Tesla BEV Competition Developments

[RobStark]

Who will ever buy Chevy Bolt if it costs approximately the same as Model 3??

In my arguments with Tesla bears I see only one legitimate Chevy Bolt buyer profile once both are available.


The BEV consumer that lives no where near a Tesla service center and is scared off by Tesla Ranger fees and has a Chevy Bolt certified Chevy dealer nearby. And does not need/want this BEV purchase to be a road trip worthy vehicle. I have run across these folks on the net. Or at least people who claim to be in this buyer pool.

Other than that it will take deep Bolt EV discounts to move in places like Los Angeles and San Jose Bay Area.

 

[Oil4AsphaultOnly]

In my arguments with Tesla bears I see only one legitimate Chevy Bolt buyer profile once both are available.


The BEV consumer that lives no where near a Tesla service center and is scared off by Tesla Ranger fees and has a Chevy Bolt certified Chevy dealer nearby. And does not need/want this BEV purchase to be a road trip worthy vehicle. I have run across these folks on the net. Or at least people who claim to be in this buyer pool.

Other than that it will take deep Bolt EV discounts to move in places like Los Angeles and San Jose Bay Area.

Actually, there's one more group - those who can't wait for the base-trim model 3 and want to be in a cheap 200-mile BEV asap. Not everyone can put in a deposit and wait their turn as Tesla ramps up production.

 

[RobStark]

Actually, there's one more group - those who can't wait for the base-trim model 3 and want to be in a cheap 200-mile BEV asap. Not everyone can put in a deposit and wait their turn as Tesla ramps up production.

I said once both are available.

Not once you are able to make a reservation on the Model 3 of your choice.

 

[Oil4AsphaultOnly]

I said once both are available.

Not once you are able to make a reservation on the Model 3 of your choice.

Well, I was thinking of "availability" as being when the first production non-sig model 3's are being delivered. I'm expecting pre-orders to exceed Tesla's initial year production capabilities, so anyone who wants one will have to wait for the backlog to be fulfilled. By the time the waiting's over (your criteria for "available"?), the bolt would probably be due for a refresh.

In either case, the arguments for why the market can support Tesla's growth story well into 2020 (despite new EV 's being introduced) would also translate to the Bolt being a viable product in the presence of a superior model 3. The demand for long range EV's is there for all models to succeed at the expense of ICE's.

 

[HansWurst]

I am surprised that no one brought up the reveal of the BUDD-e concept by VW. What are your thoughts on this? Seems to be the same platform as the Porsche Mission E concept.
Volkswagen Budd-e concept revealed at CES | Autocar

 

[RobStark]

I am surprised that no one brought up the reveal of the BUDD-e concept by VW. What are your thoughts on this? Seems to be the same platform as the Porsche Mission E concept.
Volkswagen Budd-e concept revealed at CES | Autocar

A battery pack that does not exist even in prototype using battery cells that do not exist to be charged by charging stations that do not exist even in prototype that may or may not be built in 2019.

Classic vaporware hoping to delay purchases of actual BEVs and to distract from Dieselgate.

We have seen VW do this again and again.

Hard numbers with actual production targets or it is irrelevant.

 

[RobStark]

Well, I was thinking of "availability" as being when the first production non-sig model 3's are being delivered. I'm expecting pre-orders to exceed Tesla's initial year production capabilities, so anyone who wants one will have to wait for the backlog to be fulfilled. By the time the waiting's over (your criteria for "available"?), the bolt would probably be due for a refresh.

In either case, the arguments for why the market can support Tesla's growth story well into 2020 (despite new EV 's being introduced) would also translate to the Bolt being a viable product in the presence of a superior model 3. The demand for long range EV's is there for all models to succeed at the expense of ICE's.

There are some people that decide to buy a new car when their current car is broken down but most don't.

I see most people happily waiting 3 months to buy a base Model 3 instead of spending $35k before Federal Incentive on a slightly discounted Bolt EV.

I see that happening in 2019.

I consider myself a Tesla bull but don't see Model 3 having a multi million unit backlog,collapsing demand for ICEv, and bankrupting several legacy automakers by 2020/

 

[vgrinshpun]

In my arguments with Tesla bears I see only one legitimate Chevy Bolt buyer profile once both are available.


The BEV consumer that lives no where near a Tesla service center and is scared off by Tesla Ranger fees and has a Chevy Bolt certified Chevy dealer nearby. And does not need/want this BEV purchase to be a road trip worthy vehicle. I have run across these folks on the net. Or at least people who claim to be in this buyer pool.

