A couple of tidbits in the news today that just want to be shared. Tesla’s stock surge continues (up 130% since the beginning of the year), with a market cap of some $206 billion, surpassing Toyota, and making it three times as valuable as the combined market caps of GM and Ford. How’s that for…a company that has been endlessly predicted to be bankrupt any day now?
Meanwhile, Ford has pulled the plug on its slow-selling Continental, another victim of Ford’s determined effort to be a truck-only company.
I have always refused to express an opinion on Tesla’s share price, as it’s been volatile and reflects a huge amount of optimism in the company’s future. But it’s not just wishful thinking; there are a number of facts that are fueling the TSLA fire:
Unlike the rest of the industry, which is reporting first quarter sales being down 25-50%, Tesla is expected to deliver some 88k cars, or very close to its pre-pandemic guidance and its previous record (92k). That also means that Tesla might be able to squeeze out a profit in Q2, contrary to expectations. Tesla’s China plant is starting to really kick in, and its Germany plant is scheduled to start assembling cars by the end of this year.
Meanwhile, all of the “Tesla Killers” are languishing on dealer lots, leading to massive incentives. Chevy Bolts are discounted some $15k, and that’s before state tax credits. You can pick up a Bolt for $25,475, the cheapest true EV currently available. Nissan’s Leaf is very close. Audi’s e-tron is really lagging; 2019’s are still on the lots and can be picked up for $15k off. And the Jaguar I-Pace has a whopping $24k on its hood.
Meanwhile, Teslas have no discounts or incentives, except for some minor spiffs like 6 months free Supercharging (worth some $500).
What this clearly suggests, especially to investors, is that Tesla is only increasing its dominant position, and that its technology gap is widening. Tesla is moving to build its own battery cells, with a new chemistry that promises much longer life, less cobalt, and lower cost. And Tesla’s operating system (software) that encompasses all functions of the car, entertainment, security, Autopilot, etc. is constantly evolving and a moving target, one moving away, not closer, to the competition. VW is still in a huge mess trying to sort out its software and now starting a whole new initiative to create a new open-source system it’s willing to share with partners.
Even industry execs admit that Tesla is some ten years ahead, and that the gap is not narrowing. That explains the biggest bull thesis for TSLA.
And Tesla’s profit margins and free cash flow have been improving steadily. Tesla now sits on an $8 billion dollar wad of cash.
Tesla bulls compare it with the huge growth of high tech companies like Amazon and such, rather than the industrial companies. Obviously it’s easier to scale software (or even iPhones) than cars, but that’s the assumption.
Another factor is that proposed mandates for zero-emission vehicles are growing rapidly. The Democrats have unveiled a plan to make all new cars tail-pipe emission free by 2035. The EU and the UK is moving rapidly that same direction. California and the US states that share its emission regulations is also heading that way. The market for electric vehicles is forecast to increase to 10% of global passenger vehicle sales by 2025, 28% in 2030 and 58% by 2040, according to a May 19 report by BloombergNEF. To whatever extent these mandates and projections become reality (likely to one extent or another) that all bolsters the Tesla bull case.
There you have. But don’t even ask about the market cap of Nikola, the hydrogen/electric truck company that’s been promising a production version for years…last I checked, it’s worth more than either GM or Ford. Now they’re taking $5,000 deposits for a pickup that’s only a rendering.
Oh, and the Continental. Why bother wasting words on a dead horse?
Our chatty socialite Delores passed on in 2014, her last 2002 Continental finally disappeared from town earlier this year, the end of an era. Lincoln Continentals from the 1970’s on were her choice and her identity. Now, the last Continental, which she would surely have driven is gone too. RIP Deloris and your beloved Continentals.
Delores sounds a wow. Could you write more on her and her cars. A tribute to an era of poodles, cigarette holders and platinum blonde?
News of Tesla’s world domination always surprises me. I simply don’t see that many of them—and I live in New York state, where one presumably would. Maybe it’s because cars live much longer today than they used to…if we were replacing our cars every 3 or 4 years as we did in the 60s, the turnover toward new models would be more apparent, I guess.
Where do you live in New York? I live 70 miles north of NYC and Teslas are getting pretty common around here.
Hudson, 100 miles north of the city. I noticed during your Taurus Tales that you aren’t too far away from me.
There’s a Tesla dealer in White Plains. I’m wondering if that has something to do with them being more common here than in Hudson.
Re. world domination: In many places cars are taxed way way way harder than in the US. I’m in Denmark where a conventional new car is taxed somewhere between 120 and 180 percent (that’s not 20-80 – it’s 120 to 180 percent tax – more than the plrice of the car itself). Here electric cars are free of taxes, so that makes Teslas very interesting as a Model 3 costs the same as a very nice Focus or fairly basic Mondeo give or take. In December the Model 3 was the best-selling car in Denmark. I know the Model S has held the same honors earlier in Norway where they have similar taxation.
Or an even better point of comparison – Danish prices for the following:
Model 3 Standard Range: 56k USD
Model S Long Range: 97k USD
BMW 330i xDrive aut. Advantage: 98k USD
They are VERY common over here and I see why.
Here in the UK we see quite a few – not a ‘status symbol’ – they are too cool and understated for that. They look very different to anything else seen on the road.
