The Tesla discussion
Tesla Model S scores five stars in NHTSA crash tests
Tesla Model S scores five stars in NHTSA crash tests
Tesla Motors is having a good week. Right after the California-based maker of the Model S electric vehicle reported better than expected earnings and vehicle-production numbers, the National Highway Traffic Safety Administration (NHTSA) let it be known that the Model S received five-star crash-test ratings, according to Automotive News. That means the sedan received the best possible marks for frontal and side-impact crashes, as well as for rollover. The bad news: some Teslas were destroyed in the process. It's part of a trend. Earlier versions of the Model S also received top crash test scores last year. Before that, the all-electric Roadster also passed crash tests back in 2008.
A refresher on the other good news of the week: Tesla announced Wednesday that it increased sales to 5,150 vehicles for the second quarter, and said it may double production next year. After reporting its first profit in the first quarter, Tesla's second-quarter gross margin was 22 percent and may reach 25 percent by year-end. Tesla's second-quarter revenue was $405.1 million and the company narrowed its second-quarter loss to $30.2 million from a $105.5 million loss a year earlier.
http://green.autoblog.com/2013/08/09...h-tests-video/
Trademark trolls cause headache for Tesla in China
Trademark trolls cause headache for Tesla in China
It happened to Apple when it first tried to enter the Chinese market, and now it's happening to electric vehicle maker Tesla: the automaker's name has already been registered in China by trademark trolls, reports Want China Times. Trademark trolls are people or organizations that register company names in anticipation of selling them when said company decides to enter the market. After two years of litigation, Apple ended up paying Chinese computer monitor maker Proview $60 million to buy the "IPAD" trademark. Tesla has been in litigation since 2009 for the use of its name, and so far, it doesn't have much to show for it.
"Tesla" was registered in 2009 by Zhan Baosheng, and Tesla CEO Elon Musk said the automaker already made an offer to buy it for two million yuan ($326,000), but Baosheng wanted the equivalent of about $32.6 million for the trademark. Tesla's fight to use its name has been somewhat fruitful – it bought the rights to "TESLA MOTORS" on May 6 – but the name can't be used for finished automotive products for various legal reasons.
The Silicon Valley-based EV maker might have some leverage in its case to acquire ownership of the "Tesla" trademark, because Baosheng hasn't used the name since he registered it in 2009, and he hasn't yet proved that he develops products relating to EVs.
http://www.autoblog.com/2013/08/09/t...s-tesla-china/
Tesla to introduce all-wheel-drive Model S in 2014?
Tesla to introduce all-wheel-drive Model S in 2014?
The Model X sport utility vehicle may not be the first all-wheel-drive Tesla to hit the market. According to The Verge, Tesla is working on an AWD version of its Model S sedan. Currently, the Model S is only available with rear-wheel drive, but sources in the know at Tesla reportedly have said that an AWD version could be released as early as 2014, which is the same year the SUV is expected to be launch.
There was no hint in yesterday's conference call or shareholder letter that an AWD Model S is in the mix. Furthermore, the company's attention currently is focused in other places, such as Europe, Japan and China. But, as The Verge points out, CEO Elon Musk made comments in the 2013 annual shareholder meeting on June 4 about an AWD chassis that would be released in 2014 or 2015 – without the context of the Model X. We have to wonder: were the SUV's drivetrain and chassis also developed with other vehicles in mind?
Our own Domenick Yoney from AutoblogGreen adds another peculiar twist to the Tesla story: "When I spoke to Dorian West, Director of Powertrain Hardware Engineering, at Refuel, I was given the strong impression that I shouldn't expect anything [on the AWD front from Tesla] until after the Model X comes out."
http://www.autoblog.com/2013/08/10/t...el-drive-2014/
Elon Musk gets $4.3m for Model X efforts, Tesla working on prototypes
Elon Musk gets $4.3m for Model X efforts, Tesla working on prototypes
Tesla CEO Elon Musk doesn't get paid much directly from Tesla Motors, just a $1 annual salary, but he's still raking in the dough from his work with the electric car company. Last quarter, he earned $4.3 million in stock-based pay because work on the Model X was reported as "considered probable of being met" in the company's latest SEC filing.
