If you are the CEO of a publicly traded company, you can have the biggest cajones in a given hemisphere and it doesn't matter if the board disagrees with what you're doing. It's like being a football coach. The nature of most business these days is that long-term steering is done delicately as everyone that weighs in on your job is far more concerned with what happens within a given fiscal year. No one is expecting Tesla to sit still while they catch up and first-movers advantage is well known to everyone. That doesn't mean they can't innovate and compete in this space, as long as it may take.

To be clear, I wasn't saying staying alive was easier for Tesla. It was by its very nature easier for Tesla to commit to electric cars because that's it's entire purpose. Other automakers, that have focused on ICE for several decades, have a much harder time shifting a fundamental aspect of their product offerings particularly at a time where the future held uncertain profits and current profit was extremely healthy. Most business don't move unless there's incentive and a healthy supplier network ready to support them. That wasn't present until fairly recently. There's a reason no one took off to catch Tesla ahead of their peers.

I don't see a need to assign blame because I don't see the future for them as bleakly as you do. Tesla's first-mover advantage and laser-clear mission gave them the firm spot in the automotive landscape they deserved. The other automakers are going to have to deal with lost market share. It always happens once in a generation. There's still people upset that Hyundai/Kia caught on the way did. Lexus too for North America. Tesla will likely continue to succeed to a great degree but no one is invincible.

You bring up GM. There's a whole film that explores the roles of other auto manufacturers, oil companies, the government on a federal and state level, and battery tech made the environment hostile. Of course GM's mediocre management and board killed it with those headwinds.Time wasn't right. Toyota still isn't 100% on board. Daimler owned Tesla stock and partnered with them as well. They made the SLS Electric Drive and B-clas electric (tesla batteries), BMW went off and produced the i3, and Audi had several failed plans to dip its toes in the EV space in the early/mid 2010s. Those projects were eating into their profits and they all got the same message from the board - no EVs until you can make money off them. It wasn't until much more recently that support for massive EV investment truly came to light. Ford just announced their EV unit is losing billions of dollars, which is now acceptable and accounted for. Do you really think Ford's board and stakeholders would've tolerated that in 2015?

Bottom line, Tesla had the right people at the right time with the right mission. That doesn't mean everyone else has no future.

 

It was actually easier to Tesla to start up vs being an established car maker trying to convert. All the money and rules were slanted in their favor.

 

If this is true then all legacy auto has to do is start a completely new company with zero connection to their legacy IP.

 

But they would still own it and the ICE company, unless you think they would create it and give it away to somebody. Would change nothing and probably be even more expensive.

 

I don't follow. Why would creating a brand new company (which you say is the way to go, money and rules slanted) be dragged down in any way by the legacy company?

 

I like it much better than I thought I would. When tesla's came out, I pretty much ruled the out since I actually appreciate a well engineered vehicle, with good fit and finish etc. I have driven the Model 3 a few times and actually find it a nice vehicle. I purchased the Model Y online two days after the price decrease to 53K, and bought it without test-driving. I am pleased to report the feel of the Model Y is better than the 3, for some reason feels better put together. Has better sound insulation and has a much better seating position. At the current price, it was a no brainer to buy it over anything else on the market.

 

Because they wouldn't "create a brand new company" with their current company resources and then give it away. Don't think shareholders would go for that. No advantage in doing that. Just moving resources around, and doesn't change the fact that the company still has to produce ICE cars and be penalized for it while helping fund companies like Tesla that have no ties to ICE development by purchasing their "carbon credits".

 

Tesla's price cuts are having their intended effect

Tesla's Price War May Lead To Automakers Closing Up Shop In China

While it's the largest automotive market in the world and a top spot for EVs, this is all a potential cause for major consolidation

Tesla's price cuts have caused much more turmoil across the globe than some people may have expected, and this is especially true in China. According to analysts, the situation may become so dire that some Tesla rivals may have to close up shop, or perhaps partner up or consolidate.

When Tesla first started lowering prices, the word on the streets was a lack of demand for its EVs, which has been the initial story nearly every time Tesla reduced prices over the years. Regardless of the reason for the US EV maker's price cuts, they've worked, and in a big way. Tesla's timing of the price cuts sent the industry into a spiral, and it's continuing to spin out of control in some cases.

Tesla has more competition in China than in any other market, which makes sense since it's the largest auto market on the planet and a hot spot for EVs. CEO Elon Musk even has gone so far as to say publicly that certain carmakers in China are really Tesla's only concern when it comes to real competition.

Tesla's EVs tend to be more premium and more expensive than some of its rivals' offerings in China, so the clear answer is to reduce prices, boost demand, and ensure that EV buyers in China choose Tesla over local electric car producers. Tesla has done just that, and it's working. In fact, after a few price cuts in China, some Tesla models are 50% cheaper than they are in the US.

