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What baffles me is Tesla's paralysis compared to BYD. Wasn't Tesla's goal to do rapid expansion to stay on top of everybody else volume wise? Nowadays Giga Berl
by Dunedan 3y ago
What baffles me is Tesla's paralysis compared to BYD. Wasn't Tesla's goal to do rapid expansion to stay on top of everybody else volume wise? Nowadays Giga Berlin produces way less vehicles than anticipated and the only new factory being planned is Giga Mexico, which also seems to proceed slower than expected. In addition while the next vehicle from Tesla will probably be a smaller and cheaper car, it's still at least a year before they'll be able to ship it. All that while Tesla seems to have lots cash at hand, so why don't they expand more aggressively?
- rapsey 3y agoThey have the most popular car in the world how are they paralyzed?
- petee 3y agoI couldn't find a single list that had Tesla anywhere near #1; source?
- sidibe 3y agoFor individual models I've seen Model Y as #1. But seems like growth has stopped, so paralyzed is still appropriate, and they only have 2 models that sell significant numbers
- formerly_proven 3y agoMost other OEMs have (way way) more than four models, so that kind of list doesn't really make much sense to begin with.
- kibwen 3y agoThe Model Y is the most popular car in the US only if you don't classify pickup trucks as cars. Pickup trucks dominate car sales in the US.
- kwhitefoot 3y ago> if you don't classify pickup trucks as cars Pickup trucks aren't cars so that is perfectly reasonable.
- kibwen 3y agoPickup trucks aren't cars in the same way that tomatoes aren't vegetables. If you say "I bought a car" and then show someone your brand-new Ford F-150, nobody's going to think anything of it. Pickup trucks are cars, and watching Tesla fans try to spin this fact is really pathetic.
- fragmede 3y agoI don't know how widely held that viewpoint is. words mean things and cars aren't trucks, and someone's option on Tesla has nothing to do with that. If you call a truck a car, there are people that will look at you funny.
- pcchristie 3y agoDepends what country/culture you're in. Here in Australia, you'd never not call a truck/ute a car.
- defrost 3y ago> If you call a truck a car, there are people that will look at you funny. Damn right, and SUV's, Cyber"Truck"'s, Pickup's, Toorak Tractors, etc. aren't trucks save for north america. George Miller famously made a serious of documentaries about car drivers that chase trucks: https://www.youtube.com/watch?v=Kt7trqrPYX4 https://www.youtube.com/watch?v=Kt7trqrPYX4
- modeless 3y agoThe Tesla Model Y was the world's best-selling vehicle in 2023. Hard to imagine you looked seriously and were unable to find that out. https://en.wikipedia.org/wiki/Tesla_Model_Y https://en.wikipedia.org/wiki/Tesla_Model_Y
- deleted 3y ago[deleted]
- DoughnutHole 3y agoHe may have been confused because it’s a dumb statistic. In good faith he probably assumed that the above post implied that Tesla was in some way leading other manufacturers, rather than Tesla having the single best selling model while massively underperforming in sales compared to other manufacturers that have had the bright idea of offering many different models of car.
- petee 3y ago"most popular car in the world" not most popular last year; specificty matters if you want to make big claims. The title goes to the Corolla with over 50 million sold. And apparently 1.6mil 2023 according to finalized numbers. Anyway, Tesla's numbers do not separate Model 3/Y, and they ballpaked $1.2
- ein0p 3y agoQuick search suggests BYD made 3.02 million cars in 2023. Tesla: 1.8M
- kurthr 3y agoYes, but half of BYD's cars are hybrid. Only ~1.6M are EV. They've also been around making batteries since 1995 and ICE cars since 2003. It's not like Tesla's subsidies have been small, but BYD's have been enormous.
- patientzero 3y agoSounds like a Tesla killing recipe for the existing automotive industry.
- ein0p 3y agoAs they should have been in both cases. For most uses EV is superior, and this is the only way for Chinese manufacturers to meaningfully tackle the broader markets worldwide. You can’t compete with ICEs and hundreds of billions of dollars invested into that manufacturing capacity, supply chains, and know how. But you can entirely sidestep the whole thing. Which is what the Chinese are doing.
- greedo 3y agoHow much of a subsidy does Tesla receive by selling its green credits?
- makeitdouble 3y agoIndividual model sales don't make much sense as a metric when makers are diversifying. The model Y has 1.2M sales for a total of 1.8M Tesla cars in 2023, where Toyota alone is at 11.2M.
