When he first announced that goal, his two top production people quit.[1] Now he has a guy from Audi heading up production.
Auto production lines usually produce about a car a minute. 500,000 cars a year is about two production lines running two shifts. In 2005, the NUMMI plant, which is where Tesla is now, produced 400,000 cars with 4,700 employees. Tesla is talking about reaching 9,300 employees. They do more than final assembly there, but still, that's a high headcount for an auto plant. Ford's Kentucky truck plant also produces about 400,000 units a year with about 4,500 employees.
It's an interesting read, and goes into more details about the "machine that builds the machine" concept that Musk has talked about recently. It gave me more confidence that Tesla might achieve a real leap forward in terms of productivity.
I read that and have zero confidence that there will be a leap forward in productivity.
Density of automation equipment is all well and good, but it comes at a price of being difficult to maintain. If a tool or a robot breaks in some way (and any FMEA will tell you about the myriad of ways that can happen) then people will need to get into the cell and fix it. If you need to remove a robot, gripper or fixture - well, that's going to be difficult if you've landlocked everything by packing the machinery in so densely.
Vision systems for handling are great idea, but they are a nightmare to set up and to keep clean, especially in a welding shop.
Robots that repair the looms of robots around them. Fantasy, and it will continue to be fantasy for a good while yet.
Tesla doesn't need a major breakthrough in production technology. They're proposing to produce about as many cars as the NUMMI plant produced in its peak year. And Tesla has far more employees. Tesla's problem is going to be cost. They're trying to build a relatively fancy car at a low price. That's hard.
Tesla's big edge: they underpay their employees compared to other automakers. The workers are now talking to the UAW about organizing a union.[1] Musk sounds scared about this.
Pretty sure all factories have high ceilings so the track cranes overhead can remove any piece of machinery from the factory floor, piece by piece if necessary. At least that's what my Millwright buddy who has worked on power plants, canneries and paper mills has told me.
In car assembly lines there are often gantries, conveyor systems (accumulating and EMS), trunnions and other high level equipment that prevents the use of track cranes. First choice would be to extract heavy equipment by manitou or fork-lift, crane is a distant second best.
It sounds as though Tesla aren't considering how to maintain or repair their model 3 line.
Why did people downvote you, it's an honest question? Anyway, I expect the Audi manu expert would consider this and make sure he doesn't design a system without that possibility.
Tesla does much more in-house when compared to other auto plants, they buy more individual components and raw material and less partially assembled parts. I'm told that many of auto plants that produce the complete vehicle do mainly integration work these days. Tesla's approach is different, so they require more hands, but pay considerably less for the upstream supplies flowing into the plant.
This is not so different actually, and has been done in the past by other auto manufacturers (some may even still be doing this today). The Ford River Rouge plant is the best example I can think of with literal Iron Ore going in one side and finished cars rolling out the other.
Here's Tesla's supplier list.[1] Tesla makes the battery, motor, aluminum stampings, and plastic parts. They also now make their own seats and some of the circuit boards for the electronics. Everything else (steering, brakes, wheels, etc.) is outsourced. Makes sense; that stuff is standard.
In the UK we call this a 'screwdriver operation' where they don't 'really make cars' but they just put a few bits together, pre-assembled elsewhere. This started with the Japanese auto manufacturers wanting to compete in Europe, the UK government gave the incentives to Nissan and Honda but the factories were 'screwdriver operations' according to sceptics.
It's called an assembly plant in the US. There's nothing inherently wrong with this and it can actually afford greater automation and efficiencies in a number of ways. You have the option of receiving prefabricated components from multiple sources. If you're doing built to order manufacturing you can slot in variations more easily of they're complete modules assembled identically.
The more parts in assembly there are, the harder it is to control quality. You have to trust that the 3rd party supplier is meeting the required spec in manufacture and that the parts are damaged in transit.
> The more parts in assembly there are, the harder it is to control quality.
Which is why they tend to move to larger modular components. Things like seats arrive preassembled and simply need to be inspected and installed. Inspection can happen off the assembly floor and managed without disrupting production.
> You have to trust that the 3rd party supplier is meeting the required spec in manufacture and that the parts are damaged in transit.
You don't have to rely on 3rd parties to run an assembly plant. Your assembly plant can be fed by your own manufacturing facilities. But if you do rely on 3rd parties, it's definitely possible and companies like Apple do it with great success.
> The more parts in assembly there are, the harder it is to control quality.
The quality of passenger cars is so, so much higher now than prior to the use of these methods. It seems like they've got the quality control processes taken care of to some extent.
I would love a Tesla but man those numbers would be a bit frightening if I were planning on purchasing one soon.. I don't see how they could scale up like that for a brand new model and not have quality problems. Best of luck to them!
It's worth noting that the first production cars are to be delivered to the Tesla employees who reserved one. This should have a positive impact on quality, both in terms of motivation ("the car I'm working on is mine"), and by having a shorter debug-fix-test cycle.
(I have no idea how many employee reservations there are.)
I feel like we live on different planets. I'm a software engineer making six figures and I can't imagine spending roughly $30-35k on a car when I can buy a decent used car for $7k, and spend less than $1k per year on maintenance.
