> "I wish we had put that car on the road and not Tesla," confided a senior engineer at Porsche. "We have to earn money at the end of the day though."
The article also talks about "how will the German brands win back customers from Tesla?", but really, if you look at cars like the Mercedes S-class, BMW 7 series or the Audi A8, their sales are unchanged or even increasing since 2012 when the Model S was launched. Audi has been setting record sales numbers in the US, which is Tesla's biggest market, for five years straight. So it's a bit hard to argue Tesla has taken many of their customers.
Maybe most Tesla drivers were never petrolheads in the first place, and drove a boring station wagon before the Model S came along?
Saying that Tesla sells cars at a loss is just another case of sour grapes by people trying to discredit what Tesla has done. Tesla could give up on the Model 3 right now, stop building superchargers and just rest on the Modle S and X to be plenty profitable. Funny though, I'm pretty sure every stock holder would prefer they keep "losing" money.
This is an often repeated media trope that seems a bit misleading. It makes it sound like they would loose more money if they sold more cars. That is not true. Tesla has positive gross margins.
Tesla is investing in future production and that is part of why it is losing money. I would also draw your attention to a strange fact about GAAP accounting principles. Some investments like the GigaFactory are depreciated and the expense is spread over the lifetime of the operation of the factory. However, R&D, although it’s an upfront cost that pays off over the long term, is not depreciated. You take the full charge in the quarter the money was spent. I suspect it’s because R&D has a less predictable payoff and timeframe than an investment in a hard asset like a factory.
Another factor in Tesla’s lack of profitability is their high sales expenses (SG&A). Currently SG&A is about 20% of non-gaap revenue. At most auto companies it’s about 10%. The number of Model 3 preorders indicates that their current sales infrastructure is scalable and can support much larger revenues. At scale SG&A is likely to be a lower percent of revenue.
Nevertheless, ramping up R&D disproportionally to current sales like Tesla does also incurs disproportionate costs compared to rather static incumbents.
PS: The high SG&A figures are still confounding me. In other sources, Tesla's marketing budget was said to be negligible for the premium segment.
Tesla does no marketing. They are supply constrained, so there is no need to generate more demand when they can't fulfill the demand they have generated.
however, they are opening up stores and galleries. that is an expense that is typically handled by car dealerships for legacy automakers. i assume that is a big factor driving up their sales expense, and as i stated... I believe the existing stores and galleries will be able to support a lot of model 3 sales.
The other manufacturers offload that cost onto the dealerships, who provide show rooms, sales staff, service staff, etc. AFAIK Tesla takes this on themselves.
Do Telstra split the costs of new leases, refits, transformer installs, super-charger installs - for showrooms?
Also I'd guess they are pouring a lot into training and development. Assuming they have a long term view, they'd want to retain their top sales and management staff to move them up to more senior roles in the future. This is the opposite of dealerships, where a high churn in sales staff is unquestionable doctrine.
What data do you have on this? How is such figure(s) being calculated?
Your claim also doesn't jive with the "Secret Tesla Master Plan":
"The strategy of Tesla is to enter at the high end of the market, where customers are prepared to pay a premium, and then drive down market as fast as possible to higher unit volume and lower prices with each successive model."
You need to look at 2014/2015 really, which is when the Model S started being produced in decent numbers.
The Model S outsold most other 'large luxury' vehicles in the US in 2015, including the Audi A7 and A8 combined, and the BMW 6 and 7 series combined, and the Mercedez S-class.
edit: re: rates of change: Model S sales increased 50% during 2015, Audi A7,A8, BMW 6,7 Mercedez S all down 5% or more.
Well, your prescription doesn't change the fact that magazine journalists, video bloggers, and prospective buyers do in fact compare them because they are roughly in the same price bracket.
It might be possible that most Tesla buyers are only:
1) wealthy Prius owners who want to upgrade to something bigger and more technologically advanced and would never consider Mercedes S-Class
2) eco-green consumers who would only bicycle to work or hail Uber/Lyft if car travel was necessary and would never consider Mercedes S-Class
But based on forum discussions where prospective buyers test drove both and chose one or the other, it seems like there is a population of owners who seriously considered both cars. (Same type of comparison goes for BMW/Audi.)
And if you think a S-class Mercedes is incomparably superior to a Tesla Model S, but the Tesla S is still outselling it by a wide margin, just imagine what's going to happen when Tesla's next iteration of a luxury sedan gets even closer to the Merc!
Did you actually check where a Model S starts after tax credits vs. the base price of a S-Class?
As we don't have data here we're thrown back to opinions.
I would think Tesla users buy a Model S for the electric drive and it's an upper class car and for the branding ("I drive a Tesla, I'm cool")
People buy a S-class because of the luxary and thebranding ("I drive a S-class, I'm rich").
"but the Tesla S is still outselling it by a wide margin"
It's outselling the S-class because the market it markets itself to is larger.
Tesla is trying to pivot towards mass market, this is well known. Whether they keep the luxury/sports line or push those into a new brand (or sub-brand) is the big question. But I don't think anyone questions whether or not the currently available Tesla cars fall into the luxury category. Both design and price suitable fall into that category.
