Electric vehicle war, is gas soon to be toast?

[Azure]

Originally Posted by Erick Estrada

You make it sound like that will last forever. Profitability will have to matter for them eventually as stock sales will dry up when every other auto manufacturer is offering the same or similar technology.

Again, this is the same thing people have been saying for years.

Tesla is very early on in this game. How high will their stock go?
They literally just sold a $5 billion stock offering and it didn't even make a blip on their price.

They are building up their cash on hand position.

They have demand they are not even close to meeting.

They are building capacity faster than any other car maker in the world.

Sorry, but nobody else is going to be catching up for a very long time.

[Erick Estrada]

Originally Posted by Azure

Again, this is the same thing people have been saying for years.

Tesla is very early on in this game. How high will their stock go?
They literally just sold a $5 billion stock offering and it didn't even make a blip on their price.

They are building up their cash on hand position.

They have demand they are not even close to meeting.

They are building capacity faster than any other car maker in the world.

Sorry, but nobody else is going to be catching up for a very long time.

LOL how many years? They haven't been around that long. This is a long game not a sprint. I can see you are pretty deep in the Tesla hype train so there's no reasoning here.

[Azure]

Originally Posted by Erick Estrada

LOL how many years? They haven't been around that long. I can see you are pretty deep in the Tesla hype train so there's no reasoning here.

Well, since their beginning.

It has nothing to do with the hype train.

Once they overcame the inability to generate growth, and figured out how to build vehicles, the idea that someone would beat them became a dumb conversation.

There is NO product on the market close to being able to offer what they can.

Unless you think the EV market won't continue to grow, thinking that they won't completely continue dominating the market is pretty short-sighted.

The only argument I understand is the one where EV sales die off. And that doesn't seem to be happening.

[Erick Estrada]

Originally Posted by Azure

Well, since their beginning.

It has nothing to do with the hype train.

Once they overcame the inability to generate growth, and figured out how to build vehicles, the idea that someone would beat them became a dumb conversation.

There is NO product on the market close to being able to offer what they can.

Unless you think the EV market won't continue to grow, thinking that they won't completely continue dominating the market is pretty short-sighted.

The only argument I understand is the one where EV sales die off. And that doesn't seem to be happening.

Again I will state that it's a long game here and leave it at that. We are talking about a sales segment that makes up less than 5% of all automobile sales. There's no need for other automakers to catch up for a segment that's this small at the present time and won't become significant for another decade. Things are happening behind the scenes with all automakers as they haven't lasted half centuries just to fold their tents to an upstart manufacturer. Just because they aren't producing them today it doesn't mean they won't be coming. The reality is that even early attempts like the Ford Mach-E will start diluting Tesla's EV market share and as more and more other options turn up it's going to shrink more and more.

[zamler]

Originally Posted by Fuzz

Why would they spend tens of billions to develop an electric car, when emissions weren't as big a deal as they are now, on technologies that are rapidly advancing, all to sell vehicles for 5 years that barely break even? Doesn't that seem ridiculous to you? Tesla will be abandoning the battery tech the spent so long developing with barley any profit form it as they shift to new, better technologies. So why jump in when you can't make an affordable car, rather than wait until you can? Does the industry owe Tesla a huge debt of gratitude for going through the process? Absolutely. But it doesn't make it a dumb business move to sit on the sidelines for a bit.

Do you have any concept at all of establishing brand presence, market share, brand loyalty? Bringing costs down via iterations, economies of scale, general improvements through refinement. And so many other things. When Mercedes comes out with a new engine are they abandoning EVERYTHING from the previous generation? Do you actually think making a new battery means you dump 100% of what you learned and start over. WTF?

I'll try to be nice but what you're saying here makes no sense and is completely disconnected from how the most basic aspects of building a company work.

