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Essentially, the summary of the article, is that no one is going to beat Tesla in the range game, since the design philosophy is about keeping change as invisible as possible to the core demographic of traditional automakers. Longer reliability, longer durability, and of course lower range until the right time comes about.
Proper product planning, or just a bunch of spin for a cold product from the VW group?
PR spin. ..... Tesla makes no money, so it makes no difference what the range really is. It’s like Lexus making a V12 but selling them at a loss like Tesla does, makes no difference because profits will be what makes car companies go forward.
Last edited by Toys4RJill; Sep 8, 2019 at 08:23 PM.
PR spin. ..... Tesla makes no money, so it makes no difference what the range really is. It’s like Lexus making a V12 but selling them at a loss like Tesla does, makes no difference because profits will be what makes car companies go forward.
Tremendous pressure will be put on Tesla as the competition turns a profit in the EV area. Better economies of scale as well. The range of a Tesla is not as good when opt for the performance pack. And the new suv coming has less range than the model X.
Last edited by Toys4RJill; Sep 8, 2019 at 08:54 PM.
i see little likelihood the 'competition' will turn a profit in the EV area! they don't make batteries, are just starting out, and right now they're just trying to sow FUD to slow tesla down, no matter what it costs. while companies like toyota and honda are raking in the dough still, european car companies are in SERIOUS trouble because the european market's in bad shape (plus recession, brexit, debt, death of diesels, and other fears driving it). vw, fiat, even mercedes and bmw, big trouble.
and announcements i saw today about new tesla battery tech bringing 400mi.+ range, 1million mi. life, etc. at some point put even more pressure on them.
i see teslas every day in my small town in florida... amazing since we don't even have a store here. the super charger yesterday...
Does ANY EV make a profit, or are manufacturers doing it because they are afraid of being locked out of the Chinese market and other markets (California?) because of legislation?
^^^^^ Jill has a point....it is not simply beating a dead horse. Tesla cannot go on limitlessly spending investor's money forever to keep out of the red. Sooner or later, they are going to have to make some changes if they are going to develop a balanced budget (or surplus). This is not an out-and-out prediction on my part, but IMO, the most likely change (and It probably won't happen until they replace Musk) will be to independent dealer-franchises to relieve the company of the crushing burden of paying all the dealer-bills.
^^^^^ Jill has a point....it is not simply beating a dead horse. Tesla cannot go on limitlessly spending investor's money forever to keep out of the red. Sooner or later, they are going to have to make some changes if they are going to develop a balanced budget (or surplus). This is not an out-and-out prediction on my part, but IMO, the most likely change (and It probably won't happen until they replace Musk) will be to independent dealer-franchises to relieve the company of the crushing burden of paying all the dealer-bills.
You're saying a dealer network will remove a "crushing" financial burden on Tesla, meaning they are losing huge money. If so how do you expect independent dealers to make money when it is putting Tesla severely in the red? FYI those are your characterizations not mine.
You're saying a dealer network will remove a "crushing" financial burden on Tesla, meaning they are losing huge money. If so how do you expect independent dealers to make money when it is putting Tesla severely in the red?
Perhaps the term "crushing" burden, may not have actually been the best metaphor. But the point is that the way the company does business today (and has since its inception) puts a financial burden on the company itself that would not be there (or be there to a lesser extent) than would be if private franchises are (or were) paying off some those dealer-related costs themselves. You guys often criticize me for so-called "not understanding" business, but, come on, that's just simple math.....It makes Econ 101 look complex.
Yes, the company has avoided bankruptcy (I'll concede that)...but it has done so because its hype, publicity, superb PR and spin entice investors to continually send in their $$$$$, and allow the company to continue its practices without running out of usable cash. (e.g.....Look at the amount of talk and attention the company gets right here in Car Chat, never mind the country itself). In effect, the investors, not sound business practices, are propping the company up.
Last edited by mmarshall; Sep 9, 2019 at 03:07 PM.
Perhaps the term "crushing" burden, may not have actually been the best metaphor. But the point is that the way the company does business today (and has since its inception) puts a financial burden on the company itself that would not be there (or be there to a lesser extent) than would be if private franchises are (or were) paying off some those dealer-related costs themselves. You guys often criticize me for so-called "not understanding" business, but, come on, that's just simple math.....It makes Econ 101 look complex.
You're making a claim but not backing it up except to say "it's obvious" so explain in simple terms why an independent dealer network will be profitable but Tesla doing the same thing puts them in the red. You say it's simple math so should be very easy for you to explain said math.
Yes, the company has avoided bankruptcy (I'll concede that)...but it has done so because its hype, publicity, superb PR and spin entice investors to continually send in their $$$$$, and allow the company to continue its practices without running out of usable cash. (e.g.....Look at the amount of talk and attention the company gets right here in Car Chat, never mind the country itself). In effect, the investors, not sound business practices, are propping the company up.