Mercedes might have an older and long-term luxury brand that is associated with the wealthy, which is helpful, but not an absolutely critical barrier for a brand/product to be put into the luxury category.
my feeling is that parent comment wasn't claiming that tesla wasn't a luxury brand but that it was a "cool upper-class" luxury brand. Now, obviously, this is a very slippery distinction, and as someone who probably wouldn't spend that much money on a car at all, sure, it looks like a meaningless distinction... but I don't think it is, I mean, to the people who might buy the car. Tesla, clearly, is a brand for people willing to spend a lot more than the minimum on transportation, so I do think it can properly be called a 'luxury brand', but I think parent's point was that Tesla is a luxury brand that appeals to people for whom other luxury brands wouldn't appeal. I do know several people who would be vaguely embarrassed to purchase a Benz, who would seriously consider the Tesla, mostly for social reasons... and when you get down to it, social reasons dominate for cars in that price range. Hell, I might be in that group? I mean, if I came into a huge amount of money tomorrow and was looking for a luxury car... I'd probably consider the Tesla to reflect more positively socially on me than a S class or something.
Tesla is different from BMW or Mercedes just like Cadillac is different from those brands. (I mean, it has yet to be seen if Tesla will make BMW and Mercedes obsolete the way that Acura and Lexus made Cadillac obsolete. But the point being that there are big differences between the people who might buy the different luxury brands, even when the price range is similar.)
Now, i don't know that parent is correct in saying that Tesla luxury appeals to more people than Benz or BMW luxury, or Acura or Lexus luxury, but I do think that parent is correct in that the overlap between people who would buy a Benz and people who would buy a Tesla is not 100%, even though they are priced similarly.
Marketing doesn't exclusively mean advertising:
The American Marketing Association has defined marketing as "the activity, set of institutions, and processes for creating, communicating, delivering, and exchanging offerings that have value for customers, clients, partners, and society at large."
Tesla has a clear marketing strategy in terms of what types of cars they sell and to what types of people. The fact that they don't pay for advertising doesn't change that. Musk/Tesla can be selective about who they do interviews with, or provide test cars to, etc. Those things are part of the marketing, even if there is no explicit purchasing of advertising.
"Tesla dont pay for advertising"
The God King doesn't need advertising when his disciples spread his words for free.
Living in the Netherlands, the price of a Tesla is around 100.000 euros. However, if I can lease the thing, the actual cost (due to tax benefit, etc) drops like a rock to a level that compares to a small, cheap car. For full electric cars you hardly pay taxes because the government wants to stimulate this clean way of transportation.
Now comparing to a Mercedes with a similar price is wrong, simply because the Mercedes with a similar price is costing much, much more in day to day operation: more tax (heavy car = high tax), no green car, so more taxes).
I believe that at least for the Netherlands, most hybrid or full-electric cars are driven by people that have a company car. We just love tax refunds. We hate the hassle of charging, so many hybrid cars in 2015 (Mitsubishi Outlander is a good example) were driven on petrol - not electricity.
It's interesting that Netherlands seems to assume all electric cars are green. But Singapore actually calculates the carbon emissions per km and finds the Tesla Model S to be very environmentally unfriendly: the Model S attracts a surcharge of $15,000 while the BMW i3 gets a rebate of $30,000 .
It seems the rent/loan/buying tradeoff would be independent of the choice of car.
Say a price of a brand new Tesla is 100k Euro. If you got a loan from a bank to buy it, you might be paying back 1000-2000 euro a month just to pay it back in a few years. That is quite a lot. There are companies however, which let you part-lease or part-hire or however they call it, when you pay roughly 1/2 of the value of the car over 3-4-5 years, but you don't get to keep it at the end. So you might have a brand new Tesla S, for say 400 euro a month - which is very affordable. The only caveat is that you don't get to own the car at the end - but for a lot of people that's not a huge issue.
If you buy both without a carrier, you might pay 400 EUR for the mid class phone and 800 EUR for the premium phone. The price difference no looks huge.
(The difference in acucmulated prices is the "buying" price of the phone)
The weights of the Tesla Model S and the Mercedea Class S are pretty much identical.
These two statements are not mutually exclusive.
In The Netherlands cars are taxed on multiple factors including CO^2 emission, type, and very significantly on weight.
In Tesla's case the weight is being heavily offset by the lack of CO^2 emissions, whereas the Mercedes gets all the taxes of a normal gasoline car and the weight tax on top of that.
I'm not sure it's always not worth saying; being too focused on trends is a valid criticism.
You could have just as easily said:
"... the C class interior (or the 3series or A4) is worlds better. Not even in the same league."
It's stupefying how poor and sparse the Model S interior is. Setting aside issues of taste (that is, adjusting for the fact that it is a minimalist design) it's just completely out of place in a 100k+ car.
every high end german car interior is completely customizable. all that wood can be replaced with plastic, or carbon fiber. all the leather can be replaced with alcantera. all the bling bling can be replaced with lightweight alternatives, or just omitted entirely from the build. you can literally change the seatbelt colors on a porsche, or the color of the stitching in the leather.
you wouldn't know this, because you probably never actually shopped for one, you decided on tesla because you like the fact that it's electric and are a fan of the company. there's nothing wrong with this, that's how many buyers of porsche, audi, etc, operate -- but it shows that you aren't really the target market for the german stuff.
