RobStark
Well-Known Member
Elon also said Covid would be over by Sept 2020 "this is what the numbers say" and he and his family would be driven from Los Angeles to New York City by Autopilot 5 years ago. That was like 3 baby's Momas ago.
-
Want to remove ads? Register an account and login to see fewer ads, and become a Supporting Member to remove almost all ads.
The demise of the OEMs
- Thread starter Buckminster
- Start date
Elon also said Covid would be over by Sept 2020 "this is what the numbers say" and he and his family would be driven from Los Angeles to New York City by Autopilot 5 years ago. That was like 3 baby's Momas ago.
Knightshade
Well-Known Member
While all of that is true (and hilarious), these cuts are pretty ugly for the OEMs who don't have room to cut their own prices.
The Model Y effectively dropped $20,000 in price today for a customer who qualifies for a rebate.... while the price on the previously best-selling-non-tesla EV...the Ford Mach E... effectively INCREASED $7500 for that same buyer as of Jan 1.
The Model Y effectively dropped $20,000 in price today for a customer who qualifies for a rebate.... while the price on the previously best-selling-non-tesla EV...the Ford Mach E... effectively INCREASED $7500 for that same buyer as of Jan 1.
Really, how so?
Tesla is forced to cut prices after 3 quarters of producing more cars than it can sell (delivered fewer than manufactured).
It has hit the demand wall, and was forced to fall back on its Chinese playbook of lowering the prices to clear the inventory. That will work, but at the expense of lower margins.
Tesla Car Sales Grow Slower Than Expected, Amplifying Concerns
Wall Street has grown decidedly pessimistic about Tesla, fearful that Elon Musk, its chief executive, is too focused on Twitter.
It's a sign of weakness, not strength.
No other automaker has to respond to this in any way.
Tesla Rout Deepens After Second China EV Price Cut in 10 Weeks
Tesla Inc. shares extended their slump after the carmaker made another round of price cuts in China’s increasingly competitive electric vehicle market.
www.bloomberg.com
Incidentally, I literarily don't know a single Tesla owner that would qualify for a rebate in 2023 based on the income cut-off.
Well, that's not true:
Here's every electric vehicle that currently qualifies for the US federal tax credit
As sales of electric vehicles continue to surge, many new and prospective customers have questions about qualifying for federal tax...
electrek.co
a
Actually, Tesla's biggest competitor is BYD.
Last year, BYD sold 911,000 vehicles (up 284% from 321,000 in 2021).
Last year, Tesla sold 1,313,860 vehicles (up 40% from 935,950 in 2021).
BYD is now outselling Tesla in China, EVs' largest market.
BYD is likely to overtake Tesla in 2023.
Tesla deliveries by quarter 2024 | Statista
Tesla quarterly deliveries worldwide broke records in 2022 and 2023. This came after Tesla deliveries increased to over 300,000 in the fourth quarter of 2021.
www.statista.com
Knightshade
Well-Known Member
They're not "forced" this has been planned- and mentioned as being planned- for quite a while... Zach and Elon both mentioned they'd eventually cut prices as soon as production (which keeps increasing ~50% a year for Tesla) catches up to demand at the current price and as their own costs (from material costs going back down- and increased efficiency production at new factories go up)
Anybody "surprised" by this was just not paying attention.
Prices on average, esp for 3/Y, are still slightly HIGHER than what they were a couple years ago now....essentially this is just Tesla unwinding the price HIKES of the last 2 years....and prices are still significantly HIGHER on S/X... See chart below
Again this is wrong.
Suddenly Teslas are significantly more attractive to far more buyers-- while still being hugely profitable for the car maker
Nobody else can do that, because nearly all the legacy OEMs are losing money already on their EVs-- so they can't reduce pricing any further.
On top of that- I even cited a specific example....
The Model Y is effectively $20,000 cheaper today for buyers in the US.