- ein0p 3y agoPerhaps they know something we don’t. The news outlets won’t shut up about EV demand “slipping”. That could be because they don’t like Musk, but it could also be real. In a post-truth society there’s no way to know.
- green_goober 3y agoYou can always read financial reports like 10-Ks and see what the company says and what their number say. Numbers like that don't really lie. The media has never been a "source of truth" at the best they act as watchdogs, at the worst they are propaganda. You can still find answers for yourself but good information has a time cost.
- ein0p 3y agoDemand is a lagging indicator, and worse, they have to plan well ahead for how it changes. Building multiple billion dollars worth of production capacity ahead of a severe recession would be a potentially fatal decision.
- green_goober 3y agoYou can always use leading indicators (unemployment, inflation) to estimate future car sales, then extrapolate the EV market share based on current growth numbers. It's not perfect but it's not like large institutions somehow have a crystal ball. They are likely doing the same, just with better models.
- dragontamer 3y agoThe only leading indicators you need in the car market are days of inventory and recent price actions. Tesla's have deep discounts, suggesting a decline in demand. The end. Inventory is harder because they lack dealerships, but it doesn't seem difficult to find a Model3/ModelY right now at all. ------- For other EVs like Ford Mustang MachE, days of inventory are rising and prices are declining as well as incentives. It's not just Tesla, it's a wide group of EVs that were overproduced. https://caredge.com/guides/fastest-and-slowest-selling-cars-2024 https://caredge.com/guides/fastest-and-slowest-selling-cars-... Go browse some stats yourself.
- popularonion 3y agoI take Elon at face value when he recently said “We kind of dug our own grave with the Cybertruck”
- iamcreasy 3y agoIt does not sound as ominous if you also include the next line he said. "We kind of dug our own grave with the Cybertruck. It is going to require immense work to reach volume production and be cash flow positive at a price that people can afford. It will take a year to 18 months before it is a significant cash flow contributor."
- peebeebee 3y agoThey should have just put everything on Tesla model 2. In Belgium everyone is excited for a 5000 EUR tax cut for EV vehicles below 40000 EUR. Lots of people interested in buying Model 3 and Model Y now. But 35000 EUR is still too much for the general public. If they could’ve released a model 2 for 25000-30000 EUR instead of the Cybertruck, it would have dominated the EV market.
- rapsey 3y agoTesla's are absolutely everywhere in my corner of Europe, which is by all metrics poorer than Belgium. Tesla is already dominating.
- panick21_ 3y agoIts kind of funny how people digging Tesla grave when BYD rise is a way bigger problem for all other car companies. Tesla is still producing a huge amount of EV compared to everybody. Tesla strategy is to have huge factories, not many factories. They are not only building Giga Mexica. There is currently expansion of Berlin and Texas. In addition to that they have many other things and locations. Such as their own lithium refinement. Battery materials factory in Austin and stuff like that. > All that while Tesla seems to have lots cash at hand, so why don't they expand more aggressively? As Musk has pointed out, the real limit isn't money but the ability to hire experts and to manage all these complex projects.
- alephnerd 3y agoBYD's battery division is an absolute gold mine like AWS is for Amazon. BYD is the primary battery supplier for most consumer electronics (you're iPhone or Macbook is using a BYD battery for example). Tesla doesn't have an "AWS" equivalent to subsidize it's automotive division, as the Solar+Grid Battery+Battery Management Systems divisions have much lower margins and higher upfront cost.
- a1o 3y ago> BYD is the primary battery supplier for most consumer electronics (you're iPhone or Macbook is using a BYD battery for example) Hey, do you have a source for this? I am trying to find this information online but I am failing to find, but it sounds super plausible. In their own website there's not much information other than their batteries are used in other things besides cars - link to the site below https://www.bydglobal.com/cn/en/BYD_ENProductAndSolutions/NewEnergy_mob.html https://www.bydglobal.com/cn/en/BYD_ENProductAndSolutions/Ne...
- alephnerd 3y agoApple's Supplier list from FY22 - https://www.apple.com/supplier-responsibility/pdf/Apple-Supplier-List.pdf https://www.apple.com/supplier-responsibility/pdf/Apple-Supp...
