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Eh, they probably thought it (however unlikely) could happen for reasons other than a pandemic. Like unprecedented green energy incentives leading to everyone s
by hunter2_ 7y ago
Eh, they probably thought it (however unlikely) could happen for reasons other than a pandemic. Like unprecedented green energy incentives leading to everyone suddenly driving an EV.
- fennecfoxen 7y agoThat example is a bit implausible. This is only a problem when oil prices fall very low very quickly. Manufacturing constraints prevent mass EV adoption on those timescales. On the other hand, people who draft contracts for big corporations get to talk to risk analysts and ask "if we agree to this, what might go wrong that causes us to lose money?" and write clauses that generally protect them from that risk.
- paxys 7y agoThat could happen over a span of decades or longer, not like 3 weeks.
- RandomBacon 7y agoFor most people it's going to be cheaper to continue to use or buy a used gasoline vehicle than it will be to buy a new electric vehicle.
- philipov 7y agoWhen it costs you nothing to add a clause to a contract, you don't need to come up with a plausible scenario for how something could happen, you only need to foresee the logical possibility of it occurring for any reason whatsoever. Part of managing risk is understanding the world is much more creative at coming up with failure scenarios than you are.
- hunter2_ 7y agoThat sums up my intention. I shouldn't have provided an example, for precisely the reason you describe: it's not likely to be what causes the clause to be invoked.