Other than that it will take deep Bolt EV discounts to move in places like Los Angeles and San Jose Bay Area.

Yep, fringe case, well defined.

So if we can draw any conclusions from another fringe case - sales of Caddillac ELR - it was outsold in US by significantly more expensive Model S at least 25 to 1. So similar ratio would be Model 3 - 500K cars per year, Chevy Bolt - 20K. Suggesting Tesla Model 3 sales hurt because of Chevy Bolt or any similar EV is just wrong.

 

[jhm]

Various outlets including trade journal Automotive News has GM telling suppliers including LG Chem to prepare for 25k-30k Bolts per year.

If things go well in 2017 I am sure they can scale up if they wanted to but I doubt it. They will probably attribute it to pent up demand and wait for demand to exceed to supply for a few years before committing to expansion.

I think 100k per year is fantasy for Gen 1 Bolt.

Ok, well perhaps TFTF can explain to us how GM is taking the gloves off and is going to out produce Tesla. Surely a big car company like GM has no problem producing 100k/yr of any model they so choose.. So while Tesla struggles to get Model 3 production up to 50k, Chevy should be producing 2 to 3 times as many...because they can. Isn't that right, TFTF?

That's TFTF's thesis, right? GM is willing and able to out produce Tesla on EVs. We don't need to know how GM will get around battery supply constraints or footdragging dealerships because GM is a capable and sophisticated auto major that knows how to get things done. GM also knows how to design cars that consumers really want to buy. So while some of us may question the styling of the Chevy Bolt, you can be sure they put a lot of market research into this to pick a winner. There's no way GM can miss on the demand side of the equation. So if the Bolt really is unconstrained by supply and demand, GM is in a position to really knock this out of the park. 100k in the first year is just warm up. I can't wait to see it.

TFTF, please let me know if I missed anything.

 

[jhm]

The Bolt price is promoted as $30K after the federal tax credit. So the real price will be $37.5K. This is also clearly a starting price, which already is 2.5K higher than the projected Model 3 price.

I am not negative at all. This is just purely practical question - knowing what we know about the two manufacturers and their products, I just do not see anybody buying Chevy Bolt over Model 3, leave along planned maximum yearly production of 30K Chevy Bolts making any dent in Tesla's Model 3 sales. This line of thinking has zero credibility and no historical precedence as far as I am concerned.

This is just a starting price. GM is really good at adding rebates and dealer incentives to move product. So they'll whack the price down to whatever sells. This is just a starting price.

 

[tftf]

It's not about GM or the single Bolt (although that car model due late this year shows big car companies can produce long-range EVs ahead of Tesla's Model3 introduction and aren't behind).

LG and other large battery suppliers (including Panasonic, they aren't tied to Tesla exclusively, see eg.: Chinese investment: Panasonic to build green-car battery plant in China- Nikkei Asian Review ) will build plants as needed between 2018-2025 as or if EV and PHEV demand picks up.

There will be many long-range EVs in all form sizes and price categories above $30k by 2020 from almost all major car companies (except maybe Toyota and Fiat-Chrysler).

But you are right in the sense that it takes years to build up capacity for millions of EVs. The same applies to Tesla. They keep talking about their huge Gigafactory at "full capacity", yet only one out of seven buildings is being constructed in Nevada.

Why isn't Tesla charging full-speed ahead? Why not at least construct the shells for the 86% of the Gigafactory that's missing? Why wait until 2020?

By 2020 or 2025 they won't have any time to market or scale advantages left (it's dubious there are many scale advantages anyway at the GWh level, companies like LG will build 4-5 plants instead of one).

 

[Lessmog]

It's not about GM or the single Bolt (although that car model due late this year shows big car companies can produce long-range EVs ahead of Tesla's Model3 introduction and aren't behind).

LG and other large battery suppliers (including Panasonic, they aren't tied to Tesla exclusively, see eg.: Chinese investment: Panasonic to build green-car battery plant in China- Nikkei Asian Review ) will build plants as needed between 2018-2025 as or if EV and PHEV demand picks up.

But you are right in the sense that it takes years to build up capacity for millions of EVs. The same applies to Tesla. They keep talking about their huge Gigafactory at "full capacity", yet only one out of seven buildings is being constructed in Nevada.

Why isn't Tesla charging full-speed ahead? Why not at least construct the shells for the 86% of the Gigafactory that's missing? Why wait until 2020?