Sure I can afford a $35k car, but if I choose to put that in my 401(k) instead it could mean retiring 3-5 YEARS earlier.
That's a pretty broad group ranging from janitor to assembly worker to engineer. I'd hazard a guess that the median Tesla employee could not afford a $35k vehicle.
$35k is basically a Lexus or lower-end Cadillac. You're easily into luxury range for a daily-driver.
My car was $20k brand new with several options tacked on. Most people I know have used cars... getting a new car of any kind is a big deal IMO for most Americans.
The average new vehicle purchased in the United States is $33,560[0]. The Tesla Model 3 is $35,000, PLUS $7,500 in government tax credit[1]. This puts the effective cost at $27,500. The Honda Civic, widely considered a cheap car, is $20,415 MSRP[2]. Once you factor in gas and maintenance savings, around $1,200 per year[3], the Tesla is cheaper after just over 6 years. Since most cars are kept for 20 years, that is a good deal.
Given that, I would say that calling it a "cheap" car is pretty accurate for most Americans. Obviously it is not in the range of used cars or the ultracheaps ($10-15K), but it's really amazingly cheap for an electric if they can make it happen.
But over 3/4 of car sales are for used cars, which have an average price 1/3 of the new car average#. The Model 3 might prove to be good value for a new car, but a new one will still be unaffordable for many American drivers.
If you plan to keep an electric car for 20 years, I think it's not unreasonable to expect that you'll need to replace the expensive battery during that time period.
The current Tesla packs seem to hold up pretty good. Users who are tracking the degradation are thinking a million miles is possible. Tesla has a test pack that has simulated half a million miles with <20% capacity loss. Warranty is 8 years unlimited miles.
If you are driving a half million to million miles in 20 years, an electric will probably really make sense. You MIGHT need to replace the battery. With a ICE car, you will need $5K of oil changes, $3K of timing belts, and around $20K more in gasoline than electricity, probably a new engine and transmission or two... There's probably another $5K worth of service in there (plugs, fuel injectors, transmission, belts).
So with a gas car you KNOW you're going to be in to it for basically as much as the purchase price of a Model 3 just in maintenance (again, if you are talking half a million miles).
The average age of a car on the road in the us is somewhere just over 10 years old. The averae person may be switching, but a bunch are switching into a new to them used car
I will be very curious how many of those III will be the default base model. We have not seen the feature set at that price so I expect most people to be surprised as how spartan it is.
While they will avoid much of the touch/feel issues with regards to buttons the real test is where the good plastics start and end.
With regards to production targets, not only do they have to get their plant to that level their suppliers have to be able to hit those numbers as well.
I might just put my next car purchase off now. I would like to see how Tesla is doing with this car on September 20th
When you preorder, you put down $1000 and that's it. There is no way to select any options for your reservation and there is also no pricing available for options right now.
> Since most cars are kept for 20 years, that is a good deal.
One thing to factor in though is the rate of deterioration of the battery pack over a 20 year period and other issues unique to electrics vs the maintenance requirements unique to an ICE vehicle.
It would be really interesting to see the breakdowns on those numbers.
Yes, Tesla stated that the 35k is before the discount. So effectively it is 27.5k after the discounts, and they might offer further rebates for Tesla employees.
What's the median? And even with that being the average "new vehicle" price, that doesn't mean the average American buys a new car. Lots of people can only afford used cars, and for many, $33K is their entire annual salary.
cheaper after 6 years, except you're not factoring in that honda's hold value very well and we have no idea how badly an 'early adopter' electric car is going to fare in the used market. Something tells me that the used market for a tesla isn't going to be as strong as for a honda civic
Something tells me that the used market for a tesla isn't going to be as strong as for a honda civic
Not sure why you'd assume that.
Current Tesla models have excellent residual values: 62% at 3 years according to black book, which is excellent for the luxury segment - and even better when you consider that EV values tend to be skewed by tax credits!
The Model 3 will share features like over-the-air updates that should help it retain value well.
It's surprisingly difficult to find the median car price. I just spent 15 minutes googling and could find neither the statistic itself nor a source of the data from which I could compute it.
51% of Americans earn $30,000 or less a year [1] (yes, you read that right - and you wonder why populist candidates are so popular and why the anti-rich people sentiment is so strong...).
I wish Musk hasn't said that he's not going to make a car that's cheaper than $35,000. I know he wants to add Level 5 Autopilot and whatnot by default on these cars, but he really needs to get to the $20,000 range at least. That's where the real mainstream is, and not just in the U.S. either. EVs will go mainstream when they cost $10,000-$20,000.
It may take another decade to get there, but if Musk doesn't build such a car others will. It's just that I would've preferred a Tesla car to put pressure on the quality of the competitors as well.
90% of the people living in the EU earn less than $30,000 per year. The EU's median household income is comparable to the US poverty line for median household income. The EU's GDP per capita is 60% lower than the US; they have 750 million people, with a total GDP 10% lower than the US.
Or take Sweden for comparison, it's below all but 12 US states when it comes to median individual income. The median US income is about 45% higher than the UK median. The number of countries on earth with a higher median income than the US, you can list on one hand.
