By Wolf Richter, a San Francisco based executive, entrepreneur, start up specialist, and author, with extensive international work experience. Originally published at Wolf Street
Today was the monthly moment of truth for automakers in the US. They reported the number of new vehicles that their dealers delivered to their customers and that the automakers delivered directly to large fleet customers. These are unit sales, not dollar sales, and they’re religiously followed by the industry.
Total sales in November rose 0.9% from a year ago to 1,393,010 new vehicles, according to Autodata, which tracks these sales as they’re reported by the automakers. Sales of cars dropped 8.2%. Sales of trucks – which include SUVs, crossovers, pickups, and vans – rose 6.6%. Strong replacement demand from the hurricane-affected areas in Texas papered over weaknesses elsewhere. As always, there were winners and losers.
And one of the losers was Tesla.
First things first: There is nothing wrong with a tiny automaker trying to design, make, and sell cool but expensive cars that a few thousand Americans might buy every month, and trying to do so on a battleground dominated by giants. Porsche has been doing that for years. Porsche AG is owned by Volkswagen AG, which is itself majority-owned by Porsche Automobil Holding SE. Tesla is out there by itself.
And Tesla has put electric vehicles on the map. That was a huge feat. EVs have been around since the 1800s, but given the challenges that batteries posed, they simply didn’t catch on until Tesla made EVs cool. Yet Tesla has to buy the battery cells from battery makers, such as Panasonic.
Tesla isn’t quite out there by itself, though. The Wall Street hype machine backs it up, dousing it with billions of dollars on a regular basis to burn through as fast as it can. This masterful hype has created a giant market capitalization of about $52 billion, more than most automakers, including Ford ($50 billion). It’s not far behind GM ($61 billion).
But Tesla – which lost $619 million in Q3 – delivered only 3,590 vehicles in November in the US, down 18% from a year ago.
There are all kinds of interesting aspects about this.
One: 3,590 vehicles amounts to a market share of only 0.26%, of the 1,393,010 new cars and trucks sold in the US in November. Porsche outsold Tesla by 55% (5,555 new vehicles).
Two: Tesla doesn’t report monthly deliveries. It wants to play with the big boys, but it doesn’t want people to know on a monthly basis just how crummy and by comparison inconsequential its US sales numbers are. Opaque and dedicated to hype, it refuses to disclose how many vehicles it delivered that month in the US. So the industry is estimating Tesla’s monthly US sales.
Tesla discloses unit sales data in its quarterly earnings reports, long after everyone has already forgotten about the months in which they occurred.
Three: So how are Model 3 sales doing? Since Tesla doesn’t disclose its monthly deliveries in the US, the industry is guessing. The assembly line still isn’t working. “Manufacturing bottlenecks,” as Tesla calls it, and “manufacturing hell,” as Elon Musk calls it, rule the day.
In Q3, Tesla delivered 220 handmade Model 3’s. In October, it delivered about 145 handmade units. In November, the assembly line still wasn’t assembling cars. Inside EVs estimates that Tesla delivered a whopping 345 units in November.
Four: This is where hype goes to die. In February 2017, Tesla hyped these Model 3 production numbers for 2017:
Our Model 3 program is on track to start limited vehicle production in July and to steadily ramp production to exceed 5,000 vehicles per week at some point in the fourth quarter and 10,000 vehicles per week at some point in 2018.
November is solidly in the fourth quarter. 5,000 vehicles per week would mean over 20,000 a month. OK, this is November and not December, so maybe 4,000 a week for a total of 16,000. We got 345.
Even if the estimate of 345 is off by 100 units up or down, it doesn’t even matter. And December isn’t looking much better. Because there is still no mass-produced Model 3.
Five: The bestselling Model S isn’t best-selling anymore. Inside EVs estimates that Tesla delivered 1,335 Model S in the US. This was far outpaced by the humble Model-3-killer the Chevy Bolt. GM sold 2,987 Bolts in November. Tesla is also estimated to have delivered 1,875 Model X SUVs in the US. It took the Model S and the Model X combined to beat the humble Bolt.
Six: The unglamorous Model-3-killer is number one. The Chevy Bolt faces no “production bottlenecks” and no “manufacturing hell.” It was rolled out gradually, starting in October 2016 in California and Oregon, with other states being added to the distribution plan over time. By August 2017, the Bolt was available in all states. By September, 2,632 Bolts were sold in the US; in October 2,781; and in November 2,987.
The Bolt became the best-selling EV in October and retained that crown in November. Nothing was even close. November was the ninth month in a row of rising sales, as it should be for a brand-new vehicle line. GM has sold 20,070 Bolts so far this year.
Seven: But the Bolt is just a flyspeck for GM. It’s something to build the foundation for a larger shift to EVs. It represented just 1.2% of GM’s total deliveries in the US in November. EVs are still just a niche product. And yet, even this flyspeck crushed every Tesla model without fanfare.
