Wdolson, I do not believe that this is strictly accurate. From decades ago I putzed around with preparing some tax returns for a couple of local automobile dealers. Generally, the cycle was as follows:
Manufacturer sells to dealer on open account. Manufacturer records a sale and a receivable. No cash changes hands.
Customer buys car from dealer. Dealer remits the manufacturer invoice amount to the manufacturer, or if the manufacturer finances the deal, the receivable from the dealer is reclassified on the manufacturer's books as a note receivable from the buyer.
Manufacturer allows the dealers about 20-25 days on open account before interest is charged to the dealer for the unpaid receivables, so there is some float for the dealers not to pay the manufacturer upon receipt of a truckload of new cars.
In other words "it's complicated"
I know Tesla has some loan thing set up for the overseas deliveries so they aren't completely out the cash to build the car until it's delivered overseas, but I don't think they do that for domestic deliveries. I'm not a money person, so I've only glossed over the financials.
Bob Lutz is often wrong about many things Tesla, but I still think it's good to listen to him. He articulates how the mainstream car business thinks. He does have some valid points here and there too. In the logistics of getting cars built, Tesla is behind most of the rest of the car industry. They are getting better, but they are still behind.
In some ways Lutz is right that some of Tesla's technological advantages could be eclipsed by a dedicated competitor, but the competition has to get dedicated first and only the Europeans are even close to serious about competing at this point. IMO, the South Koreans will be the next group of companies to get serious.
Tesla has a lot of moats, some easily breached by a serious competitor, others are going to take a lot of effort to breach.
1) OTA updates - It would not be difficult to do this, but other car companies are scared of software and the bean counters are too concerned about what happens if serious bugs creep into an update, it installs wrong, or hackers figure out how to override it. GM already has OnStar capability on all their new cars. They could piggyback OTA updates on the back of that, but they are culturally constrained.
2) Self driving tech - At the moment Tesla is ahead of the industry in self driving hardware in their cars. There are some other car maker's implementations of self driving tech that's is inferior in some ways but superior in others. It is an area where virtually everyone is pouring a lot of R&D funds, so it's a fairly shallow moat.
3) Overall electronics - Munro's teardown concluded that the electronics on the Model 3 was a generation ahead of anything else in the car industry. The quality of Tesla's electronics is much better than the competition. It's another relatively shallow moat because competitors could figure out how to catch up.
4) Battery tech - This is a bit hazy because there are different philosophies about the best packaging and the best chemistry. Most companies are doing pouch cells while Tesla is doing cylinders. The architecture of Tesla's battery packs is much more complex than the competition because they have to wire up all those cells and keep them cool. Munro did think the Model 3's battery pack was the best made in the industry. We know Tesla uses its own chemistry (manufactured by Panasonic), but it's unclear exactly how it differs from the chemistry used by the competition. Tesla appears to have some advantage over the competition, but few know for sure how big an advantage they have and if anyone is working on a better chemistry.
5) Car efficiency - This is one that few talk about, but for size and weight, Tesla is much better at efficiency. The i3 and Bolt have pretty good efficiency, but they are both very small cars. The new European cars coming on the market in the next year or two are the first EVs that are comparable with Tesla's offerings in size. However the preliminary range estimates for these cars all seem to be less than Tesla's range for comparable vehicles. The e-Tron will have a 95 KWh pack and have a range estimated around 200-250 miles. The X 100D has just shy of 300 miles range. Some of that is probably shape, Tesla puts a lot of effort into making their cars aerodynamic, but Tesla also has very good energy management systems on board. Some of that is probably a software advantage the competition hasn't caught onto yet.
6) Superchargers - CCS is touted as the next great thing, but the supercharger network exists today and it's very easy to use. Most current CCS chargers are not very high power, but higher power systems are promised soon. We'll see how well they work for long distance drivers. The other manufacturers are mostly just hoping the market will take care of the charging thing itself and they aren't really worried about it. VW is the only company directly involved in building chargers and that's only because of dieselgate. They wouldn't be doing it either if they didn't have to.
7) Volume - This is the deepest moat. Tesla is close to 5 years ahead on the ability to build EVs in volume. The key is access to batteries and Tesla has secured this. Other companies are breaking ground on their own battery factories, but Tesla is the only one operating and it took 5 years to get to this point. Other companies have more resources to throw at building factories and can possibly build them faster, but the lead is still measured in years.
Tesla also has some disadvantages. Being a smaller company than most of the competition, they run on more of a shoestring and a higher percentage of their expenses are going into R&D and expansion. Tesla's sales model is stronger when demand is high, but if demand dropped sharply (at this point only due to a world economic downturn), they might be in trouble because they don't have the buffer of the dealer network that other manufacturers have.
In theory Bob Lutz is also right that other companies have a wide array of ICE and their EVs will initially only be a small percentage of their sales. They could afford to sell EVs at a big loss to get in the door. However, he's wrong that this could be a viable strategy for really hurting Tesla.
5 years ago it would have worked, but it won't today. By the time another manufacturer is making and selling enough EVs to seriously compete with Tesla, they will also need to make a real profit on those cars because that volume won't be down in the noise anymore. It's true for a company like VW that selling an equivalent volume of EVs as Tesla sells would only be 5% or so of their yearly sales, but losing a lot of money on 5% of your sales volume is going to drag down the overall health of the company. And there is the danger that if they get to 5% production of EVs, a much larger percentage of their customers than that will want and EV and won't settle for an ICE. At which point the bottom falls out of their ICE sales.
To get to a point where a company could start selling an equivalent EV volume with Tesla, they would have to breach most of Tesla's moats first. It's a steep uphill climb and nowhere near as easy as Bob Lutz makes it sound.
Ford said they took apart a Model S, figured it out and said they could reproduce it, but while they could bend the metal to make something very similar, they don't have the expertise in electronics, software, or batteries to make something as good. Maybe they figured that out since.
