EU Market Situation and Outlook

[smac]

Don't know about the rest of europe, either. It parobably wouldn't sell well.

They sell fairly well in the UK due to tax breaks. Mitsubishi was the first one here to exploit a tax loop hole, where being a "commercial vehicle" you paid very little as a company car tax, and could reclaim your fuel pre-income tax.

The rules have been tightened up significantly, but a fully loaded double cab pickup is much cheaper than it's SUV equivalent, and as long as it has a 1T payload still classes as a commercial vehicle irrespective of if it has a full Bose sound system, a 250BHP V6, 7 Speed auto, and will do 135mph

 

[flankspeed8]

Is Tesla paying 10% import duty to EU area?

I believe it is the difference between importing finished automobiles versus auto parts. There still is a tax just lower on auto parts.

 

[kenliles]

I really don't think it does. Matter to Elon.

disagree-
I believe he wants demand for EV (including Tesla products) to completely and mercilessly outstrip anything Tesla could actually produce, inducing ALL other players into same to meet demand... and I think this objective carries strong influence of his strategic Tesla decisions on a daily basis... just my opinion of course

 

[dirkhh]

I believe it is the difference between importing finished automobiles versus auto parts. There still is a tax just lower on auto parts.

Import duty for a car is 10%. For a car battery by itself it's just 3.7%. And other parts have other rates.

 

[RobStark]

disagree-
I believe he wants demand for EV (including Tesla products) to completely and mercilessly outstrip anything Tesla could actually produce, inducing ALL other players into same to meet demand... and I think this objective carries strong influence of his strategic Tesla decisions on a daily basis... just my opinion of course

I don't. That would lead to many pist off customers.

You want Tesla to expand as fast as they can and have one more customer than they have cars. Same for the rest of the EV industry.

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The pickup market is miniscule (~2%). Don't know about the rest of europe, either. It parobably wouldn't sell well.

If Tesla could expand that market a bit and capture most of it I would be very happy as a Tesla shareholder. 2k sales per year?

Much more functionality that what is currently available with much lower operation cost.

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They are super popular in the US, in parts of Latin America, in the Arab world... so from an "existing Tesla markets" point of view... the US and maybe Australia?

Everywhere in Latin America that does not import large amounts of oil. That would not be an issue with Tesla.

Argentinian Gaucho's would not have to worry about about a massive fuel bill.

I think you are also forgetting Canada.

They don't like it when you consider them the 51st State. :biggrin:

 

[kenliles]

I don't. That would lead to many pist off customers.

You want Tesla to expand as fast as they can and have one more customer than they have cars. Same for the rest of the EV industry.

only if you assume only Tesla can satisfy EV customers- Tesla expanding as fast as they can (which they are currently doing) would currently equal a condition coming no where near the total EV demand Tesla induces on the marketplace (in Elon's mission statement imo), hence the definition of a catalyst.
I think what Elon has in mind is changing the industry many times faster than Tesla can possibly expand. In other words, transforming the entire industry to EV faster than production even from all EV makers can supply which in turn brings more production at higher margins.

I think the steady state scenario you are painting is decades from now in EM's plan and carries no water for current strategic positions. If he had his way- Tesla would prove the catalyst for the rest of the industry, by definition not being able to keep up with it's own demand, pissing off sufficient customers that they demand EV from more than can be currently provisioned. This is in fact what we are witnessing- Tesla expanding as fast as possible and yet demand forcing ICE to EV transition from others. AS soon as demand production parity is reached, the objective is complete- i.e. essentially an all EV system of transportation.

We may be saying the same thing- but I don't think the industry will convert to EV if Tesla can keep up with EV demand; That by definition means the objective has failed since Tesla can never produce all cars.

 

[smac]

They don't like it when you consider them the 51st State. :biggrin:

I thought the Puerto Rico was the 51st state

Not sure how many Teslas have been sold there though ; )

 

[dirkhh]

I think you are also forgetting Canada.

They don't like it when you consider them the 51st State. :biggrin:

I'd never do that. I just wasn't sure how popular pickups are in that proud country...

 

[smac]

only if you assume only Tesla can satisfy EV customers- Tesla expanding as fast as they can (which they are currently doing) would currently equal a condition coming no where near the total EV demand Tesla induces on the marketplace (in Elon's mission statement imo), hence the definition of a catalyst.
I think what Elon has in mind is changing the industry many times faster than Tesla can possibly expand. In other words, transforming the entire industry to EV faster than production even from all EV makers can supply which in turn brings more production at higher margins.

I think the steady state scenario you are painting is decades from now in EM's plan and carries no water for current strategic positions. If he had his way- Tesla would prove the catalyst for the rest of the industry, by definition not being able to keep up with it's own demand, pissing off sufficient customers that they demand EV from more than can be currently provisioned. This is in fact what we are witnessing- Tesla expanding as fast as possible and yet demand forcing ICE to EV transition from others. AS soon as demand production parity is reached, the objective is complete- i.e. essentially an all EV system of transportation.