Every automaker is preparing a lineup of EVs. Unlike Tesla, they have their supply chains down pat, and they know how to get their assembly lines to function, and they know how to mass-produce vehicles. There are already about two dozen EV models on the market in the US. Like GM, these automakers are just using their EVs to lay the groundwork for the broader shift.
Tesla has used two years of hype surrounding the Model 3 as a way to boost its share price. This allows it to raise many more billions by selling more ludicrously overpriced shares to gullible investors, and by selling more debt to institutional investors who believe that Tesla’s ability to sell still more ludicrously overpriced shares to gullible retail investors will in effect guarantee the junk-rated debt they just bought. Few companies have ever been able to perform that scheme at this masterful level.
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Elon Musk is little more than a snake-oil salesman. Not only is there the Tesla fiasco, but there are his plans to send people to Mars by 2024. If that ever comes to fruition, those who are sent will almost certainly die in the attempt. We simply do not know enough about the dangers of space travel, and how to counteract them. Then there is the boondoggle that is the Hyperloop. That is little more than science fiction, as this video shows: https://www.youtube.com/watch?v=RNFesa01llk
I believe there are those that understand the dangers of space travel, and have spent careers studying, modeling, and designing solutions to the dangers of space travel. I know some of them. I have worked with them. I personally researched architectural solutions to hardening electronics from radiation specifically for space exploration (basically, that was my job title). Saying it is dangerous, okay. Saying some may die, okay. Saying all will die and that “we” don’t know what we’re doing? You are way over the line.
There is no point in sending “colonists” to Mars; it is an inhospitable place survival upon which will depend on the total commitment of vast resources sent from the earth. The human and financial capital that would be employed would be far better spent on gathering earth’s resources; cleaning our planet; and supporting the population we already have here on our home world. Elon Musk isn’t a pioneer trying to save the human race; he is a circus clown trying to become a circus owner.
Hear! Hear!
FWIW, nothing I have said contradicts your statements.
My personal opinion is that we are inherently unsuited for space exploration. Robots are cheaper, are far more resilient in extremely hazardous environments, don’t shed hair, skin, oil, nor do they require trillions of bacterial symbionts to survive.
Space Cowboys disagree, chanting loudly, “Boots on the ground!!!”. So it goes. At times, I agree with them. People DO need heroes. That we should celebrate those who clean up the detritus does not mean we cannot also celebrate those who would risk all to put a boot on another world. If nothing else, the science involved is both interesting and, often, very useful in Earthly applications. The only reason we don’t do both is that we are stuck in a crippling 19th century vision of money.
Mars can wait.
We yearn for those who will risk all to save this planet. They will be heroes.
Yeah. Mars in uncolonisable. Sending ppl there would just be a nice demo, like the Moon.
Not to mention that there is still a real chance of either microbial life or fossils of microbial life, and any life sent from Earth will totally scramble that extremely valuable record.
If everyone agreed with you, there would be no demand to go to mars yet some people remain interested.
If Elon gives people the choice, more power to him. If people decide to spend their money getting to mars rather than investing in Earth, then apparently they disagree with your assessment.
Besides, there’s a non-trivial amount of value to making humanity multi-planetary. It gives our species a hedge against nuclear holocaust.
“It gives our species a hedge against nuclear holocaust.”
More like it would give the species another planet to destroy.
A nuclear holocaust indicates this is a species that can’t stop engaging in war.
Space travel wouldn’t make us better humans, it would make us intergalactic parasites.
We will colonize Mars when Antarctica become too crowded. We have an entire continent that is profoundly more habitable (Warmer, wetter and you can breath the air) and several orders of magnitude easier to get to.
Personally I find “by 2024” as wishful thinking. But as I clearly don’t have necessary knowledge, I request your opinion on that.
By 2024 thoughts.
In picking a time-frame for a manned mission to Mars, one would hope to choose a time when
a) Mars is in a favorable (i.e. close) position to Earth and using a Hohmann Transfer Ellipse for a shortest-possible round trip. Machine-only (i.e. robotic exploration) missions can use somewhat convoluted paths using, say, the Moon or Venus, for a gravity-assist. Earth to Mars will take about 8.5 months; a long time to be cooped up. A return trip using the same transfer will, again, take roughly 8.5 months, but to do that, one would have to wait 459 Earth days on Mars for the two planets to line up again. The alternative is to (a) have a big rocket waiting and (b) take off right after landing. That first part is something of a problem and is why we haven’t had a sample return mission…
So, Mars and Earth align this way about every 26 months. Roughly every two years serves as a good rule of thumb. 2020. 2022. 2024 (which is why Musk says 2024). 2026 and so on.
