Musk endeavours

[odysseus2000]

Live feed of William Shatner going to space in a Blue Origin rocket:

https://www.youtube.com/watch?v=SNI2x1NQYwM

Regards,

Obviously a low-budget trip, no drive out to the pad in a Tesla, pfft.

RC

Blue Origin transport to the pad is a Rivian:

https://www.nbcnews.com/business/autos/ ... n-n1274509

In price and scarcity, well above Tesla.

Regards,

[odysseus2000]

Like your previous forecasts about car distribution this may be brave but wrong!

In the short term new marques will need to set up distribution networks. It's unlikely that there will be huge numbers of new distributors set up to service the supply of new BEVs. Building brand share without distributors will be difficult. It's taken Tesla a long time and they have had to invest in large sales and service sites.

regards

Howard

One of the best sellers in the Chinese BEV market is part GM, so it has an entire existing distribution network all ready to go.

Others are also connected with major legacy makers such as VW.

Moreover, BEV are much simpler, especially the low cost Chinese offerings, with far less to go wrong than an ICE vehicle.

This distributors argument was used when the Japanese started importing and it didn't work well.

Regards,

[Howard]

One of the best sellers in the Chinese BEV market is part GM, so it has an entire existing distribution network all ready to go.

Others are also connected with major legacy makers such as VW.

Moreover, BEV are much simpler, especially the low cost Chinese offerings, with far less to go wrong than an ICE vehicle.

This distributors argument was used when the Japanese started importing and it didn't work well.

Regards,

Ody, Brilliant! You have been converted to the importance of dealerships.

And we obviously agree from an investment viewpoint it has been a good year to invest in car distributors as they are important in virtually all markets. Tesla certainly believes this because they have invested a fortune in their sales and service centres.

It’s also good to read that you're backing two legacy manufacturers who have world wide dealership networks. You are probably correct in suggesting that VW and GM are well placed to succeed in introducing new BEV models.

But are you right about the Japanese distributors argument last century? I doubt if you can supply evidence for this?

I know you aren’t familiar with driving and owning modern cars but BEVs are not necessarily low maintenance. The costs of maintaining a Tesla are higher than a similar ICE vehicle. I considered leasing a Model 3 recently. The high cost of a maintenance package was surprising. It would have cost at least £30 a month over four years for a low mileage quote. I queried this with my local Tesla sales centre and they admitted that regular tyre rotation was required because of the weight of the car and tyre wear and also a regular brake fluid service was necessary. Reliability is still a problem too. For a similar priced ICE BMW the same maintenance cover is £20 a month.

regards

Howard

[BobbyD]

Ody, Brilliant! You have been converted to the importance of dealerships.

Oh what tangled webs we weave,
when we practice to pretend that absolutely everything is a positive for Tesla...

[odysseus2000]

Howard
Ody, Brilliant! You have been converted to the importance of dealerships.

No, I was simply noting that some of the coming imports will fit into the existing legacy dealership.

Howard
And we obviously agree from an investment viewpoint it has been a good year to invest in car distributors as they are important in virtually all markets. Tesla certainly believes this because they have invested a fortune in their sales and service centres.

Think this is transitory and in the by and by they disappear.

Howard
It’s also good to read that you're backing two legacy manufacturers who have world wide dealership networks. You are probably correct in suggesting that VW and GM are well placed to succeed in introducing new BEV models.

No, the legacy makers will likely use their own dealerships and this will kill their existing business. Once that happens they become shells for the Chinese makers and get into all manner of balance sheet, union and political trouble.

Howard
But are you right about the Japanese distributors argument last century? I doubt if you can supply evidence for this?

Find someone who remembers when the Japanese came. Before long lots of independent dealers started working for the Japanese as their base cars had luxury features like heaters and radios that UK base marques didn't and they were reliable. My retired scrap yard dealer acquaintance remembers being astonished at the state that Toyota came in after collisions and/or years on the road, many parts still perfectly serviceable and he still buys Toyota for his current business. Honda had a similar reputation.

