3 Reasons Tesla Motors Will Dominate in 2014

fool.com ^ | January 3, 2014 | Tamara Walsh

[Sooth2222]

How is this a poor business plan?

The Nissan Leaf is electric, but unlike the Tesla, it is an economy car that carries the stigma of a relatively low price. At least compared to a Tesla. One can never impress neighbors that you spent $100,000 on an electric car with a Leaf.

Nissan's Leaf SL has a MSRP of $35,690. The $7,500 tax credit brings this down into the high end of the econocar range. After 2 years, based on resale prices, a Leaf is worth less than half of the original MSRP. This steep depreciation might more accurately reflect the value that the free market puts on an electric car. Requiring constant infusions of gov't cash is not a viable long term business plan. Governments change, and governments eventually run out of money for frivolous feel-good subsidies.

(BTW, didn't Cartman get his electric from the gov't for free?)

[EEGator]

“Requiring constant infusions of gov’t cash is not a viable long term business plan. Governments change, and governments eventually run out of money for frivolous feel-good subsidies.”

This is yet to be seen. Though I’m against it, it’s a very small percentage of government funds.

I know I don’t want a Leaf or a Tesla. I just purchased a new Honda Accord for $23K.

P.S. Cartman is awesome.

[ckilmer]

And with the Millions of $$$$ it received in both California and Federal subsidies that kept it alive, who do you suppose profitted the most when the stock sales went up?
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the federal program under which they borrowed money was created by george bush. Tesla paid back the loan with interest two years ago.

The Tesla story in this regard is actually a success for the federal government.

[ckilmer]

The Nissan Leaf is electric, but unlike the Tesla, it is an economy car that carries the stigma of a relatively low price.
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The stigma is not the low price but rather the small fuel range. The Leaf can go 100 miles. The tesla can go 250 miles. That make the Tesla suitable for local driving. You can leave the driveway without immediately having to worry about refueling the car.
Also, the Tesla has a lot of curb appeal. Its one cool looking car.

At least compared to a Tesla. One can never impress neighbors that you spent $100,000 on an electric car with a Leaf.

Nissan’s Leaf SL has a MSRP of $35,690.
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Tesla plans to have a 30k car with the same fuel range as the S Class — available in 2016.

Requiring constant infusions of gov’t cash is not a viable long term business plan.

Tesla did borrow government money under a program created by George Bush. But the money was paid back with interest two years ago.

If Tesla succeeds—ten years from now in creating an electric car industry then this one success of federal money will have justified the 100 failures of government money like Solyndra. This success failure ratio is about like that of private industry. What would be the meaning of an electric car success? The demand for oil would collapse and so would the price of oil. This would bankrupt the arab gulf states and defund al quaeda. Also the wealth of the industrialized world would go up big time—because lower energy prices are pure oxygen to the worldwide economy. This would be a strategic victory for the USA’s war on terror.

[ckilmer]

Domination of what? To my estimation, being the leader in a pack of environmental battery, or batter/gas generator cars isn’t a total market leader. It’s a leader of a niche market, for those with the dollars to get into it.
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Yeah that’s about right.

The big question is whether Tesla can bring down the costs so as to make the car available to a larger audience. If they do that then the world changes.

[St_Thomas_Aquinas]

-— What would be the meaning of an electric car success? The demand for oil would collapse and so would the price of oil. -—

Where does electricity come from?

[ckilmer]

To “dominate”, there will need to be a massive breakthrough in battery technology.

For most people, an EV is simply not feasible.
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Or Tesla needs to bring down the cost of the car. That’s their next promise. Tesla’s next big promise is not that they’ll improve the performance of their batter but rather that they’ll bring down the cost of the Tesla S class from 80k to 30K in 2016—without harming performance.

This is a big deal because the big breakthrough for Tesla has been their improved battery performance—which has pushed up the range of their electric car from the industry standard 100 miles to 250 miles. This is a big deal because it makes the Tesla totally suitable for local driving. People don’t have to worry about recharging their Tesla the moment they leave the driveway. Same would go for the 30k car in 2016.

Will that happen? An interesting question with incredibly profound implications. Why? because tesla is doing all their manufacturing under one roof in californa.

This totally goes against industry dogma which resources car parts from all over the world. If Tesla succeeds in collapsing the price of their car using parts from their one car plant in San Jose—then you can expect a revolution in american manufacturing to soon follow as american manufacturers bring their manufacturing home.

[ckilmer]

Major car companies know how to reverse engineer. Selling a $100,000 car for $90,000 doesn’t get far.
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agree that Tesla is forcing the major car companies to throw a lot more money at electric cars.

Real Tesla sales numbers seem not available through independent reporting agencies, unlike other car brands.
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last number I saw for Tesla 2013 sales was about 21,000 cars. They’re projecting 40,000 cars for 2014.

[ckilmer]

Apparently the government doesn’t want you driving cars.
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imho the collapse of the cost of oil represents strategic victory in the global war on terror as it would defund the the gulf state and therefor dry up funds for Al Qaeda. As well, cheaper oil prices are pure oxygen to the world wide economy. The world wide economy including the USA would enjoy much higher growth rates.

[jjotto]

Yep. Credibility gap.

Tesla claims 20,000 units for 2013. That would make them more common than new Jaguars. Who believes that?

[GGpaX4DumpedTea]

I saw a really neat Jag yesterday, and I have never seen one of the Tesla abortions.

[ckilmer]

Uh, Tesla Motors will dominate the 1 percent EV market with $165,000 cars? Yup. Got it...a sound business model if there ever was one.
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true it won’t happen that way. Tesla’s big promise is to lower the price of their 80k car to 30k —while keeping the same battery performance—in 2016.

That will make the tesla available to a much wider audience and push their sales from 10’s of thousands to 100’s of thousands. Still a drop in the bucket. But the major car companies will be forced to invest even more money in electric cars.

[jjotto]

40,000 units would be almost outselling Porsche in the US. Someone should put down the crack pipe.

[ckilmer]

40,000 units would be almost outselling Porsche in the US. Someone should put down the crack pipe.
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We’ll know by the end of this year just who that should be.

[freekitty]

I still say pedal push cars for all. Snort

[xp38]

Ford has a solar panel vehicle in the pipeline so this could throw a new wrinkle in the EV niche soon.

[GGpaX4DumpedTea]

All Balderdash!

[ckilmer]

All Balderdash!
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agreed. if Tesla moves from 21k vehicles sold in 2013 to over 40k vehicles sold in 2014—the whole story will remain balderdash.
further, if Tesla gets the price of their car down to 30k in 2016 the whole story will become poppycock.

[vette6387]

“The tesla can go 250 miles. That make the Tesla suitable for local driving. You can leave the driveway without immediately having to worry about refueling the car.”

I live in a “bedroom community” for the Silicon Valley and San Francisco. The Tesla’s are here in great abundance. We don’t have 60 below temps and the distances between these folks homes and their offices are well within the range of the Tesla. It’s a beautiful vehicle. A lot of advanced technology not only in the propulsion system but also the vehicle structure. While I still prefer gasoline fueled vehicles, the EV’s have a place in our transportation infrastructure.

[Hot Tabasco]

The Tesla story in this regard is actually a success for the federal government.

They just received a nice $34 million tax break from California..........