[Azure]

Originally Posted by Erick Estrada

Again I will state that it's a long game here and leave it at that. We are talking about a sales segment that makes up less than 5% of all automobile sales. There's no need for other automakers to catch up for a segment that's this small at the present time and won't become significant for another decade. Things are happening behind the scenes with all automakers as they haven't lasted half centuries just to fold their tents to an upstart manufacturer. Just because they aren't producing them today it doesn't mean they won't be coming. The reality is that even early attempts like the Ford Mach-E will start diluting Tesla's EV market share and as more and more other options turn up it's going to shrink more and more.

Doesn't really matter if it is 1% of the world's automobile sales.

Because the demand is still there, and the demand is growing.

You also have states in California saying they want all EV in state as of 2025. That is the 6th biggest economy in the world.

Which other EV manufacturer has the ability to even come close to meeting that demand right now?

I think you don't understand what we are talking about here, and are approaching this as if the legacy automakers can just plop some money down and make something happen.

There has been over $100 billion dumped into EV development by the legacy automakers, and most of them have very little to show for as of Sept 2020.

[zamler]

For the Tesla and BEV market in general skeptics, when is the right time to enter the market? Give a date. Since Elon Musk is doing this all wrong what is the correct approach? Is Lucid wrong as well? Is VW wrong to invest billions in transitioning to EVs? Shouldn't they wait until the tech is ripe instead of wasting their time?

[GGG]

Originally Posted by zamler

For the Tesla and BEV market in general skeptics, when is the right time to enter the market? Give a date. Since Elon Musk is doing this all wrong what is the correct approach? Is Lucid wrong as well? Is VW wrong to invest billions in transitioning to EVs? Shouldn't they wait until the tech is ripe instead of wasting their time?

I don’t think that is the argument being made here. It’s the opposite, when is it too late for the big automakers to enter the market to avoid being left behind.

The Pro-Tesla crowd appears to be arguing that Tesla has an insurmountable lead which I would argue is not well founded.

[burn_this_city]

I don't see a moat around Tesla at all. To date they get their batteries from Panasonic. So what are we left with? Electric motor tech? First to market? Cult of Personality?

[zamler]

Originally Posted by burn_this_city

I don't see a moat around Tesla at all. To date they get their batteries from Panasonic.

At least get the basics correct, Tesla builds the batteries in their factory licensed from Panasonic.

So what are we left with? Electric motor tech? First to market? Cult of Personality?

What is left? Software, motors, platform, battery tech, design, efficiency, tooling, brand loyalty. Tesla spends zero on advertising, is #1 in brand loyalty. Also what is wrong with "electric motor tech" Tesla wipes the floor here, best efficiency, best power, best range. Lucid on paper will beat Tesla here we'll see.

[Fuzz]

Originally Posted by Azure

Doesn't really matter if it is 1% of the world's automobile sales.

Because the demand is still there, and the demand is growing.

You also have states in California saying they want all EV in state as of 2025. That is the 6th biggest economy in the world.

Which other EV manufacturer has the ability to even come close to meeting that demand right now?

I think you don't understand what we are talking about here, and are approaching this as if the legacy automakers can just plop some money down and make something happen.

There has been over $100 billion dumped into EV development by the legacy automakers, and most of them have very little to show for as of Sept 2020.

Isn't that 2035?

[Azure]

Yes, I meant 2035. The have other ambitious plans for 2025.

California is a terrible example to use on how an economy should be run, but it does suggest a shift towards EVs.

[Azure]

Originally Posted by burn_this_city

I don't see a moat around Tesla at all. To date they get their batteries from Panasonic. So what are we left with? Electric motor tech? First to market? Cult of Personality?

Again, there is massive demand for the EV right now. Demand far beyond what Tesla is capable of producing.

Given that demand, and given the fact that the legacy car makers has sunk in billions of dollars into EV vehicles, wouldn't you think Tesla would struggle more with being #1 given everyone seems to think that this is as easy as writing a check, building a factory and selling a vehicle?

It doesn't make much sense to say that anyone can do this, when the demand is there and still nobody else is doing it at the same scale, and yet billions have been spent TRYING to do it.

That being said, I'm not saying that nobody else will EVER be able to do it, but it will take them years to catch up to Tesla. At the end of the day Musk seems to think that the battery storage component of Tesla will be much bigger anyways, so one would imagine that they will sell the batteries to other vehicle manufacturers.