That's why I said "adjusting for differences in taste".
The A4 has a very tasteful, restrained design that is also extremely high quality with high end materials. It also is much, much nicer than the Model S.
 Low end, entry level Audi.
But I say this as a millennial with an engineering degree, so I don't really know if the marketers particularly care about my opinion on what is stylish or not.
You don't need to pay anything extra to beat an s-class, based on their website. The slowest Tesla, the station wagon/suv x version on the slowest/lowest end battery (75kwh) was 0 to 60 in 6.0 seconds, beating all model s's-class mercedes. This was the easiest comparison site I could find, the various models of both cars makes it a little hard to pick one spec model to compare. Never the less, the low end tesla suv beat all s class.
The s class interior is nice. My dad has one, so many buttons, but it's smooth, etc. Soon, Mercedes will start advertising that the new s class is not like your dad's oldsmobile, i mean mercedes.
does any tesla cut corners as sharp as BMW? is the luxury feel of being inside comparable to S class? and so on.
the only positive feedback on Teslas i've heard compared to those germans is acceleration. part of the whole experience, but personally not the most important one - that would be handling for me, BMWs are out of this world
Yeah, the interior is not as nice as a top end BMW or Mercedes. I don't care, driving the car is amazing. I drove a $150k Audi RS7 the other day. The whole time i wanted to be back in my S.
The interior is not as nice as our 328 wagon. It's no where close to a high-end model. They are fascinating cars, but the fit and finish and range are still lacking (from my perspective, anyway). And sedans are boring.
Hire some established car interior people from existing companies, and work with existing suppliers of luxury manufacturers. The interior is the one part of the car that doesn't need to try to be innovative, so they could have basically just copied their German rivals. Am I missing something about how hard this is?
Also, is it really that bad? I've never driven or ridden in a Tesla, but I've looked inside one in a showroom and thought it looked pretty nice inside.
And at the end of the day, quality costs, and the price of the Model S is high enough already.
My soon 3yo Mercedes E-class doesn't squeak, rattle, flap, wobble, dinkle, pop or waffle anywhere. Nothing.
Meanwhile, the Tesla I test-drove felt much cheaper. It's nice enough, but it really feels like the cheapest entry-level German luxury cars, while it's priced like their highest-end cars. I've also seen reports that build quality is hit-and-miss, they start to squeak and rattle after a while if you're unlucky.
Yes, the Tesla is super fun when you get to push the speeder, but the rest of the time it's just not. This was also a year before Tesla launched their "autopilot", and I picked an E-class with Mercedes' self-driving tech which had already been on the market for years at that point...
Have you ever driven a manual? They, too, can give you acceleration exactly when you want it.
My biggest gripe about driving in the US. No manuals to rent -.-
What Tesla does do better is the constant torque. That must be fun.
This comparison is not even in the same time zone. The average American drives a car with gearing technology at least two or three entire generations beyond manuals. Electric cars feel like a couple generations beyond even the best automatic setups.
A car with a good CVT, for example, doesn't even switch "gears", it's one continuous acceleration from 0 to speed. My current car, a hybrid with a primary motivating electric motor, makes my wife's CVT feel like a steam-punk jalopy.
A good electric car, on the other hand, makes even the best automatic feel like the engine is dragging, or you're pulling a trailer or something.
Manuals, even great ones, feel like some stone-aged anachronism. After riding around in an electric, then getting in a manual, you can't believe that cars are still being made with such terrible gear shifting contraptions. It's like that car from Chitty Chitty Bang Bang with all the lever pulling and pedal pumping.
I don't see how they could know in advance that I'm going to accelerate unless I tell them. Hence the sluggishness can not possibly be removed.
Unless you count flappy pedal gearboxes as automatics as well. Then yes, far superior to traditional manuals.
Mind you, even Formula E has a flappy pedal 5-speed gearbox despite being all electric.
I haven't driven a fully electric car yet, and I'm sure their power output is impressive, but I have driven hybrids and they were crap in terms of fun-to-drive.
However, my mom's (fully-electric) Leaf is worlds apart. No matter how hard you step on the accelerator, it always responds immediately, fully, with seamless, continuous thrust.
A Tesla? I've never driven nor ridden in one, but I can only imagine it being like a launch-type roller coaster: immense, terrifyingly sudden acceleration.
The only way a manual can hope to compare is if you rev the engine and drop the clutch, which probably isn't something you do everyday.
Probably not. Modern autos like CVTs don't actually even shift, not in the way that a manual or very old fashioned automatic. They can feel a little mushy, but on modern generation vehicles power is pretty instantaneous and about as continuous as you can get in a non-electric vehicle. They aren't "fun" though and tend to be built to maximize efficiency over speed or power. But they're mathematically more responsive than any manual could be and they're effectively always in the "right" gear, up/down shifting doesn't really make sense.
Other than the occasional rental or when riding in my friend's cars, and between our household cars and the occasional electric I've been in, I haven't felt a gear shift in a couple years. It actually feels a little alarming these days when you do feel one. Manuals are worse, they don't feel fun anymore, they feel like there's something mechanically wrong with the car.