See:
https://www-spof.gsfc.nasa.gov/stargaze/Smars2.htm
for gravity assist, see:
https://en.wikipedia.org/wiki/Interplanetary_Transport_Network
Note: I kept a poster of the ITN on my office wall. What can I say, I’m a geek.
b) The Sun is in a minimal solar flare phase of the 20 year cycle. Getting caught in a CME (coronal mass ejection, or solar flare) is the greatest threat to biologic life in deep space (99% of radiation encountered in our solar system comes from our sun). Galactic Radiation (cosmic rays) are the second greatest threat.
See:
https://science.nasa.gov/science-news/science-at-nasa/2006/10may_longrange/
https://solarscience.msfc.nasa.gov/predict.shtml
So, pick a period when Mars and Earth are close together, accounting for transit times to and from, that also occurs during a solar minimum. Predictions are that 2020 and 2030 will be solar minimums, so those would be good years. 2024 is very close to a solar maximum, so would probably not be a very good year to go. Spam-in-a-can if you get caught in a flare/CME. 2030 (or 2031) would be a good choice. This is about the time frame NASA proposed for the first manned mission to Mars.
Note: having a rocket at Mars ready to return to Earth is still a problem. Having fuel there to refuel and return would be an option (another is to take a big-ass rocket with you). This is why the search for water on Mars is so important. Not only is it considered a precursor to life-as-we-know-it, it can also be converted to rocket fuel.
Water also works as a radiation shield in sufficient thickness. In sufficient thickness is a key phrase. The last time I looked at this, 4 feet was considered a good start. Rather, a 4-foot thick water jacket would work. Poop works, too, fwiw. So, if we have a capsule which supports such a water jacket, and which also has another layer to hold macerated poop (a NASA black water tank, as it were), we could use the water for the travelers to survive and also use their excrement as shielding. This is why finding water on our Moon is a big deal as well. Getting water to orbit is expensive. Keeping water in orbit, not so much (which is why the ISS astronauts drink recycled urine and sweat). This is also why using the moon as a staging area is not so far-fetched as one might think now that we know where the water is. Sending robots to the Moon and Mars to collect and process water in anticipation of arriving humans is fairly important in this regard. Moon Base Newt, I suppose.
The last time I saw Musk’s Dragon capsule (admittedly, 2010, so it has been a few years), there was no thick heavy shielding. Certainly, no 4-foot thick jacket of water. I don’t know their plans for radiation shielding, but if they are planning a 17-month flyby, with humans, during a solar maximum, they’d better address it soon.
Does that help?
Yes , that did help. I am more convinced that it is highly unlikely that Tesla or anybody else will be able to send men to mars “by 2024”. Its just a too optimistic target considering challenges listed out by you.
Excellent points. One of the reasons I’m in favor of a private space industry rather than just letting government agencies handle it all is that governments tend to be extremely risk-averse, and understandably so as they are run by politicians. Nobody wants to be leading the charge to spend billions on a mission only to have it spectacularly blow up on the launchpad. Not a good way to get re-elected. If human beings want to go into space, some human beings are definitely going to die trying before the kinks are worked out.
And the reason I’m against Musk’s version of a private space industry is that he is still pretty much relying on taxpayer dollars to fund much of his enterprise.
But as you pointed out in your other comment, manned or unmanned, we’d get a lot further if our ‘leaders’ understood how money works. Ideally I’d love to see governments put up a lot of the funding for the R&D, and then allow private industry to purchase the rights to use it rather than simply shoveling subsidies at preferred industries.
maybe some are risk averse (ok maybe a lot). but seems like there have been more than a few that werent. and lots of what we have today is because they took a chance. course some of them also took chances to keep our countries ours, when it might have been easier to just surrender
Yup. They took chances developing rocket engines.
Elon knows this, he stole their homework.
one observation, at one time it was dangerous for us to cross the Atlantic, and it was even thought all that tried would die. Years later the same was said that flying was impossible. And then going to the moon was impossible. that flying faster than the speed of sound was also impossible. And before that, going faster than 50 mph would burn up who ever tried it.
It always I possible, till some one tries . And succeeds. will we go to mars soon successfully? Soon? maybe, we never will do any thing if we don’t try, and learn from the failures that will happen. but one can question sending folks on a one way trip, without at least some idea of how they will survive. And we will gain lots knowledge along the way
I’d say that’s a very uninformed cliché way of understanding human endeavor. There is always a cost associated with everything. How many do you want to die to satisfy Musk’s deadline because he promised some investors (AKA the “uninformed”) about some launch to Mars? That’s what we are talking about: Musk’s hype machine, which earns him undue millions.