Howard
I know you aren’t familiar with driving and owning modern cars but BEVs are not necessarily low maintenance. The costs of maintaining a Tesla are higher than a similar ICE vehicle. I considered leasing a Model 3 recently. The high cost of a maintenance package was surprising. It would have cost at least £30 a month over four years for a low mileage quote. I queried this with my local Tesla sales centre and they admitted that regular tyre rotation was required because of the weight of the car and tyre wear and also a regular brake fluid service was necessary. Reliability is still a problem too. For a similar priced ICE BMW the same maintenance cover is £20 a month.

For a premium model, folk are prepared to pay more maintenance, but even in your example it is 10x12x4 = £480 over 4 years. For anyone needing to go into emission controlled zones this is a small difference and electrical costs are still a lot less than petrol.

No idea why brake fluid needs changing more often. Most ICE cars recommend change brake fluid every 3 years, but hardly anyone does which can be a mistake as the fluids get black, from water absorption, and eventually reaches a point where in braking the water in the fluid boils and brakes do not work. It may be because the brakes are used so little if one uses regenerative braking and this lack of use leads to more water absorption, but I am speculating based on possible causation, I have no specific information on this.

Most ICE cars recommend regular tyre rotation for longevity, but this is again often neglected. For all wheel drive ICE cars one usually has to change all four tyres at the same time which is expensive and perhaps this applies to dual motor Tesla.

However, a lot of the Chinese models heading to the West are much simpler cars than Tesla and much lower entry prices with £5k being enough to get one of the best selling Chinese models. I believe the Citron mentioned recently on this board is about £6k. At these prices there is nothing very sophisticated and the Chinese experience, as I understand it, is of long and reliable operation with minimal servicing. One can speculate on how this will change the service and dealership model. E.g.a £5k car would cost less than many folk are now paying for a 3 year lease, making for the prospect of much lower second hand prices and more pain for ICE makers trying to compete.

Regards,

[odysseus2000]

Captain James Tiberius Kirk weightless:

https://youtu.be/61LsDTZVjR0

Regards,

[odysseus2000]

More on Diess warning that a slow transition to BEV could cost them 30,000 jobs:

https://europe.autonews.com/automakers/ ... eport-says

Regards,

[Howard]

Howard
Ody, Brilliant! You have been converted to the importance of dealerships.

No, I was simply noting that some of the coming imports will fit into the existing legacy dealership.

Howard
And we obviously agree from an investment viewpoint it has been a good year to invest in car distributors as they are important in virtually all markets. Tesla certainly believes this because they have invested a fortune in their sales and service centres.

Think this is transitory and in the by and by they disappear.

Howard
It’s also good to read that you're backing two legacy manufacturers who have world wide dealership networks. You are probably correct in suggesting that VW and GM are well placed to succeed in introducing new BEV models.

No, the legacy makers will likely use their own dealerships and this will kill their existing business. Once that happens they become shells for the Chinese makers and get into all manner of balance sheet, union and political trouble.

Regards,

Ody, This is a fascinating investment strategy for the big players. Import cheap electric cars and destroy their distributors.

So you are betting that in the short term the boards of legacy makers will purposely sabotage their dealerships? This does seem a very sensible idea.
And, of course, it will embarrass Tesla who have spent multi millions building a distribution network, employing thousands of new staff. Won’t they look silly once GM and VW have destroyed their dealerships and made them shells for Chinese makers.

Presumably Tesla should reverse out of building their own bricks and mortar distributors before it’s too late?

I am surprised you are not on the board of a big manufacturer advising on strategy.

regards

Howard

[odysseus2000]

Ody, This is a fascinating investment strategy for the big players. Import cheap electric cars and destroy their distributors.

So you are betting that in the short term the boards of legacy makers will purposely sabotage their dealerships? This does seem a very sensible idea.
And, of course, it will embarrass Tesla who have spent multi millions building a distribution network, employing thousands of new staff. Won’t they look silly once GM and VW have destroyed their dealerships and made them shells for Chinese makers.

Presumably Tesla should reverse out of building their own bricks and mortar distributors before it’s too late?

