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Truth Or Myth: Most People Still Don't Get Tesla

I'm with scriptacus, you lost me with your argument #2. People buy Mercedes, BMW, Audi, Jaguar for all kinds of reasons, nothing foolish about that.

Maserati and Austin Martin don't even belong in that list, they are iconic brands which by itself may be enough reason for someone to buy one. Personally, I like the Austin Martin styling even more so than the Model S. I could never afford to buy one, but it is a very beautiful car. Who cares that the Model S does 0.5 second better from 0-60, or that it cant fit 7 people. I doubt many would consider that argument.

There are rich people with whole collections of cars, some are for fun rides, some daily commuter, etc. I just met a Model S owner who has a Ferrari, a couple of BMWs and a Mercedes.

The silence of the S is golden. I like it better than any Mazerati or Austin Martin
 

imherkimer

Member
Supporting Member
Mar 23, 2013
266
812
United States
I work doing "handy-man" chores (anything that needs to be done), ranch maintenance, work in orchards and gardens, and have been saving for years for a car. I don't spend much, actually, on anything. Have been living kind of toward the other side from the 1 %. Never spent much on a car, and always bought used. Only one time I bought a new car, a Toyota Camry, in 1996. When it was totaled, I kept the money, and just used my old pickup for years after that. When my dad died, I got his 2003 Acura. Never have spent more that 20,000 on a car. (Does that make me average?)

I think the Tesla Mod S is the best buy I ever made. And I live far from any supercharger. I feel happy every day, and marvel at the craftsmanship, the quiet and comfort, and the power of the car, every time I get in to drive. I also find it very practical, lots of room for my stuff, and it looks and feels pretty durable, like it will last a long time. I like that, too. I even sprung for the service plan. Peace of mind and happiness every time I get into that amazing automobile! Really, it was worth a whole lot to me, used a chunk of my retirement. And I feel great about it! Paid for it too. Won't be making payments on the car. I would not have considered any other car in the world for this price, but the Model S..... feels like its worth every penny. Am I crazy? Maybe. But I am not alone, maybe even a little "average."
 

scaesare

Well-Known Member
Mar 14, 2013
8,591
15,199
NoVA
Here's the thing. Tesla was never supposed to reach profitability in early 2013. A growing business needs to grow. Tesla needs to pay for all the infrastructure they have built and work toward profitability. Tesla still needs to fine tune their scaling, manufacturing, and vendor process. The ZEV credits came in over and above all that which allowed Tesla to reach profitability earlier than expected. That's why Elon is going back to the original timeline of profitability...late 2013. He knows that by the end of the year that Tesla will have all of that smoothed out with the profits there. Elon is a man that doesn't hold back the truth when he is aware of it.

Thanks for the reply.

Unfortunately that boils down to "Trust Elon." While that holds water for many of us here, it doesn't do much to address the concrete issue of Tesla needing the ZEV credits currently in order to be profitable that some of the financial folks point to.
 

roblab

Active Member
Jul 15, 2008
3,904
3,413
Angwin (Napa Valley) CA
I don't want to know about your friends but how it is affordable to an average person (not having that kind of money at first place) If Elon can tell about model 3 (far away five years) I am not going to convenience (you don't have to do that).

It looks like you don't understand that 100k car is not for everybody, and tesla has not made a profit without tax help. Everybody on the forum knows EV is future but Model S is not answer for everyone.

It looks like your topic don't make model s affordable to an average person. You can travel in private jet, first class or economy (experience matters) and right now Model s provide experience (private and first class), but a world needs third one (economy).

Sorry you feel that way. I knew what I wanted 15 years ago, and I planned and saved for this car since then. I have worked in a hospital laboratory for the past 25 years and make a little less than the average nurse, so I would call myself average, at least.

What I notice is that people afford what they want. A friend of mine was complaining that he'd like an S, but couldn't afford it. He lives in 2000 sq ft house, drives a humongous pickup. The pickup cost over $50,000. Of course, he has another car, his wife has a car, the daughter has a car. They have the prerequisite large screen TVs with the high tech cable package, etc., etc. He chose his options, and lives in a different world than I do. But can't afford it??