Secondly, back then, we used humans because they did not have robotics. How many do you think died in the creation and advancement of aerospace? A ton. Are you going to say that its these dead trailblazers, who no one even remembers, are necessary these days? I don’t think they are necessary at all. In fact, try to live in a closed environment in Antarctica. They tried and they cant – the tech is literally centuries away, from having a sustainable hydroponic farm, machinery to make/scrub filters ad infinitum, the necessary livable airtight/radiation proof housing, medical equipment, etc.
I’m not trying to debate against space travel – I’m trying to debate against sending people to their doom senselessly. If you cant do it on Earth, you wont last 2 seconds in space. Or as was written on the first Alien poster “In space, no one can hear you scream”.
Hahahaha “architectural solutions” to mimic MILES worth of atmosphere, complete with Earth’s built in radiation prevention system (see magnetic field)? FOR ELECTRONICS?! What you think the human body is a PCB?
https://en.wikipedia.org/wiki/Effect_of_spaceflight_on_the_human_body
That’s all I have to say. Read it and weep. I’d say we are centuries away from safe space travel.
Focus, will you? Radiation in space within a CME or in orbit around Jupiter is similar to radiation in, say, what is left of the Fukushima reactor core. Robots with radiation hardened electronics finally were able to enter the reactor core and let the engineers see what was left. Similarly, robots were used to investigate three mile island decades ago.
Look, no human has ever lived for than a week outside of Earth’s magnetic field. Those colonists will be dying of cancer by the time they reach Mars…and then the perchlorates in the soil will ensure they’re dead…if the lethal radiation hitting the surface doesn’t doom them first.
This is a planet hostile to human life: cold, virtually no atmosphere, and with 40% the gravity of Earth, anyone who spends a few years on Mars will be too weak to return to Earth.
I stumbled on that video (and others) by “Thunderf00t” (who is quite a character, to say the least) a week or so ago and it became clear to me that as you say Musk is just a con artist. He is like the magician who constantly diverts one’s attention — in his case, from his previous ponzi scheme. I urge all to watch the video and see how basic laws of physics mean the Hyperloop could never work — or at least not with any margin of safety.
To see numerous media pundits and “reporters” breathlessly say how we’ll all be going from LA to SF in 35 minutes for $50 or so… truly depressing how clueless they are.
It’s always a good detector – wait for one miracle performance is finished, before put one’s faith on the next miracle.
That way, you can catch fake saviors.
Yeah, those pesky laws of physics and thermodynamics are a real buzz kill.
Not to (inevitably) date myself, but it reminds me of all the happy talk about nuclear power being “too cheap to meter” from decades back …
Paging Harry Shearer! (^_^)
“Too clean, too safe, too cheap to meter” — News of the Atom.
Say what you will about Musk. But Spacex is delivering payloads to orbit and bringing back the boosters for reuse. I won’t speculate on the future, but this year has been very good at Spacex.
Meanwhile ULA is still relying on Russian engines, and the SLS is going nowhere fast.
SpaceX is heavily subsidized by Elon’s buddies in DC who have directed taxpayer’s infrastructure and NASA resources to help this shyster.
Every private space company that goes to LEO is heavily subsidized by a national government. The difference between ULA and SpaceX is that SpaceX seems to reduce costs and cut us in on the reduced costs; and SpaceX seems to develop innovative new technologies. What has ULA done?
Considering SpaceX is delivering the goods for a fraction of the cost that ULA is, I think that is a deal we should be happy with. But I’m sure you would rather we just shut down the space station altogether.
Hey ChuckO, you are a little behind. Now Elon is saying he is going to send a Tesla to Mars in January! Talk about a salesman.
Will that be the one that took all of December to manufacture?
nah. havent even finished designing it yet
Yes, there is a lot of hype. But would you rather see investment?? go to wall street tycoons or industrial tycoons who use profits to buy back their own stock, or to buy the stock of already existing businesses (mergers) or just park the profits in stocks, bonds or CDs (Apple) in another nation (Ireland). Were there be a Chevy Bolt if Tesla were not tickling them?
Whenever I read about the Tesla, I am reminded of another boutique car, the DeLorean.
Oh, and I have spotted exactly one Tesla here in Tucson. If I hadn’t seen the nameplate, I would have thought it was a Honda.
around Austin, you can see many every day. in fact i have gotten to where i am looking for them
It appears Austin and Seattle “liberals” with too much money are a dime a dozen. Just like the Tesla will be in a few years.
The echo chamber is strong today. Counterpoint: Teslas are omnipresent in urban California.
They’re ubiquitous in DC and Northern Virginia. I’ve seen exactly one Bolt and there are quite a few Volts.
Western Washington is awash in Teslas. I can hardly drive even several blocks without crossing paths with one. He may be a huckster, and be playing with other people’s money but what he has actually accomplished between starting a new car company ex nihilo and developing and applying unique technologies that the existing (also heavily subsidized everywhere) industry weren’t ready to pursue. If the company is still around in five years, which is debatable but my money’s on yes, you’ll be seeing Teslas in Tucson like I see them here. If he manages that, he’ll have done something nobody has done in the US in many, many decades. Breaking into the US auto market as a start-up where the entry barriers are staggering. It’s been regarded as essentially impossible to do.