These numbers are even more dramatically out of line, if you're talking about white households (which supposedly form the core of the populist anger). The median white household earns $75,000 and has a median net worth of $145,000 - an income number drastically higher than Sweden, Finland, UK, Germany, France, etc.
So remind me again how income numbers in the US are driving the populist anger.
It looks like there'll be further models after the Three:
"I'm super excited about being able to produce a car that most people can afford," Musk said. "And there will be future cars that are even more affordable down the road."
"With something like the Model 3, it's designed such that roughly half the people can afford the car," he continued. "With fourth generation and smaller cars and what not, we'll ultimately be in the position where almost everyone will be able to afford the car."
> I wish Musk hasn't said that he's not going to make a car that's cheaper than $35,000.
When did he state that? I'd only read the general plan of 'make an expensive high-end car, use profits to make a less expensive mid-range car, use profits from that to make an affordable car'.
Or did he mean that they don't need to make a cheaper car for widespread adoption since owners can rent the car out as a self-driving taxi to recoup ownership costs?
I guess I'm jaded from my week spent there. It was a whole different world to me. One lady talked to me about how this is her second job today and that she can barely make it on time to today's safety training because of the bus schedules. The parking lot was an ocean of beat up cars. The perception I got was that nobody on the production floor would ever own these cars.
That just seems really sad. I've read that Tesla doesn't pay exceptionally well, expects people to work really long hours, and doesn't offer an employee discount because Elon doesn't believe in it.
Despite all this I've always imagined it to be a great place to work because of the world-changing potential of the work.
But the idea of all these people toiling away on an amazing product they can't even hope to own just seems incredibly depressing. I guess it's no different to all the people making iPhones in China, it just hits closer to home.
Musk created a company that gives around 15,000 workers a job. The company he created is not just a capitalist endeavor, but an attempt to start an environmental movement aimed at making electric cars viable in the world market. At multiple points during the company's early days, Musk put everything he had on the line; assuming huge levels of risk.
Meanwhile, Tesla is not making a profit and one wrong move could destroy it - ending the jobs of thousands and an environmental movement in one fell swoop. Giving luxurious benefits to Tesla employees just isn't possible at this point.
Your criticism that Musk is just a capitalist who doesn't care about his workers and treat them well seems completely unfair.
Boo hoo, not treating your workers like shit isn't some impossible, gargantuan task. Working your engineers & labor 60+ hours a week makes for great sound bites, but significantly below average productivity. Combined with an employer that won't even take basic suggestions on improving workflow from their floor staff, Tesla obviously has a certain level of arrogance about how to build a car. Fuck the employees who actually do it day in and day out, they don't know shit according to Tesla.
I imagine there is a huge difference in the employee pool between their Fremont factory location and their Palo Alto office location. Of course, Tesla is not exactly known to pay even their engineers very well: http://www.autoblog.com/2016/03/08/working-tesla-meaning-str...
But it's not a refundable credit. Which means you get whichever is the lowest of your tax liability or $7,500. Please note saying it's not refundable is term of art that does not mean what you might take it to mean. So let's walk through some examples.
Let's say your total tax liability for a year is $10,000. You paid in $11,000 via Payroll and other taxes. Without the credit you'd be due a refund of $1,000. If you are eligible for a $7,500 credit because you bought a Tesla you'd be due a $8,500 refund.
Let's say your tax liability for the year is $5,000. You've paid nothing in taxes for the year (probably because you knew you were buying the car and didn't need to). You bought a Tesla which makes you eligible for a $7,500 tax credit. You do not get anything refund from the IRS, but the $7,500 tax credit offsets your entire tax liability.
So just because it's a credit doesn't mean the credit is effective for low income people. You have to have enough income to have a high enough tax liability to even get the full $7,500.
This post is in response to someone saying "this is literally the cheapest car on the market", which is exactly what someone with that small of a liability would be looking for.
> "The car I'm working on is mine" and short debug-fix-test cycle
Just saying, at the announced pace, after 2 weeks they've provided cars to every Tesla employee, their partners and children. That's a short test cycle indeed ;)
You hit the nail on the head. It's the scaling/quality control problems that are the biggest risk. Also, from what I understand there have been quite a lot of problems with the different telsa models to date, but the top notch tesla service has been able to keep customers happy. That level of customer service is much easier to provide when selling a few $100,000 cars then when mass producing $30,000 cars.
The mechanics in /r/justrolledintotheshop complain about parts availability and the constant rolling changes. The door handles on the Model S are apparently up to revision "G".
Assuming Tesla parts start with "A" or no letter suffix, that actually doesn't seem too bad, in my experience. The Ford Focus I owned several years ago had 34 revisions made to the door handle assembly by the time I had to replace mine.
That number is insane, they work with many 3rd party suppliers and any one of those have issues can cause delays for any number of thousand reasons. Tesla also needs to expand their tech support/repair by many folds. Working on cars and computers, any issues is going to take a good amount of time to fix, not even thinking of backlogs. It helps that they literally only have 3 cars, meaning 3 sets of parts to inventory one whatever needs to break, but still the stories of how they handle repair is really amateur.