The best selling NON Tesla EV in the US, the Mach E, is now effectively $7500 more expensive as of Jan 1 becuase they don't qualify for the tax credit.
Tesla was already outselling the Mach e massively-- that will only increase based on these price changes.
YM
No other automaker can afford to respond. Which is a big problem for them.
HTH!
Tell me you're massively out of touch with normal people without saying you're massively out of touch with normal people
You don't know ANYBODY who doesn't make more than 4x the average income in the US? Not even your butler or personal pilot??
Well, that's not true:
Here's every electric vehicle that currently qualifies for the US federal tax credit
As sales of electric vehicles continue to surge, many new and prospective customers have questions about qualifying for federal tax...
Except, of course, it is true.
Here's a slightly newer link from your own source that corrects the earlier- factually wrong- link you cited.
Tesla Model Y and Mustang Mach-E left out of $7,500 credit for a dumb reason
Tesla Model Y and Mustang Mach-E were left out of the $7,500 federal tax credit for electric vehicles for a dumb reason, but you can do something about it.
electrek.co
This is the perfect example of what I'm telling you
Tesla could afford to cut the LR AWD Model Y price to qualify because they will still be making a large profit on each sold.
Ford can not afford to do that on the Mach E because they are already not making any profit on each one at CURRENT prices- a cut would only increase losses they can't eat.
Thus the Y is now effectively $20,000 cheaper to buyers- and the Mach E $7500 more expensive to them.
Actually, Tesla's biggest competitor is BYD.
Last year, BYD sold 911,000 vehicles (up 284% from 321,000 in 2021).
Last year, Tesla sold 1,313,860 vehicles (up 40% from 935,950 in 2021).
BYD is now outselling Tesla in China, EVs' largest market.
BYD is likely to overtake Tesla in 2023.
Tesla deliveries by quarter 2024 | Statista
Tesla quarterly deliveries worldwide broke records in 2022 and 2023. This came after Tesla deliveries increased to over 300,000 in the fourth quarter of 2021.
Well, currently BYD sales are like half hybrid (though you appear to only be quoting BEVs so I appreciate that)-- and the bulk of their BEV sales are in the lower end of the market where Tesla does not even have a product yet--- once they do (probably 2024 by most guesses) that may well change significantly.
Plus, BYD is doing that WITHOUT the large profits Tesla is-- so scaling up gets them massively less $ than it does Tesla.
All that said, BYD is certainly doing a vastly better job than the legacy OEMs are- and I certainly expect them to take a significant share of the overall market long term.
But they and Tesla will be eating up the share of folks like Ford and GM and Toyota... not of each other.
Last edited:
Doggydogworld
Active Member
BYD sold 1,857,379 passenger vehicles in 2022 (plus 6k commercial EVs).
911k BEVs
946k PHEVs
BYD used to be 80/20 BEV vs PHEV, but their PHEV sales went crazy about a year ago. Some months they posted Y/Y clown numbers like +546%.
In Q4 BYD outsold Tesla in China by 5x. It's no longer even a contest. If you restrict it narrowly to BEVs in the 200-300k RMB price segment it's pretty close. But BYD sells a full line of EVs, including both lower and higher price segments and PHEVs. Tesla's single model (Y is really just "3H") makes for simple and efficient production lines, but limits market reach. Tesla's amazing 3/Y sales are a testament to Musk's marketing prowess. Mere mortals would do well to sell a tenth as many near-identical cars in that price segment.
BYD only recently started sales in Europe and has no presence to speak of in the US. I doubt the brand will travel well in major markets, but they'll sell OK in smaller, non-protectionist markets such as Australia, Norway, South America, etc.
Getting back on topic - I was on the Lucid waiting list but it was arguably overpriced even before yesterday's TSLA's across the board price cut. I'm pulling for them but they had about 3 to 6 months of cash available and are losing $ on each vehicle. Something's got to give.
Hilarious.
