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Tesla's Investor Day was mostly about the ways they're working on reducing costs. They won't get to $11K anytime soon, but they might manage $25K, and that's st
by DennisP 4y ago
Tesla's Investor Day was mostly about the ways they're working on reducing costs. They won't get to $11K anytime soon, but they might manage $25K, and that's still in the low end of the market for ICE cars these days.
- seanmcdirmid 4y agoThey could probably get there if they wanted to, but the profitability for them wouldn't make it interesting enough, and the low end, where it really sells (i.e. outside of the USA), is crowded by Chinese car companies.
- DennisP 4y agoIn one of Sandy Munro's videos, he said he thinks Tesla can manage costs of $19K. The size of the market increases dramatically as you go down the price curve, which makes a $6K profit per car plenty interesting. That certainly seems to be what Tesla thinks at least, unless they were completely lying to investors about the volume they hoped to achieve.
- seanmcdirmid 4y agoWhy invest 200 million USD to make 1 billion when you can invest the same to make 10 billion? The problem is that expanding isn’t free, you take the most probable business first. The low end is growing rapidly, but the players already there will ensure that Tesla doesn’t make $1k of profit per vehicle. They can’t compete with a Wuling Mini EV for $4k, or whatever BYD has up to the model 3 price point.
- DennisP 4y agoI don't see many Wulings for sale in the US, and Tesla is selling plenty of Model 3 in China. Tesla did take the most profitable business first. Now they're expanding to the mass market. You might disagree that it's the best strategy, but it's the one they're following; if you don't believe me, just watch Investor Day.