[Azure]

Originally Posted by GGG

I don’t think that is the argument being made here. It’s the opposite, when is it too late for the big automakers to enter the market to avoid being left behind.

The Pro-Tesla crowd appears to be arguing that Tesla has an insurmountable lead which I would argue is not well founded.

Nobody said insurmountable. I said 5-10 year lead.

The other issue here is that GM invested $2 billion into the hopes and dreams of Nikola, and the founder and CEO just resigned and quit after his company got investigated.

If anyone has been paying attention, Nikola was seen as a big Tesla competitor.

Then you have this.

TOKYO -- Toyota Motor and Volkswagen each sell 10 million cars, give or take, every year. Tesla delivered about 367,500 in 2019. But when it comes to electronics technology, Elon Musk's scrappy company is far ahead of the industry giants.

This is the takeaway from Nikkei Business Publications' teardown of the Model 3, the most affordable car in the U.S. automaker's all-electric lineup, starting at about $33,000.

What stands out most is Tesla's integrated central control unit, or "full self-driving computer." Also known as Hardware 3, this little piece of tech is the company's biggest weapon in the burgeoning EV market. It could end the auto industry supply chain as we know it.

One stunned engineer from a major Japanese automaker examined the computer and declared, "We cannot do it."

The module -- released last spring and found in all new Model 3, Model S and Model X vehicles -- includes two custom, 260-sq.-millimeter AI chips. Tesla developed the chips on its own, along with special software designed to complement the hardware. The computer powers the cars' self-driving capabilities as well as their advanced in-car "infotainment" system.

https://asia.nikkei.com/Business/Aut...Toyota-and-VW2

And this.

Volkswagen CEO Hebert Diess has admitted that Tesla has a significant lead when it comes to software and its use in its self-driving program, according to leaked internal communications.
Tesla pioneered over-the-air software updates in the auto industry.

At first, it was touted more as a smartphone-like feature that enables your car to have a better user experience over time.

However, Tesla’s use of over-the-air software updates has evolved, and it is also now at the center of the automaker’s effort to achieve a fully self-driving system.

Volkswagen is recognizing that, and its CEO, Hebert Diess, is apparently “worried” about it.

The German magazine Automobilwoche obtained internal communications at Volkswagen from the CEO talking about Tesla’s software, which he admits is ahead of its own and “any other automobile manufacturer.”

In the internal communications, Diess says that Tesla’s lead gives him “headaches.”

He conceded that customers appear to love Tesla’s deep software integration with features like using your phone to control the vehicle and building the user experience around a center screen inside the car.

But what is of greater concern for VW’s CEO is Tesla’s use of software in its Autopilot program:

What worries me the most is the capabilities in the assistance systems. 500,000 Teslas function as a neural network that continuously collects data and provides the customer a new driving experience every 14 days with improved properties. No other automobile manufacturer can do that today.

https://electrek.co/2020/04/27/vw-ad...leak-internal/

and this.

In a recent review of the Tesla Model 3 by German newspaper Die Welt, auto industry expert Prof. Ferdinand Dudenhöffer is quoted as saying that Tesla has a huge lead over the competition. “The technical lead is easily four to five years. Range and driving pleasure are unmatched.”

https://cleantechnica.com/2019/06/19...dustry-expert/

And on and on.

Just a strange thing to ask, wondering what Tesla is doing that anyone else can't do.

[jammies]

Making an ICE vehicle has few points of commonality with building an EV. It is disruptive technology, it's entirely possible some or even most legacy auto manufacturers will die off, be bought out or merged. Besides Tesla, there is nothing stopping other companies with relevant knowledge from starting up their own EV divisions. It is chips, software, and batteries that are needed, not powertrains, engines and yearly model updates.

Googlecar, here we come!