You keep repeating factually false assumptions to justify logically erroneous conclusions.
To name a few:
- Production is catching up to demand? It has far exceeded demand for the last 3 quarters (see below).
- Tesla has been failing to grow at the target 50+% annually, which is one of the reasons their stock is in the toilet.
- Material costs are going down - based on what? Raw materials inflation is accelerating unabated. Cost of aluminum, steel, and LiOn batteries are all up m/m, y/y.
They wish they didn't, but they have to.
Tesla is slashing prices right now because it has to. It needs to prop-up demand to match its existing, never mind the new growing production capacity.
Do a little homework:
Lithium-ion Battery Pack Prices Rise for First Time to an Average of $151/kWh | BloombergNEF
BloombergNEF’s annual battery price survey finds prices increased by 7% from 2021 to 2022 New York, December 6, 2022 – Rising raw material and
about.bnef.com
Aluminum Price Monthly Trends: Commodity Markets Review | YCharts
In depth view into Aluminum Price including historical data from 1960 to 2024, charts and stats.
ycharts.com
STEEL | NYSE American Steel Index Historical Prices - WSJ
NYSE American Steel Index | historical charts for STEEL to see performance over time with comparisons to other stock exchanges.
Indeed.
The writing has been on the wall for the last 3 quarters:
Tesla’s (TSLA) sudden drop in wait times doesn't mean demand for EVs is dropping
Tesla (TSLA) had a sudden drop in wait times for EV deliveries, and some are reading into it as demand falling off, but there's more to it.
electrek.co
And you are dead wrong about Mach E not qualifying for $7.5K Fed credit.
I am not sure why you are so fixated on Mach E, but here is an IRS web site listing all vehicles and OEMs that qualify for the (erroneously named) IRA credits:
Credits for new clean vehicles purchased in 2023 or after | Internal Revenue Service
You may qualify for a clean vehicle tax credit up to $7,500 if you buy a new, qualified plug-in electric vehicle or fuel cell electric vehicle.
Sorry, this is a false argument.
No company cuts prices and lowers margins willingly. Unless it has to. Ever.
Full stop.
You seam to be implying that Tesla is run for some altruistic reasons, and exists outside of the financial pressures of free markets and capitalism. That's plane silly.
If that was true, they would have never raised prices over the past few years.
Tesla raises prices when demand exceeds supply, and lowers them when supply exceeds demand (now). In both cases, to balance out the two forces.
Economics 101.
Study it.
It works.
This debate will 1/2 auto-resolve itself when Tesla reports 4Q'22 financial results on January 25, and 1/2 when we observe if any other OEM responds with its own round of price cuts (which anyone CAN clearly do, at any time, if market conditions warrant so doing).
Cheers!
Mod: you're wrong. he's right, either way around, don't just keep saying the same things over and over. --ggr.
Xepa777
Member
Just throwing it out there, the new Toyota Prius looks great 
I‘ll keep that in mind if I ever decide to decorate my yard with obsolete tech. Though for the money there are a lot of much nicer classic collectors cars you could get for less.Just throwing it out there, the new Toyota Prius looks great
Doggydogworld
Active Member
They definitely removed a lot of ugly from the previous version. And 0-60 went from 10 seconds to sub-7. They say the new Prius Prime will get close to 40 miles EV range. If they can pull that off at $30k I'll be very impressed.Just throwing it out there, the new Toyota Prius looks great
I keep telling people that as long as we're battery constrained the choice is not BEV vs. PHEV. It's 1 BEV and 3 ICE vs. 4 PHEVs. Government is rewarding the wrong choice, as usual.
Xepa777
Member
If you get outta this shareholder driven (aka personal greed driven) bubble, and talk to real human beings like on slickdeals, you will see strong demand for hybrids.
Demand for hybrids which don’t have decent EV substitutes is fine. Demand for hybrids that compete head to head with EVs? Not so good. Prius sales are 1/8th what they were at their peak and Toyota sales are down 9% in 2022.