According to Wikipedia, "As of May 15, 2016, Tesla had taken about 373,000 reservations" so I think the total number of reservations must be well north of 500,000 by now?
> Musks target of 500,000+ cars a year of velocity in 2018 is an insane goal!
From a computing viewpoint, scaling a car production line is not a theoretically hard problem (it's very parallellizable, but you have to take supply chains into account).
They can definitely sell. It is upto buyers figure out how to charge. Considering the prices it is almost certain most Tesla sold there would be chauffeur driven. So it would not be big deal once the owner/family is dropped to work/shopping/home driver can spend hrs in getting car charged.
Agree about the chauffeur but consider that many wealthy people have diesel generators to handle power cuts. Would it really make sense to charge an electric car from a diesel generator?
No, the profit after all investment costs is thin and may depend on accounting, but the car production itself produces the money they are investing into e.g. the Gigafactory.
Tesla sold stock several times to fund the Gigafactory. Then they got Panasonic to pay for half of the Gigafactory.
That's not from profits, that's from shareholder investments. Its the power of the stock market to dump money into an asset. But don't pretend that Tesla managed to scrap together like $3 Billion from their years of operating losses.
TSLA is one of the most hyped companies out there. To vindicate the short-sellers, TSLA doesn't have to flop, it simply has to justify slightly less exuberance.
I'm very new to the stocks game so excuse what's probably a simple question, but would vindicating the short-sellers require TSLA shares to drop back down to around $180-190 or whatever level they were at before the shorts were in place?
Yes, exactly. Ideally (for the short-sellers) the stock would fall even further, as if the stock is at the exact level it was when they bought, then they'll only break even.
With current interest rates, it wouldn't have to fall much more, but yes. Plus opportunity cost, and a return to compensate for the risk [1], etc.
[1] It's very risky to short a stock as you can end up losing a very large amount of money, as stocks can increase many times in value. When holding a stock, your risk is finite, as it can only lose 100% of it's value. When shorting, the stock can double or triple in price.
Tesla is going up against an old, entrenched industry. Competitors have been around for many decades. Their odds have been slim. They have made mistakes. But it's looking better for them as time goes on.
Because they are a fledgling car company. Those are generally doomed. A few wrong moves, a few bad models, and you disappear. Either that or one of the established companies uses their resources to launch at competing product.
Frankly, the likes of Honda and Toyota are probably laughing at tesla. Once their ducks are all lined up their size will allow them to produce electric cars at an insane scale. Shortsellers bet on this happening sooner than later and have so far lost that bet. But that doesn't mean it cannot happen tomorrow. Telsa is still on a knife's edge, will be for a decade or more. Tesla knows this an so is trying to leverage its battery know-how into other fields, a hedge against a decent honda electric hitting the US market.
Tesla's sales are a rounding error for Toyota. Even if Tesla somehow delieved 100% off their Model 3 preorders in 2017, that would be less than 5% of the number of cars sold by Toyota.
They are indeed a small number compared to the total number of cars produced by Toyota, but they are all-electic. How many all-electric cars does Toyota build? Of course, Tesla won't be taking over the car market by numbers any time soon. But they are about to take a huge slice of a profitable segment of cars, with models Toyota at the moment cannot compete with. They are working busily to change that, but right now, Tesla has no competitor in their segment.
Do you have any numbers to back up your statement? How is the revenue of Renault and Nissan from their electric car programs? At least they sell well, so I would assume they are profitable.
And of course Tesla is not really profitable as in the quarterly revenue, but according to their statements, they do get above 20% profits from selling cars which get eaten up by their aggressive reinvestments - the company is growing by about 50% year over year.
To sell cars in California manufacturers need to get credit for selling a certain number of electric or hybrid cars. I believe Nissan sells leafs at a loss to meet those quotas. BMW and Fiat certainly do. Most of the other big manufacturers are buying credits from Tesla to meet their quotas. The credits were the only reason Tesla made a profit on a recent quarter.
I still would like to see the numbers backing up the thesis that especially Nissan and Renault, who are selling a lot of electrical vehicles here in Europe too where there are no ZEV credits in play, and lose money at that. Yes, the credit business helped Teslas profitability as a company in the last quarter, but that is a statement about Tesla as a company. They are making strong profits on the production of the Model S/X, but are spending all proceeds from that into the expansion. This means: building the Gigafactory, expanding the Freemont plant, setting up dealers and repair centers, running and expanding the supercharger network. At a year over year growth of more than 50% this is an amazing feat. I don't think that supports the statement "you are not making a profit selling electrical cars".
You will not see hard numbers because companies don't show them. Nissan Leaf became profitable about two years ago, if ever (their boss said "We're getting there" [1]) - but that means cost of production of a single unit got below cost of sell. It's still a long road before the RnD and other upfront costs will be returned.
The same goes for BMW. They recently announced they expect lower profitability of the entire make due to cost of production of the electric cars.[2]
Each Fiat 500e is sold with $14000 loss[3].