I may have been a Tesla skeptic at a time, but I never had any faith the Continental would do well. It was a swankier MKZ, which itself was a swankier Fusion. What was I missing that made me feel this was a weaker effort for the name than even the previous Taurus based ones(with an exclusive powerplant)? Didn’t even have suicide doors out of the gate, instead they belatedly outsourced them as an option in a fashion as crude looking as modern hearses and mobility vans. Not that I expected it would have helped sales much, but at least it might get have been a gimmick worth talking about out the gate. Instead everyone who was excited about it were the same people clamoring for a return of the Panther.
There’s no way in hell Nikola will succeed. I need no data to say it either, they simply jinxed themselves with that name. The two car companies to successfully emerge from nothing in 100 years managed to be the first and last name of the scientist? What are the odds! Strikes me as an cynical ploy to get Tesla to acquire them as a sub brand more than anything else. I’m open to be proven wrong again, but… we’ll see.
I really wanted to like the new Continental, but all I could ever muster up was a “meh”. Not a bad car, but not exciting and didn’t stand out to me. At least this car seems like it will be forgotten relatively soon, leaving the Continental nameplate open for another revival sometime in the future. I just hope it is not for some bland CUV.
So is this new it for Fords that are not trucks or Mustangs?
Me too, there was a moment the hype machine for the Continental wasn’t dissimilar to what we’ve been seeing for the upcoming Bronco, with all this speculation it would be the breakout to end Lincoln’s then funk, and it just was more of the same with yet another new grille theme.
I don’t know what the future holds for Ford but I have a thought time imagining how having more subsegments of crossovers and SUVs than sedans ever had at one time is a recipe for success. Lincoln might be better off in an Aviator/Navigator only lineup, but everything below is just carryover from the brand’s meh days, and Ford’s lineup of Mach-E, “cool” bronco, “wimpy” bronco, escape, explorer, expedition, focus active, is getting as confusing as a Roger Smith era GM lineup. And I have a bad feeling that if the Mustang Mach-E is considered successful enough the real Mustang will quietly be put out to pasture, making the lineup fully devoid of anything classed as a car.
Tesla is sitting on a bunch of cash and lost much less money last year–$144 million–than the $862 million they lost in 2018.
I truly do hope it becomes a long-term going concern.
Those are “net losses” meaning taxable income/loss and includes a number of non-cash charges. Cash flow, or EBDIT is what’s critical, and Tesla has been a net generator of cash for several years now.
Not aimed at you, but the number of journalists who don’t know the difference between a net profit/loss from cash flow never fails to amaze me. People are so fixated on Tesla’s losses (or small profits), but that’s not the critical metric.
I mostly agree, although I worked for a Silicon Valley giant whose founder and CEO always preached the EBTD gospel … and it finally bit the dust. But Tesla has decent financials, a massive market cap, a charismatic leader if not to everyone’s liking, and great products that are selling well globally. Ten years ago I thought they’d end up as somebody’s acquisition but if Elon cared (which I suspect he doesn’t) vice versa is now far more likely. CJC’s comment below about HW and SW is spot on, and to that I’d add Tesla’s vision about infrastructure; without the Supercharging network these cars would be far less viable.
“People who are really serious about software should make their own hardware.” -Alan Kay
Usually people think about Apple when this quote comes up, but I think it works for Tesla as well. The combination of advanced battery tech and software integration is tough to beat.
There’s a sucker born every minute, and two two take him – and one of those two is Elon Musk
That’s a highly predictable comment left at any Tesla story for over 10 years straight now. Will you still be making it in another ten years?
I’m at a loss to think of another American car that was launched from scratch (not a merger or etc.) that survived a dozen plus years. Nothing post WWII, certainly.
Kaiser and Frazer never had Harry Truman to subsidize them.
Since the luxury car market in the USA seems to have morphed into the luxury SUV market I have to wonder if the future of the Lincoln Continental might just be as a low volume suicide door Lincoln Navigator totally pimped out with a price tag to reflect it’s lofty position. It’s a legacy name in search of a marketable platform to live on.
Even though I’ve finally come around to believing that Tesla won’t be shuttering their gates anytime soon I think I’d nevertheless push my pile of chips towards the Toyota square on the felt.
Here’s what I can’t get around and I can’t believe that I’m alone in this:
I believe I’m very much in the target market for a Tesla of some sort – I’m interested in cars, have purchased new ones costing over $50k, seem to switch cars often enough to try something new, I’m not averse to trying differing propulsion methods (gas, diesel, CNG, hybrid, why not electric), have owned cars with iffy reliability reps, have owned cars whose builders disappeared, so why am I not clicking the “take my money” button this time?
Perhaps it’s that Tesla the brand is way too intertwined with Musk the person. If Tesla was owned by VW or Toyota and produced the same stuff, I’d perhaps be more on board.
As long as nothing happens to Musk, they’ll likely be around for at least the medium term. If something physically happens to him, all bets are off, he seems to drive that ship very much to the exclusion of anyone else. That is not a viable long term strategy in my opinion (but which doesn’t necessarily run counter to them succeeding as an entity).