- a1o 3y agoAmazing! Thank you! Pretty cool information! https://en.m.wikipedia.org/wiki/BYD_Company https://en.m.wikipedia.org/wiki/BYD_Company Somehow it wasn't in theit Wikipedia either - it mentions briefly something about batteries for common electronics but doesn't details or mentioned Apple. Anyway, thanks for the source!!!
- alephnerd 3y agoNp. Most Chinese corporate information isn't going to be found on English Wikipedia tbh. It's an insular industry and most OEMs and VARs are Taiwanese, Chinese, Singaporean, Thai, or Malaysian so Mandarin is the preferred language as they're all owned by the SEA Chinese diaspora
- gimmeThaBeet 3y agoI mean is it just like, interest rates? Even if they have cash on hand, I'm assuming any big moves they would make are still really capital intensive because it's the auto industry. By stuff Tesla and Musk have said, they are expecting slowing sales growth, but part of that is also because they said they are developing a new car. But other comments have just been standard demand and competition. So is it just they don't think it's a good idea to keep expanding at past pace into uncertainty while hurdle rates got much higher?
- JoshTko 3y agoA couple of main issues. In the US. Company EVs are currently not possible because they would be too expensive. The 7.5k IRA discount only applies if car and battery are manufactured in the USA. Tesla/panasonic is the only large scale battery manufacturer in the US and capacity is tapped out for existing models. Tesla would need to 4x this capacity to sell compact in the US with sufficient volume/margin. Tesla’s Mexico plant will achieve volume production at start of 2026. Second issue Elon messed up. Elon assumed that he would be able to either scale 4680 battery production a lot faster OR FSD would have achieved L4 autonomy by now which would unlock 3x utility of existing fleet via owners lending their car to rideshare when not in personal use. If this happened the need for a compact vehicle would be in theory greatly lessened. Neither happened and Elon has no backup plan. Hence why he is 2-3 years behind BYD in developing a compact EV.
- hbarka 3y agoI remember the time when the Nevada Gigafactory was really hyped up. It was supposed to dwarf even the largest Amazon Distribution Center and the plans were expand it to where you could see its octagonal shape from outer space. It was to be in the size of hundreds of football fields. Planes and drones flown by fanboys hovered over the site and posted weekly updates on how magnificent the progress was, like we were watching a modern-day pyramid endeavor. Of course, it was just another Musk distortion field. Today it’s only at 30% of the fantastical plans. The stock went up though.
- letmevoteplease 3y agoAccording to this list, even its current state, the Nevada Gigafactory has the most floorspace of any warehouse in the world (5.3 million ft², followed by Boeing with 4.3 million ft²). Not entirely unimpressive. https://www.avantauk.com/top-14-largest-warehouses-in-the-world/ https://www.avantauk.com/top-14-largest-warehouses-in-the-wo...
- hbarka 3y agoTesla does impressive things but are the very definition of hype: Full Self Driving but really lane keeping assist L2 Mother of all factories but really 30% of mother Vacuum-sealed underground tubes capable of moving people en mass at high speed but really a 15mph underground paved road for Tesla cars Linear growth of battery density but stuck on same chemistry Used to have radar but now disabled on cars that have it because vision is like the human eye don’t need anything else
- fnordpiglet 3y agoI thought their goal was to stay on top of everyone margin wise. Margin is better than volume in every dimension.
- Closi 3y agoNot always - volume is often better than margin if you are in a competitive market and have enough access to capital (other things being equal). Particularly if you are taking market share from your (higher margin) competitor. If you can sell two cars at half the margin, that can be better than one car at double the margin if your competitor got the other sale, assuming your strategy is to take the market (i.e. wipe out your competitor). High margins tend to be hard to defend in the long run (without building a moat).
- coliveira 3y agoThe problem is that, in Germany and the US, Tesla costs are going through the roof. They can expand in China, but probably don't want it. They can also do it in Mexico, but won't be fast either. The truth is that China has, through government decision, created a full supply chain for EV production, mirroring their success in other areas. The US is several years behind them. Tesla can invest the money in the US to catch up, but it will be very costly, so probably they won't be able to do what you wish.
- api 3y agoBottom line is that private companies can’t compete with governments. China heavily subsidizes its industries, far more than the US or Germany, and makes it easy for them to operate.
- blackoil 3y agoVery simplistic view. US has also given billions in subsidies to US ev makers and protectionism. One reason Tesla is so big on US is China is not allowed to enter.