Because of these qualities, most racing leagues have banned CVTs, since a performance oriented CVT would outperform any other shifting strategy in most kinds of racing. It was tried out by Williams decades ago for F1 and is said to have been astonishingly faster since it kept the engine in peak torque. https://www.youtube.com/watch?v=x3UpBKXMRto
But the industry is starting to move beyond CVTs now and direct drive is starting to hit cars. Teslas are like this, but even some consumer hybrids don't have any sort of gearing anymore. CVTs beat manuals for shift speed, but direct drive, because there's no such thing, beat CVTs. These are both the correct answer, manuals are some sort of weird vestigial technology that clings on because of all kinds of weird myths about performance and efficiency and notions about what's "fun".
I'll toss this out, a ludicrous launch in a Tesla is much more fun than any ICE engine transmission system.
You can learn to drive an automatic, just like you can learn to drive a manual. In mine, I just blip the throttle down a bit to force the car to downshift if I'm anticipating an overtake soon - it's something you learn if you drive long enough. Besides, I drive a car with an AMG 7-speed Dual Clutch transmission, where the shift takes fractions of a second - I could not possibly change that fast in a manual. No chance.
That's the thing... any trace of that sluggishness is gone in a Tesla (or other quality electric). From the moment your foot starts moving even the tiniest amount on the accelerator, you feel your back being pushed into the seat. There is zero delay.
A comparison I thought of... It's the difference between pressure-sensitive touch screens and capacitive.
> I haven't driven a fully electric car yet, and I'm sure their power output is impressive, but I have driven hybrids and they were crap in terms of fun-to-drive.
Yep, hybrids are nowhere close to a Tesla. Go take a test drive, you'll see in the first few seconds what I'm talking about.
Caveat: I am from Germany, have driven manuals all my life.
Every time I even drove a Citroen C-Zero shared car from Multicity for 10mins, getting back into a manual car -- even one of the nice CLA Mercedeses that car2go now offers --, feels like going back from the 21st to the 19th century.
"#Citroen c-zero vs #2CV which one is going to win?":
My money is on the 2CV.
In what ways can Tesla drive itself better in comparison to S class systems?
If Tesla just sold the Model S, they would be profitable. Margins are pretty good for each Model S. But selling just the Model S is not the plan, hence the huge cash burn.
I'm curious where you draw this conclusion from. Tesla definitely burns a ton of cash, but it's primarily capex ($1.6bn in 2015), which doesn't directly affect their profitability.
2015 R&D was $718 million. Even if we assume none of that is related to the model S and add it back, they still would have lost $170 million (net profit). And this is the marginal profitability, ignoring all the R&D expense from prior years that went into the model S.
Telsa are loss leading, hoping to grow their brand and technology to the point and out compete their rivals by the time the vehicles are truly profitable. If the capital markets remain favorable to them for a long enough time, they might just do it. Or established brands may acquire their technology once they deem the market to be sufficiently mature for them. Or we may have a problem in the markets, and Tesla's continuing cash requirements might lead them into difficulty.
I presume he's talking gross margin, which excludes prior R&D (except capitalized), marketing, distribution & sales costs, office/admin expenses, financing costs etc.
We have seen the exact same (lame) process from BMW/audi/porsche for 12 years now.
First they announce an "e/i/tron/whatever" initiative, then they roll out some concept cars, then they test market a half-assed hybrid with a lanwmower engine hidden somewhere inside ... and then wait four years.
We've seen at least three cycles like this from all of those high end manufacturers. All they have to show for it is million dollar cars from mercedes and porsche and a half-assed hybrid i8 from BMW. Oh, and I guess audi now has a small sized hybrid.
All of which aren’t bought by anyone, because they’re too expensive when you can buy the same in the gas version for half the price.
Exactly - a pair of onion-parody electric car models (the kind of design you would come up with if you were trying to make fun of electric cars and the people who buy them).
I have no idea what the mercedes tesla is that you speak of - all I know of is the B class. Again, a bubbly e-car for people that aren't interested in cars.
What I want is either an electric A8 (having previously owned two gas A8s) or an electric Porsche Panamera. Two electric motors. Identical interior / cabin design.
I've been ready to throw money at that for 10 years now, as are, I suspect, many Tesla drivers.
What the incumbent car companies don't get, and this article gets right, is that Tesla are operating on a different plane. Yes, I've drunk the Musk Kool-Aid, but it's the only thing that appeals to me that is on offer. The big OEMs just don't get it, and I'm not sure they ever will.
Like, how long will it be before one of the big 3 German OEMs has a > 200 mile range, fully electric car for sale? 2018? That's nuts
And, assuming you can afford it and you don't need a station wagon, why on earth would you not buy a 7 series/S-class/A8? They are, after all, some of the very best luxury cars in the world. If it's good enough for royalty, why isn't it sufficient for you?
A) A car no larger than a 3 series BMW
B) A full EV car with >250 mile battery range
Basically the first reputable company that can deliver that has me as a customer!
I wouldn't buy an a8 or 7 series because they dont come with kool-aid. Seriously!
Of course not all Mercedes cars are in the same class, but it just goes to show that Tesla is still relatively small for now and its captured market share does not necessarily need to have a significant effect on other brands (for now).
