mmarshall

Yes...definitely. Might not have been ignition switches, but Delorean, except for the genuine stainless steel used for the car bodies (which required special cleaning techniques when the car was washed), cut costs massively, left and right. First, before the car even got into production, he chose Northern Ireland to build his assembly-plant because of the cheap labor (by European standards) and the big tax breaks that the British Government (who occupied Northern Ireland at the time) were only too happy to give him. But labor was cheap in Ireland for a reason....among other factors as well, it contributed to the Delorean's shoddy workmanship and unacceptable number of defects, many of which involved the flip-up, gull-wing doors that didn't even have conventional handles....you opened them with electronic buttons. Worse, in a rollover, the doors often wouldn't open at all.....you were essentially trapped inside (obviously not a good idea underwater or in a vehicle-fire). And, last, he used a rather mediocre V6, of joint French/Swedish development, that not only didn't put out much grunt but was rather unreliable as well.

One obviously cannot directly compare DeLorean to Tesla, although both of them ended up on shaky ground for different reasons. The biggest difference seems to be that Teslauses far more expensive components in their vehicles (except for the stainless steel that DeLorean used)...and that seems to be one big factor in Tesla's money-crunch. With DeLorean, it was other factors.



I won't swear to it, but if my memory is right, I think Lutz was required to dump his GM stock as a condition of the buyout, over a conflict-of-interest issue

LeX2K

FFS man there is a blatantly obvious reason why Tesla is not currently profitable. It took Toyota over 10 years to make a single dollar on their hybrid tech were you screaming back then about how Toyota's hybrids are a failure? Business is slightly more complicated than taking a snapshot of financials and making blanket statements about how a company is doing.

MattyG

Exactly. Talking about the current Tesla vehicle line profitably at this stage of the current electric car market is odd. Nobody seriously thinks that Toyota ever made a buck on those 1997 Toyota Prius' did they? Were they available immediately and was there a wide distribution network for them at each and every Toyota dealer? How about the Chevy Volt? Was that a bit of cheap theatrics to say, "we're green too"... and then they couldn't give them away.

Absolutely he did... and he was a former GM darling at the Pontiac division. How did he end up becoming an FBI sting suspect and got caught on camera at time when that would have been difficult to do?

Don't know if Elon Musk has any history as an executive with the Detroit automakers and would stoop that low.

In fact, his manufacturing is all USA isn't it? Lithium factory, car making plant. I thought this was the buy America century and made in America and buy in America. It's the other conventional car makers who are busy outsourcing big time and rely on China for their profits.

Toys4RJill

Love how nobody seems to check the facts

Toyota hybrids were profitable in the fourth year of production. Toyota is on record for stating this.

LeX2K

There were a few articles at the beginning of the year talking about this, something along the lines of the Model 3 will be about 95% American made parts easily making it the most 'American' car out there.

As for Tesla's long term success, that is certainly not assured. But they have two advantages straight away, they are way ahead in software and no one else has anything like the Gigafactory. Knowing Elon he is going to streamline and improve mass production techniques, combine that with economies of scale not seen before I don't see any other auto maker matching Tesla's battery production costs. Not for a while.

I don't want to come across as an Elon worshiper I'm not in fact I think he's a bit of a *****, and highly disagree with him on his insistence on taxing carbon. But he is not the run of the mill CEO the man is a genius he's very much hands on and is responsible for many of the designs that go into his cars and his rockets. A guy like Lutz is a competent business man but he's nothing like Musk. Let's put it this way Bob Lutz could not replace Elon, the reverse easily.
Got a source? Toyota initially said it would take 10 years. And if it did indeed take 4 years doesn't change my point at all. Tesla is constructing the worlds largest building and largest lithium-ion cell factory by far it will make more batteries than all other factories combined. The start up costs for Tesla are quite ridiculous and very ambitious, some would say risky or even stupid. Time will tell.

MattyG

Any pure electric cars available to consumers 1997-2001 with a 200-300 mile range on a single charge? Most folks might have known about golf carts that could go about 5 km/hr on the golf course. And yes the posts indicate that we drifted over to hybrids, so that's why you are saying Toyota made a profit eventually.

Tesla is not a hybrid company... it is a pure electric car company. Toyota too, took a huge loss on those 1st generation Prius'. $20,000/car. And they had the luxury of other more profitable lines to prop up the Prius.

https://www.ft.com/content/146ad23c-...ab49a?mhq5j=e2

coolsaber

Lutz, tesla are all in the same cess pool as every other automaker. You see success, you have to take a dump on it, to make sure wall street and common folk can sleep at night. I agree what does Lutz have when hes was in bailout mode. What does Tesla have when they delivered late on the X with technical issues and a company working with $4 billion in subsidies from the gov. Again its just the business. To the point of the faulty switches, I think its reality vs idealism. Musk is a visionary, hes found a niche market and wholly cornering it, but he cannot forgo reality. Labor disputes and working conditions are a bound so hes not a man on a pedestal, nor is his company; its the reality of the game.

Now back to the distribution setup, the direct sales model is a startup (hes not a startup anymore but hes not an established brand player yet) souvenir. New exciting product frontier coupled with a new system of sales. Its does wonders for market and brand adoption and establishment.

4TehNguyen

iTrader: (1)

this is why you encourage competition. As long as this protectionist law is in place, no one will ever know any alternative to this dealer model. How is the UAW going to force union workers in certain states like Texas?

once place specializing in holding the inventory is better than 100 different places doing it on their own. Basic economics and logistics 101

Toys4RJill

Keep dreaming. There are people who go to school and earn degrees in this sort of stuff.

bitkahuna

iTrader: (20)

LexsCTJill, must be why amazon, which MAKES THEIR OWN STUFF (besides selling other's stuff), doesn't use third party warehouses, resellers, dealers, etc. they sell, warehouse, and ship direct. keep dreaming that things won't change when they already have and will continue doing so.

the whole debate here really is short term anyway, as most people won't be buying cars at all in 20 years.

Toys4RJill

I don't see what Amazon is doing that is all that great. They have warehouses in many different locations. Two in the Greater Toronto Area, they ship straight to the doors. Big deal. Toyota has many central depots that store cars until they are allocated to specific dealers. The dealers locations are needed to move cars. Trying to ship 17.5 million cars direct to the consumer and avoiding dealers does not make anything more efficient. Its makes less efficient.

Funny enough, amazon barely turned a profit in 2016. Walmart grossed 131 billion in profit in 2016, Ebay 650 million, Google 3.62 billion. And Amazon made $63 million in profit per quarter.

coolsaber

thats why dealership groups in the country all have moved to central warehouses for all their locations?

coolsaber

so what company is doing this?

4TehNguyen

iTrader: (1)

dealerships have zero incentive to increase their efficiency when granted a govt monopoly. If dealers are so efficient then surely they dont need this law protecting them. Give them a competitor and suddenly they will be really keen on where they can reduce costs.

Och

iTrader: (3)

Give me a freaking break, there is a ton of competition between dealers. Plus besides franchised dealerships there are lot of small dealerships that sell/lease just about any brand, and competition between is fierce.