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Incumbent car companies seem to have recently realized they are about ~2 years away from being put out of business by Tesla. In the past two weeks we've seen t

Incumbent car companies seem to have recently realized they are about ~2 years away from being put out of business by Tesla. In the past two weeks we've seen the CEO of BMW step down with speculation it was over BMW's botched EV strategy. Now the VW / Ford alliance on electric and self driving.

trilila 7y ago
German car makers are an enormous source of pollution in Europe. I am shocked anyone wants to buy their cars anymore after the emissions scandal.
hodder 7y ago
They clearly are at no risk of being put out of business by Tesla. All electric car sales are still only a fraction of ICE and given Tesla’s stagnant sales nuns it looks like it will remain that way for a while. Tech early adopters have bought and most others aren’t interested until the price falls significantly and the reliability becomes something like a civic.
- pmorici 7y ago
  Tesla's sales and sales of EV's in general look like they are in the early days of an exponential growth curve. They have been at around 100% or better YOY sales growth for the past 3 quarters. At that rate it will only take a few years to go from niche to dominating the market. Car sales in general are flat or in slight decline and Tesla is seeing 100% YOY growth. It doesn't take a rocket scientist to see that if that trend continues for a couple more years some of the traditional auto makers are going to go out of business. The real nail in the coffin though will be if Tesla crack full self driving by 2021 which is what they stated they think they will do.
yyyk 7y ago
Even if the entire world now wanted Teslas and nothing but Teslas, the manufacturing ability is just not there. Inevitably the vast majority of the market would go to other companies. That was always the relation between Tesla and established car companies: Tesla has better EV technology, but others had the better manufacturing ability by far. In theory, this should favour the established companies - Tesla doesn't patent their EV advances, and they aren't the only EV player anyway. It should be easier to add EV tech to existing chain than to establish an entire new supply chain. But every established company is very invested in ICE, and has large internal lobbies. It's interesting to see who gets the better of this - the established car companies' objective advantage or their internal political disadvantage. The recent moves might suggest these established companies are getting their internal politics in order, which should allow them to do EV better.
- pmorici 7y ago
  I realize that is the prevailing opinion. I think it's wrong. No incumbent out there has has yet made an electric vehicle that can even match Tesla's 2012 model S on range and performance. The electric cars they have come out with are money losers for them. Fiat's CEO famously told people he hoped no one bought the Fiat 500 Electric because the company loses $14,000 on every sale.
  - yyyk 7y ago
    Other companies are behind on EV proper (aside). Commercially, it doesn't matter all that much. Tesla can't sell nonexistent cars, and it can't increase capacity to the point of even getting near to taking over the market. The existing companies have more than enough time to fill in demand with their existing EVs - which will 'win' even if only because these models have cars which can be sold, though I wouldn't bet against the other companies having a compelling offer too. With scale profitability will come. Of course, the existing companies could sleep and lose their chance, but this doesn't seem likely. (aside) Note that comparison should also include price, and on that scale other EVs are already better. There should be room at the bottom of the market as well.

trilila 7y ago

German car makers are an enormous source of pollution in Europe. I am shocked anyone wants to buy their cars anymore after the emissions scandal.

hodder 7y ago

They clearly are at no risk of being put out of business by Tesla. All electric car sales are still only a fraction of ICE and given Tesla’s stagnant sales nuns it looks like it will remain that way for a while. Tech early adopters have bought and most others aren’t interested until the price falls significantly and the reliability becomes something like a civic.

pmorici 7y ago
Tesla's sales and sales of EV's in general look like they are in the early days of an exponential growth curve. They have been at around 100% or better YOY sales growth for the past 3 quarters. At that rate it will only take a few years to go from niche to dominating the market. Car sales in general are flat or in slight decline and Tesla is seeing 100% YOY growth. It doesn't take a rocket scientist to see that if that trend continues for a couple more years some of the traditional auto makers are going to go out of business. The real nail in the coffin though will be if Tesla crack full self driving by 2021 which is what they stated they think they will do.

yyyk 7y ago

Even if the entire world now wanted Teslas and nothing but Teslas, the manufacturing ability is just not there. Inevitably the vast majority of the market would go to other companies. That was always the relation between Tesla and established car companies: Tesla has better EV technology, but others had the better manufacturing ability by far. In theory, this should favour the established companies - Tesla doesn't patent their EV advances, and they aren't the only EV player anyway. It should be easier to add EV tech to existing chain than to establish an entire new supply chain. But every established company is very invested in ICE, and has large internal lobbies. It's interesting to see who gets the better of this - the established car companies' objective advantage or their internal political disadvantage. The recent moves might suggest these established companies are getting their internal politics in order, which should allow them to do EV better.

pmorici 7y ago
I realize that is the prevailing opinion. I think it's wrong. No incumbent out there has has yet made an electric vehicle that can even match Tesla's 2012 model S on range and performance. The electric cars they have come out with are money losers for them. Fiat's CEO famously told people he hoped no one bought the Fiat 500 Electric because the company loses $14,000 on every sale.
- yyyk 7y ago
  Other companies are behind on EV proper (aside). Commercially, it doesn't matter all that much. Tesla can't sell nonexistent cars, and it can't increase capacity to the point of even getting near to taking over the market. The existing companies have more than enough time to fill in demand with their existing EVs - which will 'win' even if only because these models have cars which can be sold, though I wouldn't bet against the other companies having a compelling offer too. With scale profitability will come. Of course, the existing companies could sleep and lose their chance, but this doesn't seem likely. (aside) Note that comparison should also include price, and on that scale other EVs are already better. There should be room at the bottom of the market as well.