Your figures include vans etc.
[Source: https://roadster.com/Mercedes-Benz and https://roadster.com/BMW]
It seems impossible to hit a top price–performance ratio with so much overhead.
At least the major German manufacturers regally outsell the competition in EU because they actually let people choose what kind of car and equipment suits them. Being shoved down a few lanes Apple style is a common complaint for Asian manufacturers here ("Want that active cruise control? Tough luck, it's +8000EUR and you MUST get leather seats and bunch of other crap as well!" type deals).
I'm not saying Tesla isn't the next thing and car companies shouldn't be afraid. But it's still a far bet.
I have never seen any.
And outside of the valley Teslas are very rare by comparison with any other brand.
i'm not a tesla fanboy, but this isn't true. LA has more. LA has more of everything car-related, because it's LA.
most people that live in the bay area have never actually been to los angeles so they don't comprehend the size of the metro area. it dwarfs the bay in terms of population and sheer size, which is why a lot of people don't like it.
either way it's not "very rare", that just snacks of someone who lives in the sv bubble.
i thought i was pretty clear about that, but i guess i should have just kept it short and sweet.
All the more reason the German car giants should've been in the game all along. They are just to tied to their internal combustion investments, such as deeply established knowledge about turbos, advanced gearboxes and so on.
Being Ford, natch, it's impossible to upgrade the Sync that shipped with the car with whatever they're shipping now, which I also heard is much better. My $500 tablet I can upgrade, my $30000 car I cannot.
To me the huge draw of Tesla is that the company actually seems to understand how computers work. Tesla updates their computers over-the-air. Meanwhile, Ford wants to charge me $150 to mail me a SD card, hah.
Yes...but you can't build the products of tomorrow when you're primarily focused on selling the products of today.
This phenomenon is explained in Clayton Christensen's well-known book Innovator's Dilemma.
With the new upgrade, the largest model S can drive 613 km on a charge. And this year or next year Tesla covers basically all of North America and Europe with their chargers.
Already now, the range covers what people need 99 percent of the time. I drive more than 600 km once every 2-3 years. So for me a Tesla would already cover 99.9 percent of my use cases. Some people take long hauls more often, but most of them pass superchargers on the way. Once the batteries exceed 7-800 km and the supercharger network is slightly more expanded in the American Midwest, Southern and Eastern Europe, Tesla will cover 99.9 percent for everybody. I simply cannot think of a scenario, in which an American or European in 2021 would drive 800 km and not pass several superchargers on the way, unless they drive outside of Europe and North America or go to arctic regions.
Price is another thing. Model 3 is priced like a midsize car. A lot of buyers cannot afford that even when incentives and money saved on gas is included. But from mid size class and and up, you basically get a car
- that is much safer
- that unlike gasoline cars is upgraded for free on a regular basis after you purchased it
- that unlike gasoline cars can be upgraded modularly for small investments (buying better batteries etc.)
- has much more luggage space
- that drives more smoothly (due to electrical engine)
- with better acceleration
- that to some - ever increasing - extent can drive itself
- that you can buy in the city center or a mall
- with longer range between charges/fill ups
- with cheaper fuel
for the same price as a gasoline car.
But mostly, Tesla buyers will get a car where the digital stuff is integrated in everything. Tesla learns from usage just like Amazon or Google learn from usage. And just like Amazon and Google use that to get an edge from their competitors, I have a hard time seeing how Mercedes or Audi are going to be able to compete in the mid to large size class unless they too integrate digital into everything.
Habits die hard, and for some people, gasoline cars are the only cars. But if the market for Tesla has been high income 30-60 year old first movers on the American coasts and Northern and Central Europe, it will soon be medium income people all over Europe. The demographics of potential Tesla buyers will be 100 times larger in a couple of years.
I truly hope the large car manufacturers introduce their own fully electrical vehicles in production soon, and not just a concept car here and there. Competition is best. But if they don't do it in the next 2-3 years, they are going to be gone from everything except very high end and cheap cars, and for cheap cars as well after a decade or so, when Tesla can produce $20,000 cars.
I don't think they fully understand how grave their situation is. They focus on the fact that Tesla is losing money. But Tesla basically hasn't played all their cards yet. Tesla is still 1-2 years from selling a mid size car, 5-10 years away from selling cheap cars. They haven't upgraded batteries to bury the range issue yet. They haven't integrated solar in the cars yet to further kill any range anxiety.
The autopilot is learning from around a million driven km per day at the moment and soon that will be from tens of millions of km driven.
Any day Tesla can license their battery technology and superchargers to any of the large car companies. And if bankruptcy threatens, they can sell to Apple, Google or another tech company.
Heck, I bet I am just one of hundreds of thousands of people who would gladly pay $5-10,000 for their shares in a future round just to save them, even if I thought there was a good chance I would lose it all.
The traditional car companies should be much more worried. We are in a situation like when Apple introduced the iPhone and changed the cell phone industry.
> [Electric car] that is much safer
It's way too early to tell, we need a decade more of statistics before you can say that. As of now, there are many gasoline cars that have better safety records than the Model S; in terms of fatalities per mile it is only on par with the NHTSA average.
