Interested how your rep voted:
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- In December 2023, the German government scraped incentives of up to ā¬4,500 for EV buyers.
- EVs lost market share in Germany last year, now making up just 13.5% of all new car sales.
DB2
I have little doubt that the same will happen in the US if the incentives are scrapped, yet Musk says itās OK with him if that happens. I believe he thinks it will hurt other manufacturers more than Tesla, and he maybe right, but I still think heās being shortsighted.
We have already seen that some manufacturers are pulling back on EVs because of ādecreasing demandā (which so far isnāt actually decreasing, itās just the rate of increase is decreasing). So perhaps heās right that it will cause some companies to reasses - but it seems unlikely that the majors, at least, will abandon the segment wholesale. Itās an area they canāt afford to ignore, so they will have to be there.
I have rarely heard a philosophy of āit will hurt me but it will hurt you moreā being very successful, but that seems to be where we are.
Apart from EVs, thatās been the general philosophy for a while - look only to November 6.
Pete
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Data point that may or may not be interesting. Went last week to Acura to buy a portable charger for my ZDX. (Some Air BnBās have 14-50 plugs at the driveway for EV owners). I noticed the lot had only 1 ZDX left and asked the parts counter guy (who is also a ZDX owner). He said they sold a ton in December because of the threat of tariffs going away. Will be interesting to see how much they build inventory back up.
Memory serves the Honda Prologue started selling in pretty high numbers, almost as high as the Mustang Mach-E (which outsold the ICE Mustang in 2024). But I think the ZDX has still been a slow seller, especially compared to the Lyriq.
Keep in mind, the possibility that Musk doesnāt really care about Tesla anymore. What is his track record of staying engaged with a company, after it is up and running and successful? Does he get bored with it, turn it over to āprofessional managersā, and move on to his next big thing?
Steve
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Ironically, I think itās the opposite problem. I think heās being too farsighted.
Musk seems to genuinely believe that full autonomy is right around the corner for Tesla. Heās got a horrible track record of being over-optimistic on the tech - heās been predicting full autonomy will happen within a year or so for many years now. But by all appearances he seems to really believe this.
If Telsa actually were on the doorstep of a fully functional Level 5 autonomy package, then the loss of an EV credit in the US would indeed have a modest impact on the company. If Musk is wrong about the autonomy timeline, then perhaps heās making a huge mistake - but he seems confident about it (as always).
If not that, perhaps itās a realization thatā¦the U.S. auto market isnāt and shouldnāt be a priority for EV makers? We have low gas prices, low population density, and very high miles driven per person (with a corresponding longer trip length). EVās make less sense here than elsewhere. Weāre a small part of the global EV market (over 11.5 million units in China, ~2.8 million units in Europe, and ~1.3 million units in the U.S.). China has already surpassed the US as Teslaās largest market. The U.S. just may not be a very important market for EVās going forward, barring an AV switch.
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In last yearās mobility report, McKinsey reported the rate of EV recidivism in various countries. There seems to a correlation with country size.
% very likely to Area, million
switch back to ICE sq. miles
Australia 49% 3.0
US 46 3.7
Brazil 38 3.3
China 28 3.7
Germany 24 0.14
France 18 0.25
Norway 18 0.15
Italy 15 0.12
Japan 13 0.14
DB2
Less than 50% means that EVs are on fire while ICE is melting.
The Punster
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Hereās the thing. A fully autonomous car does not require that car be an EV of course. And if EVās donāt (supposedly) make sense in the USA, why does an autonomous one move that needle? Wouldnāt, therefore, an autonomous ICE car make more sense?
As an exercise to the reader, look at the models where GMās Super Cruise is available on. About half of them are ICE.
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Sure, but this theory is premised on Tesla getting a āfirst and onlyā period - some number of years where they have gotten to autonomy before any other manufacturer can duplicate it. That would result in a huge boost to demand for their vehicles (a lever that they can adjust based on how they price the FSD), a be such a huge differentiator that it would overwhelm any of the ICE vs. EV considerations I mentioned in the prior post.