- AnthonyMouse 3y agoBYD is nominally a private company. What you're really getting at is that governments can subsidize industries to give their domestic companies an unfair advantage, and China does that aggressively. Other countries could do the same thing or punish China for it via tariffs etc., but doing nothing seems like a bad idea.
- aurareturn 3y agoWe've had subsidies for EVs in the US for over a decade now. US governments have bailed out automakers in the past. Every election year, politicians parade over car making states with promises to win votes. US government has done as much as it can to protect ICE cars, ICE workers, ICE unions, oil companies (US is #1 oil producing country). I think what you're trying to say is that Chin has done a better job subsidizing its EV industry than the US has and China has more incentives to move towards an EV future.
- dandy23 3y agoBut why expand if no one buys their cars? There are so many more players selling EVs now both from China and Europe. It's harder to sell when you have competition.
- duckman1 3y ago[dead]
- MomoXenosaga 3y agoMusk has many goals. He also does drugs and gets involved into politics. There's only 24 hours in a day.
- roenxi 3y agoI'm not sure about this specific case, but the general case is usually that China is using some technique that is illegal in the US. Or sometimes energy policy is the problem. You mention Giga Berlin for example. Germany is suffering from the EU energy crisis (which really has been an ongoing thing since around 2008 when the per capita downtrend in energy took hold), so it wouldn't be weird if cars being produced there aren't competitive with Chinese-manufactured goods. Similarly, US manufacturing doesn't seem to have the same vibrancy as Chinese work and the root causes seem to be environmental and labour law. It is also possible that the US just doesn't have the expertise; as far as I'm aware the US doesn't have an answer to Shenzhen (I'm happy to be told this is just ignorance, the US is a big place, but so far no dice).
- Jonanin 3y agoFWIW, Tesla's market cap is almost 10x BYD's. So the market does not necessarily agree with this assessment. One reason is that Tesla competes exceptionally well in the international luxury car market. BYD pushes a lot of metal at low margins.
- DiogenesKynikos 3y agoThat's because Tesla's stock is overvalued. Tesla's revenue is only 60% higher than that of BYD Automotive.
- Jonanin 3y agoIt's very humorous, though not unexpected, to see a reply about revenue numbers to a post that was mainly speaking about Tesla's superior margins.
- DiogenesKynikos 3y agoTesla has a P/E ratio of 45, vs. 17 for BYD. A lot of Tesla's value is based on hype and expectations, not on its current business.
- fatkam 3y agoTesla need to lower costs.
- roneythomas6 3y agoI been following the Tesla IR presentations. The slowdown was intentional. The key issues are Tesla doesn't have diversified model lines, price wars and the misstep with 4680 batteries. Currently Tesla Shanghai has more than enough capacity for global Model 3 and Y demand. The rate of growth for these models have also slowed down from 2yrs ago. Hence why Tesla is doing aggressive price cuts, also when your doing aggressive price cuts you don't want to increase production dramatically in order to keep the margins in line. You can also see that since they have done price cuts the margins are down. At the same time in luxury market, both Model S and X sales have fallen dramatically. Which btw is made in US and exported internationally. Going to Europe, from what I understand the battery production productivity isn't anywhere near China and lastly Tesla gets federal govt credit for making batteries in US and then exported to Europe. Last part is 4680 misstep, first of all 4680 isn't anywhere close to what Tesla said at the their battery day. The production is still expensive, hence why they cancelled the sub 39k$ CT. Which btw has been the biggest mistake. Tesla could have easily sold 250k units once fully scaled up, but now they have moved to timelines to maybe in 2026. If you look at the production targets for F150 lightning, the total sales this year will be higher than CT. If you look at the sales/price bell curve of light trucks (note this is inclusive of SUVs, but Trucks make up at least half the dataset), you see a massive amount of area in the $40 -50K range, the over $70K range makes up less than 5%. https://www.energy.gov/sites/default/files/styles/full_article_width/public/2023-05/FOTW_1292.png?itok=9DcXT1BI https://www.energy.gov/sites/default/files/styles/full_artic... In other words, Cybertruck sales numbers are going to hurt until the price is closer to announcement - A $39K Cyber Truck could (theoretically) sell millions based on category alone. a $100K truck could sell tens of thousands.
- greedo 3y agoIf anyone believes that there will ever be a $39K CyberTruck, I have a Hyperloop I'd love to sell you.