> [Electric cars] that unlike gasoline cars is upgraded for free on a regular basis after you purchased it
Gasoline cars have similarly complex ECUs and entertainment systems and are already being updated for free (usually at regular services).
> [Electric car] has much more luggage space
The Model X "SUV" proves that electric cars with decent range are so far restricted to the "liftback" body shape. Let me know when there is an electric equivalent of a Chevy Suburban or Volvo V70 (which really have much more luggage space).
> unlike gasoline cars, [electric cars] can be upgraded modularly for small investments
You've seriously never heard of the $300 billion-a-year market for aftermarket car parts? Never heard of the SEMA show? Gasoline cars are much better suited for modular upgrades: everything from better air filters to chiptuning to a bigger turbo is easily available and can be done by anyone with freely available tools in their garage. Unlike electric cars, which are inherently much less hackable.
> They haven't integrated solar in the cars yet to further kill any range anxiety.
You clearly haven't done the basic math here: a solar panel the size of a car roof will take several weeks to charge an electric car.
> Any day Tesla can license their battery technology and superchargers
Tesla does not own the IP for the battery tech nor the superchargers
Tesla Model S Achieves Best Safety Rating of Any Car Ever Tested
Due to dealerships, most cars can _only_ have their software upgrades during services. Tesla can push it out over the air. I'm not aware of anyone else doing that, and they probably can't due to dealership rules.
> Luggage space
But there's the frunk. Because the motor is the size of a watermelon instead of 1/4 of the car. The Model S has nearly twice as much cargo space as, say, the Audi A6.
Yep we can agree on this one, solar wont help on cars.
> Tesla does not own the IP for the battery tech nor the superchargers
Do you have a source for that? Tesla batteries are damn complicated, its not just a load of laptop batteries glued together, there are very complex support systems around the battery cells. Are you telling me they dont own the IP for that?
Of course it could be that reckless drivers purchase Teslas, confounding the statistics. But given the safety ratings only account for how likely a passenger (or pedestrian) is to die/be injured in certain kinds of impact, it is a very incomplete picture.
Even if the metric is perfect at measuring this, the average result for fatalities per mile would seem to then suggest an increased number of high-risk collisions per mile.
As for luggage space: I was talking about an estate/wagon class car, so this is the correct comparison:
Also, just counting cubic feet with two luggage compartments is only helpful in some situations. You wouldn't be able to fit a washing machine in a Model S, for instance, or a dog cage, nor most baby prams (without significant disassembly).
Tesla does own some patents on the battery pack assembly, but Musk famously declared a while back that these are free for all other car companies to use in good faith. (He "open sourced" them.) Also, Tesla is the only electric car manufacturer going for the 18650 cell as the basis, all others are going for much larger individual cells in their packs, so most of Tesla's battery pack IP doesn't apply to others since it's specific to the cell form factor.
You don't understand. Most car manufacturers have agreements with dealerships that will prevent OTA updates from being possible.
> Musk famously declared a while back that these are free for all other car companies to use in good faith
Yep, but 'good faith' means opening up their IP in return, more or less, so not many companies are taking that up. Anyhow Tesla still own the IP, so your original statement is incorrect.
There are also legal frameworks that make OTA updates edgy. Tesla is being investigated in germany because pushing additional features ("auto"pilot) might substantially alter the car from the approved version, leaving it without approval to drive on german roads.
OTA also suffers from all the beautiful issues that networked updates suffer from, most notably security, authentication, encryption. I for one prefer updates done via good old fashioned removable media.
So yes, OTA updates are nice, but I'm not certain I really really want that in my car.
Maybe it's just me, but I find that terrifying.
I don't want there to be any possibility of my car changing its behavior unless I take the deliberate action of bringing it into a dealership for that purpose. It's one thing if an update bricks my laptop, it's quite another if it bricks my car. Let alone if one day a malicious update somehow gets pushed out.
I see four categories of people here:
1) People who really don't want to think about it, and fully trust Tesla to take care of them. This is the vast majority of people.
2) People who understand security, and want security patches applied as quickly as possible by a professional. This group also likes OTA updates, but is admittedly quite small.
3) People who want to minimize their security surface area entirely. These people wouldn't buy a Tesla, nor would they allow their dealer to plug into their car. They buy a car that's carefully vetted to have a small attack surface, and do the maintenance themselves (or by a trusted contractor). This is, like, the Secret Service, etc. This is a tiny group.
4) People who need some degree of "control theater" so that they can maintain the sensation they are in control of the status of their vehicle, but who aren't actually applying any sort of rigorous security protocol (as evidenced by leaving their car unattended at a random dealership). It's is a bigger group than #2 or #3, but much smaller than #1.
Hopefully it's more than the sensation. Anyone who's ever had a Windows update take over right before a presentation, or an Apple update brick their phone, wishes they had more control over when and if to accept an update.
Being able to upgrade/downgrade helps a lot. "Bluetooth for my headphones broke, after I upgraded. I'll downgrade, until they've fixed that bug."
So what is this?
One's a European institution; the other is American.
I believe Tesla's idea behind solar panels is to extend the range a bit (5 percent or so) in order to alleviate the range anxiety drivers have, not to charge the batteries fully. At least not before the batteries and panels get much more efficient.