Then there’s SpaceX, covered upthread. Who else alive has a CV to match? He makes stuff happen in fields where BS doesn’t generally fly very far,
The supply-chain and logistics for electric powertrains are simple, you’re talking 25 moving parts verses the 10,000+ for ICE – anyone honestly think Tesla can’t become supremely efficient at that. Tesla owns a sweet network of charging stations. A secure source of Li and other battery resources close to the gigafactory they own with Panasonic (article mistates this point) and might have exclusive access to the best new battery tech being developed. Toss in a small percent of the semi market. Toss in solar city and how rapidly panels keep getting better and cheaper, and how little home solar penetration is compared to where it will be in 10-20 years. Toss in a powerwall sale and install in a lot of those homes. Toss in the goodwill Tesla has generated by disrupting the planned obsolescence of the old auto order. Given the choice I will gladly pay a premium for the Tesla brand. I think a bigger problem for Tesla is the lack of charging options at condos and apartments i.e. you need a dedicated spot with a charging setup. Wireless garage charging pads will turn into a huge accessories market. Another challenge is in Europe where automakers are developing a competing charger network. Either way as time goes on the battery economics keep getting better and pent-up demand keeps building. Autonomous vehicle insurance could be a huge new market opportunity. They could 3D print their own parts. They could offer a subscription service or lease program. Having an old auto assembly line factory will soon be more of a liability once ICE sales start really falling. So just like Bezos focusing on cash flow and operational excellence being a recipe for Amazon’s success I think Tesla is following that game plan and that type of growth is what the market is rewarding.
toss in how few people can afford to build a wireless charging station into their floor, toss in how bezos got market share by not paying sales taxes, toss in how bezos could be one of the worst employers since the pullman co. Toss in that the market rewards itself, and it’s doing so with doe eyed hype and will continue to fleece the muppets as it has for time immemorial. FTA…GM 61 billion, ford 50 billion, tesla 51 billion….20,000 plus chevy bolts maybe 5,000 teslas? Thanks elon for the battery tech, clearly other companies deliver more better. You may pay a premium for the tesla brand though from those numbers you look to be an outlier, but thanks for being willing to take the loss and help finance battery tech.
If it’s so easy to manufacture EV’s how come Tesla’s still struggling?
Yes, and on the flip side, becoming supremely efficient at handling a supply chain with only 25 moving parts sounds like it would be a total walk in the park for automakers who’ve mastered handling one with “10000 moving parts” no?? Unless if you believe the PR that says these giant “archaic” automakers will just stand by and watch as they’re being “disrupted” into oblivion, doubling down on ICE even as the nimble startup that is Tesla moves the market in a different direction.
Catch phrases, sound bites and “David downs Goliath” tales that play well in the land of software startups don’t transfer well to industrial scale manufacturing. Tesla will require more than hype to play with the big boys (who have massive balance sheets, supply chain management,production and distribution know how not to be sneered at), much less become a big boy itself. The giant automakers are not stupid, they’re making their own forays into EVs (as the chevy bolt case mentioned in the article illustrates) while recognizing that ICE, much as we’d all like them to disappear tomorrow, will be around for a while to come still, that’s just the reality. While Tesla’s potential isn’t to be dismissed, it better not suffer from the type of hubris that will be its undoing in the end.
PS: There was an article here a while back that made a persuasive argument about how advances in battery technology won’t necessarily be the biggest impediment to Tesla (and other EV manufacturers) hitting their projected production outputs, but rather the locking up of offtake agreements to guarantee the supply of sufficient raw materials (e.g. cobalt).
“Toss in the goodwill Tesla has generated by disrupting the planned obsolescence of the old auto order.”
What’s the planned obsolescence in the old auto order? They’ve been increasing their quality for at least the last decade, the vehicles are running better and longer than they ever have.
no not exactly. While they are more reliable , they are also incredibly complex. The non-dealer mechanics and DIY owners are getting pushed out of being able to maintain the foolish things.
Tesla itself – Musk is what he is, opinions differ – has done quite a service bringing EVs into the limelight. It would be helpful if the idiot market didn’t overvalue his company so much that the car part can’t be spun off into the possession of a “real” car company/companies.
If, for example, GM/Nissan got together and acquired Tesla’s car stuff for what it is really worth (pretty much the company-sized version of that “needs work” Corvette you are eyeing in the local Craigslist) then with the Bolt/Leaf/Mod3 in a single showroom, and all the IP now free to distribute among dedicated engineers, you would now have something.