More to the point of the overall post though, Teslas main problem is otherwise – there is a VERY large part of the (worldwide) market that doesn’t want to or can’t spend what Teslas cost. I don’t see them producing anything near the price scale of a Corolla or Golf (i.e. half the cost of a base Model3). If VW would stop stepping on their own tail they have almost every part of the world except for the US covered and are still popular everywhere but here. I’m starting to think GM purposely made the Bolt a little hatchback and only really sold it in the US (yes, I know of the Ampera, should have been spelled Niche) to ensure failure since they supposedly lose money on every one, imagine the losses if they built a small CUV instead that people might actually want… If Toyota finally got on board with 100% electric or just perfected the solid state battery to do so economically then they’d have the market of all the people that are done with fancy or special or interesting cars etc and just want something to get them to work on time and cheaply, that’s where the true scale is, there are WAY more people in that market than the gearhead or moneyed market. The Tesla range does not offer anything to the mass market and no I don’t think a $35k Model3 is that. 90k sales spread across four models in a quarter is not terrible (for Tesla), but that’s worldwide and now the output of TWO plants combined. What other manufacturer produces an annualized output of 360k units spread over four models and is profitable? Porsche is probably the closest analog in that they produced 280k units in 2019 in several plants but their average transaction price is much higher than Tesla’s AND half of their platforms are shared as well as many components being off the shelf and shared with other cars. Why has Teslas production not increased significantly over the last year (yes I’m discounting last quarter for obvious reasons.)? NUMMI used to produce over 450k cars a year BEFORE Tesla expanded the plant and everything we hear is that electric cars are supposedly easier to manufacture than conventionally engined ones so what’s the holdup?
I’m not negating Teslas success or potential, they’ve done significantly better than I was willing to bet a few years ago and I can admit that – the stock price is fairly meaningless as an arbiter of actual success though, he could tweet something stupid tomorrow and make it drop significantly, might as well take your cash and head to Vegas.
Edit: I forgot about the Continental (just like the market) – that thing was DOA as soon as I saw it at the Auto Show its first year and confused it with the Zephyr or MkZ or whatever it was that got the same front end at the same time. Instantly reduced to oblivion, nothing like making your flagship look just like your bread and butter model, there’s no coming back from that.
The Bolt is over 5′ tall and has black plastic flares and rocker panel trim. All GM had to do was certify it as a “light truck”, send it out into the world with factory dark tint glass and a tip warning on the sunvisor (that it doesn’t need) and lo, it would be perceived as a crossover. The boundary is that blurry.
But…they didn’t and thus it was doomed in this market, at least comparatively speaking.
You’re going to keep me busy tonight: 🙂
I don’t see them producing anything near the price scale of a Corolla or Golf (i.e. half the cost of a base Model3).
Then I guess you haven’t read that Tesla is planning to design/develop/build a smaller cheaper hatchback in China, at their new planned China design/tech center. Undoubtedly, if/when that comes to pass, that could be built in the US or Europe, or imported.
As to Tesla’s prices, you do have to keep in mind that gas savings for those that drive considerable distances add up, and there’s state tax credits in quite a few states.
There’s already a CUV version of the Bolt that’s due to arrive here soon. But I don’t assume that’s going to solve all of their problems.
If Toyota finally got on board with 100% electric or just perfected the solid state battery to do so economically then they’d have the market of all the people that are done with fancy or special or interesting cars etc and just want something to get them to work on time and cheaply,
That’s a lot of “ifs” there. Their claims for solid state batteries are as credible as their claims that they’re going to bring the price of fuel cells down to the same as EVs. I’ve been waiting on both those claims for some years now. And folks give Musk a hard time for over promising. He’s hardly the only one.
Solid state cells will come, fairly soon. It’s not that magical, but the price is not yet competitive. Tesla is also hard at work on them. When the price comes down, they will appear. They’re an inevitability. All in good time. But it’s not a magic cure-all.
The Tesla range does not offer anything to the mass market and no I don’t think a $35k Model3 is that.
The average transaction price of a new car is now almost $40k. Figure in tax credits and gas savings, and a $35k or $40k Model 3( before those savings/incentives) sounds very mass market to me.
90k sales spread across four models in a quarter is not terrible (for Tesla), but that’s worldwide and now the output of TWO plants combined….. Why has Teslas production not increased significantly over the last year (yes I’m discounting last quarter for obvious reasons.)? NUMMI used to produce over 450k cars a year BEFORE Tesla expanded the plant and everything we hear is that electric cars are supposedly easier to manufacture than conventionally engined ones so what’s the holdup?
There’s a huge difference in how Tesla operates Fremont and how NUMMI did. Tesla is massively vertically integrated, they even build all their seats in Freemont, and huge amount of other parts/components. Do you think NUMMI actually built any components except body panels there? Engines? transmissions? Interior assemblies? Seats? Suspension components? They just assembled everything that was shipped there. Very, very different kind of operation.
Tesla obviously would have built more this quarter, but there was this little inconvenience called the coronavirus that shut down both their China plant and then their Fremont plant. Compared to everyone else, Tesla’s production in the 2nd quarter is exceptionally high compared to their capacity.
Tesla is utterly maxed out at Fremont, given their vertical integration. No, electric cars aren’t easier to manufacture. Significantly harder, at this stage of the game. Battery cells have to be made (or bought, for others in the industry). Cells have to be integrated in a complex battery pack. Automation will bring these costs down, and Tesla is currently in the process of setting up a pilot line for manufacturing their own cells using a highly automated line.
