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Bob Lutz has no faith in Tesla

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lutz is a Putz. He's no dummy, he's just defending his old employer. As the force behind the volt, He secretly wishes he had the stones to be like musk.

This is probably correct in psychological terms. But he could never be Musk, with all his bagage from a long working life in the ICE business, no matter how much he tried at this point in time. In a broader sense he's probably also bitter that when he was young he wasn't what Musk is now that Elon is young.
 
The assertion that Tesla is hemorrhaging cash is either moronic, deceitful, or completely ignorant. Tesla is investing to double their production capacity every 18 months or so. When did GM double anything other than their idiotic car designs? I think Lutz should go back to Lutz farm to enjoy his retirement without embarrassing himself :)
 
Many people don't know that Kodak tried hard to make a digital camera, and had some major commercial imagers. They just never had the electrical engineering skills of the Japanese.
Most large automakers outsource most of their electrical engineering and software. The heart of car manufacturing culture is engine and drivetrain. ICE engines have achieved far more in price/performance than any engineer would have believed forty years ago. This success lays the foundation for failure.

They were pioneers in digital cameras, but they chose to protect the film business over committing to digital photography. They may have ended up losing anyway in the new field, but they chose their fate.
 
I'm still not sure what these three comments are supposed to mean.

"If Elon says he's bought up every Country (Company?) that controls lithium and now controls the global supply of lithium, maybe there is a chance"

Plenty of Lithium in the world

America finds massive source of lithium in Wyoming | MINING.com

Bob wasn't saying this in context of Elon needing to secure more sources of Lithium in order to be able to make batteries. The question was about the competitive edge of the Gigafactory, and whether it leaves other competitors unable to catch up.

The argument made by Bob is that Lithium batteries are very easy to make with automation, and the existence of a Gigafactory doesn't give Tesla so big an advantage that the competitors can't catch up. "The price of the battery is not the assembly line, it's the raw material which has to be procured and everybody pays more or less the same price."

Now if Elon were to secure all the Lithium sources in the world, that would put competitors in trouble, and unable to catch up.


Same with the "Boy, I don't see it" argument. The direct context is that he doesn't believe that the mere existence of a Gigafactory would give Tesla an unsurmountable competitive advantage. I don't see it either. Anybody can build one - and even Elon thinks there needs to be hundreds of Gigafactories. It's necessary, and it's the next step, but the winner isn't going to be who owns the first Gigafactory or where it's located.
 
The argument made by Bob is ..."The price of the battery is not the assembly line, it's the raw material which has to be procured and everybody pays more or less the same price."

Except it isn't. The price of raw materials is in the range today of $80/kWh. The processing and labor is the rest. Lots of room to do better there.

Speaking of, I'm just going to leave this here:

Tesla signs Up to 500MWh deal w/ Advanced Microgrid Solutions
 
"The price of the battery is not the assembly line, it's the raw material which has to be procured and everybody pays more or less the same price."

He clearly hasn't done his homework. Tesla is the only battery company talking directly to mines to get their elements/ores required. Everyone else pays basically the same price - in commodity markets - where the price is higher.
 
The assertion that Tesla is hemorrhaging cash is either moronic, deceitful, or completely ignorant. Tesla is investing to double their production capacity every 18 months or so. When did GM double anything other than their idiotic car designs? I think Lutz should go back to Lutz farm to enjoy his retirement without embarrassing himself :)

Completely agree. And yet pundits and talking heads all like to mention how Tesla isn't turning a profit. I don't know about most shareholders, but I count my profit in the HUGE and GROWING Supercharger network and the Gigafactory being built. Moronic non-growth oriented CEO's will only cater to the Wallstreet quarterly "did they profit?!" mantra. For example, if I start a small restaurant and show you I turned a profit of $10000 a month, would you be happy? Maybe. Now, if instead I reinvested that $10,000 every month in profit back into growing and building out a network of restaurants.... all able to make $10,000 a month and eventually get to thousands of locations... would you be happier? Of course! Now we have a huge business chain of restaurants. However, during that growth phase I would have to report "no profits made for a long time, even though our restaurant locations are growing. All money was reinvested into growing the business"... which is what Tesla is doing currently. Elon doesn't want to make 80,000 Model S's a year... .he wants to make 500,000 Model 3's in addition and bring EV's to the masses, changing personal transportation as we know it along with helping the environment and creating jobs domestically. I don't know why there aren't more American's standing behind this guy. He's brought the USA back on top for Automobiles and Space. FWIW he got into the USA by going through Canada. Yay Canada, hah.
 
Bob wasn't saying this in context of Elon needing to secure more sources of Lithium in order to be able to make batteries. The question was about the competitive edge of the Gigafactory, and whether it leaves other competitors unable to catch up.

The argument made by Bob is that Lithium batteries are very easy to make with automation, and the existence of a Gigafactory doesn't give Tesla so big an advantage that the competitors can't catch up. "The price of the battery is not the assembly line, it's the raw material which has to be procured and everybody pays more or less the same price."

Now if Elon were to secure all the Lithium sources in the world, that would put competitors in trouble, and unable to catch up.


Same with the "Boy, I don't see it" argument. The direct context is that he doesn't believe that the mere existence of a Gigafactory would give Tesla an unsurmountable competitive advantage. I don't see it either. Anybody can build one - and even Elon thinks there needs to be hundreds of Gigafactories. It's necessary, and it's the next step, but the winner isn't going to be who owns the first Gigafactory or where it's located.


agree


He clearly hasn't done his homework. Tesla is the only battery company talking directly to mines to get their elements/ores required. Everyone else pays basically the same price - in commodity markets - where the price is higher.
Actually the reverse is true, mining companies sell product direct at a Premium to the commodity market. (particularly Nickel) There are valid reasons to deal direct with the mine, but reduced cost is not one of them (primary reason is security of supply, and matching grade closely to requirements, price stability.) If someones wants cheaper product from a mine, then that requires partial ownership/financing.

What Elon's gigfactory provides is economy of logistics and security of supply. A PHEV centric approach gets similar results.

At the end of the day, everybody will have cheaper batteries, much of what is stated for gigafactory is actually just continuing the general li ion cost reduction trend.

Lutz is bullish on 200mile min range plugin vehicles, whether pure EV or range extended hybrid.
 
Actually the reverse is true, mining companies sell product direct at a Premium to the commodity market. (particularly Nickel) There are valid reasons to deal direct with the mine, but reduced cost is not one of them (primary reason is security of supply, and matching grade closely to requirements, price stability.) If someones wants cheaper product from a mine, then that requires partial ownership/financing.
Not sure how that applies to the lithium carbonate market. Tesla right now is talking directly with local mines in Nevada and the mines there have indicated they are the first to do so. I would imagine buying at a mine directly (and shipping everything yourself) would have some cost savings vs. buying in the commodity market from a supplier (that has its own margins built in).
 
Exactly. The same way that SpaceX makes rockets a whole lot cheaper than anyone else, all of whom have access to the same raw materials. There's more to making a product than the price of the raw materials.

I think people like Lutz generally understand that mass production will reduce costs, but when it come to batteries they don't seem to get that every increase in battery capacity also ends up cutting cost, because it cuts the amount of raw materials needed for each battery pack

the roadster pack has almost the same amount of lithium cobalt ect as the Model S pack but, the Model S has 85kWh of storage