But you can’t get it for “what it’s worth” due to the market idiocy. “It’s the future” doesn’t mean you still won’t go broke overpaying for it.
Of course part of the reason that it is overpriced is that the entire stock market is overvalued. But another reason is that people are pricing it as if they were a startup selling software. Or even a company that can simply outsource production to be done on the cheap in China. But unlike software, with actual hardware it is no easy matter to go from production in the 1,000s to 100,000s. The SV business model of disrupt=>dominate=>distribute=>profit simply doesn’t work. You have to show profit before you can dominate because ramping up production is EXPENSIVE. In the 60s and early 70s the big three dominated and were pretty awful because of the huge barriers to market entry. Imports were able to become big competitors because they were ALREADY profitable businesses in their home countries. The creation of a dealer network in this country was much easier because they didn’t need to ALSO create a manufacturing.infrastructure. And they still probably wouldn’t have been successful without the gas-crisis radically changing consumer demand away from the the cars that Detroit was selling.
O RLY? They could acquire it now…if they wanted it.
— http://money.cnn.com/2014/06/12/news/companies/musk-tesla-patents/index.html
It’s almost as if the car makers don’t want to learn how to make anything that wouldn’t be out of place in the 1950s. Not everyone wants/or needs a car with seating for 5 and a trunk large enough for 4 suitcases and range of 300+ miles. But that’s what we design our cities and homes around and that’s what we are stuck with.
And electric cars did not fail due to lack of technological advancement in batteries: it was a business model failure. Electrics were leased/rented vs owned and the companies that managed them ran into capital/finance problems. It’s true that the energy density of a pound of gasoline is hard to match, even now, but it wasn’t insurmountable.
Elon Musk is a disrupter of the status quo and therefore is by definition an enemy of conservatives of all political and economic persuasions.
Conservatives are fighting back against his vision of the future and know to hold their own positions on the top of the industries Musk targets, they will need to drive Tesla stock price to vulture range and remove the threat. Musk has been tempered by near bankruptcy a few times, this time doesn’t even appear close. This article is a hit piece. Wolf sounds like a mouth piece for the auto industry.
That’s quite the hit on the author for him highlighting the reality of Tesla’s sales numbers.
True, Musk has made electric cars fashionable again against the status quo of gasoline powered cars. There’s however still the matter of fact that Musk seems to be relying on hype over substance for Tesla. To point out that simple fact along with the low sales numbers does not make the author a conservative. It makes him pragmatic and realistic.
There’s also that he’s comparing Tesla to a better performing electric car. So on that basis, he wouldn’t be showing some conservative bias for fossil fuel if that’s what you were implying.
You could be falling into the trap where you try to attack anything remotely negative about what is presumably your political allegiance. If the author said something directly negative about electric cars in general, then you would have a point, but this does not seem to be the case.
I think it is possible to attack the article as a hit piece without necessarily signing up for allegiance to Tesla. I think it is possible to understand objectively that Tesla is a threat the automakers status quo and is also quite obviously the target of a sustained disinformation campaign. Say what you want about Elon Musk, but the man is an industry catalyst influencing EV policy around the world and forcing other automakers to address EV cars and infrastructure. If they do not it is at their own peril, and they know it, hence the progress with the right hand and dirty tricks with the left hand.
The entire push to EV’s is such a misdirection. If we could have a ‘do-over’, go back to 1910 or so, and have Henry Ford chose and market an electric vehicle rather than a petroleum powered vehicle, maybe our current situation would be better.
As it is, we’re proposing that we take these millions of solo vehicles, all of which are manufactured out of finite resources, using vast amounts of energy to manufacture and transport to point of sale, and clogging the streets of our cities with grid-locking traffic, thus generating calls to build more roads and overpasses, which use more scarce resources. So what if they all become self-driving? Our local roads would become quieter and cleaner …. but what will happen back along the supply train?
We’re all in denial. We don’t want to let go of our lifestyle that allows us to get in our car and drive off toward the horizon, adventure and a better life. Only, the horizon has become a gigantic stinking tar sands wasteland and the better life a shaky mirage.
There were plenty of electric vehicles around back around 1910. The US had a fairly extensive trolley system. The auto industry put them out of business, most likely deliberately.
Now the ‘sharing economy’ is trying to reinvent the wheel so to speak, but in a far worse manner than what already existed a century ago. Putting tens or hundreds of millions of electric cars on the road to be ‘shared’ by app users is clearly not the answer.
> So what if they all become self-driving?
“So what” indeed. Nothing about self driving cars inherently leads to fewer cars on the road. On the contrary, automation could easily lead to more cars on the road — cars endlessly circulating to avoid parking fees, cars shuttling kids to places they can’t drive themselves, etc. But of course, it’s all a fantasy anyway since truly self driving cars aren’t on the horizon aside from a few toylike scenarios.
