On a side note, how exactly did Tesla persuade lots of people to pay them enormous margins?
That's a very good question. The 5-year cost of ownership for a Model 3 is similar to a BMW 3 series, and yet the Model 3 requires its owner to plan around their range anxiety and deal with hours-long recharges as opposed to ten-minute fill-ups. A brand new Civic costs almost half as much to own as a used Tesla. It would seem like people looking for luxury would gravitate toward the most convenient solution, and the people looking to a car that makes financial sense would gravitate toward the most economical solution.
Even after years of technological improvement, Teslas are still neither economical nor convenient when compared to their ICE and hybrid competitors. That's why Tesla's early product managers made the decision to compete in the market for performance vehicles, where looks and acceleration are more important than practical concerns, and where paying enormous margins for unreliable small-batch vehicles was already the norm. That still doesn't explain why any work commuter should choose a Tesla over a Civic. It makes no financial sense, but then again neither do the vast majority of cars on U.S. roads.
Interesting that you’d stop the cost of ownership comparison at 3 years. Would love to see the source for that. I assume the numbers only improve for the Tesla the longer out you look based on reduced maintenance cost (no oil changes, transmission fluid, radiator, spark plugs, far cheaper full, etc.). Teslas are extremely economical in the long run. These cars have proven they can go easily go 300,000 miles on the original battery and drive train. They have some of the highest safety ratings of any car ever made and the highest performance.
I’ve explained to you before, but you choose to ignore that Tesla is not incapable of producing a quality EV for under $35k (roughly the US average for new vehicles), The simple fact of the matter is Tesla is battery cell constrained. They are not demand constrained. Battery cells are the limiting factor. So, why on earth would they use the limited cell supply to produce lower margin vehicles? Same for introducing new models. Why would you produce a new model (semi or Cybertruck) before you have the cell capacity to support that new line AND your existing lines. Adding new vehicles to your production incurs added costs and reduces profitability, unless you have the cell capacity to support both. You can harp on Tesla “breaking promises” by delaying these new models, but as a share holder I appreciate they are making smart business decisions to maximize profitability. Tesla is able to produce unheard of margins on their automobiles because they’ve reduced the cost to manufacture and produced a product of superior value.
You also fail to mention or to grasp the reason “a brand new Civic costs almost half as much to (purchase) as a used Tesla” is because of the tremendous resale value of used Teslas, which is actually increasing the cost to own advantage of the Tesla over ICE vehicles. Plus, comparing even the base Tesla Model 3 to a civic is like questioning why you’d pay more for a good steak over a hamburger. In this case, you pay a premium of front, but enjoy lower cost of ownership, especially avoiding high gas prices, and then get to sell the car at a premium in the used car market. Lightly used Teslas are currently selling for more than new Teslas due to the long wait times (6-12 months) for new vehicles to be delivered.
Lastly, you talk about the “inconvenience” of owning a Tesla. A Tesla owner can refuel in their garage overnight and wake to a fully fueled vehicle every morning. A Tesla owner can fuel at work. A Tesla owner has access to dedicated nationwide supercharger network for the rare drive exceeding 300 miles of range. Where, after driving 300 miles, they can gain 80% charge back in less time than it will take them to go to the bathroom and scarf down a fast food burger, before driving another 250 miles or more. Oh yeah, you just saved yourself a couple hundred dollars on fuel, so treat yourself to a nice dinner when you do stop for the night.
It wasn’t luck that Tesla succeeded, which is not to say they were guaranteed to succeed, but plenty of investors saw the vision early and knew this was something different. The first ever attempt to build a compelling EV from the ground up and give it real performance, not some compliance car/weird mobile. EVs are clearly better from a technology, performance, and cost of ownership perspective. The demand speaks for itself despite your unsupported concerns. Keep doubting Tesla, (I know you say you’re routing for them to succeed, though there’s little in the tone of your posts to suggest that’s the case), it hasn’t slowed their rapid ascent to date. If I listened to the talking heads,Wall Street, or message board wisdom, I’d sold years ago and missed out on tremendous gains. Tesla is just getting started.