I am surprised you are not on the board of a big manufacturer advising on strategy.

regards

Howard

Ha Ha This is amusing.

Your basic tenant is that boards are machines capable of logical thought, not emotion driven humans.

Most boards look at what is happening now and try to maximise returns. Do most boards care about the longer term? Often not because in the longer term they have retired or are working for someone else and caring about their employees and subcontractors is not something they are noted for.

The whole process is a mass of emotion with many incapable of realising that things are changing. Boards see sales and conclude that all is well no matter what is on the horizon as was the case in the UK car industry that assumed what they were doing would last forever. We are seeing exactly the same behaviour with legacy auto. They have all these Chinese companies building very low cost vehicles and want them selling into prosperous western markets so as to realise their investment in them and what this does to their legacy sales does not enter their minds except as passing thoughts.

If they cared about the future they would have developed BEV. GM had the EV1 which had the program continued would have made life for Tesla very difficult. But no, once California watered down its clear air act, GM didn't want the distraction of BEV and so had all the cars forcibly re-possessed and crushed returning to a pure ICE platform.

The business now is bring over a bunch of low cost Chinese cars, re-sticker them to prices where good profits are made and see if they sell. If they sell the p&l goes up and in the by and by their own legacy offering of ICE become unattractive.

That is what they will do, to think otherwise is to credit boards with a long term interest in their employees and contractors and to add spice to the whole affair, if they don't do this, one of their competitors will and so they have no choice. It is beginning to happen now.

As to servicing and maintenance, why bother, why not have an Apple like model where a relatively low cost few year old model becomes only of interest to folk who like to tinker, much of the market wants the latest and with a bit of discount for trading in their old car they are happy to spend what is needed for the new model. The old cars are recycled and all is well for everyone. The air is cleaner, the companies P&L is positive, lots of folk are employed making and then re-cycling cars etc.

The entire auto market is changing. If AI can drive cars it will change yet more, but with what we know now, the old ways of doing stuff are no longer relevant.

Regards,

[Howard]

Ody

Over the last 10 years, despite predictions, the boards of most legacy auto manufacturers have played the market pretty well. Tesla has taken over 15 years to grow into a small/medium sized manufacturer of premium cars. Over that time the big premium players have been profitable, generally speaking, letting Tesla make losses for most of its life.

It seems unlikely that the premium players will introduce cheapo short range BEVs to destroy their businesses and to predict this seems nuts to me.

The cheaper brands might try this, but any cars introduced into Europe will have to meet stringent safety standards which add significantly to costs so they won't be as cheap as in China. I'd guess the same applies to the American market.

It's true that the auto market is competitive but to suggest that manufacturers will behave in an irrational way doesn't seem sensible to me. And your forecasts of their fate have been wrong for 10 years, so it's probably safe to assume that they and their distributors will be making good returns for some time to come.

regards

Howard

[odysseus2000]

Ody

Over the last 10 years, despite predictions, the boards of most legacy auto manufacturers have played the market pretty well. Tesla has taken over 15 years to grow into a small/medium sized manufacturer of premium cars. Over that time the big premium players have been profitable, generally speaking, letting Tesla make losses for most of its life.

It seems unlikely that the premium players will introduce cheapo short range BEVs to destroy their businesses and to predict this seems nuts to me.

The cheaper brands might try this, but any cars introduced into Europe will have to meet stringent safety standards which add significantly to costs so they won't be as cheap as in China. I'd guess the same applies to the American market.

It's true that the auto market is competitive but to suggest that manufacturers will behave in an irrational way doesn't seem sensible to me. And your forecasts of their fate have been wrong for 10 years, so it's probably safe to assume that they and their distributors will be making good returns for some time to come.

regards

Howard

My job as an investor/trader is to make money. Tesla has been very good to me.

As I predicted Tesla has become the dominant BEV maker, legacy auto has continued as it was, making profits and the boards assume this will go on forever, but it won't. ICE is an obsolete technology. Sure most folk don't realise this but the realisation is dawning. The Chinese September sales figures were murderous to legacy.