They can’t even make ONE car that can drive itself, but they promise to make it up in volume, by self driving them all, at the same time.
Last week I was in Chilpancingo, Mexico. Not one of Mexico’s ten biggest cities by a wide margin, and a place afflicted with extreme concerns about violent crime.
Guess what I saw there: a row of Tesla charging stations! (with no cars charging, big shock)
How??????
Well, while not the size of Mexico City, it is but 100 kilometers (60 miles) from Acapulco (popular tourist area) and it’s in the scenic Sierra Madre mountains. Chilpancingo (~200k pop.) is an attractive short drive in a Tesla Model S for wealthy/ship-bound tourists on a two-day layover.
Mystery solved?
That “popular tourist area” of Acapulco you mentioned was visited by my daughters two years ago, who found half the beachfront resorts abandoned, and were sternly warned not to venture more than a block from the beach. It was all Mexican families on holiday, who were shocked, though gratified, to see my Gringa daughters visit what is universally understood to be an extremely dangerous region.
The mystery persists.
I guess I wasn’t clear. Anon’s comment is hilarious if you know anything about this part of Mexico.
Chilpancingo is going through not-quite-El Salvador levels of violence. Acapulco, as Michael noted above, is hardly better. Emergency room surgeons there have been murdered for saving the lives of rival gang members and the surviving surgeons went on strike to protest.
Also, what cruise ship lets you bring your car with you all the way to Mexico??
Mexico City is one of the biggest cities on earth with a metro of 23 million people and great concerns over air pollution all of which would make it ideal for electric cars if Volkswagon didn’t have the country in its filthy grip. No comparison with Chilpancingo.
There are a small herd of Teslas here on the west coast of the Granite State, and a row of Tesla charging stations in the same strip mall that hosts a Walmart and a discount supermarket. I think I did see one car charging there when I drove past last week.
New Hampshire has a west coast?
But bigger point: the mystery of charging stations for nonexistent cars persists.
What has been most distressing for me is how many renewable advocates and professionals have put their hope in the Howard Hughes of the 21st century to help (or single-handedly according to some) deliver us into a renewable energy future. Turns out he is a confidence man of the highest order, scatterbrained to all hell, a union buster, tone deaf, possibly racist/sexist based on employees, etc. etc. As far as being a leader for renewable energy development he is more Ahab than Jean-Luc Picard.
Give me a federal program over an eccentric billionaire any day.
For a federal program, you need to go to China:
China to ban sales of fossil fueled cars, 2017 Sep
“Tesla – which lost $619 million in Q3 – delivered only 3,590 vehicles in November in the US, down 18% from a year ago.”
Wolf goes on to note that in February Tesla predicted “to steadily ramp production [of the Model 3] to exceed 5,000 vehicles per week at some point in the fourth quarter and 10,000 vehicles per week at some point in 2018.” In other words, their total all-models sales are running at under 1000 per week, less than one-fifth the production rate they predicted for the Model 3 alone as recently as February. Making Tesla’s valuation downright Bitcoinesque in its ludicrousness. And like BTC, it will surely ramp quite a ways higher before the whole manic bubble collapses. And speaking of Bubble 3.0, another Wolf Street piece:
o The US Cities with the Biggest Housing Bubbles | Wolf Street
Locations for charging stations in Mexico City are probably less & look forward in the long term.
Things that are possible are made from Systems Engineering, over Mechanical or Civil Engineering Disciplines. (Henry Petroski includes in the over all Discipline.)
Musk is a Fireball Visionary Leader. This is a category of leadership types.
If his assembly lines are not up to par, it means he has not yet found the one individual he needs to help him achieve that goal, a fast efficient assembly line.
Musk, as well the Financial Engineering of today and of Corporations with Peculiar Leadership Styles have adopted Modern Monetary Theory where the idea is the leading force that the organizations employees really take to heart, so much so they will engineer towards that goal the great leader has exemplified.
Debt does not matter as much for Bezos & Musk.
I watched a ten minute youtube Wendover productions video Titled Musk Economics, on his economics. I’d recommend it.
Musk, is not the man to defend the planet. We are supposed to get that from the UN.
I see Bezos’ rockets & capsules as well suited for the building of the Space Elevator system that because it is possible must be made as from where to let satellites go, & also allow for cheapest most complete near earth outer space Work.
Musk & his Powerwall is the Earth Thing.
It will be the Mars “Thing” as well.
All we have to do is end the illiberal ignorant lust for the apocalyptic riot.
That great short-lived show “The Brink” is significant in portraying the ongoing attempt to make Israel the flashpoint for the apocalyptic riot.
We end up seeing scientists & engineers doing all they can to create a livable present & future pitted against an intractable cadre of the vicious religious & fanatics forever counter revolutionaries of a willfully ignorant international force more united than international labor.