By 2020 or 2025 they won't have any time to market or scale advantages left (it's dubious there are many scale advantages anyway at the GWh level).

TFTF, are you now complaining about too low cash burn rate? I'm getting more and more confused what your thesis is.

 

[FluxCap]

TFTF, are you now complaining about too low cash burn rate? I'm getting more and more confused what your thesis is.

There isn't a coherent one, and I'm pretty sure he's paid to write here.

 

[Jonathan Hewitt]

TFTF, are you now complaining about too low cash burn rate? I'm getting more and more confused what your thesis is.

The confusion is his goal I think?

 

[tftf]

TFTF, are you now complaining about too low cash burn rate? I'm getting more and more confused what your thesis is.

My point is the car industry is so cap-ex intensive that it will take Tesla many more billions to just get to 500k cars / battery capacity by 2020.

If jhm argues that GM (and other large car companies) are asleep at the wheel regarding EVs, that still won't help Tesla a lot because it will/would take them about 10-15 years from today to get to the scale of existing large car companies.

But these large car companiea aren't asleep at the wheel, there are many long-range EVs and new battery plants (LG, Samsung, Panasonic, Chinese companies...) coming by 2020.

I don't see any lasting advantage for Tesla or other new entrants by around 2020.

 

[Cebe]

Perhaps off topic, but... at some point, the media is going to switch from "Tesla killers" to "Tesla clones", right?

 

[aznt1217]

It's not a mutually exclusive scenario... Large automakers grow the pie for EV's.

 

[tftf]

There isn't a coherent one, and I'm pretty sure he's paid to write here.

?

My thesis has been pretty consistent since early 2013:

- Tesla breaking up with its two car partners was a huge mistake. Especially because of the upcoming Model3. Without partners Tesla had/has better chances of survival in its current high-end niche (sports car/S/X) imho.
The Model3 space is incredibly competitive and full of rebates etc. A snake pit for a new entrant.

- Tesla's integrated battery manufacturing at the cell level is a huge gamble (without car partners, apparently both weren't interested in the Gigafactory. See Nissan's experience having to write down billions). It add tons of cap-ex needs in an already cap-ex intensive industry. (Coming back to my earlier point: Without the Model3 Tesla wouldn't need to invest in a Gigafactory).

- The analogies and investor dreams of 'disruption' (Valley style) and 'Tesla is a tech company' are wrong. It takes decades, not years, to shift market share in the car industry. Investors will be in for a rude awakening until 2020. The continued delays with the Model X are a first taste of this low-margin industry.
Faraday Future by the way made the same mistake in their presentation by referencing the iPhone and the last decade - changes in cars take 5-10x longer on a timescale. Otherwise Tesla would sell millions of cars per year today, not 50k.

- Tesla's CEO is his own worst enemy. Instead of installing at least a COO he seems to micro-manage everything with tons of other duties (Space X etc). Which likely adds to delays and design decisions like the Falcon Wing doors.

So instead of trying to become the "Porsche of EVs" (high-end niche at maybe 100-150k cars/year long-term, no need to build a Gigafactory) Tesla is trying to become Audi/BMW or Daimler and building millions of cars.

 

[dalalsid]

My point is the car industry is so cap-ex intensive that it will take Tesla many more billions to just get to 500k cars / battery capacity by 2020.

So?

If jhm argues that GM (and other large car companies) are asleep at the wheel regarding EVs, that still won't help Tesla a lot because it will/would take them about 10-15 years from today to get to the scale of existing large car companies.

But these large car companiea aren't asleep at the wheel, there are many long-range EVs and new battery plants (LG, Samsung, Panasonic, Chinese companies...) coming by 2020.

They are totally asleep at the wheel. By many you mean Bolt and Leaf 2? I have my doubts any other global auto major gets into even 5 digits with long range EVs by 2020. And "long range" = just barely over 200 miles as the only option is not cutting it. That is expected to be the absolute miniminum of the lowest end Tesla with available larger range batteries. None of that is coming from either the Bolt or the Leaf 2.

I don't see any lasting advantage for Tesla or other new entrants by around 2020.

So who else is going to build a global supercharging network by then? Also you seem to be warming up to 2025 as opposed to 2020 for large battery ramps. If you replace 2020 with 2025 in all your comments, that might be more realistic and believable.

 

[schonelucht]

I am unsure where the certainty is coming from that the model 3 is going to superior to the model 3. We know little about the Bolt and we simply know next to nothing about the model 3. It may be better, it may be approximately equal or it may be worse than the bolt. It's just too soon to decide.