Needless to say, Tesla's rivals in China have lowered their prices to better compete, much like other global automakers. Mercedes and Volkswagen are offering discounts in China, Ford dropped the price of the Mustang Mach-E electric crossover, and local companies Nio and Xpeng have had no choice but to cut prices as well.

Some 30 automakers in China have now reduced prices, and it's creating a disaster for some. According to recent reports, the China Association of Automobile Manufacturers has asked for an end to the price war. The organization notes that this is no way to fix long-term concerns and was simply put into place due to a drop in sales at the beginning of 2023. It hopes to convince automakers to "return to normal operation” as soon as possible.

According to Teslarati, Nio's Chief Financial Officer Steven Feng told Bloomberg Television that the auto industry in China is dealing with a "very profound shuffle.” He shared:
“We need to go through this price war at the beginning of the year, and then we expect the industry to go through some profound fundamental consolidation. It’s almost consensus that China now has too many automakers."
Over 150 new electric cars and plug-in hybrids will debut in China in 2023 alone, and there are arguably too many brands and models for buyers to choose from already. Meanwhile, as many of China's automakers are struggling with the price cuts, Tesla is in a position where it could reduce prices even further if needed.

Tesla has billions of dollars it could use to sustain price cuts, while rival automakers are already hurting. Morgan Stanley notes that BYD could also afford to be more aggressive with price reductions for a time, but weaker competitors won't be able to handle it for long.

https://insideevs.com/news/658902/te...a-auto-market/

 

The EV Price wars continue



Tesla is poised to benefit from rapidly dropping lithium prices, particularly in China, where the automaker produces nearly half of its vehicles.

No element has become more synonymous with electric vehicles than lithium. None of the modern batteries that make electric vehicles possible could exist without lithium. Hence, the price of EVs has become intertwined with the cost of lithium, which has slowly become cheaper thanks to massive investments worldwide. Now, according to Reuters, lithium prices have hit all-time lows in China, following similar movements in North America and Europe.

China’s lithium market reached just 260,000 yuan ($38,079) per ton today, less than half its price from November last year. Giving context to this fall, Reuters pointed out that analysts expected the price of lithium in China to fall to only 300,000 yuan by the end of the year.

Several factors have likely helped push Chinese lithium to its meager price. Foremost, the Chinese government recently ended incentives for electric vehicles, which has slightly slowed their adoption in recent weeks. Second, Chinese lithium faces more competition than ever before, particularly from the New World, where lithium extraction and refining capabilities have skyrocketed.

South America, which is by far the most lithium-dense continent on the planet, has seen its lithium extraction capabilities grow, particularly in Chile, where countless new projects are looking to capitalize on the massive amount of surface brine that can easily be converted into solid lithium. Meanwhile, in North and Central America, corporations and governments alike have doubled down on lithium investments, especially as the United States looks to decouple itself from Chinese supply.

In turn, this price movement in China and the Americas has had a similar effect in Europe, though that effect has been more muted.

But how could this affect Tesla pricing?

With Tesla’s most significant vehicle production cost still being the battery, there is no doubt the business will benefit dramatically from the falling price of one of its core elements. Furthermore, as Tesla still leads the auto industry in terms of profit margins, it has the most flexibility regarding its vehicle pricing.

If Tesla does institute another price cut thanks to this lithium price movement, it could very well upend the industry that the American automaker’s price cuts have already rattled at the beginning of the year. However, it remains unclear how much more space other automakers have to move regarding the price of their EVs, which is already unprofitable for many.

https://www.teslarati.com/tesla-pric...-prices-china/

 

good articles AMIRZA, thanks.

dumb question - where are tesla batteries made and what percentage of their batteries do they make themselves (vs. buying from panasonic, i think, and maybe others)?

 

I know they build battery packs in Berlin and Austin, but heard they are moving a lot of battery pack manufacturing to the US so they qualify for tax credits. Our resident Tesla expert probably has a better answer. I'm talking to you @LeX2K

 

China, Europe and the United States the specific mix is not public although I'm sure someone has figured it out. Tesla makes batteries basically anywhere they have an assembly line or near one

• Gigafactory 1 in Nevada
• Gigafactory 2 in Buffalo
• Gigafactory Shanghai
• Gigafactory Berlin
• Gigafactory Texas
• Fremont

Tesla also sources batteries from 3rd parties in China. Some locations they use a pilot line or make them in small volume.

 

Thanks!!!!!!!

 

What I posted may not be 100% accurate! Caveat emptor.

 

never heard of gigafactory buffalo... lol

what's tesla's deal with panasonic then?