As for IP, Tesla doesn't need to own all IP from lithium ion batteries to chargers. Just to have the necessary licenses for whichever part of the the base IP which is not already in free use and to have licenses or patents to the way they have put it all together (the way they combine the batteries, their charger etc.). Take Volvo: For them, building a network of chargers covering their markets would mean an investment of billions of euros that they don't have. Buy batteries from Tesla instead, and they can pay as they go.
Changing modules in an electric will eventually be like changing RAM or a fan in a computer. Something most people can't do themselves but that an expert can do in half an hour. Electric cars can be built like PCs where one module can replace another. Gasoline cars are not as modular. Also, the 300 billion dollar market for gasoline car parts is mainly because there are many and many old gasoline cars and because their moving parts need to be repaired and replaced often, not because they are upgraded. You rarely upgrade a gasoline car - you mainly fix broken stuff. I never heard of anyone handing in their gasoline car and picking it up a few days later with faster acceleration and longer range, just like Tesla now offers with their new battery.
Ever seen "The Fast and the Furious"? I am pretty sure people upgrade their gasoline cars all the time. People already replace modular parts on their cars similar to computers. OEM upgrades that increase acceleration, etc may not be common, but aftermarket upgrades that increase acceleration or horsepower are extremely common.
I'd bet there are many more options for upgrading an old 90s model Toyota Supra or Mitsubishi Eclipse than there are for a brand new Tesla Model S.
It's really pretty standard. I have several friends who "chip-tuned" their diesel engines for significant HP boost, people regularly change suspension parts, exhausts, they add intercoolers to the engines, order a turbo etc.
Those are pretty standard things and there are many specialized shops when you can drop your car for a few days to get those done.
You shouldn't trust your opinions on the topic if you haven't heard about it because those are really common things among car enthusiasts.
As an example, I live in Graz, Austria, where there is just one supercharger. It's not massively convenient for where I live in the city, but it's a small city, so it's possibly reasonable. However, last week I drove to Budapest and back, via Slovenia, which is motorway/freeway/autobahn the entire route. Total journey distance is approximately 800kms.
There are no superchargers in Budapest. I could have returned via Vienna, adding another 50kms to the journey, but there is only one, inconveniently located, inner city supercharger in Vienna. I would lose a substantial amount of time leaving the motorway and ring road, to navigate to this sole supercharger.
Instead, I drive my Hyundai diesel and top up at any one of the multiple service stations enroute.
Superchargers need to be a lot more ubiquitous and located much closer to major arteries before this becomes a compelling proposition.
So, I don't think the supercharger network needs to be "slightly more expanded" in Eastern Europe, but greatly expanded and much more convenient.
Plugshare.com exposes just how many access points are available for recharging on trip - public/govt options, for-pay high-power stations, etc...
Using the trip planner shows dozens of charging options between Graz and Budapest, for your particular case.
It's certainly helped me address some range anxiety as I consider an EV.
It requires extra planning, yes, but I was actually surprised how it wasn’t constraining. YMMW obviously.
BTW, that 600km range is very theoretical. The real range of 85D is ~420km (driving at 110km/h) and while P100D has better range, it doesn’t have 50% better range.
This sort of limitation applies to pretty much anyone who doesn't live in a house with a driveway or garage. Many people park their cars on the street, and would have the same problem I do.
We must have very different definitions of "covered". Looking at the supercharger map on Tesla's website, I'm not sure that even the SoCal area is close to fitting that definition. Most east coast state have only 5-10 stations for the entire state. Unless Tesla is planning to increase the rate of supercharger installations at an exponential rate, it will probably be another decade before the US will be covered to the point that you could reasonably expect to take off on a long distance trip without needing to plan around charger availability.
- with cheaper fuel
(numbers and previous discussion here: https://news.ycombinator.com/item?id=12379662)
It is possible that other branches of the business could subsidize car sales indefinitely, but highly unlikely.
The trend of Tesla is there - question is, if typical buyers addressed by the Model 3, Tesla itself claims as essential for the success of its business model, wouldn't as well change to every other vendor bc of price, quality, etc.
"Tesla is a battery company" - well, I guess a company is that kind of company, according to what it does to an utmost.
Hummer, Jaguar and Maserati though, those are further away from the natural "ideological core" of potential Tesla owners.
True, but they are also cars for the affluent, and Teslas, in addition to appealing to people with an enviro-lefty bent, appeal to the affluent.
Yes, after 100 years of polluting the planet with gasoline- and diesel-powered automobiles, the established companies cannot spare a few billion dollars to help us end our dependence on fossil fuels. This is why climate change will not be solved anytime soon.
I live in Germany.
Very interesting! Are there any case studies on that?
I was watching a segment on these companies the other day that addressed the importance of small companies, which constitute the backbone of the German economy. They took one such small company and chatted with its founder. He started talking numbers and I believe he said his small company builds tunnel boring machines and had a turnover of about 5 billion euros.
They also mentioned how they're not worried about China because Chinese companies mass produce stuff using German machinery. And how German companies make "the thing that goes into the thing that goes into the thing". Anyway, it was of course an oversimplified CNN-MSNBC-like segment, but it's interesting to see what they consider small company.