We may be saying the same thing- but I don't think the industry will convert to EV if Tesla can keep up with EV demand; That by definition means the objective has failed since Tesla can never produce all cars.

The problem with a catalyst business model is, almost by dictionary definition, it can't grow as fast as the things it has catalysed

Given TMs need for hard spendable cash, they need to keep their borrowing rates low. To achieve this they need to keep their market cap high, which in turn needs a much higher multiple on revenues than the competitors, which then Tesla are supposedly catalyzing...

It's all a massive juggling act, and I would imagine this is the main thing on Elon's mind.

 

[Bgarret]

I'd never do that. I just wasn't sure how popular pickups are in that proud country...

Don't worry. Canadians all know Americans say they are Canadians when we travel overseas so people won't think we're ugly Americans. Imitation - the highest form of flattery.

 

[Taipan]

In reality the Model S is in a class of one.

In Europe, it is classified as an F segment car. Good enough for me. That is as close as you will get to objectively classifying the car.

Last fall, Uber France classified the Model S into the UberX (ie. economic/low-cost) segment with local french mid-size sedans retailing for 20-30K€ because the seats were not confortable enough, not enough headroom and *guess what* no central armrest with cupholders for water bottles.
While the Audi A6, Merc Class E, BMW 5 & Chrisler 300C were re-assigned to the upper "Berline/BlackCar" segment, with the usual Class S, Jaguar & co.

List of cars accepted by category

That sent a dramatic signal to all profesionnal drivers/chauffeur services in Paris (Uber being the absolute leader) and, AFAIK, Tesla France didn't get any order from those customers ever since. It just killed that market and it may take some time and effort to recover from it.

Edit: the Berline category generates approx. twice more revenue per kilometer than UberX => why spend 100K€ on a Model S while you can get the same revenue per kilometer from a 20K€ Renault Laguna ?

 

[MikeC]

Last fall, Uber France classified the Model S into the UberX (ie. economic/low-cost) segment with local french mid-size sedans retailing for 20-30K€ because the seats were not confortable enough, not enough headroom and *guess what* no central armrest with cupholders for water bottles.
While the Audi A6, Merc Class E, BMW 5 & Chrisler 300C were re-assigned to the upper "Berline/BlackCar" segment, with the usual Class S, Jaguar & co.

List of cars accepted by category

That sent a dramatic signal to all profesionnal drivers/chauffeur services in Paris (Uber being the absolute leader) and, AFAIK, Tesla France didn't get any order from those customers ever since. It just killed that market and it may take some time and effort to recover from it.

Edit: the Berline category generates approx. twice more revenue per kilometer than UberX => why spend 100K€ on a Model S while you can get the same revenue per kilometer from a 20K€ Renault Laguna ?

That's interesting, because it qualified for UberLUX in the US: Uber Luxury Qualified

Maybe an example of how slow uptake delays further uptake. If people were more aware and it was popular like in the US, maybe it would have been given a higher categorization.

 

[dirkhh]

Don't worry. Canadians all know Americans say they are Canadians when we travel overseas so people won't think we're ugly Americans. Imitation - the highest form of flattery.

See, I have the advantages that I can say "I'm German" (in the four or five countries where that's useful), "I'm American" (when in the US), and "You can't do that to me, I'm a Canadian citizen" (everywhere else)

 

[kenliles]

The problem with a catalyst business model is, almost by dictionary definition, it can't grow as fast as the things it has catalysed

Given TMs need for hard spendable cash, they need to keep their borrowing rates low. To achieve this they need to keep their market cap high, which in turn needs a much higher multiple on revenues than the competitors, which then Tesla are supposedly catalyzing...

It's all a massive juggling act, and I would imagine this is the main thing on Elon's mind.

Yes true. And that may well be the biggest challenge for Elon's TM. Could be that's what Apple could resolve for them to essentially create a scalability that gets to Rob's described equilibrium much faster. Going to be a blast to watch it play out regardless

 

[schonelucht]

The point is to make such a compelling truck you change minds.

How could you make a truck compelling for a European who doesn't work in construction? I doubt it can be done. If you are looking at cars that would be an insta-hit in Europe, you have to go for the smaller models. Size and performance of a Golf, reasonable range and price after incentives? You'll need a few Gigafactory to fullfill European demand alone.

 

[Yggdrasill]

It might sell in the US, but in Norway? No. The pickup market is miniscule (~2%). Don't know about the rest of europe, either. It parobably wouldn't sell well.

If Tesla could expand that market a bit and capture most of it I would be very happy as a Tesla shareholder. 2k sales per year?

Much more functionality that what is currently available with much lower operation cost.

I think trying to capture 50-100% market share in the pickup market would be *far* harder to accomplish than getting a 25-50% market share in the smaller hatchback/station wagon/crossover segment. I definitely think Tesla should focus on selling 20k Model 3 in Norway than focus on selling 2k pickups.