Tesla's next EV is due late next year and Musk said during a conference call about the filing last week that the Model X will become a bigger priority for his company at the end of this year. Currently, Tesla is focused on getting the Model S ready for sale in more markets but Tesla confirmed to Bloomberg it is "currently working on prototype [Model X] vehicles."
Bloomberg says Musk is currently the 162nd-richest person in the world, with a net value of $7.7 billion. This number climbed more than 220 percent this year thanks in part to the increase in TSLA stock value, which is currently at around $148.
Tesla reported that it had a $30.5 million net loss last quarter, but there were $16 million worth of adjustments (including the $4.3 million for Musk) that Tesla says help get the company to its actual number: a $26.3 million profit. From its adjusted profit figure, Bloomberg says, the company also excluded $16 million for its early DOE loan repayment and "$19.3 million related to the start of its leasing program." Math like this is apparently common in Silicon Valley, where Tesla is based, but unusual in the automotive industry as a whole, Bloomberg says.
http://green.autoblog.com/2013/08/12...on-prototypes/
Elon Musk's Hyperloop Alpha takes travel to the next level, with tubes
Elon Musk's Hyperloop Alpha takes travel to the next level, with tubes
Gallery:
http://green.autoblog.com/photos/hyp...#photo-468715/
Earlier today, Tesla Motors CEO Elon Musk Tweeted that he "Pulled all nighter working on Hyperloop (as did others). Hopefully not too many mistakes." We finally get a look at the first official details on this fantastical-sounding travel option, and it's a duesy.
Musk calls the Hyperloop a "fifth mode" of transportation (after planes, trains, cars and boats) that is, in the right application, better than all the others. That specific case is between major cities that are less than 900 miles apart. The system relies on tubes built between the cities that would be traversed by pods that have an "electric compressor fan [mounted] on the nose of the pod that actively transfers high pressure air from the front to the rear of the vessel. This is like having a pump in the head of the syringe actively relieving pressure," Musk wrote, and will help the Hyperloop overcome the Kantrowitz Limit (the top-speed law for a given tube-to-pod area ratio).
To propel the pods, we just have to look at the Model S. Musk envisions an external linear electric motor, "which is simply a round induction motor (like the one in the Tesla Model S) rolled flat. This
would accelerate the pod to high subsonic velocity and provide a periodic reboost roughly every 70 miles." The system would also be green as all get out. Thanks to solar panels on the top of the tube, "the Hyperloop can generate far in excess of the energy needed to operate. This takes into account storing enough energy in battery packs to operate at night and for periods of extended cloudy weather. The energy could also be stored in the form of compressed air that then runs an electric fan in reverse to generate energy, as demonstrated by LightSail," Musk wrote.
Musk first mentioned the Hyperloop a year ago, and there has been a lot of speculation as to what, exactly, the man who is forcing the auto industry to pay attention to electric vehicles and sending rockets into space can come up with. In a Tesla conference call last week, Musk admitted that the interest has been kind of intense and that, "I think I kind of shot myself in the foot by ever mentioning Hyperloop."
Musk's plan is to publish his "quite detailed design," let outsiders criticize and improve it, and then let it breathe as an "open source design that maybe you can keep improving and I don't have any plan to execute, because I must remain focused on SpaceX and Tesla." Today's proposal is called Hyperloop Alpha, after all. One of the people who may be able to take the idea further is John Gardi who, before the reveal, Musk said had "the best guess so far."
http://green.autoblog.com/2013/08/12...alpha-concept/
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Tesla was so impressed with this car
They agreed to lend a car for the day for us to test drive at will. A loaded Performance Model S was brought to us and I can't say enough good things about this car. It truly is one of a kind. The infotainment system is just awesome, better than anything in any other car by far. It feels high quality and the speed is pretty amazing with 4 people in it let alone by yourself.