And you know, I am sure you know, that the Tesla Master Plan (TMP) is to build high end first, mid range second, and economy (Gen III) third. What's the complaint? Wait a couple more years and save your money. I suspect you don't have any problem forking over the extra 20 to 40 thousand dollars for gas for the 10 years you own your transportation, with weekly installments plus maintenance. So, I say again, can't afford it? Of course, we need the economy level. Right now, people who want an entry level car do not start by buying a Mercedes or BMW anyway. That's where Kia, Hyundai, Toyota Scion, etc. etc. come in. I personally am past entry level cars, and into the midrange, where I figure the Model S is.

But, can't afford it? I doubt it very much.

As to "tax help", get real. All the Big 3 Automakers, all the Big Oil companies, get tax help, subsidies, low interest loans. Come on.
 
Last edited:

brianman

Burrito Founder
Nov 10, 2011
17,615
3,217
I work doing "handy-man" chores (anything that needs to be done), ranch maintenance, work in orchards and gardens, and have been saving for years for a car. I don't spend much, actually, on anything. Have been living kind of toward the other side from the 1 %. Never spent much on a car, and always bought used. Only one time I bought a new car, a Toyota Camry, in 1996. When it was totaled, I kept the money, and just used my old pickup for years after that. When my dad died, I got his 2003 Acura. Never have spent more that 20,000 on a car. (Does that make me average?)

I think the Tesla Mod S is the best buy I ever made. And I live far from any supercharger. I feel happy every day, and marvel at the craftsmanship, the quiet and comfort, and the power of the car, every time I get in to drive. I also find it very practical, lots of room for my stuff, and it looks and feels pretty durable, like it will last a long time. I like that, too. I even sprung for the service plan. Peace of mind and happiness every time I get into that amazing automobile! Really, it was worth a whole lot to me, used a chunk of my retirement. And I feel great about it! Paid for it too. Won't be making payments on the car. I would not have considered any other car in the world for this price, but the Model S..... feels like its worth every penny. Am I crazy? Maybe. But I am not alone, maybe even a little "average."
Thanks for your post. Stories like this give me hope we can turn this ship around. (I'm not talking about Tesla.)
 

gameon

Member
May 29, 2013
212
2
CO
Hey Troll,

Go back to guarding your bridge and leave investing in Tesla to the big boys and girls.

P.S.

The model S isn't just for people with private jets. It's also for people that use fractional ownership of jets.

You are same as OP i.e. can't criticism or take a look at the other side of the coin.

EV is the future but Tesla 100k car is not the answer. As market mature other automakers will offer options and tesla won't be only player in the EV market.

- - - Updated - - -

Sorry you feel that way. I knew what I wanted 15 years ago, and I planned and saved for this car since then. I have worked in a hospital laboratory for the past 25 years and make a little less than the average nurse, so I would call myself average, at least.

What I notice is that people afford what they want. A friend of mine was complaining that he'd like an S, but couldn't afford it. He lives in 2000 sq ft house, drives a humongous pickup. The pickup cost over $50,000. Of course, he has another car, his wife has a car, the daughter has a car. They have the prerequisite large screen TVs with the high tech cable package, etc., etc. He chose his options, and lives in a different world than I do. But can't afford it??

And you know, I am sure you know, that the Tesla Master Plan (TMP) is to build high end first, mid range second, and economy (Gen III) third. What's the complaint? Wait a couple more years and save your money. I suspect you don't have any problem forking over the extra 20 to 40 thousand dollars for gas for the 10 years you own your transportation, with weekly installments plus maintenance. So, I say again, can't afford it? Of course, we need the economy level. Right now, people who want an entry level car do not start by buying a Mercedes or BMW anyway. That's where Kia, Hyundai, Toyota Scion, etc. etc. come in. I personally am past entry level cars, and into the midrange, where I figure the Model S is.

But, can't afford it? I doubt it very much.

As to "tax help", get real. All the Big 3 Automakers, all the Big Oil companies, get tax help, subsidies, low interest loans. Come on.

I can't take 100k loan right now or in 2 years (unless I win lottery).

100k car is not for everybody and his argument doesn't hold for now. When Tesla come out with model 3 ($20k to $30k range with different battery options like model s) and charging is not a problem you got the winner in your bag.
 

brianman

Burrito Founder
Nov 10, 2011
17,615
3,217
@gameon
I think I understand your concerns, but I do have a question: Do you consider only a fully-loaded maxed out P85 or P85+ to be the only Model S worth having and/or capable of replacing an ICE as your daily driver? If not, then the $100K figure you keep asserting is off the mark.
 