Or maybe Tesla is still going because investors see a tremendous upside going forward. I've talked to a few people that think Tesla's stock will go north of $1000, remains to be seen but Tesla has 2nd to none name recognition and cachet going for them.
You're making a claim but not backing it up except to say "it's obvious" so explain in simple terms why an independent dealer network will be profitable but Tesla doing the same thing puts them in the red. You say it's simple math so should be very easy for you to explain said math.
The simplest way to explain it is that a privately-owned dealership pays most of its daily operating bills themselves.......insurance, attorneys, buisness-taxes, property taxes, accounting, utilities, employee/manager salaries/benefits, cost of repairs/service/parts (except for warranty work, which is factory-reimbursed), building/infrastructure work, repaving, customer-perks......the list is endless, and I couldn't include it all in just one post. When you have a set-up like Tesla, with company-owned facilities, the manufacturer eats all or most of those costs....in return, of course, for having more direct control over day-to-day operations at the dealership. Effective in that sense, but costly....and some of the Tesla facilities look more like warehouses than modern auto dealerships.
Last edited by mmarshall; Sep 9, 2019 at 03:54 PM.
The simplest way to explain it is that a privately-owned dealership pays most of its daily operating bills themselves.......insurance, attorneys, buisness-taxes, property taxes, accounting, utilities, employee/manager salaries/benefits, cost of repairs/service/parts (except for warranty work, which is factory-reimbursed), building/infrastructure work, repaving, customer-perks......the list is endless, and I couldn't include it all in just one post. When you have a set-up like Tesla, with company-owned facilities, the manufacturer eats all or most of those costs....in return, of course, for having more direct control over day-to-day operations at the dealership. Effective in that sense, but costly....and some of the Tesla facilities look more like warehouses than modern auto dealerships.
In your mind all those costs hurt Tesla but the same costs don't hurt the privately owned dealer.
In your mind all those costs hurt Tesla but the same costs don't hurt the privately owned dealer.
Why do you accuse me of that? Not true. Of course they can, and sometimes do, hurt private dealerships. Why do you think dealerships go out of business, or get bought out by other owners? Any business, in a capitalist economy, is a potential risk. The difference is......if Joe Blow Ford, or Smiling Sam Chevy, or John Q. Dodge down the street can't make it and folds, that's one thing, and purely a local matter, affecting maybe a few dozen to a few hundred jobs at most. But if Ford, Chevy, or Dodge itself goes out of business, on a major scale, that's quite a different matter.
Also, Tesla's problems are not just limited to company-ownership of facilities. There are a number of other issues as well...too many to go into in detaining one post or thread.
A shame, too, that the company can't get its act together, because they make a vehicle with one heck of a power train. Driving a Model 3 was like a being a 5-foot Jockey on the back of a race horse....that torque has to be sampled to be believed.
Last edited by mmarshall; Sep 9, 2019 at 04:37 PM.
In your mind all those costs hurt Tesla but the same costs don't hurt the privately owned dealer.
its completely naive to think that the dealers would bear these costs and not expect a return. Either Tesla would have to share its margin with the dealers or the customers would have to bear a higher price. Someone loses in this economic paradigm as its a zero sum game. Basically, if you add a 3rd party (franchise dealers) to this equation, they too will want profit further reducing the profit of Tesla or increasing the price to the consumer. Tesla offering a direct channel to the customer can keep a lower price and enjoy a higher margin on the products. The franchise dealerships aren't needed in this day and age as they'll just leech out more value in the value chain.
its completely naive to think that the dealers would bear these costs and not expect a return. Either Tesla would have to share its margin with the dealers or the customers would have to bear a higher price. Someone loses in this economic paradigm as its a zero sum game. Basically, if you add a 3rd party (franchise dealers) to this equation, they too will want profit further reducing the profit of Tesla or increasing the price to the consumer. Tesla offering a direct channel to the customer can keep a lower price and enjoy a higher margin on the products. The franchise dealerships aren't needed in this day and age as they'll just leech out more value in the value chain.
Dealer-profits have little or nothing to do with what the factory itself actually makes. Dealerships (except for rare exceptions like Saturn and Scion, which no longer exist) can, and do, vary their asking prices according to vehicle-demand.......they profit from each vehicle according to how much they can sell it for. The factory usually doesn't (or can't) do that....they have the same mark-up (and profit) on each vehicle they sell, because the dealerships pay the same price for the vehicles wholesale.
And many of today's private-franchise dealers don't even operate on the old Middle-East Bazaar-style of bargaining anymore. In many cases, they have a no-dicker price, published on their web site, either at list (most likely on all-new vehicles with high demand/short supply) or at a discount, and that's that. On rare occasions, they can still charge over list...but you don't see that as much today as you once did.
Toyota and Lexus Join Mille Miglia For The First Time
Slideshow: A five-car lineup spanning more than five decades of Toyota performance and engineering will tackle one of Italy's most celebrated automotive routes.
PR spin or Proper product planning (Tesla vs the rest)