Tesla’s China plant is already being expanded to produce Model Y there. And Tesla’s German plant is supposed to start assembling Ys by the end of the year. 2021 production capacity should be significantly higher.
Tesla’s growth has to follow the growth of its market, which it largely is. If Tesla had had too much capacity a few years back it might have killed them. Acceptance of EVs still has to constantly overcome resistance from consumers. But that’s constantly and steadily breaking down. It’s a lot like the example I used a long time ago; that Tesla is like BMW or Mercedes in the US market back in the late ’60s and ’70s. If they had suddenly shipped massive amounts of cars here, they could not have sold them. The market steadily grew, and their sales steadily grew, for several decades. Things don’t happen overnight, not such a massive change to EVs, certainly.
though, he could tweet something stupid tomorrow and make it drop significantly,
He tweeted twice that he thought the stock was too high, and it came down some 10% the next day. But then went right back up. Nobody can accuse Elon of hyping his stock anymore. Who else goes on twitter and says “Stock is too high”?
Given the massive momentum TSLA stock has had this year, I don’t think anyhting Elon could say would make much difference, except for him saying he’s about to die. 🙂
If Tesla was owned by VW or Toyota and produced the same stuff, I’d perhaps be more on board.
Another massive “If”. The simple reality is if that were the case we wouldn’t be here discussing Tesla’s massive market cap. Tesla IS Musk, and vice-versa. Take it or leave it. Tesla investors’ worst nightmare is Elon leaving. He’s the one driving the company. If he says something stupid once in a while, that’s just a reflection of his personality. The question is whether that’s really material or not. To investors, not. To the media, yes, because it’s clickbait. They love it for that reason. Musk is #2 clickbait after Trump. And they’re not happy about him having piped it down this past year or so.
I get all my automotive news from Curbside Newsstand. But apparently missed the one about the smaller Corolla-killer Tesla, good to hear, that is genuinely very interesting. 🙂
I suppose I should do the math on fuel costs vs electrical charge costs, and SuperCharger rates vs home rates. No solar panels yet, too much of a sunk cost and I move too often. But my state does offer a $4k incentive (reduced from $5k as of 1/1/2020). The least expensive Model3 is currently $37,990 before that incentive, so $33990 after (RWD, in whatever the one forced color this quarter offers).
You are correct in the ATP being in that ballpark. I figured the mass market was closer to the low to mid 20k range with AWD vehicles (midsize CUVs) in the $40k range, so about 10-15k less than the Tesla equivalent and at this point excluding the pickup and large SUV market as there is (currently) no equivalent.
Yes I was aware that NUMMI was an assembly plant and not so vertically integrated. However, Tesla states that Model 3 motors and battery packs are produced offsite (Nevada Gigafactory) and shipped as assemblies or at least that’s how I read it and that’s by far the volume model at this time. I do understand that they produce many of the sub-assemblies in-house and while I am not a supply chain manager or engineer, can’t really wrap my head around it beyond a (possible non-existent) control issue. The quality doesn’t appear to be different vs using a supplier and at least on the Model S I drove several years ago now, several interior pieces were clearly Mercedes sourced. (shift lever, window switches etc), that may be different now or it’s not all the pieces. (which you didn’t claim, I know.)
Perhaps that’s the better way of phrasing it, the stock price IS priced as high as it is very much due to the “Musk” factor. If he were to tweet that he’s dying, then yes that would have a significantly greater impact on the price that if the same was said of any other company head that I can think of, including Steve Jobs for example. Jobs, while certainly mercurial enough on his own was understood as having a team to rely on and while he also jumped into the fray as often as Musk does seemed more above it, and Apple was somewhat more diversified as to products. Although who knows what would be if Jobs was still around in the Twitter era….I believe Musk tweeted that he thought the stock was too high precisely to lower the price and create a “buying opportunity” which then created publicity and a greater number of buyers that took the bait and fueled a bigger rise. But that could just be my tinfoil hat being a little snug!
You’re absolutely correct that the post was more about the market valuation and I kind of ran in a different direction with it (which I realized). But still think that Musk may be the greatest thing for the stock price and for the products themselves BUT not for actual sales numbers – I’ve had the same personal feelings re: Apple off and on over the years as well though. Then again I’m reminded that Musk’s stated goal was not for Tesla to be the sales leader in volume but to create a shift to a different kind of vehicle, i.e influence the industry as a whole.
Anyway, interesting conversation, I freely admit you are far more read up on the subject than I am, thanks for the info. I already mentioned my preferred news source 🙂
I haven’t been inside Fremont, obviously, but from what I hear it’s jam packed to the gills (and expanded upon) with all kinds of manufacturing and R&D activities. Including several that are absolutely off-limits.
All I can say is that Tesla does things very differently. You can be the judge if that’s good or bad.