To summate, the longer I have lived the more I have ascribed to the Great Man Theory of History.
I had dinner with Gene Roddenberry & was introduced to Rod Serling. I am into the futurists of our times & would tell Musk It Appears He needs a better Systems Engineering Staff.
Visionary?
His ideas are nothing new. He has at best achieved some measure of incremental change to the status quo. There’s nothing visionary about him.
He’s got lots of money because he was in early to a classified ad company.
To put a number to his visionaryness, lets go with tesla’s (typing that really hurts) market share, which is probably an over-estimate. >0.25%
But, the status quo is somehow able to make money doing it.
Elon economics- Get rich quick, spend lots on PR, don’t worry about products.
Simple arrogance. Limited production of high margin luxury vehicles is an entirely different business than mass production of no margin vehicles. There are 10s of thousands of mechanical, civil, operational, industrial, and electrical engineers in the Detroit metro. There are hundreds of independent tool-making firms employing 10s of thousands experienced machinists. Rust-belt universities and community colleges add 1000s more talented workers every year. They are capable of a billion dollar factory retooling in a few months. Tesla lacks talent, experience, suppliers, and experience with suppliers to compete in the mass-production side of the automotive industry.
Tesla is a very good example of why you don’t offshore manufacturing. The relationship networks between suppliers, experienced staff, and training institutions are incredibly difficult to recreate.
That Musk is a better visionary than he is a manager has never been in debate. His visions do eventually come to fruition too (sooner or later at Wolf rubs in).
I think the issue here is not that EVs are ascendant in the marketplace, but whether or not Tesla and/or Musk are the next Apple to investors. Sure as hell not yet. However, I recall when Apple had some very bumpy years too.
Looks like Tesla might be attracting fewer investors in suits, and a greater number with goggles and silk scarves over their shoulders.
“His visions do eventually come to fruition too”. Let me stop you right there. The hyperloop is never going to be a thing. 100 percent certainty. Point to point rocket travel on Earth? Million to one against. So no, some of his claims are clearly garbage. Obviously based on SpaceX and the Tesla models R and S, some aren’t.
Re. SpaceX, I’ve long wondered whether the resuable-booster-which-flies-itself-back-down and the attendant immensely-complex software and propulsion-tech represent a genuine cost-effectiveness gain or are gee-whiz for gee-whiz’s sake, compared to the reusable solid-fuel boosters of the space shuttle, or a low-tech ‘reusable-ized’ version of (say) the old Saturn V booster stage – add a simple parachute system to limit splashdown speed to what the structure can survive and some simple inflatable bags to keep it afloat (or just use the natural buoyancy of the empty fuel and LOX tanks), then tow it back to the launch site or to the booster-refurbishment facility.
Working in the automotive industry, I have my reservations about Tesla.
They have skipped some very important validation for their Model 3.
http://wardsauto.com/industry/tesla-s-hiccups-devil-details
This is simply not done in the industry. Usually there is 6 to 12 months of preproduction before the line goes to full scale production.
I suspect that many of the problems that Tesla is experiencing is related to the rush. Outside of Tesla though nobody is able to confirm or deny this.
The first public owners better hope that the quality control is good or they may find themselves with vehicles with many problems.
It is important to keep in mind that this is a new platform for Tesla and that this is the car that they claim will be able to bring them to profitability, along with mainstream appeal. The issue is that if there are any major issues, this could lead to serious reputational damage. Unlike Tesla fanatics, the general public is not going to be as forgiving.
The answer is that it is not as easy to scale up from a small niche to mainstream where the margins are razor thin as the Silicon Valley disruptors claim.
Elon Musk has always seemed like a huckster to me. In my opinion, his ideas about the hyperloop and space travel to Mars border on delusional. As Wolf indicates, the number of Teslas manufactured each month fall far short of what he has indicated. From what I’ve read about the Tesla manufacturing plants (one in Fremont, CA) the workers are very dissatisfied and are treated poorly. For the kind of work done, they are poorly paid ($18/hr) . Apparently, there has been at least one attempt to unionize, and workers who engage in this activity are fired under the pretext of poor performance reviews. Musk and Bezos fall into the same category in regard to treating their workers inhumanely. I refuse to patronize companies who engage in this kind of disrespect for their workers.
If Elon does in fact succeed in sending a space vehicle to Mars, I think he should take a ride on it.
Two predictions:
1) The issue of humans not surviving in deep space without radiation shielding will be solved by providing effective shielding. A small hollowed-out asteroid, perhaps with a fission-reactor-powered magnetic field, seems doable if you’re more worried about economies of scale than speed. (Think supertankers vs. Airbus aircraft.)
2) Musk will be a) in business and b) out of jail longer than Uber Cab and its crooked-to-the-core founder and ex-CEO Travis “High” Kalanick will be, respectively.