I hope to write a full review later. This is one amazing, but expensive car!
They agreed to lend a car for the day for us to test drive at will. A loaded Performance Model S was brought to us and I can't say enough good things about this car. It truly is one of a kind. The infotainment system is just awesome, better than anything in any other car by far. It feels high quality and the speed is pretty amazing with 4 people in it let alone by yourself.
I hope to write a full review later. This is one amazing, but expensive car!
Tesla to be named Tuosule in China
Tesla to be named Tuosule in China
Tesla is not Tesla anymore, at least in China. The Palo Alto-based manufacturer has apparently given up on the fight over its name, for the time being. The name "Tesla" was trademarked by one Zhan Baosheng in 2006, while the American EV company didn't attempt to claim it until 2009 (we reported on this development a few weeks back).
Of course, trademark squatters aren't really a new thing, particularly in China. Earlier this month, we told you about a car company that is attempting to patent a Volkswagen design before the German manufacturer could even bring it to market.
Since the California electric car manufacturer can't go by Tesla in the Asian automotive market, it's reportedly elected to be known as "Tuosule." First reported by InAutoNews, the Tuosule name apparently comes from a transliteration of "Tesla" to a dialect of Chinese spoken in Hong Kong. This was the second time Tesla has gone to court over its name. The first time was to reclaim the name "Tesla Motors," which it achieved by purchasing the name from its owner, Qiao Weiwei, but that name apparently isn't licensed for automotive use.
According to the report, Tesla offered Baosheng $326,000 for the name, but he had a different number in mind – $32 million. Tesla hasn't given up the fight, though, arguing that because Baosheng has no plans to use it, he should be forced to give up the copyright.
http://www.autoblog.com/2013/08/20/t...sule-in-china/
Tesla says Model S crash test score is best NHTSA has ever recorded
Tesla says Model S crash test score is best NHTSA has ever recorded
Tesla Model S Achieves Best Safety Rating of Any Car Ever Tested
Sets New NHTSA Vehicle Safety Score Record
Monday, August 19, 2013, Palo Alto, CA - Independent testing by the National Highway Traffic Safety Administration (NHTSA) has awarded the Tesla Model S a 5-star safety rating, not just overall, but in every subcategory without exception. Approximately one percent of all cars tested by the federal government achieve 5 stars across the board. NHTSA does not publish a star rating above 5, however safety levels better than 5 stars are captured in the overall Vehicle Safety Score (VSS) provided to manufacturers, where the Model S achieved a new combined record of 5.4 stars.
Of all vehicles tested, including every major make and model approved for sale in the United States, the Model S set a new record for the lowest likelihood of injury to occupants. While the Model S is a sedan, it also exceeded the safety score of all SUVs and minivans. This score takes into account the probability of injury from front, side, rear and rollover accidents.
The Model S has the advantage in the front of not having a large gasoline engine block, thus creating a much longer crumple zone to absorb a high speed impact. This is fundamentally a force over distance problem – the longer the crumple zone, the more time there is to slow down occupants at g loads that do not cause injuries. Just like jumping into a pool of water from a tall height, it is better to have the pool be deep and not contain rocks. The Model S motor is only about a foot in diameter and is mounted close to the rear axle, and the front section that would normally contain a gasoline engine is used for a second trunk.
For the side pole intrusion test, considered one of the most difficult to pass, the Model S was the only car in the "good" category among the other top one percent of vehicles tested. Compared to the Volvo S60, which is also 5-star rated in all categories, the Model S preserved 63.5 percent of driver residual space vs. 7.8 percent for the Volvo. Tesla achieved this outcome by nesting multiple deep aluminum extrusions in the side rail of the car that absorb the impact energy (a similar approach was used by the Apollo Lunar Lander) and transfer load to the rest of the vehicle. This causes the pole to be either sheared off or to stop the car before the pole hits an occupant.
