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In Reply to: RE: Has a death spiral begun at TSLA? posted by Sondek on May 02, 2024 at 08:44:13
No sane reason to take the Chinese approach and overbuild what does not sell.
More layoffs than 10%? How about 66% like you find at Ford?
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...in fact, they are continuing to grow, but not at the rate anticipated or forecast by the global auto industry.
For Tesla--the party's over. The slice of the pie (EV sales in the overall auto industry sales numbers) IS still growing, but not getting as big, as fast as was hoped-for. Adding to that are the number of players fighting for their share of that small piece of the pie.
For over a decade, Tesla had faced very little "real" competition in the EV market. They never operated in a "competitive mode" because they faced little to no competition. Fueled by gov't incentives/investments, and private-sector investors, Tesla focused on R&D/innovation, and priced their vehicles at whatever price the market would bear. They (smartly) invested in a global charging network to service their customers.
Now they are facing actual "serious" competition from not only new start-ups, but also a lot of "legacy" auto manufacturers. Gone are the days of being "the only game in town", to having to focus on operating costs and profits--actually competing for and accounting for every dollar spent.
If you hadn't noticed, every new start-up and EV-program under the legacy auto manufacturer umbrella has promised to be/offer a "Tesla-killer" product. Tesla was both a benchmark and a target.
Gov't mandates/targets (globally) for EV-adoption enticed the "big-boys" to invest billions into what they thought was going to be the "future" of the auto industry--and followed in Elon's footprints of "cost-is-no-object" development/manufacturing/pricing.
Other than the Chinese, no one has introduced a cheap, daily-driver EV. Tesla is feeling the pressure of competition and "trimming the fat" of bloated corporate structure--they're not imploding. Ford, GM, and many others, are reducing production and/or suspending development and investment in EV projects to mitigate the amount of red ink on the ledger.
They over-produced and over-priced their products--now they are sitting on lots, waiting to be purchased.
I've owned a Tesla Model S, and Evelyn and I now both currently have M-B EQS 580 sedans. We're not opposed to EVs, BUT--these are pricey (but very nicely appointed) vehicles, not geared for the average consumer.
Our EVs serve us well--even on longer trips. Both have nearly 400 mile range, and can charge rather quickly. But EVs have a long way to go before everyone can/will own one.
"And today is for sale and it's all you can afford. Buy your own admission. The whole things got you bored. Well the Lord chooses the good ones, and the bad ones use the Lord"--a very dear friend for decades Michael Stanley (Gee)--RIP
I see that as temporary, although I agree that the EV market is still a minority market share. Overall auto sales/demand has "cooled" due to price increases and financing costs, but gov't mandates/targets/incentives will continue to force EV-adoption.
I'm not adamantly for or against EVs. We currently own two, but I still have a lot of ICE vehicles sitting here. They're not for everyone--that's for sure, but they meet our needs, even for relatively long trips. With nearly 400 miles of range. We (as drivers) need a break to re-charge at about the same time the cars do. Stop--have breakfast, lunch, dinner, or just a snack and stretch your legs while the car sits for an hour (or less).
"And today is for sale and it's all you can afford. Buy your own admission. The whole things got you bored. Well the Lord chooses the good ones, and the bad ones use the Lord"--a very dear friend for decades Michael Stanley (Gee)--RIP
Gallup polls suggest otherwise with the downward intent trend. It appears those who really want them have already purchased.
...as EVs continue to get more affordable, and gov't mandates/targets for EV adoption begin to approach their proposed implementation deadlines. In addition to the pro-EV push by governments and environmentalists, there is a corresponding anti-ICE movement that will alter/shift those numbers--primarily by restricting/regulating ICE vehicle useage.
I don't agree with these mandates/regulations, as I feel that they are premature and economically harmful, but the wheels are in motion. There are already efforts to banish diesel trucks and locomotives, that if implemented, will cripple the shipping/transportation industry, and increase the cost of consumer goods across the board.