Besides, I'd argue that Tesla make money on their cars not because they are in a "profitable segment of electric cars", but because they are in profitable segment of luxury sedans (and SUVs). Sure, all-electric is part of their appeal, but they are no more profitable than luxury sedans with combustion engines.
Yep. I am a Tesla shareholder and the growing short interest makes owning the stock all the more exciting.
Just because Toyota, Honda and the like manufacture gasoline cars at a large scale, one cannot postulate that they will overnight produce electric cars at the same scale. Assembly line retooling is a big deal.
Tesla has the batteries, but they don't have the rest of the car. Honda and the like, even GM, can churn out new models built to very high standards much faster than Tesla. BMW is doing very well with pure electrics without much press. They are looking at shipping 100k electrics this year. Tesla may be the cool luxury brand in california, but BMW is in a different league in terms of build quality and worldwide acceptance. If tesla misses the "cool" factor, BMW is right their. That potential for upset is driving the shortsellers.
Personally, I'd never buy a car from someone as small and young as tesla. They just don't have the legs. I've been brought up to buy good used cars and drive them until they die. I expect 20+ years. BMWs, Mercs, hondas, even jeeps and Volvos really do last that long if you are nice to them. Until I see a 25yo Tesla driving down the road I am not a potential customer.
I was considering buying a Tesla a few years ago, but the finish and interior of any other luxury sedan blew the Teslas out of the water, and it's definitely where they are lacking.
However, I wonder if it's harder for Tesla to get better at fit & finish and interiors and quality, or if it's harder for the entrenched players to gut their petrolhead heritage, and sacrifice their lucrative combustion engine business, and especially the lucrative service & repair business it creates.
Another angle is that Tesla is Silicon Valley bred, they're a software company through and through. The other companies treat software as an afterthought, their infotainment systems range from "monstrosities" to "I don't want to claw my eyes out yet". None are good. Some are bearable. Teslas is good, and it's an obvious priority, and software is such a huge part of modern cars and their performance, that the hardware will be commoditized.
> Tesla is Silicon Valley bred, they're a software company through and through
Are they, really? I'm not impressed. Software is very central to their cars, and I think the end user experience is pretty abysmal. Which is par for a car manufacturer, of course, but I had other expectations given their Silicon Valley heritage. Get Apple involved already! They don't seem to be going anywhere with their own car investments anyway...
> Tesla has the batteries, but they don't have the rest of the car.
Tesla doesn't have to make a single car anymore if automakers would make a real electric car; they'd just supply the industry with batteries. But, compliance cars. So, Tesla plods on with their own vehicles.
Plus alternates. Toyota is pushing strongly for Hydrogen. And if petrol station chains are forward thinking they will encourage this too. Electric is too easy to make the petrol station redundant.
If I was Caltex/Shell/BP/Exxon etc I would be forming a group to drive support to hydrogen, both via govt and manufacturers. Should consumers largely go electric not many people will turn up to their shops any more.
It is going to be difficult to make money with hydrogen filling stations; both liquid and compressed hydrogen come with huge challenges in terms of transportation and storage.
Petrol stations will not make much money on electricity if they install chargers, but they will sell a lot of food to customers waiting to charge, even "supercharging" is quite slow..
That sounds like one of those "alternative facts". After following the cite trail from Wikipedia, it was apparently something someone from the hydrogen car industry said at a conference. No further cite or info on what exactly they are counting in that figure.
Cost difference does seem counter-intuitive but not an expert. I also wonder if rather than transporting hydrogen around they could make it on site from piped water. Not sure if electrolysis of water has scale benefitsm of mass producing hydrogen then trucking around. That could reduce cost of transport... but then that would be much the same as electric anyway with the inevitable energy loss on conversion...
EV chargers are much cheaper to operate/install than gas pumps; and gas pumps should be less expensive than hydrogen filling stations, i.e. something does not add up here.
It's very expensive to keep hydrogen cool enough to stay liquid, but it's not exactly cheap to keep hydrogen compressed in massive tanks that always leak either. Moving it around is another problem, I find it extremely unlikely that this costs less to operate than electric infrastructure, which is static.
Hydrogen doesn't really make much sense to me. It's hard to work with so if you've got a bunch of it laying around why not combine it with some CO2 frozen out of the air to form methane, something you can pack much more densely in tanks and which won't tend to leak through so many things? You'll produce CO2 when you burn it but no more than what went in to creating it in the first place. Some back of the envelope math says you're losing about 25% of the energy in the Sabatier process to do that but it makes all the transportation and storage of the fuel so much simpler.
Because it isnt about the science. In most jurisdictions if co2 comes out the tailpipe it isnt "zero emmissions" regardless of the overall numbers. There are also other non-carbon forms of pollution that any ic engine must address (no2 etc).
> Tesla has a big lead over other OEMs in battery cost.
Do they though? How come GM was able to shop a reasonably priced Chevy Bolt as a competitor to Model 3?
I realize that in car manufacturing GM is a leading brand with economies of scale working for it, but in electric battery world they're a nobody, so I'd expect them to pay close to market price, no Gigafactories and all?