The rear crash testing was particularly important, given the optional third row children's seat. For this, Tesla factory installs a double bumper if the third row seat is ordered. This was needed in order to protect against a highway speed impact in the rear with no permanently disabling injury to the third row occupants. The third row is already the safest location in the car for frontal or side injuries.
The Model S was also substantially better in rollover risk, with the other top vehicles being approximately 50 percent worse. During testing at an independent facility, the Model S refused to turn over via the normal methods and special means were needed to induce the car to roll. The reason for such a good outcome is that the battery pack is mounted below the floor pan, providing a very low center of gravity, which simultaneously ensures exceptional handling and safety.
Of note, during validation of Model S roof crush protection at an independent commercial facility, the testing machine failed at just above 4 g's. While the exact number is uncertain due to Model S breaking the testing machine, what this means is that at least four additional fully loaded Model S vehicles could be placed on top of an owner's car without the roof caving in. This is achieved primarily through a center (B) pillar reinforcement attached via aerospace grade bolts.
The above results do not tell the full story. It is possible to game the regulatory testing score to some degree by strengthening a car at the exact locations used by the regulatory testing machines. After verifying through internal testing that the Model S would achieve a NHTSA 5-star rating, Tesla then analyzed the Model S to determine the weakest points in the car and retested at those locations until the car achieved 5 stars no matter how the test equipment was configured.
The Model S lithium-ion battery did not catch fire at any time before, during or after the NHTSA testing. It is worth mentioning that no production Tesla lithium-ion battery has ever caught fire in the Model S or Roadster, despite several high speed impacts. While this is statistically unlikely to remain the case long term, Tesla is unaware of any Model S or Roadster occupant fatalities in any car ever.
Sets New NHTSA Vehicle Safety Score Record
Monday, August 19, 2013, Palo Alto, CA - Independent testing by the National Highway Traffic Safety Administration (NHTSA) has awarded the Tesla Model S a 5-star safety rating, not just overall, but in every subcategory without exception. Approximately one percent of all cars tested by the federal government achieve 5 stars across the board. NHTSA does not publish a star rating above 5, however safety levels better than 5 stars are captured in the overall Vehicle Safety Score (VSS) provided to manufacturers, where the Model S achieved a new combined record of 5.4 stars.
Of all vehicles tested, including every major make and model approved for sale in the United States, the Model S set a new record for the lowest likelihood of injury to occupants. While the Model S is a sedan, it also exceeded the safety score of all SUVs and minivans. This score takes into account the probability of injury from front, side, rear and rollover accidents.
The Model S has the advantage in the front of not having a large gasoline engine block, thus creating a much longer crumple zone to absorb a high speed impact. This is fundamentally a force over distance problem – the longer the crumple zone, the more time there is to slow down occupants at g loads that do not cause injuries. Just like jumping into a pool of water from a tall height, it is better to have the pool be deep and not contain rocks. The Model S motor is only about a foot in diameter and is mounted close to the rear axle, and the front section that would normally contain a gasoline engine is used for a second trunk.
For the side pole intrusion test, considered one of the most difficult to pass, the Model S was the only car in the "good" category among the other top one percent of vehicles tested. Compared to the Volvo S60, which is also 5-star rated in all categories, the Model S preserved 63.5 percent of driver residual space vs. 7.8 percent for the Volvo. Tesla achieved this outcome by nesting multiple deep aluminum extrusions in the side rail of the car that absorb the impact energy (a similar approach was used by the Apollo Lunar Lander) and transfer load to the rest of the vehicle. This causes the pole to be either sheared off or to stop the car before the pole hits an occupant.