I haven’t been inside the Fremont plant since it built rear wheel drive A/G Bodies 🙂 but I know quite a few folks who have worked there (actually both NUMMI and Tesla people). And I know a bit about supply chains and the Bay Area’s manufacturing capabilities. For a lot of good reasons, despite the downsides, Tesla chose the Bay Area, but capable sheet metal, plastic, machine shop, etc suppliers that can handle automotive size parts and volumes have disappeared there. GM sourced a lot of stuff from their national component plants or sub-tier suppliers, and NUMMI was able to tag on to the local companies that supplied Lockheed, IBM, Apple, Atari, Peterbilt etc. All gone now, so Tesla’s only choice, beyond just control, was either to invest in vertical integration or suffer from a long expensive supply chain with extended lead times and shipping costs. The vertical integration has also made it easy to attract the best and brightest employees. Apple manufacturing engineers who practically lived in China half the year, can now just sit on Hwy 237 for an hour but still sleep at home.
Another point of difference between Toyota and Tesla is the manufacturing and development philosophy.
If you are a software company or other similar start-up company, no doubt the agile sprint approach works better. Tesla is incredibly good at making difficult things real fast.
Toyota is lean and lean is about continuous improvements – gradually perfecting your processes, cutting away the fat to the benefit of all. This works well for a heavy industry like car manufacturing or big pharma where I work.
It is immensely fascinating to me that Tesla’s products are of such relatively high quality all things considered.
I love lean but I can see where an agile approach is more beneficial. I’m certainly more inclined to buy a Model 3 than a Toyota. The 3 is the first new car I’ve been genuinely excited about since I was a kid.
And of coure the irony is that the Tesla product is about as lean as a car comes even though its development is by all accounts anything but lean.
What I don’t understand is. At what point will Tesla have to stop owning their own cars prior to sale? They flipped the traditional dealership floor pan on it’s head by directly selling to the public. At some point all that cash tied up in inventory will stifle growth. Barring a robocar mutiny where all Tesla’s simultaneously turn their on owners, switch to ludicrous mode and fly off the nearest cliff I don’t see sales slowing down. Surely their has to be a simple mathematical formula for this. I have no idea as I’m terrible at math. Perhaps when inventory days of supply hits 30 days?
At what point will Tesla have to stop owning their own cars prior to sale?
And the other manufacturers are jealous of Tesla’s direct sales. They’d love to do the same thing to, and have tried to sneak in little bits of it here and there, causing the dealers to take them to court, as in the case of Volvo’s mobility service.
This is why there are no Tesla dealers in Michigan. The Michigan dealers association lobbied our legislature to pass a law banning any direct sales from the manufacturer to the customer.
Tesla’s done so many things wrong – not using industry-standard charging connectors forcing them to waste huge amounts of capital building out an alternative infrastructure, wasting *more* huge amounts of capital on a quixotic legal battle to circumvent dealers, *still* not being able to deliver anything other than bottom-of-the-industry initial quality. Throw in a flaky charismatic founding CEO whose Twitter feed makes you glad the natural-born-citizen clause of Article 2 of the Constitution exists, and the *expectation* early on that they would grow to a point where the tech and concept were proven before selling to an established player. No wonder they’ve attracted more shortsellers than any other company!
But they got two, crucial, things right – the underlying technology and the image. That goes a long way, and it may just take them all the way. The next milestones will be redesigning/replacing existing models and successfully evolving to a post-Elon company.
As for the Lincoln it was too little, too late. If they had put the Continental concept from 2002 in production within a year or two, preferably before Chrysler’s less expensive 300, they could’ve reskinned/evolved it into this and had a good, long profitable run from the platform. As things are, sedans are the new coupes and Lincoln’s emphasis on comfort means they’re pushing attributes the market finds most appealing in a crossover (or if they tow or are a livery service, the big BOF Navigator).
Tesla’s done so many things wrong – not using industry-standard charging connectors forcing them to waste huge amounts of capital building out an alternative infrastructure,
You’ve got that backwards. There was no charging network before Tesla created Superchargers. It’s still by far the densest system. It’s been a huge key to their success so far. If you want to drive a non-tesla EV long distances often, good luck with that. it’s getting better, but 3-5 years ago, it could have been a nightmare or impossible on many routes. Plus many of the other systems are much slower. It’s an asset, not a liability. And now that it’s not free for most new Tesla owners, it will increasingly pay its own way.
wasting *more* huge amounts of capital on a quixotic legal battle to circumvent dealers,
Another huge and critical asset. People hate dealers. Tesla has shown how to circumvent the whole thing. Just go pick it up, or even have it delivered. It’s the future, today. Other companies would love to be able to do the same thing. And it cuts out the middleman. Tesla takes 100% of the sale. No incentives, advertising, dealer cut of the revenue, etc…
*still* not being able to deliver anything other than bottom-of-the-industry initial quality
I agree that’s not optimal, but it seems to be good enough. At least so far. Tesla does learn, and they will presumably continue to make progress in this regard. The M3 has gotten vastly better. the Y is brand new and was rushed out, as usual. But yes, it’s an opportunity for them.
Speaking of quality and reliability – I’m not surprised that Audi and Jag’s e-offerings have gone begging. Given the reliability problems with both brands as to their gasoline offering (yes, I know Audi has gotten better lately but there’s still the matter of sky-high dealer repair rates; trust me, I know), I suspect that many people are leery of trusting those brands with a relatively new, electronics – heavy technology. To these folks I’m sure Tesla seems a safer bet, to say nothing of its panache – luxury buyers love that.