[standinmotion]

Originally Posted by jammies

Making an ICE vehicle has few points of commonality with building an EV. It is disruptive technology, it's entirely possible some or even most legacy auto manufacturers will die off, be bought out or merged. Besides Tesla, there is nothing stopping other companies with relevant knowledge from starting up their own EV divisions. It is chips, software, and batteries that are needed, not powertrains, engines and yearly model updates.

Googlecar, here we come!

While EV has less parts and hence less production challenges, it's still not that easy to just stand up a car manufacturing at scale. Tesla learned it the hard way, but it seems like they have figured it out.

[GGG]

Originally Posted by jammies

Making an ICE vehicle has few points of commonality with building an EV. It is disruptive technology, it's entirely possible some or even most legacy auto manufacturers will die off, be bought out or merged. Besides Tesla, there is nothing stopping other companies with relevant knowledge from starting up their own EV divisions. It is chips, software, and batteries that are needed, not powertrains, engines and yearly model updates.

Googlecar, here we come!

Being a car manufacturer at a low cost is a logistics problem not a technological one.

Batteries will make up a relatively small component of a cars cost long term. A Tesla battery is only something like 10K right now.

Toyota’s RAV4 prime is the disruptive vehicle that is coming out next year.

[GreenLantern2814]

Originally Posted by burn_this_city

I don't see a moat around Tesla at all. To date they get their batteries from Panasonic. So what are we left with? Electric motor tech? First to market? Cult of Personality?

Ding ding ding.

A car company that makes niche performance vehicles is not worth $300 billion.

Ferrari is worth $30B. And Ferrari doesn’t build any of their cars outside.

[GreenLantern2814]

Originally Posted by Azure

You said Tesla will sell out and legacy car makers will overtake them.

Even the most delusional analysts who are about as negative as one can be about Tesla don't go that far.

Also, I said they are dead in the water in the context of EV sales. Which they are. Look at the numbers.

Most major companies don’t sell a ton of EVs because *gasp* the general public is not willing to put up with their shortcomings.

People don’t want a car that takes 45 minutes to refuel.

People don’t want a car that has its operational range shrink by 50% or more when they use the heat in the winter (or the AC in the summer; that one never gets talked about enough).

Hyundai sells two fully electric vehicles at the moment - the Kona and the Ioniq. As second cars, they’re absolutely brilliant. If they’re all you have, you can’t justify spending the premium.

Furthermore, unless you have a house, it’s not clear where a renter is meant to recharge their fancy EV every night.

You can tell me I’m wrong, but I am as hyped on EVs as one can be - they are too limited for a normal person.

EVs have to do the job as well or better as the thing they’re replacing.

They don’t.

Hybrids actually do - hybridizing every passenger car on the road would cut fuel consumption in half. It would improve air quality. It would extend the life cycle of vehicles and reduce maintenance costs.

Oh, and you could still fill it up in 5 minutes.

Fuel cell cars would be awesome. And fuel cells might actually be able to be shrunk down to build power tools. Because we’re not sending men into a mine armed with Black and Decker.

People buy Teslas because they’re sexy and cool and they think Elon is Iron Man come to life. All of which is fine, but a personality cult is not about to supplant some of the largest corporations in the world that already have decades of experience functioning as viable businesses.

Tesla doesn’t. It’s not clear at all that they can.

Doesn’t mean their product isn’t great.

[Enoch Root]

Tesla does not have anywhere near the lead or ongoing advantage that some of you believe.

90% of the electric market, going forward, will be lower-cost vehicles ($40k and down). Tesla will have no advantage there against Hyundai, Kia, Toyota, etc. And profit margins at the low end are all about production efficiency, not technological advantages. Tesla will not be able to compete with those companies in that market, within 3-5 years.

In the higher end market, the Germans will destroy them for the same reasons. The big 3 are all already making electric vehicles, and their lineups will expand significantly over the next 3 years. Again, they have massive advantages over Tesla on all aspects of automobile design, with the small exception of electric-specific tech, which they will catch up on in no time.

In order to justify the stock price, Tesla needs to gain a VERY significant market share. But as all the other (much larger and more efficient) manufacturers start rolling out their lineups, that market share just won't materialize.