Yes, they lose money on bolts or at least break even. I'm trying to find the source on it but from what I read the reason they are making the bolts is to get ZEV credits that'll offset their larger & more profitable trucks and gain experience in building electric cars so if (when?) they have to compete head to head with Tesla on a larger scale that they'll have the knowledge to do so.
And Renault have delivered over 100k all electric cars (spread over 4 models, though most of them are the Renault Kangoo Z.E. and the Renault Zoe Z.E.)
> Once their ducks are all lined up their size will allow them to produce electric cars at an insane scale.
For Elon Musk, that would be the "Mission. Fucking. Accomplished." moment[0]. His point all along is to make cars electric, not to be the one who sells most of them in the long run.
I'm a Tesla bear, I've shorted Tesla a few times over the last several years, but I've heard from insiders that they are going to hit their initial deadline, and they are already testing Model 3s on the roads, in a Model S form factor. That means I'm going to stay far away from this stock, at least as a short.
Not a lawyer but unless he's an employee of Tesla or otherwise got his information through his employment then he's not an insider for purposes of insider trading regulation.
Which isn't to say the SEC wouldn't go after him. Cops arrest people in the US for photographing public things all the time, for instance. Just that if it went to court he'd probably win.
I should have clarified, those are rumors that I heard online from alleged insiders a few months ago. I don't have real insiders information, otherwise I wouldn't be roughly break-even on my Tesla trades.
I think people who have attitudes like this are misguided. If you don't like working for Elon or at Tesla, don't. There is only one Tesla while there are tons of other companies you can have a "good" work/life balance at.
That's true to some extent. You should be able to choose a job that is a little less stressful but pays a little less, or the opposite.
But there are a lot of caveats. For example:
First of all, a company sets standards in wages, benefits, and hours to the extent that it is a monopsony [1] in its particular geographic market and labor market, and also insofar as there is unemployment in the region (and, thus, there are people who could take your job and it would be hard for you to find another job). Tesla is a very large employer of unskilled labor, as well as skilled. The Bay Area doesn't have as high unemployment as other areas, but it still has some. Therefore, the labor conditions at Tesla impact labor conditions at other workplaces to some extent.
Second, more on the level of values, why should a worker have to miss his daughter's ballet recital on Saturday because his manager told him on Friday afternoon at end-of-shift that he has to come in tomorrow? That should not be necessary in a well-run factory. Maybe it would be different if a factory worker at a Tesla factory could participate in the vision by buying a Tesla car, but that's not possible either because they're too expensive.
[1]: https://en.wikipedia.org/wiki/Monopsony: "In economics, a monopsony ... is a market structure in which only one buyer interacts with many would-be sellers of a particular product [here, labor]."
Honest question. Its February 2017, you say "late 2018". Why would you be buying anything, including something so expensive as a car, and wait for it more than a year not knowing how much technology will progress in next 12-18 months?
I expect that Tesla will be driving the technological change, and between now and my car arriving home I expect significant changes in the state of the art.
Chevy got the Bolt to market at the same price Tesla is aiming for with the Model 3, but it's a $25k car with a $35k price tag. If the Bolt makes it to Australia before the Model 3, I may consider it.
In the meantime I view the Model 3 as more than just a car: it's an investment in a company pushing the world to acknowledge that fossil fuels are literal and figurative poison which we need to abandon post-haste.
Driving my Model 3 around will be as much about driving a BEV as it is about providing visual evidence to other road users that the age of the internal combustion engine is over. The Otto cycle ist kaput.
In addition, I contribute to Plan International because I want to help rapidly educate people in impoverished nations so we can keep population levels under control. From the "it is just a car" perspective giving money to poor women in underdeveloped nations is throwing good money after bad. From my perspective it is the best thing I can do to ensure the next generation actually has a world worth living in.
There are probably better ways to accomplish this with the money I have, but driving a BEV and pulling people out of poverty sounds like a decent starting point to me.
The point being, why would anybody put money down on any car really, when it's a rather significant monetary investment not to be delivered for quite a while.
It's $1,000. I think a lot of people in the tech community can afford to part with $1,000 for a while. It's fully refundable until you actually convert your reservation into a concrete order, so you can change your mind later.
I'm thinking about getting a second car for my family. I don't need it immediately. A Model 3 sounds like it would be perfect for the job. I put $1,000 down to reserve one just in case. If I decide I don't want it, I'll get my money back. I'll miss out on maybe $15 of interest on that money in the intervening time, big deal.
I know not at the same volumes, but almost all supercars follow that model as well. People will put down their deposits before it's even announced, wait several months for the launch, and then have a build window potentially in the year+ timeframe. Although a small number of units, there's an even higher monetary investment and commitment.
We've not seen it to this extent in the "affordable" scene, but even if you flip it, there's probably enough market demand to be able to wipe your face on the deal if you did want to chase the new shiny thing announced in the meantime (which may or may not have extended build times too).
That being said, I'm with a lot of people here that aren't new car buyers - I know you need new car buyers to have a used car market, but I'm not tuned into the mentality of it all.
The difference is that generally the supercar is an investment on account of status and strictly limited availability. For example Veyron production ended after 450 cars and if you want one now it's a seller's market.
