This is the catalyst for Tesla stock...

[zambono]

Stop making our children sick: Beijing parents force government action over smog

and all the regulations that will be implemented on the future sale of vehicles in a country of nearly 2 billion people. So get your shares and ride out the downs because the future is bright.

 

[MXWing]

I like the cut of your jib.

My concern though with your thought process is Tesla going to be the company that fills that need? Or is China just going to go with its own homebrew EV to address this demand?

 

[ecarfan]

So get your shares and ride out the downs because the future is bright.

In my opinion it is not that simple. There are multiple Chinese EV companies and no doubt more coming. They have significant cost and regulatory advantages over Tesla.

 

[tander]

I like the cut of your jib.

My concern though with your thought process is Tesla going to be the company that fills that need? Or is China just going to go with its own homebrew EV to address this demand?

In my opinion it is not that simple. There are multiple Chinese EV companies and no doubt more coming. They have significant cost and regulatory advantages over Tesla.

Originally I think Tesla was planning on putting the 2nd factory in China, since China is now the largest auto market in the world. For a long time that has meant that any foreign business that wants "in" to China has to partner with a Chinese company and give them majority control of the venture. However that is supposedly beginning to change as China opens up a little more, and it's looking like in the coming years they may start letting foreign companies in on their own. So right now I think the plan is to put the 2nd factory in Europe somewhere and wait a little while to see how things shake out in China.

 

[SwTslaGrl]

This Reuters video talks about GM aiming for BEV in China,
China's anti-Teslas drive a cheep electric car boom

 

[austinEV]

In my opinion it is not that simple. There are multiple Chinese EV companies and no doubt more coming. They have significant cost and regulatory advantages over Tesla.

By that logic Chinese automakers should drive GM, BMW, etc out of business.

 

[neroden]

By that logic Chinese automakers should drive GM, BMW, etc out of business.

Yep.

I honestly think they will.

I personally think Tesla will probably survive the Chinese onslaught; I doubt most of the legacy ICE manufacturers will.

 

[tander]

Yep.

I honestly think they will.

I personally think Tesla will probably survive the Chinese onslaught; I doubt most of the legacy ICE manufacturers will.

I kind of wonder if it is that simple with regard toward driving others out of business too. It seems like most incumbents have already started to go electric so while they may be late in the game, it doesn't necessarily mean they get kicked out of it right? Fiat Chrysler hasn't really jumped in yet have they? I just about bought a Jeep yesterday until I heard about diesel gate part #2. Noticed they announced a Wrangler Hybrid today...nice timing. Interesting thing with Jeep in particular is that their big thing is having good off-road systems, which I think like ice engines going electric makes all those 4wheel driving gearings and stuff kind of overly complicated. But then again people don't buy Jeeps because they get good mileage, they're fun and good at off-roading. Guess time will tell.

 

[neroden]

I kind of wonder if it is that simple with regard toward driving others out of business too. It seems like most incumbents have already started to go electric so while they may be late in the game, it doesn't necessarily mean they get kicked out of it right?

Not necessarily. Given the long lead time to build automotive factories, battery factories, and mines, it's *very dangerous* to be too late in this transition. I think it's moving very fast. Some of the late movers will likely survive; most of them will not.

I've been gaming out the fleet transition. The first big point is the arrival of the Bolt and Model 3. After that, sales continue to be production limited. But the highest-margin top end cars are switching to electric so profits start to crater at the old line companies, giving them less and less money for investment.

The second big point is when electric cars essentially take over the top half of the new car market. A few years after that, I expect that the used electric cars will displace most of the bottom half of the *new* car market. (Thought experiment: at the same price, would you rather buy a nice 3-year-old used Model 3 or a new Toyota Corolla? Thought so....)

If you're a car maker and you haven't got good BEV or PHEV offerings by then, you're doomed.

The third big point is when the gas station closures accelerate and gas stations become hard to find. I think this happens in roughly the same time frame. At this point, even having PHEV offerings doesn't help you, you have to have good BEV offerings.