The rear crash testing was particularly important, given the optional third row children's seat. For this, Tesla factory installs a double bumper if the third row seat is ordered. This was needed in order to protect against a highway speed impact in the rear with no permanently disabling injury to the third row occupants. The third row is already the safest location in the car for frontal or side injuries.
The Model S was also substantially better in rollover risk, with the other top vehicles being approximately 50 percent worse. During testing at an independent facility, the Model S refused to turn over via the normal methods and special means were needed to induce the car to roll. The reason for such a good outcome is that the battery pack is mounted below the floor pan, providing a very low center of gravity, which simultaneously ensures exceptional handling and safety.
Of note, during validation of Model S roof crush protection at an independent commercial facility, the testing machine failed at just above 4 g's. While the exact number is uncertain due to Model S breaking the testing machine, what this means is that at least four additional fully loaded Model S vehicles could be placed on top of an owner's car without the roof caving in. This is achieved primarily through a center (B) pillar reinforcement attached via aerospace grade bolts.
The above results do not tell the full story. It is possible to game the regulatory testing score to some degree by strengthening a car at the exact locations used by the regulatory testing machines. After verifying through internal testing that the Model S would achieve a NHTSA 5-star rating, Tesla then analyzed the Model S to determine the weakest points in the car and retested at those locations until the car achieved 5 stars no matter how the test equipment was configured.
The Model S lithium-ion battery did not catch fire at any time before, during or after the NHTSA testing. It is worth mentioning that no production Tesla lithium-ion battery has ever caught fire in the Model S or Roadster, despite several high speed impacts. While this is statistically unlikely to remain the case long term, Tesla is unaware of any Model S or Roadster occupant fatalities in any car ever.
Tesla considers adding overseas production
Tesla considers adding overseas production
Tesla is currently using the old General Motors/Toyota NUMMI facility in California for Model S production, and despite the brand's rapid growth, it's still not coming close to approaching the full 500,000-unit production capacity of that former facility. Still, the EV manufacturer is shopping around for both European and Asian production facilities in anticipation of bountiful increases in sales.
While we'd caution that this counting of chickens isn't the best idea, Tesla has just cause for planning ahead. According to Automotive News, Model S production should crest at 21,000 units by the end of 2013, and 40,000 units by the end of 2014. It'll soon be joined at the Fremont, California factory by the Model X SUV, along with the rumored Model E, which will occupy a volume position for the brand below the Model S. And while the old NUMMI facility might have production capacity for far more vehicles than Tesla can build, churning three separate vehicles out of the same factory might not be as economically viable as just picking up a new factory altogether.
While Musk won't come out and say it, if his logistical predictions are any indication, it's a safe bet that he sees Model E becoming the big-selling model for Tesla. Speaking to Bloomberg, he said, "We'll try to locate those close to where people are, close to where the customers are, to minimize the logistics costs of getting the car to them."
It remains unclear if, or more likely, when Tesla will make any acquisitions in Europe or Asia. It's already operating a small facility in the Netherlands that's completing Model S models using parts shipped over from California, but a larger-scale facility for the Model E probably won't happen for another few years, which is in line with Musk's prediction that the new vehicle would hit the market "within five years." Stay tuned.
http://www.autoblog.com/2013/08/23/t...tion-facility/
Tesla Model S vulnerable to hackers?
Tesla Model S vulnerable to hackers?
Next time you walk by a parked Tesla and its sunroof is opening and closing with nobody sitting inside or around it, you could be witnessing a hacker moment. For all of its strengths as a car, the Model S reportedly has a weak spot: the security of its API (application programming interface) authentication, according to an article in the O'Reilly Community by George Reese, executive director of cloud management at Dell. Tesla develops and uses its own API authentication protocols, which have made access to certain Model S functions too easy for hackers, Reese says - himself a Model S owner.