I have strong doubts Tesla would be able to sell 2k pickups in Norway, no matter how hard they tried. The pickup trucks here are used extensively for towing, for one thing. Electric cars are currently not good at towing long distance. Now, maybe enthusiasts like you and I might be convinced to make it work, but convincing the current pickup truck owners would be an entirely different thing.

Okay, maybe they could do it if they could get costs down to a competitive level, and stuffed a 150 kWh battery in there, and threw in lots of stuff construction workers would like, such as a winch, power outlets for running power tools (like on the VIA trucks), etc. But would it be worth it? I'm thinking no.

 

[matbl]

That's interesting, because it qualified for UberLUX in the US: Uber Luxury Qualified

Maybe an example of how slow uptake delays further uptake. If people were more aware and it was popular like in the US, maybe it would have been given a higher categorization.

Probably not. If tjey categorized it with specific reasons, it's not because of slow uptake. If the report is accurate, they did it for interior comfort alone...

 

[RobStark]

Okay, maybe they could do it if they could get costs down to a competitive level, and stuffed a 150 kWh battery in there, and threw in lots of stuff construction workers would like, such as a winch, power outlets for running power tools (like on the VIA trucks), etc. But would it be worth it? I'm thinking no.

Companies are all about Total Cost of Ownership.

So I think it would be easier to get ~75% marketshare because is all about the math.

Getting people out of VW and Ford station wagons is a much more emotional decision for consumers filled with perhaps some irrational range anxiety.

There are all those advantages you mention plus much lower cost of fuel and lower maintenance . Companies run the spreadsheet and pick the lowest cost option.

The Tesla pickup truck is not coming out next year.

Somewhere in the 2020-2025 range.

The Tesla cost for an electric powertrain should be equal to or below an equivalent ICE powertrain by then.

Meaning massive kWh for the battery pack for towing at least as capable as an ICE for what is available in Norway at least. I take it Norway's construction workers plumbers don't drive 7.0L V8s like in the US.

BTW I am not saying this should be the focus of Tesla Norway. In any event all they really need is to have the truck available. Tesla does not do paid advertisement anyway. It is not like they would take advertising dollars away from Model 3 and Model Y for the Tesla Pickup.

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Last fall, Uber France classified the Model S into the UberX (ie. economic/low-cost).

I think the European Commission is a more objective body for categorizing automobiles than Uber France.

Plus, Tesla is now available with BMW type heated Recaro seats with more rear seat headroom for those with that preference. As indicated by Uber USA many Americans have a different definition of what constitutes seat comfort.

And a rear central console with cupholders for water bottles is now available.

Not to mention the executive rear seat option.

 

[Yggdrasill]

Companies are all about Total Cost of Ownership.

That which you mention plus much lower cost of fuel.

Many pickup trucks aren't owned by companies, though. Single person businesses are common, and many pickup trucks are privately owned for towing boats, etc. Pickup truck owners are a diverse bunch, and trying to get close to 100% market share will be difficult.

The Tesla pickup truck is not coming out next year.

Somewhere in the 2020-2025 range.

The Tesla cost for an electric powertrain should be equal to or below an equivalent ICE powertrain by then.

Meaning massive kWh for the battery pack for towing at least as capable as an ICE for what is available in Norway at least. I take it Norway's construction workers plumbers don't drive 7.0L V8s like in the US.

Most plumbers/electricians/painters/carpenters/etc in Norway usually drive vans like the Transporter, Hiace or Caravelle. Pickup trucks are more common in heavy duty construction, like building dams, roads, bridges, tunnels, etc.

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BTW I am not saying this should be the focus of Tesla Norway. In any event all they really need is to have the truck available. Tesla does not do paid advertisement anyway. It is not like they would take advertising dollars away from Model 3 and Model Y for the Tesla Pickup.

A more realistic goal for a Tesla pickup truck in Norway would be 500-1000 per year. Moving beyond that would become increasingly hard.

 

[RobStark]

Many pickup trucks aren't owned by companies, though. Single person businesses are common, and many pickup trucks are privately owned for towing boats, etc. Pickup truck owners are a diverse bunch, and trying to get close to 100% market share will be difficult..

Other than F segment in Silicon Valley, I doubt Tesla gets 100% marketshare anywhere. I think 75% is doable.

Most plumbers/electricians/painters/carpenters/etc in Norway usually drive vans like the Transporter, Hiace or Caravelle. Pickup trucks are more common in heavy duty construction, like building dams, roads, bridges, tunnels, etc.

This is what I thought about vans being dominant in the business sector which is why I asked about the weekend cowboy.

I think this is where TCO comes in where the Tesla pickup can take marketshare away from the Euro Van.

Heavy duty is a straight up spreadsheet type of sale.

Others will take more convincing. I know Europeans think it is crazy to leave your stuff out in the open in a pick up bed but there are many solutions.

If private pickup owners see the businesses buying Tesla they may take it as a hint there maybe something up with that Tesla truck that makes sense.