Exactly. A friend and I were chatting (he's a dental surgeon) and it came up that in dental care, many things that cost in the 2-4k in the US or Europe cost about 200 bucks here (Algeria) - same techniques, same materials, same hygiene standards, etc -.
Naturally, I asked him why there weren't people flocking from Europe (it's about 100 euros round trip from here). He said that even if dental care is cheap, everything around it sucks. He said that neighboring countries built the infrastructure to allow this to be possible (specialized resorts that have deals with clinics, etc). Tourism is thought with this in mind.
He said that if you compare that with our country, there's too much friction for your average European.
On a cost based analysis, it's still worth it. Many Algerians who reside abroad get all their medical/dental care and their children's done here when they visit, but they know the country and have family. They're not in a completely unknown territory.
It's not enough that something is technically possible, there are many parameters (even social parameters) that enter into consideration.
> He said that if you compare that with our country, there's too much friction for your average European.
> On a cost based analysis, it's still worth it.
I'll try to explain why this wouldn't be worth it to me, even if it would cost x100 less for dental care.
I'm in Germany, and I'm obliged to pay for a private health insurer provider (almost €300 per month), even though I'm a healthy late twenties individual. It doesn't matter that I barely use medical or dental services at all, I am obliged to pay that by law, even though I just use it for the occasional checkup, getting my teeth cleaned, etc.
I don't care if my dental work costs €5 or €500, my insurance provider picks up the bill. I don't care at all. In this case, the entity using the service and the entity paying the bill are completely separate.
My free time is very limited, I have a full schedule, working full time, social life, gym, hobbies, etc. I don't really have time to take time off for medical tourism to Algeria, I want to enjoy my free time. There is also the perception issue, I have no idea if I can trust anyone there.
Also, I wouldn't compare dental care costs between the US and Europe. From what I've read, the US is in it's own special price category for a lot of things related to dental/medical expenditures. Look at EpiPen fiasco, Turing Pharmaceutical, and many more. That stuff doesn't happen in Canada, Europe, Australia, or if it does its much rarer than in the US.
In that case you are in a lucky situation due to being privately insured. The vast majority in Germany is in the public system which only pays for the most basic of dental care. If you want more eloberate work or better material you need to pay out of your own pocket (which of course is still much less than in the US).
Dental care combined with a vacation in Poland, the Czech Republic, or Hungary is a thriving market. Some health insurers even cooperate with providers abroad and many doctors there speak German.
Similiar, many people opt for eye laser surgery (which you need to completely pay out of pocket) in Turkey or in-vitro fertilization in the Czech Republic (where a wider range of methods are legal).
I've heard stories from my home country about people going to Poland and other places for dental tourism like you mention, which has the advantage of being in the EU (visa-less travel, some level of trust, likely similar standards).
Whether you become a medical tourist or not likely depends if you are in a public health system or not, and if so, what is covered by the public system and how much you must pay out of pocket to make the travel cost-effective.
Here's a website that I love. http://atlas.media.mit.edu/en/
You can look things up by country, by product, etc. What country exports to what other country, and what does it export or import. There's also the "economic complexity index" of each country. Pretty neat.
We're talking about a nation that had ships 450 feet long and 150 feet wide 600 years ago. If Noah was real, he was probably Chinese, lived in the 15th century, and the animal pairs he took with him were fast robotized arms from Germany.
There was no big secret behind it. It's just that their whole market was like 20 companies worldwide served by maybe 7 providers of which 2-3 actually counted.
Media stories about it talk about doubling storage capacity.
If so, it's a product of US government research.
In line with the topic I'd like to plug Mennekes (which does have a small public relations department and is larger than the companies mentioned above). They supply plugs for practically every electric car.
50 employees, tiny amount of machines they produce, but without them, the world would be far worse as everyone could only eat ice cream in those tasteless paper-like ice cream cones.
Take this quote: BMW hopes its fully autonomous iNext, due in 2021, will revolutionize the industry but in the meantime it will continue to promote its poorly performing i3 as the best option for those looking for a premium zero-emissions car.
Yes, the i3 is a wacky, kind-of ugly design, and it isn't surprising (to me) that it hasn't been a big seller. But the BMW i division is one of the most interesting things happening in the car industry today, and is making cars that are just as innovative as Tesla.
It's a pity that it didn't explore this a bit more.
She ended up not ordering it because the delivery time was too long (6 months maybe? can't remember)
So it appears to me the i3 sells really well - BMW just can't (or doesn't want to) keep up with demand.
My sister drives a Golf hybrid now.
She's very happy with it.
I know what you mean though :-)
I think the differences in the drivetrain might be so much that they would need to create a fundamentally new car. It would have to be a new model.
That's a story worth writing.
I find it difficult to imagine how the i3 could ever be viewed as a pretty car, but they have some history in picking trends.
I'm really into the i3's interior though: the steering wheel and the screen just look like they're floating and the dashboard looks so sleek.
edit: I should mention that gomore isn't EV exclusive, drive now is EV exclusive here though.
The i3 interior is.. bizarre. Two tablets in a plywood holder? But I guess it can have its own novelty appeal. Still I'd suggest the electric Mercedes over this, if one gravitates towards premium German makers. Just my two cents.