Mass-market cars on the other hand depreciate as soon as the key is turned. So not only dp depositors lose interest on that $1000 but they also lose in depreciation.
Because you want to be first in line when it does become available. And anyway it's not that big of an 'investment' ($1000) and you can get your money back at any time if you need it or change your mind about the car.
I'm thinking the same thing. Would love to see it earlier. At least by the time the right-hand drive market gets it all defects should be out of the car.
The one 'advantage' to buying Tesla in Australia is that even if you do get an absurdly long wait times, at least when they deliver you get all the newest fetures.
eg Every Model S delivered to customers in Australia had the Autopilot hardware, because it took that long for them to build and ship them.
It just smells like spin to me. They were going to build preproduction cars anyway for certification, testing, and to iron out manufacturing kinks. Putting them on display for the press and investors is just PR.
I don't think it is big news that they are going to build preproduction cars, of course they have to do that. The big news is, that if they are doing it now, that they seem to be on schedule for the full production.
What's the going market rate to buy a reservation from someone? Say you wanted to be order #50,000 or higher?
Also: "last week design changes were still underway, which could hinder the ramp-up to full production"
This is kind of funny because it so often what you see in software which was his background. I wonder if any exec at GM ever pushes the envelope in this way.
Pre-Orders are non transferable, so not sure there is much of a market. There are also not really set places in line. Stores were open on the East Coast were open before the West Coast, but West will ship before East. And current owners cut in line somehow as well.
I am sure you could pay someone to keep their pre-order open, buy the vehicle, then sell it to you afterwards. But that seems like a good way to get screwed, on both sides of the deal.
So you're not going to do business with a company you already weren't going to do business with. I fail to see how that is going to make any kind of statement.
I agree. I want to make sure nobody competent works in the executive branch alongside the other team, so that the maximum amount of damage is cause to my country as a result of their mistakes.
Wait, no I don't, because I'm not insane. Are you aware that we're playing for real money?
I'm really hoping that Model 3 production is not delayed because every delay makes it less likely that I will get the full $7,500 federal tax credit.
Once Tesla sells its 200,000th US car the credit will be cut by 50% to $3,750 after a period of up to two quarters. That puts the likely cut time at July 2018.
Tesla themselves may be able to find cost savings further into production which could bring down the wholesale cost of the vehicle making somewhat up for the loss of the tax credit. Or if not maybe the "version 2.0" will.
I will say I'm not sure what price segment Tesla's endgame for the Model 3 is. I assume somewhere in the 25-35K mark, but there's a lot of variance in that range and without seeing the Model 3's trims and features it will be hard to judge where it should fall compared to the competition.
Tesla's site has impressively little basic information about the Model 3. Heck, I don't even know if it has electric windows (obviously it does, but my point is that Tesla's site lacks a 101 level spec sheet right now). Kind of ballsy to ask for a $1K downpayment for a vehicle they aren't telling you a darn thing about.
According to Elon, they only expected like a 100k reservations. So having 400k reservations was a very important information for Tesla about the initial demand and gave them a few more months to plan for higher production numbers. As they asked for the refundable 1k fee with the reservations, should make sure that people are not just reserving for fun or excessive amounts.
On a slightly related note, I have serious doubts that even if they hit their target that the company will actually sell enough to profit in the long term, because it is an electric car and they only sell electric cars. This is dissimilar to traditional car manufacturers which do manufacture electric cars but primarily make gas powered cars.
The main reason I argue this is that to a lot of consumers, an electric car is nice but functionally less useful than a gas car. That is, a lot of consumers think, "What if my battery runs out? How do I charge it in an emergency?" referring to if the battery runs out somewhere. In a traditional car, if you go somewhere far and run out of gas you can just call AAA and they can either tow your car or bring you a bit of gas to get you to your next gas station, and this isn't really possible with current electric cars. Even in town, if you forget to charge your car you can't just go to the gas station, you have to wait a bit of time for your car to be ready to go. Don't discount 5 vs 15 minutes -- I can fill a car and be done in less than 5 minutes whereas it takes a bit more time to charge an electric car, even a Tesla at a supercharging station.
The company that produces a car that isn't gas powered but can be re-powered in the same amount of time, or creates the technology within batteries, will be the one that causes a true revolution. I don't know if I'd go so far as to short TSLA but I am not completely convinced their cars will take off (also consider the fact that a $35,000 car is still really expensive for the average consumer).
I think the opposite is true. For Tesla owners its more like "Every day I wake up with a full tank of gas."
The percentage of trips over ~215 miles is quite small. Doing the math you are saving many hours/year on average. Of course I'm not accounting for edge cases but that's the point they are edge cases.
Absolutely. I love my electric car for this reason and I _hate_ it when I'm in our hybrid and the dumb yellow E comes on and I have to make an unplanned pitstop.
I also got over range anxiety pretty quickly too: I've taken our Model S from Portland to Yosemite twice. With little kids, the time to supercharge is less than the time needed to get get them all snacks, potty breaks, stretch, etc. It was great!
PS: Just noticed that the last like 10-15 comments I've made are all about Tesla. I should probably get a new hobby :P
I think it's fair to say that there is a large percentage of the population where a trip over 215 miles is a once-per-year or less event.