One of my Tesla-owning friends who is a serious car geek talks about the charging network and the dealer-free sales and service experience more than the car (Model 3) itself. I think they are a huge part of the value-add.
I hate dealers.
No dealers, no advertising, no race sponsoring—this is how a car company should be! The state of Michigan can go to hell…right along with the city of Detroit.
Now get me that million mile battery in a $30,000 car without any subsidies. Thats the ticket right there.
I’m just gonna leave this here graphic right here
“As for the Lincoln it was too little, too late. If they had put the Continental concept from 2002 in production within a year or two” I was so disappointed at what the Continental became, just another generic blob with lots of content at a sort of high price.
Honestly, I’m surprised Lincoln even kept the Continental as long as it did. It was exactly what I expected it to be, a cynical attempt to bring back a nameplate that has little if any relevancy to the modern world in general, expecting some form of misguided nostalgic recognition to propel it to success, and built for as little as possible minus some touches here and there, because the bean counters would’ve had a fit if they actually put any effort into the product.
The fact of the matter remains is that the Continental, as a model in Lincoln’s lineup, stopped having anything resembling importance in 1988. The days of the suicide door 60s and even the big B-52 sized 70s were long gone, and there wasn’t anyway to capture that over 50 years later in a modern age that would be unable to reproduce that in any meaningful capacity. It was a desperation attempt, brought on by a company that really didn’t need to waste everyone’s time to try to peddle out what the Continental turned into in the last pathetic generations and decades of it’s twilight years. A gussied up Taurus with fancy gingerbread. And the suicide doors at the end, was not only an obvious desperation ploy, but the integration of them was so misguided, you’d almost think that it was a bad photoshop made real. It would be infuriatingly arrogant if it wasn’t so funny.
So, yeah. RIP Continental. I’d drink to your loss, but it would be a waste of alcohol.
The transverse InTech V8 was exclusively designed for use the 95-02 Continental so it wasn’t quite as simple as being a gussied up Taurus like the previous 88-94 years. I think the styling failed, they softened it up far too much with the jellybean and doubled down with the 98 refresh. Sedans for the elderly, just a curvier Cadillac with a more reliable V8 than the northstar, but a worse transmission.
Frustrating because Lincoln hit home runs with the Mark VII and 1990 Town Car, but the Continental never seemed to benefit. First it was saddled with its bustleback body when the Mark showed the way forward, then its Taurus based 88 successor was simply uninspired, sharing way too many cues with the redesigned Topaz sedan, and then for 94 went all jellybean like the Mark VIII, which essentially previewed the notorious Ovoid theme. I don’t think it mattered much what the Continental was based on so much as the execution was consistently lacking. I mean the big 70s Continentals were essentially just reskinned LTDs, but the designs still were very Lincoln with a distinctly imposing presence.
Yes, the Intech was a great engine. Unfortunately, the AX4N hung on the end of it was made of glass. Now if the 6F50 could be adapted, perhaps you’d have something. The biggest challenge would be the software. Also, there’s no love out there for those Continentals.
The thing that might sink Tesla is not the cars, it’s the CEO. The latest:
FWIW, I’m seeing Teslas here in Tokyo more often than I see GM or Ford products. Same in France: last time I was there, I even saw a Tesla taxi. The cars are selling. But this bonus thing is another tone-deaf misstep by Musk, just like his ranting against COVID-19 countermeasures. The bigger Telsa gets, the less Elon’s evermore erratic behaviour is going to be tolerated by his shareholders. Can Tesla survive without Musk? That’s the $55bn question.
That’s not going anywhere, and is old news.
Musk has never taken a cent in cash compensation. All of his compensation has been in the form of stock grants and options, which of course means he is totally invested in the success of Tesla.
This latest compensation deal was made a few years back, and gives him the opportunity to make huge amounts (in stock options/grants) but only if certain metrics are met, including Tesla’s market cap, revenue, profits, etc. These milestones were considered incredibly ambitious at the time (3 years ago, IIRC), and nobody cared much, because most didn’t see how Tesla could meet them.
Well, they have met the first one, Tesla being worth more than $100B for more than six months, so he is entitled to the first round of option grants.
Why would any intelligent shareholder care, since he’s making them much richer too? They’re benefiting as much or more than he is. And these stock option grants don’t really cost the company anything, as obviously diluting the stock a very small amount is not having a negative effect on its price.
The absolute nightmare for Tesla stockholders would be for Musk to leave the company. The stock would crash! This suit is just more of the constant little side noise that goes on at Tesla.
My first used car was a 1984 Lincoln Continental Valentino edition.
Lincolns have always had a place in my heart.
A trip down (Lincoln) Continental Lane…
The 1961 Lincoln Continental sedan…
The 1976 Lincoln Continental Town Car…
The 1984 Lincoln Continental Valentino Edition…(the one like my first car :(…
The 1992 Lincoln Continental…
The 2000 Lincoln Continental…
And, a beautiful car, even if it may considered a “dinosaur” by some, the 2018 Lincoln Continental…
On Tesla (or any electric car): the biggest block to wide-spread adoption will be recharging issues… especially at home, where a 25% adoption rate would overwhelm the capacity to supply in the average neighborhood. This can be remedied, but will take a long while and a lot of money.