EVs are here to stay, and being forced upon the public. A not-so-distant future chart/graph should include the category of "have no choice".
"And today is for sale and it's all you can afford. Buy your own admission. The whole things got you bored. Well the Lord chooses the good ones, and the bad ones use the Lord"--a very dear friend for decades Michael Stanley (Gee)--RIP
Certainly not this year!
"While annual EV sales continue to grow in the U.S. market, the growth rate has slowed notably. Sales in Q1 rose 2.6% year over year, but fell 15.2% compared to Q4 2023. The increase last quarter was well below the previous two years ".
...and it isn't a particular market-distaste for EVs. Tesla is no longer "the only game in town"--there are viable competitors. Tesla is "old news"--they haven't introduced a new from the ground up model in a decade. Minor refreshes and adaptations of existing platforms only go so far. Their entire line-up is ageing-out of it's production life-cycle. You can only re-apply the lipstick to a pig so many times before people realize that it's just an old pig. THAT is no different than with ICE vehicles--it applies to ALL vehicles. You can only hold-on to a model/platform for so long, before you have to go back the drawing board and start from scratch. Tesla hasn't done that--yet.
Elon is now facing serious competition, but probably doesn't want to further risk his credibility with investors to make such a major investment to overhaul his entire product line--not right now.
"And today is for sale and it's all you can afford. Buy your own admission. The whole things got you bored. Well the Lord chooses the good ones, and the bad ones use the Lord"--a very dear friend for decades Michael Stanley (Gee)--RIP
"Minor refreshes and adaptations of existing platforms only go so far."
"You can only hold-on to a model/platform for so long, before you have to go back the drawing board and start from scratch."
Remind me again how long Chevrolet has been selling the Suburban? How long has Ford been selling Mustangs? The Audi A6? The Chevrolet Corvette (finally given a real update recently)?
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We are inclusive and diverse, but dissent will not be tolerated.
...have gone through significant changes in platforms/designs. Only the names have carried over through all of these years/decades. The only thing that a current Mustang has in common with it's predecessors is that it is still rear wheel drive with an available V-8 ICE engine. Every generation of Corvette is clearly defined (C1 through C8), and distinctly different--not just in appearance. My current Suburban is a far cry from the first one that I ever drove--working on a farm in the 70's. I don't recall it having GPS, touch screens, heated leather, and power everything. In fact, it was a stick-shift with no A/C and no radio--and no carpet--the floor was all rubber/vinyl that could be hosed-out at the end of the day.
"And today is for sale and it's all you can afford. Buy your own admission. The whole things got you bored. Well the Lord chooses the good ones, and the bad ones use the Lord"--a very dear friend for decades Michael Stanley (Gee)--RIP
You can only hold-on to a model/platform for so long, before you have to go back the drawing board and start from scratch.
Porsche would laugh at that notion with the 911 series...
Nothing wrong with "luxury" unless something cheaper works as well, (or you're poor).
Perhaps both the fact and perception of Tesla 'luxury' is fading a bit.
Dmitri Shostakovich
...and I'll say that having previously owned a Model S (2019). They may have been priced and marketed as such, but Tesla is a tech company, not a coach-builder. The leather was cheap, fit and finish were average (at best), but the dashboard/display panels looked like Star Trek command and control.
I bought mine used (from a close friend) who had purchased it as an "experiment" into EVs. He sold it to me (two years old) for half what he paid for it, basically so I could do the same. It was mostly comfortable, and relatively trouble-free--I had a couple OTA software updates fail, so I had to reload them manually. I never required road-side or dealer assistance, and it never left me stranded. But it never looked/felt like the $100K car that it was (at original purchase).
My wife and I now own 2 M-B EQS 580 sedans, and they have all of the "luxury" of an S-class M-B ICE vehicle. Fit and finish is all there, and they are very comfortable, but relatively basic in their dashboard displays--just like an ICE S-class.