For myself personally, I probably take 5 or 6 trips per year where I'm covering over 400 miles in a day. The time it takes to recharge the car would be a big negative to me. It's nice to be able to jump in the car in SF early morning and be in Seattle by evening. Not sure I'd even make it half way in an electric car.
I'm sure someone will comment "well this car isn't for you" and they are correct.
>You don't want a 30-min break in the middle of that 400 miles?
30 minutes if you can drive right up to a charger. Do you think that will be the case once hundreds of thousands of EVs are on the road? Have you ever road-tripped in the summer and had to wait in line for gas, which takes minutes to fill? I have. Often.
That's only 5 hours of driving at 80 mph. I sometimes drive that distance on a Friday night. Get off work, eat a quick dinner, and hit the road. I stop to gas up once and go to the bathroom at the same time. In and out in less than 10 minutes. I'm often going camping, so the fact that my vehicle is full is also important. My understanding is that a Tesla isn't fully recharged after 30 minutes. I realize this is far from average, but the OP's case isn't crazy.
You get used to having an extra 20 or 30 minutes tacked on pretty easily. I own an S. You just have to know what the good supercharger locations are with good stuff nearby (like free WiFi)! Bring a good book with you. I don't know it sounds like I'm justifying the inconvenience...I guess for me it's about the eventual environmental impact and the self driving more than the extra 30 minutes at a rest stop!
Yeah I could see getting used to that. Especially if you plan it around having dinner. Just curious, do you ever run into having to wait for a spot at the super charger? I see lots of them are 4 spots deep.
Another problem is that, depending on where you are going, it looks like you might not be able to charge anywhere on the route. I found a map of locations here:
http://www.teslarati.com/map/
Like the typical route between Denver, CO to Lake City, CO (255 miles one way) has no supercharger close. Would you modify your route to swing by the location? Or would you have a friend drive a gas car instead?
Well, I'm in the Northeast. When I'm heading somewhere to camp it's usually upstate from NYC. I'm pretty lucky in that the superchargers on the Thruway are honestly really empty at this point. I'll pull in to maybe 1 car, especially if I go further north. Paramus and Tarrytown are fairly busy but further North superchargers are not.
I have a 90D so I'd be able to make that drive in one go, although it would be close!
You would spend a bit under 2 hours charging en route, but it'd give you time to grab breakfast in Corning, and lunch in Springfield.
That being said, having done Seattle to San Diego recently (while passing thru Gilroy), I should have spent a day in Oregon or Norcal, 13hr days are just not my jam when it comes to driving.
Exactly so. The last time I had to go out of my way to "fill up" my car was at the end of December. The next time will probably be this summer sometime. Sure, it slows me down a bit when I'm making those long trips, but it's a net win.
It's true that this is a negative for EVs, but it's also one of their great advantages.
Add to this with their fast charge you can add ~70m/100km 10min. This makes topping up quite fast if your going over the range a bit any one day. Or 80% charge in 40min, which for most people would be easy to organise around lunch break or meeting if your already doing enough driving to drain the days range.
Looking further ahead, the self driving will likely allow the car to go fuel itself while you are out of it. And generally we should see more and more parking spots with chargers.
I think you're underestimating the number of long distance trips. I have a car only for long distance trips. Short trips and commutes I can do with public transit, cross country trips I do with planes, 50-500 mile trips I do with a car. I do a trip that long almost every weekend. If I had to add 30 min to a trip from Denver to Vail and back I'd be pissed.
I have no idea how you're upvoted, your one problem is literally the whole reason super chargers exist. There is now a super charge grid across the country specifically for that purpose, you can literally drive to any major city in the US have have a whole line of super charger support you along the way. This will even be free for most use cases.
Heck, it's even better than gas cars now where you car will actually tell you where the nearest super charger is in your range and if there are spots for you at it.
The only real edge case is if someone completely doesn't heed their cars own warnings about running out of energy, and then, well, there's still tow trucks for that edge edge case. Just like if your ICE car breaks down.
I'm sure Tesla is trying to figure this problem out without compromising the integrity of their batteries. I expect to see quick charging electric cars within the next 2 decades. Regardless, I'd still rather have a Tesla car over any ICE car because I can just charge my car at home, and I can still do road trips across the country because of superchargers. I wouldn't mind the wait at all.
Musks target of 500,000+ cars a year of velocity in 2018 is an insane goal!
By the numbers:
- They have just shy of 400,000 of the 3's on deposit, along with a backlog of other models.
- Last year Tesla shipped about 76,000 cars.
- Their Q4 delivery numbers were <25,000 cars and trailed expectations by about 5%.
- They blamed last quarter on autopilot hardware issues, eg OEM supplier / component issues.
- They made a significant uptick in velocity between Q2 (14,000 cars) and Q4 (22,200 cars).
I can't imagine how hard Tesla is pushing - for any Tesla HN's good luck! We are rooting for you :)
If, somehow, Musk reverses the chronic lateness and hits 500,000 in 2018 it's going to be quite the fireworks show.
https://www.bloomberg.com/news/articles/2017-01-03/tesla-fal...