At question is the Tesla REST API, which is accessed via a web-based portal, usually by Model S owners with their iPhone or Android-based smartphone, to perform a variety of menial tasks and check the status of the car. The Tesla-registered e-mail and password of the car owner is used to access the API through a web portal, which creates a "token" that lasts for three months. During that period, owners access the Tesla REST API via the token without the use of their log-in information. Unfortunately, the tokens and their respective cars are stored on website databases that are all too easy to hack, Reese explains, and if a hacker gains access, "it has free access to all of that site's cars for up to three months with no ability for the owners to do anything about it." On top of that, there is no way to revoke access of a compromised application.
Reese says that "there's nothing in the API that (can? should?) result in an accident if someone malicious were to gain access." The API can check the car's battery charge, operate climate control, operate the sunroof, identify car location, honk the horn, open the charge port, and perform other similar operations. But, he cautions, "Perhaps the scariest bit is that the API could be used to track your every move."
At least it's not a major hack-attack like that experienced by a Forbes reporter in a Prius. Now that's scary!
http://www.autoblog.com/2013/08/25/t...rable-hackers/
Lexus Test Driver
Joined: Jun 2012
Posts: 981
Likes: 11
From: CA - California
Numbers Don't Lie: Tesla Is Beginning To Put The Hurt On The Competition
http://www.forbes.com/sites/markrogo...e-competition/
Upstart automaker Tesla Motors TSLA +1.48% won’t sell as many cars this year as Chevrolet sells in 3 days, but its early success with the all-electric Model S sedan is already keeping the competition up at night. An examination of sales data from across the U.S. and in California for the first half of 2013 paints a picture of just why that is. While Tesla delivered right around 10,000 cars through two quarters, those sales appear to be coming at the expense of BMW, Mercedes, Lexus and Porsche. And Tesla’s sales are remarkably — though perhaps not surprisingly — concentrated in California thus far, with nearly half winding up in the Golden State. As the automaker continues to open new sales and service locations across the country while simultaneously growing its network of high-speed Supercharger stations, things are likely to get a bit worse for the imports.
The numbers at first glance don’t seem quite so bad as BMW and Mercedes are both registering double-digit sales increases for 2013. But a deeper dive (thanks to GoodCarBadCar and the California New Car Dealers Association) paints a different picture. As the accompanying chart shows, five competitive vehicles are all down significantly against their 2012 sales numbers. Given that overall U.S. auto sales are up by 7.7%, and 12.5% in California, the performance of the Mercedes E-Class, the BMW 5-Series, and the Lexus GS are especially disappointing.
But it’s in the BMW 7-Series and Porsche Panamera that the presence of the Model S is probably being felt most acutely. Both are performance luxury sedans capable of seating families comfortably and both are fairly commonplace in the wealthy neighborhoods of the San Francisco Bay Area. Those neighborhoods are now rife with Teslas. More than 4700 Model S registrations have been recorded in California and at least some are coming at the expense of the competition. Nationally, the Tesla has matched the total sales of the Lexus LS, Audi A8 and Panamera combined.
It’s certainly true that for the moment, BMW and Mercedes are still going to sell plenty of cars. Together, their midsize sedans will have a 5:1 edge over the Tesla in 2013, and much greater if you also include the large sedans in the mix. But by the end of next year, Tesla hopes to double production and deliver as many cars outside the U.S. as it’s selling here. The competition is clearly heating up.
Comparison data
In the meantime, Tesla will attempt to expand from its west coast stronghold and if other green cars are any indication, the company should continue to grow from here. Less than 30% of Toyota Prius sales nationally are in California, even though the Prius is the state’s most popular vehicle. While precise data isn’t available on the Nissan Leaf, a total of 5,000 non-Tesla electrics were sold in California in the first half and 9,839 Leafs were bought across the country. Given the half dozen miscellaneous EVs you can buy or lease here (the Ford Focus, Honda Fit and Toyota Rav4 all come as EVs), we can reasonably conclude that even the Leaf is seeing a smaller portion of its sales in California than the Tesla.