On Nikola, I’d not count on this catching fire (might be a bad pun on H2 use). Infrastructure for piping doesn’t exist, safety of the distribution system is a big issue… even a pinhole leak could self-ignite due to negative Joule-Thompson coefficient of thermal expansion, an… the biggie: the most efficient means of production involves: 1. natural gas (oh no, fossil fuel!) as the feedstock and 2. releases 5.5 lbs of carbon dioxide per lb of hydrogen produced (and that at 100% efficiency, which never occurs).
Further, for some (such as our family) electric range and refueling times cause problems for our lifestyle, which includes frequent long distance driving of up to 2,000 miles. As battery technology and distribution systems improve, this will change.
Finally, if the US decides to actually walk its own talk on forced child labor we will have a shortage of some critical minerals necessary for battery manufacture… horrible conditions in those mines.
will be recharging issues… especially at home, where a 25% adoption rate would overwhelm the capacity to supply in the average neighborhood.
How much electricity does your house use at night? Do you run your dryer all night, or your range, or water heater. The amount of power for any one of those is enough to charge most EVs.
This is such a tired old argument. Electric suppliers are salivating at the opportunity to utilize massive unused capacity at night. With smart meters and smart charging, this means it can happen when the grid is at its lowest ebb otherwise.
Paul: My source is an article in the Wall Street Journal a few months ago explaining needs in the “average” neighborhood (which like most averages is likely typical… but rare), having X homes and in area with transformer service of Y. It detailed how the “average” infrastructure would be unable to supply neighborhoods the power necessary to charge electric vehicle in advertised timeframes if more than about 25% of the homes had such cars (also an “average” vehicle, I suspect). The individual home services are easy to upgrade and aren’t the issue; the neighborhood transformers serving them are the bottleneck, followed by the substations serving those area transformers.
You might be tired of this “argument”, but that does not make it invalid, at least for many parts of the country. Further, to depend upon people following the common sense you’ve suggested I’d say good luck… recent events in the country show we have precious little sense at all.
I don’t have access to the WSJ. The key is timing: if the article assumes folks will charge their EVs during the day, then, yes, it will be an issue. Did the article specify time of day for charging? That’s the critical factor. If it specified that the problem would exist at night, I’d like to see it. if it doesn’t, then I suspect it’s another veiled hatchet job on EVs, which are all-too common.
I dont believe these infrastructure issues are an insurmountable problem. The grid is going to have battery storage built into it soon. Houses will have their own battery storage soon, as well as solar roofs. The weak link will be the neighborhood transformers that supply homes with 240VAC single phase power. This is antiquated garbage anyway. We should’ve had 3 phase residential power “on the pole” decades ago. Its time. This is all merely my opinion however.
Yeah the infrastructure would need a lot of upgrades to handle something like a 25% EV adoption rate. Fact is most homes don’t have smart meters with time of day metering and the average person isn’t going to program their car to do anything other than charge when plugged unless it will result in significant savings due to time of use metering.
So yeah everyone is going to get home plug in their car, turn up the heat, turn on lights, cooking appliances ect in that same peak use window.
According to JD Power, Tesla ranked dead last in quality. Consumer reports also found quality problems a few years back.
Remember prior to GM’s “deadly sins” in the 70’s people used to think GM was great, so much so they had more than 50% market share. Razzle dazzle will get people to buy cars once, but quality will get them to buy again. Just ask Toyota.
It would be interesting to know how many Tesla owners buy another Tesla. Is it a high rate because of a lack of real competition? Or are they dumping them in favor of Priuses, Bolts, Leafs, electric Porsches etc?
I’m reminded a bit of what the then-CEO of Nokia said around the time they were getting passed by by Apple, Samsung, and Google. Nokia was building phones, but their rising competitors had built entire ecosystems – phones, but also related accessories, app stores, third-party developer relationships, brand-exclusive software like FaceTime and iMessage, tablets that ran the same operating system, etcetera. Tesla is like Apple was ten years ago – they build
phonescars, but they also built an ecosystem – a huge network of Superchargers that can only charge Teslas, a direct sales channel, Powerwall home charger and battery storage units, and they’re getting into solar roof tiles (actual roofing, not just ugly panels that sit atop the existing roof). Everyone else is like Nokia – here, you want an electric car? Let us show you the e-Golf in the back corner of the lot next to our charger.
The Superchargers are Tesla’s ace in the hole. They work like the gas pumps we’re used to and ease the transition to electric power. Buy any other EV and you’re faced with a patchwork of different companies’ chargers, many with their own plugs, their own usage instructions, some requiring first loading their phone app or registering before you can use them. What a mess. Tesla also has cachet. Everyone knows what a Tesla is. Almost nobody knows what a Jaguar I-Pace or Audi E-Tron is, and those that do know they can’t go as far on a charge as a Tesla can. Tesla has purity; they promote and make only EVs; everyone else is being dragged into it reluctantly.
And no, Tesla’s success doesn’t mean every EV startup is going to make it big. Did you all catch the new about Byton yesterday? I wouldn’t expect any more from Nikola. Faraday Future was all hype. Better Place is now in a better place. Sir James Dyson’s EV dreams have been put to bed. I’ve already forgotten the names of some other once-hyped EV dreamers. The only EV startup I’m bullish on is Rivian, and even they took a recent hit when Ford backed away from a promising Rivian-based Lincoln SUV.
