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It turns the idea on its head that the price of something should be related to the cost of making it. If there were a bunch of viable Tesla-like alternatives o

It turns the idea on its head that the price of something should be related to the cost of making it. If there were a bunch of viable Tesla-like alternatives out there, they wouldn't be able to afford to leave in disabled features. So, it's in essence exploiting their monopolistic position which is evil.

mrmonkeyman 7y ago
> It turns the idea on its head that the price of something should be related to the cost of making it. Who told you this? It is blatantly untrue and the modern world would come crashing down fast if it were to be true. The financial sector is general would like a word with you. The only relation these concepts have is that production costs form a lower boundary: you have to charge more than it costs to produce it in order to turn a profit. There is no upper bound. Ask your friendly neighborhood notary or lawyer.
brianwawok 7y ago
The cost of items is based on what you will pay, not what it cost to make. Capitalism 101.
- salawat 7y ago
  >The cost of items is based on what you will pay...not what it cost to make. So... Where's my 200 dollar car that costs 4000 to make? Oh wait, did you mean >The profit margin of an item is what value the customer is willing to pay over and on top of the cost of initial production + logistics of getting product to the final resales? Because if you don't take that in to account, you only played enough attention to validate a worldview in which capitalism justifies unbounded exploitation. Capitalism operates within specific bounds outside of which the axioms on which it is based cease to produce net positive effects for the health of the societal framework in which it operates based on it's tendency to inequitably partition the fundamental means of exchange without active measures in place in order to ensure that the majority of capital continues exchanging hands instead of languishing in accounts chasing after opportunities for growth rendered nigh-impossible to find once a "winner" is established by conservative investment strategies in most industrial verticals, and that winner optimized beyond the reach of meaningful competition by new entrants. You'll then end up in repetitive cycles of boom and bust as too much capital chases too few opportunities for growth; all the while with the financial industry converging toward whatever form is most able to avoid current regulatory controls.
  - rz2k 7y ago
    Most of these cost more than $4,000 to make: https://sfbay.craigslist.org/search/cta?min_price=200&max_price=200 https://sfbay.craigslist.org/search/cta?min_price=200&max_pr... Some design or manufacturing flaws can lead to auto makers paying someone to dispose of an otherwise brand new car. Sometimes, such as when they've poorly forecast demand, selling their inventory at a loss is a smaller loss than paying for disposal. Other times they will destroy functioning, new vehicles if that's what's necessary to maximize total revenue.
    - jjeaff 7y ago
      Regulations like emissions limits can also cause this. GM has supposedly been know to sell some of its electrics at a loss simply to help meet the ratio requirements of the EPA so they can sell more big vehicles.
      - salawat 7y ago
        Again, this is a consequence of the statement I made before regarding >the financial industry converging on whichever form most effectively sidesteps the current regulatory regime. I should probably have phrased it to industry in general, but regardless, I stand by my original point. The automotive industry accepts taking a loss through sub-optimal implementations of regulatorally incentivized models in order to optimize on the most profitable model segment. Capitalism will converge in the direction of a net negative naturally without active efforts to reign in it's tendency toward fiscal optimization at all costs. I'm not even being controversial and saying socialism/Marxism is the way. (They aren't; in case anyone is wondering). I'm just pointing out what actually happens.
    - salawat 7y ago
      With Craigslist you're generally not looking at a good representation of the "well-equipped or dispositioned" seller; and given the market in the SF Bay area, you're optimizing for one of the highest friction automotive ownership locales in the United States. If anything you're Also to a degree proving my point on the market at large being skewed toward larger actors; as the capability of the "new entrant" to extract value from the market is significantly diminished. Get that same car to a dealership, and they might even be able to extract even more value for it. Also, if you're taring the sale at last seller, that's not entirely fair. First sale is what we're discussing, generally represented by first change of hands after factory->reseller.
- topmonk 7y ago
  Unless you have a competitor making a nearly identical product. That's why I said it was exploitation of a monopolistic position. There is no other car company close to Tesla, so they get to pay these games. Same as a chip manufacturer, say Intel, developing a process to make say 3x faster chips. But instead of releasing the fastest chip they could make, they titrate their new ability to the market over time. First a chip 50% faster, then 2x, etc., so they can milk the market. I don't know about what you're willing to accept, but I don't like being treated like a farmer's cow.