"And today is for sale and it's all you can afford. Buy your own admission. The whole things got you bored. Well the Lord chooses the good ones, and the bad ones use the Lord"--a very dear friend for decades Michael Stanley (Gee)--RIP
Not necessarily to everyone, especially for those who own actual luxury autos.
Dmitri Shostakovich
If that RR is such a "luxury" car, why doesn't it even have bumpers?
Heck, I've seen 30 year old Toyota Corollas that don't have bumpers.
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We are inclusive and diverse, but dissent will not be tolerated.
Albeit government policies are a significant driver, however ...
"This article outlines three key reasons for the growth of China's EV sector: experimenting in adjacent industries, encouraging operational solutions, and doubling down on core technology." See link below.
Also see ..
= China's EV strategy of going small and cheap to pay big dividends in Asia
= Are Chinese electric vehicles taking over the world?
= Chinese EV Makers Post Strong March Sales After Slow Start
But it's also true that there has been some over-supply and there will be consolidation amongst the Chinese EV makers ...
= A brutal elimination round is reshaping the world's biggest market for electric cars
~~~
BTW, F150 Lightning was a stupid idea. Pretty obviously the typical pickup driving redneck is an ICE devotee.
Dmitri Shostakovich
Their sales include all the ones rotting outside with no buyers.
So, are you aware of their massive, multi-billion dollar ghost cities where no one lives?
Same charade Bill.
All Chinese cities seemed to have their "apartment farms", the bigger the city the taller the buildings. In many places the vacancy rate was very high.The real estate boom in China was driven by complex factors. One being the typical Chinese don't trust the Chinese stock markets, (with good reason), they are forbidden to buy foreign investments, hence turn to RE to invest their savings. Another is that local governments rely for funding on selling land to real estate developers. The developers, for their part, have assumed huge debt while over-supplying housing product; some such as Evergrande Group have failed or are likely to.
Note that the licensed EVs in the video you linked were bought and licensed by short-term car retail scheme that fail. Also mentioned there were bicycle-share enterprises that failed and it show vast heaps of abandoned bicycles.
You can't definitively blame the failed that car scheme on the fact that the cars were EVs.
BTW, when we were in Beijing on 2018 we saw plenty of by-the-hour rental bicycles; they seemed reasonable popular. Also BTW, extremely popular were battery-electric Vespa-style scooters -- these are a big menace to pedestrians because they are almost silent and driven fast and without much regard for traffic rules.
Dmitri Shostakovich
Edits: 05/04/24
One being the typical Chinese don't trust the Chinese stock markets, (with good reason)...Good reason!
Massive defaults by contractors leaves Chinese "investors" without completed homes to actually live in.Very different situation here.
As for EVs, overproduction (and product dumping) as I've mentioned before remains their ruse.
"China's production capacity for new energy vehicles in 2025 is expected to reach over 36 million vehicles when the plans of automobile companies and local governments are combined. Sales that year are expected to be around 17 million vehicles, creating a nearly 20-million-unit surplus . "
Edits: 05/04/24
But you can't export real estate.
Apparently China's broad strategy going forward will be high-tech manufacturing and export. The export-lead economy was the Chinese thing for a couple of decades; some call it "mercantilist" or neo-mercantilism. It worked pretty well; seems Emperor Xi wants to go back to that given domestic real estate has turned into a bust.
Given this, it's understandable that Chinese foreign sale of their "over" production of EVs is seen by foreigners as "dumping". But traditionally dumping implies temporary disposal of production over domestic consumption. But this overproduction, I suspect, is a prelude to penetration of foreign markets, the US in particular.
Cynics would say that it's the old would-be monopolist tactic of undercutting competitors price to drive them out of business. This could be close enough to the truth. It is likely to be met be protective tariff bring an end to the mostly free trade world we've know.
Dmitri Shostakovich
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