Hydrid SUVs and trucks maybe doing Ok. The Prius and other sedans and hatchbacks are getting slaughtered.
carbuzz.com
Hydrid SUVs and trucks maybe doing Ok. The Prius and other sedans and hatchbacks are getting slaughtered.
Toyota Prius Hybrid Sales Will Likely Peak At 35,000 Units In 2023
With the EV revolution still in its early days in the US, hybrids still have a place in the automotive world, and the Toyota Prius has to be the most infamous of them all.
carbuzz.com
Consider for a moment, most of these automakers are burdened with tens or hundreds of billions in debt for equipment and assets which are rapidly becoming worthless.
When you hear about Jeep shuttering an assembly line (just happened recently), that’s $50-100 million worth of resources which have been idled, possibly permanently. There is millions in debt associated with property which is now worth pennies on the dollar. It will take an additional $100 million or more to make it productive again.
Now multiply this problem by a dozen or more factories for each of these companies. Billions in assets which will be written off in the next 5-10 years. Billions more they need to invest to bring those factories back online as EV factories. Every sale they lose increases the debt burden on the next car that goes out the door. Eventually every dollar they earn goes into servicing debt and there is no room for lowering prices.
I’m sure governments will be eager to help these guys out, but it’s not going to be a simple $10 billion bailout, these companies are turning into giant cash furnaces.
A good argument for Ford spinning off their EV division and becoming the majority shareholder of it. And every major auto company.
When you hear about Jeep shuttering an assembly line (just happened recently), that’s $50-100 million worth of resources which have been idled, possibly permanently. There is millions in debt associated with property which is now worth pennies on the dollar. It will take an additional $100 million or more to make it productive again.
Now multiply this problem by a dozen or more factories for each of these companies. Billions in assets which will be written off in the next 5-10 years. Billions more they need to invest to bring those factories back online as EV factories. Every sale they lose increases the debt burden on the next car that goes out the door. Eventually every dollar they earn goes into servicing debt and there is no room for lowering prices.
I’m sure governments will be eager to help these guys out, but it’s not going to be a simple $10 billion bailout, these companies are turning into giant cash furnaces.
A good argument for Ford spinning off their EV division and becoming the majority shareholder of it. And every major auto company.
RobStark
Well-Known Member
They shut down the Jeep line. To convert it to a BEV line. Stellantis has not said which BEV.
Stellantis was growing before COVID and opened new factory in Detroit, Mack, in Dec 2020.
RobStark
Well-Known Member
Prius has lost sales mainly to other Toyota Hybrids. Corolla hybrids, Camry Hybrids, Highlander Hybrids etc. At its peak Prius was the only hybrid Toyota sold. And Prius is a hatchback.
Toyota foresaw the chip shortage and horded chips. And had a relatively good 2021 vs other legacy OEMs.
Their chip stash got used up and Toyota had to cut back production.
In 2022 Toyota was production constrained not demand constrained.
The consensus among chip analyst is the shortage will alleviate a little this year expanding production a little bit and get back to normal in 2024.
A big percentage of trade-ins on EVs are Toyotas and Hondas. In large part because almost half of American EV purchases are on the West Coast. Where Toyota and Honda have greater market share than they do nationally.
It is likely Toyota would have new conquest sales to replace those lost sales to EVs. But we won't know for sure what is relative demand among the OEMs til 2024.
Why?
We don't have enough raw commodities to go around to build enough LiOn batteries to go 100% EVs. For decades to come.
Personally, I dislike hybrids and wouldn't own one (maximum mechanical complexity for minimum fun).
But if I were a 110% greenie, 5x hybrids might well be better for air quality then 1x EVs ?!?
Anyone cares enough to run the #s, or shared research of someone who has?
All this knee jack "Four legs good, two legs bad" attitude is plain childish, in the absence of proper # crunching.