taxpayers!
Just for the record: I don’t own a Tesla or another EV. I own a vehicle powered by a gas-guzzling 300+ HP ICE engine that my wife drives to work every day and bitches about having to fill up. However, our next car – in however many years that might be – may be an EV, but not a Tesla.
I haven’t fueled my 120HP V6 ICE vehicle in months, it tops out in the high 20’s MPG, not bad for a full size vehicle built 35 years ago? Last year I probably drove less than 3k miles….
Besides sales volume and profitability concerns, Panasonic may not be happy because Tesla bought Maxwell Technology battery and capacitor producer, and Musk also said their Chinese production would carry Chinese locally produced batteries.
Maybe what the US EV market really needs to curb sagging sedan sales is a Tesla pick-up truck. Can haul a lot of batteries in the bed of a pick-up truck. Just need to figure out how to market that to all the American cowboys. Maybe Musk is up to the job.
My guess is TSLA sales are directly tied to the tax credit. DOE still shows that dropped from $7,500 to $3,750 on January 1st, 2019, and is still slated to drop to $1,875 on 7/1/19. You can plot the price/demand sensitivity. And that’s without any serious competition in its narrow, ultra-lux niche.
Porsche will eat Tesla alive with its sports EV.
Musk is a genius, just not in all matters as he believes.
I am convinced that ultimately, electric battery cars will be an evolutionary dead end, just an offshoot of the lithium battery’s usefulness in cellphones and electronics. The physics and chemistry of trying to pack high energy densities into chemical compounds and making the mix quickly rechargeable WITHOUT also making it into a package of high explosives just don’t exist. There isn’t that much difference between high energy density chemical batteries and solid rocket fuel. Or gunpowder.
The more energy you pack into a chemical compound, the more likely it will burn furiously in a flash fire, or explode. Period.
Hydrogen fuel cells are the obvious answer for the distant future, which Japanese and Korean manufacturers have been working on for some time.
Despite the pictures of the Hindenburg disaster, hydrogen is actually much safer than gasoline. If the container ruptures, the gas escapes upwards instead splashing everywhere. The majority of the Hindenburg passengers and crew survived as a result. If a lithium battery ruptures and is ignited, it can behave just the solid rocket fuel that it resembles and flash burn in a ferocious jet, or explode
There are lots of other reasons that hydrogen fuel cells should become the obvious future choice, too many to discuss here
this is another case of tax incentives that did not work. The govt in Nevada gave Tesla & Panasonic tax incentives for jobs that never materialized. therefore, AOC was right to oppose New York state giving Amazon tax incentives for jobs that would never be created.
My guess is Amazon creates more jobs than Tesla although more low paying service jobs is more of the same solution to a problem that didn’t exist before offshoring became subsidized.
Whatever happened to truckmageddon, meanwhile PCAR is making new 52wk highs….
and the ponzi scheme continues to unravel
Looks like some of Tesla’s losses just been shifted to JV.