Regarding crash worthiness, as so often you have not researched the quality of Chinese models. Citron have already introduced a $6k car to France and it is selling well, meeting all the European crash regulations etc. Why won't the other legacy do this?

Everything about the auto market is sadly playing out as I predicted. Soon the predicament of legacy auto will make the news channels, but it won't save them.

Let us look at how badly legacy has performed over the last 20 years.

On the long term chart, VW has gone from 2.8 to 22.75 = 8.1x:

https://twitter.com/0_ody/status/144871 ... 95881?s=20

Ford has gone from 8.8 to 15.5:

https://twitter.com/0_ody/status/144871 ... 17187?s=20

GM has gone from 27 to 57:

https://twitter.com/0_ody/status/144872 ... 26656?s=20

Toyota has gone from 33 to 175 = 5.3x

https://twitter.com/0_ody/status/144872 ... 21568?s=20

Tesla has gone from 6 to 819 = 136x:

https://twitter.com/0_ody/status/144871 ... 79429?s=20

These numbers tell anyone that legacy auto has not behaved in ways that have rewarded their owners (share holders). To argue that they are competent and operated with good business acumen fails when one looks at how they have allowed a new business to come in and reward its shareholders vastly more than they have. GM were first into BEV and then they abandoned the project. What does this tell you about their management? Most other legacy has been in denial. Only a few years ago VW were openly laughing at Tesla, but they ain't laughing no more. The recent Chinese September sales figures showed just how weak they are and how bad things are happening to their sales.

I find the whole field fascinating. Complacent legacy business becoming ostrich as a new competitor emerges. We are now seeing the same thing with AI and lots of legacy business and with AI a lot of professions going about like headless chickens as the realisation that all their well educated and well paid folk can not compete with extremely low cost AI. This was obvious when Alpha-Go became the world champion GO player and there has been enough time for them to adjust and develop their AI skills but they have behaved as did legacy auto and now bad things are happening and they are like deer in headlights. Many highly skilled human professions are being eclipsed by AI and the professions behave like luddites, trying to argue against overwhelming evidence that they are still relevant.

Regards,

[odysseus2000]

Tesla bitcoin investment up by $1 billion:

https://electrek.co/2021/10/14/tesla-ts ... 1-billion/

Regards,

[murraypaul]

As I predicted Tesla has become the dominant BEV maker

Has it?
Genuine question, what is Tesla's market share of BEV vehicles?
I thought it was dropping.

[BobbyD]

As I predicted Tesla has become the dominant BEV maker

Has it?
Genuine question, what is Tesla's market share of BEV vehicles?
I thought it was dropping.

It's very strange phrasing. Tesla has probably been the biggest manufacturer of BEV's since it hit double digit production per week, but it's market share has been falling ever since!

[odysseus2000]

It can be confusing to look at BEV production numbers as many of the media have a tendency to call them new energy and to lump together pure battery (BEV) and plug in hybrid (PHEV). As far as I know the numbers here are pure BEV.

The last quarter number from Tesla (new 3q results coming shortly) gave a production of around 250,000 BEV Tesla cars, for a likely 1 million cars per year from existing factories. Tesla currently has no production from Berlin or Austin Texas.

The Chinese maker BYD sold 24,996 BEV in July, about 300,000 per year, the best selling BEV the Wuling Hongguang Mini EV sold 30,706 in July, about 368,000 per year:

https://www.electrive.com/2021/08/11/ch ... -vehicles/

VW delivered 134,000 electric vehicles in 2020:

https://www.carmagazine.co.uk/electric/volkswagen/

Unless someone has different data I think it's clear that Tesla are currently dominant in BEV and at the same time the number of BEV entering the market from other manufacturers is increasing so that the entire fleet of BEV is growing and Teslas share of that entire market falls even though they are the largest maker.

Going forward it is unclear to me as to how many of the low cost (£5k) BEV cars that are manufactured in China will be received in Western markets. Currently Citron's entry in France is apparently selling very well and there are other niche, small BEV that have a following in various countries.