It’s fair to note that the Tesla is expensive and there’s plenty of money to buy them in Silicon Valley, Beverly Hills and La Jolla. But that said, other luxury vehicle sales are not especially overweighted toward California (it’s about 23% for the E-Class for example). So while it remains likely that technology early adopters will continue to buy Teslas and those folks continue to be disproportionately out here, sales will grow faster elsewhere, likely very soon. Given how quickly Model S sedans are popping up on the streets near me, that’s saying something.
A tale of two German brands
Thus far, Audi has apparently remained immune to the Tesla virus as both its larger sedans have scored significant sales increases this year. But if you look at the absolute numbers, you’ll see that both are small sellers against the competition. Audi’s numbers speak more to its marketing success against Mercedes, BMW and Lexus than against Tesla, it appears. And the other good news for everyone is that even with Tesla’s plans to double production by the end of next year, the U.S. figures you see are about all the company is likely to be able to deliver for quite some time. The company plans on selling 21,000 vehicles this year, with most going to the U.S. By the time the production rate hits 40,000 late in 2014, it will be divided between three regions (Europe and Asia, as well as North America) and two vehicles (as the Model X SUV gets introduced at the end of next year). That should mean most competitors don’t feel much more pain here than they already are.
The big loser going forward appears to be Porsche, whose Panamera has received mixed results from critics and is mostly outperformed by the less expensive Model S. To make matters worse, Porsche profits come heavily from the Cayenne. When Tesla delivers Model X, Cayenne might well be a significant casualty. The upside for Porsche is it will be entering the midsize SUV segment with its Macan (loosely based on the Audi Q5) long before the Model X arrives. And it will be probably 4 years before Tesla has a smaller SUV that competes in that segment, as that vehicle isn’t due till after the company delivers its third-generation sedan, expected no sooner than late in 2016.
How much room to grow?
For Tesla, a big question has been how much the company can grow selling expensive luxury vehicles that start above $70,000 (before tax incentives). While the answer is still unclear, the concentration of sales in California on just one model of vehicle certainly implies that there is upside, perhaps even beyond the company’s goal of 40,000 vehicles. As Tesla looks forward to 2015, when its cheaper vehicle is still just a prototype, it could find itself testing the limits of that demand and eclipsing the 50,000 mark, especially if sales in China, Japan and Europe prove promising. This is good news for shareholders, but also for proponents of electric vehicles generally. And with BMW bringing its own EV to market early next year, it will not only grow the EV market, it might even recoup some of the sales it’s losing to Tesla.
http://www.forbes.com/sites/markrogo...e-competition/
Upstart automaker Tesla Motors TSLA +1.48% won’t sell as many cars this year as Chevrolet sells in 3 days, but its early success with the all-electric Model S sedan is already keeping the competition up at night. An examination of sales data from across the U.S. and in California for the first half of 2013 paints a picture of just why that is. While Tesla delivered right around 10,000 cars through two quarters, those sales appear to be coming at the expense of BMW, Mercedes, Lexus and Porsche. And Tesla’s sales are remarkably — though perhaps not surprisingly — concentrated in California thus far, with nearly half winding up in the Golden State. As the automaker continues to open new sales and service locations across the country while simultaneously growing its network of high-speed Supercharger stations, things are likely to get a bit worse for the imports.
The numbers at first glance don’t seem quite so bad as BMW and Mercedes are both registering double-digit sales increases for 2013. But a deeper dive (thanks to GoodCarBadCar and the California New Car Dealers Association) paints a different picture. As the accompanying chart shows, five competitive vehicles are all down significantly against their 2012 sales numbers. Given that overall U.S. auto sales are up by 7.7%, and 12.5% in California, the performance of the Mercedes E-Class, the BMW 5-Series, and the Lexus GS are especially disappointing.