mrmonkeyman 7y ago

> It turns the idea on its head that the price of something should be related to the cost of making it. Who told you this? It is blatantly untrue and the modern world would come crashing down fast if it were to be true. The financial sector is general would like a word with you. The only relation these concepts have is that production costs form a lower boundary: you have to charge more than it costs to produce it in order to turn a profit. There is no upper bound. Ask your friendly neighborhood notary or lawyer.

brianwawok 7y ago

The cost of items is based on what you will pay, not what it cost to make. Capitalism 101.

salawat 7y ago
>The cost of items is based on what you will pay...not what it cost to make. So... Where's my 200 dollar car that costs 4000 to make? Oh wait, did you mean >The profit margin of an item is what value the customer is willing to pay over and on top of the cost of initial production + logistics of getting product to the final resales? Because if you don't take that in to account, you only played enough attention to validate a worldview in which capitalism justifies unbounded exploitation. Capitalism operates within specific bounds outside of which the axioms on which it is based cease to produce net positive effects for the health of the societal framework in which it operates based on it's tendency to inequitably partition the fundamental means of exchange without active measures in place in order to ensure that the majority of capital continues exchanging hands instead of languishing in accounts chasing after opportunities for growth rendered nigh-impossible to find once a "winner" is established by conservative investment strategies in most industrial verticals, and that winner optimized beyond the reach of meaningful competition by new entrants. You'll then end up in repetitive cycles of boom and bust as too much capital chases too few opportunities for growth; all the while with the financial industry converging toward whatever form is most able to avoid current regulatory controls.
- rz2k 7y ago
  Most of these cost more than $4,000 to make: https://sfbay.craigslist.org/search/cta?min_price=200&max_price=200 https://sfbay.craigslist.org/search/cta?min_price=200&max_pr... Some design or manufacturing flaws can lead to auto makers paying someone to dispose of an otherwise brand new car. Sometimes, such as when they've poorly forecast demand, selling their inventory at a loss is a smaller loss than paying for disposal. Other times they will destroy functioning, new vehicles if that's what's necessary to maximize total revenue.
  - jjeaff 7y ago
    Regulations like emissions limits can also cause this. GM has supposedly been know to sell some of its electrics at a loss simply to help meet the ratio requirements of the EPA so they can sell more big vehicles.
    - salawat 7y ago
      Again, this is a consequence of the statement I made before regarding >the financial industry converging on whichever form most effectively sidesteps the current regulatory regime. I should probably have phrased it to industry in general, but regardless, I stand by my original point. The automotive industry accepts taking a loss through sub-optimal implementations of regulatorally incentivized models in order to optimize on the most profitable model segment. Capitalism will converge in the direction of a net negative naturally without active efforts to reign in it's tendency toward fiscal optimization at all costs. I'm not even being controversial and saying socialism/Marxism is the way. (They aren't; in case anyone is wondering). I'm just pointing out what actually happens.
  - salawat 7y ago
    With Craigslist you're generally not looking at a good representation of the "well-equipped or dispositioned" seller; and given the market in the SF Bay area, you're optimizing for one of the highest friction automotive ownership locales in the United States. If anything you're Also to a degree proving my point on the market at large being skewed toward larger actors; as the capability of the "new entrant" to extract value from the market is significantly diminished. Get that same car to a dealership, and they might even be able to extract even more value for it. Also, if you're taring the sale at last seller, that's not entirely fair. First sale is what we're discussing, generally represented by first change of hands after factory->reseller.
topmonk 7y ago
Unless you have a competitor making a nearly identical product. That's why I said it was exploitation of a monopolistic position. There is no other car company close to Tesla, so they get to pay these games. Same as a chip manufacturer, say Intel, developing a process to make say 3x faster chips. But instead of releasing the fastest chip they could make, they titrate their new ability to the market over time. First a chip 50% faster, then 2x, etc., so they can milk the market. I don't know about what you're willing to accept, but I don't like being treated like a farmer's cow.