Model X Price vs Cost of Oil

[PoweredByRain]

[..] I see falling gas prices as piling on to that threat, especially if it in any way reverses the falling consumption rates and increases the chances that big oil will succeed in using up every last drop in the ground.

Decreased prices may increase consumption rates, but they won't "succeed in using up every last drop in the ground". For that you need higher prices, not lower. Many have speculated that the Saudis are not decreasing production (and thus leaving the market "oversupplied") because they want the oil price to stay low enough for long enough to kill off higher-cost projects. The oil pretty much just flows out of the ground in Saudi Arabia, they have a very low cost of production, whereas new production in the U.S. and the oil sands in Canada require much higher oil prices to be profitable. Some projects are not profitable below $60 or $70 or maybe even more per barrel. Investment in such projects will dry up if the price stays low for long enough.

Cheap oil producers are walking a tightrope between too-high prices that encourage conservation, new production, and the development of alternatives, and too-low prices which of course mean a lot of lost income. Peak oil may have hit in many locations but apparently the Saudis are not constrained yet.

 

[tdelta1000]

I don't see how oil can affect a vehicle that doesn't use an oil based product as fuel.

 

[flankspeed8]

I don't see how oil can affect a vehicle that doesn't use an oil based product as fuel.

For the small subset of American's that are willing to drop $100k+ for an EV it doesn't. However, I would argue, that this subset and early adopters can only do so much to lift the prices of EV's when comparable (if there is such a thing) ICE's are much much cheaper for the long term. Once you eliminate or reduce the perceived fuel savings, it makes it that much harder to think of this as reaching the ranks of a mainstream vehicle or technology. Someone posted they are paying .42 kwh in Massachusetts. When gas is less than $2 it makes the economics less of a slam dunk. It is all relative IMO.

 

[trialcritic]

The price of oil has little impact on the early adopters who are spending over $100k. As many have said, the early versions of new technology have usually been expensive. When the economy version of the car becomes available, gas becomes relevant. If you spend $35k on a car which has free electricity and has a range of 200 miles, why would you use a gas car, except for long distance travel when you wish to fill up fast. The question is one of tradeoff.

Do note that Tesla is also working on the technology to reduce the time taken to charge.

“It’s not going to happen in a year from now. It’s going to be hard. But I think we can get down to five to 10 minutes,” Tesla CTO Straubel said in an interview with MIT Technology Review in July 16, 2013.

http://www.technologyreview.com/new...aims-to-charge-electric-cars-in-five-minutes/

If this happens 5 years, ICE cars will be on their way out.