But it’s in the BMW 7-Series and Porsche Panamera that the presence of the Model S is probably being felt most acutely. Both are performance luxury sedans capable of seating families comfortably and both are fairly commonplace in the wealthy neighborhoods of the San Francisco Bay Area. Those neighborhoods are now rife with Teslas. More than 4700 Model S registrations have been recorded in California and at least some are coming at the expense of the competition. Nationally, the Tesla has matched the total sales of the Lexus LS, Audi A8 and Panamera combined.
It’s certainly true that for the moment, BMW and Mercedes are still going to sell plenty of cars. Together, their midsize sedans will have a 5:1 edge over the Tesla in 2013, and much greater if you also include the large sedans in the mix. But by the end of next year, Tesla hopes to double production and deliver as many cars outside the U.S. as it’s selling here. The competition is clearly heating up.
Comparison data
In the meantime, Tesla will attempt to expand from its west coast stronghold and if other green cars are any indication, the company should continue to grow from here. Less than 30% of Toyota Prius sales nationally are in California, even though the Prius is the state’s most popular vehicle. While precise data isn’t available on the Nissan Leaf, a total of 5,000 non-Tesla electrics were sold in California in the first half and 9,839 Leafs were bought across the country. Given the half dozen miscellaneous EVs you can buy or lease here (the Ford Focus, Honda Fit and Toyota Rav4 all come as EVs), we can reasonably conclude that even the Leaf is seeing a smaller portion of its sales in California than the Tesla.
It’s fair to note that the Tesla is expensive and there’s plenty of money to buy them in Silicon Valley, Beverly Hills and La Jolla. But that said, other luxury vehicle sales are not especially overweighted toward California (it’s about 23% for the E-Class for example). So while it remains likely that technology early adopters will continue to buy Teslas and those folks continue to be disproportionately out here, sales will grow faster elsewhere, likely very soon. Given how quickly Model S sedans are popping up on the streets near me, that’s saying something.
A tale of two German brands
Thus far, Audi has apparently remained immune to the Tesla virus as both its larger sedans have scored significant sales increases this year. But if you look at the absolute numbers, you’ll see that both are small sellers against the competition. Audi’s numbers speak more to its marketing success against Mercedes, BMW and Lexus than against Tesla, it appears. And the other good news for everyone is that even with Tesla’s plans to double production by the end of next year, the U.S. figures you see are about all the company is likely to be able to deliver for quite some time. The company plans on selling 21,000 vehicles this year, with most going to the U.S. By the time the production rate hits 40,000 late in 2014, it will be divided between three regions (Europe and Asia, as well as North America) and two vehicles (as the Model X SUV gets introduced at the end of next year). That should mean most competitors don’t feel much more pain here than they already are.
The big loser going forward appears to be Porsche, whose Panamera has received mixed results from critics and is mostly outperformed by the less expensive Model S. To make matters worse, Porsche profits come heavily from the Cayenne. When Tesla delivers Model X, Cayenne might well be a significant casualty. The upside for Porsche is it will be entering the midsize SUV segment with its Macan (loosely based on the Audi Q5) long before the Model X arrives. And it will be probably 4 years before Tesla has a smaller SUV that competes in that segment, as that vehicle isn’t due till after the company delivers its third-generation sedan, expected no sooner than late in 2016.
How much room to grow?
For Tesla, a big question has been how much the company can grow selling expensive luxury vehicles that start above $70,000 (before tax incentives). While the answer is still unclear, the concentration of sales in California on just one model of vehicle certainly implies that there is upside, perhaps even beyond the company’s goal of 40,000 vehicles. As Tesla looks forward to 2015, when its cheaper vehicle is still just a prototype, it could find itself testing the limits of that demand and eclipsing the 50,000 mark, especially if sales in China, Japan and Europe prove promising. This is good news for shareholders, but also for proponents of electric vehicles generally. And with BMW bringing its own EV to market early next year, it will not only grow the EV market, it might even recoup some of the sales it’s losing to Tesla.