This is a hit piece below even Seeking Alpha gibberish for many reasons. I'll just start off with the fact that it's EV makers in China asking for their battery suppliers to slash their prices, not a statement of any kind from the battery suppliers themselves much less an announcement of a 40% price drop by these suppliers as the title heavily and falsely implies. There are plenty of other reasons the suggestion that this obsoletes the GF is blatant rubbish.
If there's a strong bear narrative, why don't they put aside the rubbish we've been fed prolifically for years and just spit out their real case for being bearish?
We also need to remember that almost all Chinese BEV battery production is probably not breaking-edge technology:
http://en.calb.cn/comm/?id-172.html is one producer, and then;
Company Profile | BYD makes their own batteries.
But, these guys are not stupid:
China the centre of lithium universe | MINING.com but keep in mind taht teh quoted article was written by somebody from International Lithium Corporation, so...
Top Lithium Mining Companies | Investing News this is a possibly less-biased source.
I do not suggest that SteveG3 is incorrect, in fact I probably agree mostly. while also being realistic enough to know taht the Chinese EV mandate is driving BEV production volumes for Cars, trucks, busses and more. With the monumental pollution problem in major Chinese cities the simultaneous move to BEV's and cleaning up the electrical grid will be transformative.
Anybody who doubts the Chinese ability to accomplish this need look no further than Chinese rail transport, including that astonishing maglev. My first trip to China was in ~1978, most recent 2016. Anybody who's observed the changes will not underestimate the transformative ability of the world's most populous country. Put another way, the Chinese car-buyer-market middle class are more numerous than the total population of the USA.
That said, I think China is more of an opportunity than a threat for Tesla.
Large question: President-elect Trump equates a "balance of payments deficit" with a "loss" seemingly not understanding that goods and services are received for that money so it might not be bad. Because of that conflation of 'deficit' and 'loss' Tesla is specifically at great risk for Chinese expansion. We must wait to see what happens. I mention this because the BEV, renewable energy production and electrical storage markets within China are clearly the largest in the world. Chinese producers will be major worldwide players simply due to that enormous domestic scale.
History: The industrial development of Germany, USA, Japan, Korea, UK and France were all initially built on domestic demand. Later all diversified internationally with varying degrees of success." 'ain't nothin' new under the sun".
Latin nihil sub sole novum, from the
Hebrew אֵין כָּל חָדָשׁ תַּחַת הַשָּׁמֶשׁ (en kol chadásh táchat hashámesh, “there is nothing new under the sun”), from
Ecclesiastes 1:9.
copied from:
there is nothing new under the sun - Wiktionary
Conclusion: The Chinese are coming, but that may actually be good news for Tesla. Tesla will go after highest tech, best in class. the Chinese market is almost axiomatically oriented to high volume, low cost in teh medium term. Argument against my thesis: Volvo, Faraday Future, evolution of BYD, among others.