That is just the sort of thing a multi-billion dollar ādevelopmentā contract from DARPA could expedite. The thing is how to manipulate the system to make that contract happen?
Steve
Iām not sure Tesla is going to be the first and only for some period of time. Itās not like Waymo is nowhere in this field after all. Nvidia and partners are also working on this as well. Further, I think the speculated market for fully AV cars isā¦ ridiculously over estimated.
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I donāt think so. Close relationships with the government are far more important to SpaceX contracts, and for regulatory issues relating to Tesla and xAI. I canāt see how a DARPA contract would assist Tesla in their FSD efforts, or how such a thing would be preferable to favorable contract terms over on the SpaceX side.
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I agree, but Musk certainly seems to think so. He regards Waymoās system as brittle and unable to be scaled - and, of course, itās not set up to be a Level 5 āsell the AV to a buyerā type of system, so Tesla would have that type of product all to itself if it developed one. So if youāre trying to figure out why he seems so unconcerned about maintaining subsidies in the U.S., I think thatās a big reason.
And again, I wouldnāt rule out Musk just understanding that the U.S. is likely to be an EV backwater going forward. We sell half as many EVās here as in Europe (even after the German sales plunge) despite being a larger car market, and weāre a fraction of Chinaās sales.
I tend to agree with that statement, unfortunately. I wonder, for example, why GM Ultium products have official SuperCharger access but the Prologue/ZDX do not. Itās been near 4 months now with the ball in Teslaās court, and I honestly think Iām screwed here. Iāve also watched two NEVI funded SuperCharger sites in Texas do nothing for several months now.
So yes I question Muskās concern about the American EV market too. Further, I question why people think the AV market is going to be so large. I just donāt get it. Personally I only see the demand from techies who think this stuff is cool. Normal people I know donāt seem to want it.
Generally, they believe that EVās will soon reach the point where they are materially cheaper than ICE cars in terms of monthly payments + fuel costs. Where the EV version of (say) a Corolla has a significantly lower monthly cost than the ICE version of that exact same Corolla. At that point, consumers wonāt want the ICE Corolla any more, and so Toyota wonāt make the ICE Corolla any more.
The analog here would be the shift between CRT and LCD screens for displays and televisions. Once one technology gets vastly cheaper than the other, the old tech just gets displaced.
The experience in Norway is taken as validation of this belief. Norway quickly replaced nearly all of their new ICE car sales with only EVās. Believers in EVās interpret this to be the pathway that most other countries will follow - that once EV adoption gets going and passes a certain level of market penetration, it will inexorably and swiftly take over the market.
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That I get. Itās the AV market I"m talking about ā autonomous car. That I donāt get. Iāve bought into the EV argument myself already and love it.
Whoops! My bad - I misread your post!
Same thing, though. They believe that TaaS will be much cheaper than owning your own vehicle, that pooled AVās can deliver transportation at materially lower cost per mile than a privately owned car. And that once that happens, people wonāt want to own their own cars any more.
I see a collision between two narratives:
1: the most defective, dangerous, part of a vehicle is the one at the steering wheel. We are seeing flox of systems intended to mitigate that defective part: ālane assistā that detects if the car is wandering off the marked lane, and takes control of the steering. ābrake assistā that decides if the car is approaching the car ahead too quickly and jumps on the brakes. iirc there is a mandate to be implemented in a couple years requiring a system that decides whether the driver is āunder the influenceā, or ādrowsyā, before allowing the car to be started. A totally autonomous car would be the ultimate āsafety featureā by taking the driver entirely out of the equation.
2: luminaries like Sean Hannity bellowing about ābig gummit taking over your carā.
I wonder how big a check the insurance industry would need to write to Hannity to get him on board?
Steve
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