“Buy any other EV and you’re faced with a patchwork of different companies’ chargers, many with their own plugs, their own usage instructions, some requiring first loading their phone app or registering before you can use them. What a mess.”
No, as long as you don’t buy a Nissan or Mitsubishi every non Tesla station you come across will accommodate your car.
The whole registration, downloading an app and carrying another card or fob is going away quickly. CA led the way requiring payment by credit card to be an option in their state and Electrify America is doing that by default at all locations across the US. Yes you can get a lower price if you become a member. Other providers will follow.
There is also a new app released recently that does away with the separate memberships ect and works accross most public charging systems. Then you have the Mach-E which will plug and charge at just about any public charging system just like you can with Tesla, but with more locations.
All I’ll say about Tesla is that the Hampton Inn here in Gallup next to Exit 16 has a bank of chargers (I think about 6 or 8 slots) in the back of their parking lot. It is generally nearly full of Teslas at many different hours of the day. Of course lots of I-40 traffic coming in from California and Arizona or heading back that way. I also see a fair number of car carriers loaded up with new Teslas making their way down I-40 to other parts of the country.
Back tot he Continental. I am saddened by seeing the death of sedans period or even the killing off of cars in the larger sense. Rumor has it that the Malibu won’t make it beyond either 2021 or 2023, which would be the end of sedans not called Cadillac for GM. The development of the next generation Camaro has been suspended which would leave the Corvette alone as the only non-truck/SUV/CUV that GM builds outside of the Cadillac brand.
I was never going to be buying a new Continental but a CPO turbo AWD model is an attractive proposition. If only the big 3 had put this much effort into sedans 20 years ago.
I still wonder which midsize family sedan will be the last man standing. At the current rate I think this will happen in my lifetime (being only 43.)
It will most likely sport a Honda, Hyundai or Toyota badge.
Meanwhile, all of the “Tesla Killers” are languishing on dealer lots, leading to massive incentives.
Which suggests that Ford’s use of the Mustang badge and styling cues for its EV was a smart move. The complaints by the Mustang faithful have generated a fair amount of free publicity for the upcoming vehicle.
One wonders how many people know that those other vehicles even exist. Whether Ford can sustain and build upon that momentum remains to be seen.
I used to work in the GM plant that Tesla bought. No mater what I think about Musk, he did have that run in about the Covid shut down, which I thought was a bit irresponsible. I give him credit for developing the technology that allows the Space X booster stages to land on those ships. I pass by the Tesla plant all the time, they do build the best electrics, no argument there. Most other manufacturers’s efforts seem half hearted, kind of like how Detroit handled the “Import Invasion.”
The Continental shares all the problems of all sedans. They don’t do anything better than a crossover or SUV, in fact they pretty come up short in function. I would rather have a new Aviator than a Continental. That holds true down the entire product line.
I like sedans. I like sporty GTs, I like actual sports cars. I own a mix of different type older cars. A pick up truck, SUV, luxury sedan, luxury GT, and even a pony car. If you are not an enthusiast, why have any of these cars except the truck or SUV? A CUV will fill the bill also. Most buyers don’t have that emotional investment in cars and just want to buy something that will fill their needs. Unfortunately sedans don’t fit well with current lifestyles.
I think automakers lost track of what sedans should be, are they supposed to be stylish and sporty for the sole sake of the lower weight and center of gravity?When you look at 4 door sedans in the mid 90s they were stylish enough but gave up nothing in terms of the practicality a 4-door family car had been known for for decades. Crossovers get a whole lot of love now a days for their supposed superior practicality, but I think they just do the old regular 4 door sedan thing that sedans gradually became less good at because of their lower sleeker rooflines and smaller trunk openings in the quest for every sedan to be a “sport sedan”. Afterall, if outright practicality was the only thing a public ambivalent about cars cared about, Minivans would be a much healthier segment than it currently is.
The crew cab pickup and the 4 door SUV/CUV has replaced the 4 door sedan. Partly because fuel standards on cars. Also some moronic car companies still trying to sell grossly over priced tarted up cars like the Lincolns. Buy a nice Fusion for considerably less than the Lincoln version. Also somebody there at Lincoln thought the bustle back was coming back in fashion. Its ugly now, was ugly when Cadillac did it to the Seville.
On Elon, I am not sure where I sit with the car company, but thank god he pulled together a team and built that rocket company. Thank You Elon for flipping the rocket industry upside down!!!
The future of tesla is tied to musk’s success or failure in the self driving tech. This is my opinion. Tesla will be here to stay if and only when a tesla can truly drive itself cross country completely empty of human beings inside it. And I completely believe tesla will accomplish this goal…eventually.
People dont really care if the car runs on a battery or a fuel cell or natural gas. They care about full self driving and the ability to refuel itself in their own garage without any human hands involv4d in the refueling task. If that can be achieved with natural gas…good enough.
I was just checking this out.
I’ve been a BIG skeptic regarding electric in general and Tesla in particular.
I could say that Tesla buyers are probably very affluent, and thus less affected by COVID, which has helped their sales. They are.
Even so, it’s hard for me to argue with numbers. The numbers are very good in this environment.
But if Tesla is as vertically integrated as Paul states, that impresses me on many levels.