Christian Science Monitor: Rise of the Boutique Carmaker

[tonybelding]

A really informative article (as I've come to expect from CSM) that covers not only Tesla Motors, but also has some insights about what direction the automobile industry is heading.

http://www.csmonitor.com/2006/1027/p12s02-stct.html

Highlights:

Money came from a group of investors that included billionaire PayPal founder Elon Musk as well as Google cofounders Larry Page and Sergey Brin. That has helped Tesla compress time. "In order to get the Roadster on the market fairly quickly, all the choices we made were not the most cost-effective choices," says Eberhard.

The manufacturing is done in England. Some parts - windshield-wiper motors and the like - are bought from other automakers in a milder form of the sourcing done by companies like Georgia-based performance carmaker Panoz, a leader in "scavenger" engineering.

"We're developing a car for $60 million," says Mr. Harrigan. "GM would probably spend that on marketing [alone] for its new Chevy Cadaver or whatever."

[asdar]

Not a hopeful article for Tesla or the electric car in general.

I hope this lights a fire under the people that want to prove the analysts wrong.

[tonybelding]

I didn't read it that way. I mean, we already knew this was a David versus Goliath story -- in that respect the critics are pointing out the obvious.

However, if you look at this bit:

"Every generation has its creative geniuses who think that they can beat the odds, but the reality is that the car business is more than just the challenges of engineering the car itself," says Maryann Keller, an industry analyst, in an e-mail. "Getting the attention of the buying public with advertising and then setting up a dealer network - no, you can't sell them online - parts and repair investments, etc., are usually way beyond the capability of most individuals."

That really strikes close to home on most electric car companies. It doesn't bode well for Commuter Cars, or Wrightspeed, or AC Propulsion, etc. Tesla Motors, by comparison, are the ones who seem to have their corporate act together. They're the ones who appear to be thinking about not only the car, but also public relations, service and repairs, a dealer network, all the things that people expect a "real" car company to do.

[Tesla2Go]

"We're developing a car for $60 million," says Mr. Harrigan. "GM would probably spend that on marketing [alone] for its new Chevy Cadaver or whatever."

;D ;D ;D ;D

I don't see the point in offering the "wisdom" that: there's no point in doing anything, since you're too small to have an effect.

Mitsubishi, Toyota......their giant wheels are starting to turn. No doubt what Tesla has done and is doing, will increase the big guys motivation

[WarpedOne]

Never mind analysts. All they can do is look at history and extrapolate.

When did any extrapolation forcasted a revolution? They are only modern fortune-telleres.

[david_42]

"no, you can't sell them online" There are many billions of dollars that say you can sell online. Certainly, you need physical support, but Tesla is providing that, in part, by restricting the locations where they sell the Roadster. This is the first electric car designed to be sold to people who love cars and driving. These are big city folks, not back-to-landers. Their market target is online with broadband.

I'm bringing a new consumer product to market, online, no retail at all. It will work because my target market is both connected and concentrated.

[tonybelding]

"no, you can't sell them online" There are many billions of dollars that say you can sell online. Certainly, you need physical support, but Tesla is providing that, in part, by restricting the locations where they sell the Roadster. This is the first electric car designed to be sold to people who love cars and driving. These are big city folks, not back-to-landers. Their market target is online with broadband.

And yet, that runs counter to the whole "Amazon.com" philosophy of online sales -- the idea that you can sell to the whole country (or even internationally) without having to build and staff expensive stores everywhere.

Speaking for myself. . . I am online with broadband, but I am not big city folks. I live way out in the country. When I take my Lotus in to the dealership (in Austin Texas) for service, it's 120 miles there and 120 miles back. It's not fun. I'm not too happy about Texas being outside Tesla's service area. I've got my fingers crossed hoping they'll open a presense here in 2008, or sometime in 2009 at the latest.

[Michael]

I would also argue that selling a vehicle is different than most other items, which can be successfully sold via internet. I strongly doubt that the majority of the public would purchase a vehicle that they couldn't test drive (or even see if they can fit in it comfortably). I know I wouldn't and also don't personally know of anyone that would.

I also don't think that the majority of the public will accept such limited access to service and repair facilities, which also argues that Tesla should probably have an agreement with a large auto manufacturer or become a subsidiary of a larger manufacturer in order to get to the public. I would imagine that having sufficient Tesla auto dealers, to reach the massesx, would require such markup on the vehicle that it would greatly extend the time frame for Tesla to get an affordable vehicle to the masses.

[vfx]

Many points made in this 2001 article here sound very familiar.


Panoz Auto Development Company

[graham]

I always liked the look of the Esperante. I briefly considered it for a while...

I wish them luck - perhaps they could use a Tesla drive train in the future.