Regards,

[murraypaul]

Going forward it is unclear to me as to how many of the low cost (£5k) BEV cars that are manufactured in China will be received in Western markets. Currently Citron's entry in France is apparently selling very well and there are other niche, small BEV that have a following in various countries.

I think there will be consumer skepticism about buying into a totally unknown brand, and for a lot of people the fact that they come from China in particular will be a negative.
I think if they do take off it will be a big positive for BEV embracement.
To be broadly popular, we need good cheap small BEVs, to replace the good cheap small ICE cars that are by far the best sellers in the UK.

[odysseus2000]

Going forward it is unclear to me as to how many of the low cost (£5k) BEV cars that are manufactured in China will be received in Western markets. Currently Citron's entry in France is apparently selling very well and there are other niche, small BEV that have a following in various countries.

I think there will be consumer skepticism about buying into a totally unknown brand, and for a lot of people the fact that they come from China in particular will be a negative.
I think if they do take off it will be a big positive for BEV embracement.
To be broadly popular, we need good cheap small BEVs, to replace the good cheap small ICE cars that are by far the best sellers in the UK.

A number of the Chinese low cost BEV makers are joint ventures with various legacy auto makers.

It is possible that these low cost BEV will be sold under legacy brands, such as the GM brand, Vauxhall in the UK, which may deflect any consumer concerns about new makers and the origin of the vehicle.

Regards,

[murraypaul]

It is possible that these low cost BEV will be sold under legacy brands, such as the GM brand, Vauxhall in the UK, which may deflect any consumer concerns about new makers and the origin of the vehicle.

That has possible advantages and disadvantages.
It certainly makes the initial sale easier.
Nissan did something similar a decade or so ago with cars made in India, I think the Pico was an example.
They were poorly made, and risked doing more damage reputationally than they earned in profit.
I think the European brands need to 'own' the model, and make sure it is something they are happy putting their names on.

[odysseus2000]

It is possible that these low cost BEV will be sold under legacy brands, such as the GM brand, Vauxhall in the UK, which may deflect any consumer concerns about new makers and the origin of the vehicle.

That has possible advantages and disadvantages.
It certainly makes the initial sale easier.
Nissan did something similar a decade or so ago with cars made in India, I think the Pico was an example.
They were poorly made, and risked doing more damage reputationally than they earned in profit.
I think the European brands need to 'own' the model, and make sure it is something they are happy putting their names on.

The Citroen is made in Morroco:

https://en.wikipedia.org/wiki/Citroën_Ami_(electric)

The biggest current importer of Chinese cars in to the UK is MG:

https://www.thisismoney.co.uk/money/car ... urope.html

China now produces about 1/4 of all cars. There are many media stories noting poor Chinese build quality, but my professional experience of Chinese products is that they are nearly always better than what I could buy in the UK and at lower cost. This price advantage may be declining with increased fuel costs, but in terms of quality Chinese stuff is excellent.

Regards,

[Howard]

It is possible that these low cost BEV will be sold under legacy brands, such as the GM brand, Vauxhall in the UK, which may deflect any consumer concerns about new makers and the origin of the vehicle.

That has possible advantages and disadvantages.
It certainly makes the initial sale easier.
Nissan did something similar a decade or so ago with cars made in India, I think the Pico was an example.
They were poorly made, and risked doing more damage reputationally than they earned in profit.
I think the European brands need to 'own' the model, and make sure it is something they are happy putting their names on.

The Citroen is made in Morroco:

https://en.wikipedia.org/wiki/Citroën_Ami_(electric)

The biggest current importer of Chinese cars in to the UK is MG:

https://www.thisismoney.co.uk/money/car ... urope.html

China now produces about 1/4 of all cars. There are many media stories noting poor Chinese build quality, but my professional experience of Chinese products is that they are nearly always better than what I could buy in the UK and at lower cost. This price advantage may be declining with increased fuel costs, but in terms of quality Chinese stuff is excellent.

Regards,

Is the Citroen Ami EV a car? I think it's a quadricycle.

regards

Howard