Thanks for your post. Stories like this give me hope we can turn this ship around. (I'm not talking about Tesla.)

I work doing "handy-man" chores (anything that needs to be done), ranch maintenance, work in orchards and gardens, and have been saving for years for a car. I don't spend much, actually, on anything. Have been living kind of toward the other side from the 1 %. Never spent much on a car, and always bought used. Only one time I bought a new car, a Toyota Camry, in 1996. When it was totaled, I kept the money, and just used my old pickup for years after that. When my dad died, I got his 2003 Acura. Never have spent more that 20,000 on a car. (Does that make me average?)

I think the Tesla Mod S is the best buy I ever made. And I live far from any supercharger. I feel happy every day, and marvel at the craftsmanship, the quiet and comfort, and the power of the car, every time I get in to drive. I also find it very practical, lots of room for my stuff, and it looks and feels pretty durable, like it will last a long time. I like that, too. I even sprung for the service plan. Peace of mind and happiness every time I get into that amazing automobile! Really, it was worth a whole lot to me, used a chunk of my retirement. And I feel great about it! Paid for it too. Won't be making payments on the car. I would not have considered any other car in the world for this price, but the Model S..... feels like its worth every penny. Am I crazy? Maybe. But I am not alone, maybe even a little "average."

Powerful stuffs. Elon could use it when answering questions like "what is the demographic customers for Model S?"

- - - Updated - - -

Thanks for your post. Stories like this give me hope we can turn this ship around. (I'm not talking about Tesla.)
I once came across an article about Tesla could save the global economy, and I was like 'no way, that is too far a stretch'. However I was influenced when I state "It has an whole ecosystem supporting it with Tesla seated at the top of the pyramid" in #6.

Someone could lookup the article, I m in a hurry for something else.
 

SebastianR

Active Member
Feb 8, 2013
1,202
6,181
Denmark
@gameon
I think I understand your concerns, but I do have a question: Do you consider only a fully-loaded maxed out P85 or P85+ to be the only Model S worth having and/or capable of replacing an ICE as your daily driver? If not, then the $100K figure you keep asserting is off the mark.

It's quite funny to observe how the Model S is compared: Since it drives rather economically, its running cost is quite favorable even to a really small car. But since it costs quite a bit upfront people compare it to a luxury car.

I think the truth is in the middle: Everybody needing financing on the car will look at it as if it is expensive everybody else will look at it as the best deal ever.

Bottom line? It will take a while to figure out what the "true comparison" should be...
 
While I agree, I don't like Elon/Jobs comparisons as they each stand on their own; I disagree to conclude Elon achievements are far greater. I think he has the potential for that conclusion, but currently in terms of industry changing business etc., even Elon would likely admit he has a long way to go for that. Apple alone could buy Tesla with next quarter's cash without a blip; Pixar could do the same; that said I do agree Elon is on a path to surpass that potentially, but one quarter of profit isn't quite it... imho

I agree that Elon would not admit openly that he has been more world changing than Jobs ... I also get that Apple or Pixar could (theoretically) Buy Tesla .... still its not even close to me. In ten years they will not be able to buy Tesla ... and even now they can not buy Tesla / Solar City/ Space X...... the last one is not for sale until after Mars transport is established Elon recently said. By the time Gen 3 Hits it will become much harder to argue the Jobs<Elon statement :)
 

kenliles

Active Member
Jun 7, 2012
3,060
8,376
I agree that Elon would not admit openly that he has been more world changing than Jobs ... I also get that Apple or Pixar could (theoretically) Buy Tesla .... still its not even close to me. In ten years they will not be able to buy Tesla ... and even now they can not buy Tesla / Solar City/ Space X...... the last one is not for sale until after Mars transport is established Elon recently said. By the time Gen 3 Hits it will become much harder to argue the Jobs<Elon statement :)

Yes but that's precisely the point between now and 5 years from now. That's exactly the part Elon has not yet achieved. And currently Apple could easily buy all 3 (assuming for sale on SpaceX of course), and not just acquire but pay cash for them, with billions to spare, and not counting Pixar... Currently measured in those terms, its not even a close call. All said, I agree with you on potential future value.

By e way, I'll mention it here instead of a new thread. Elon tweeted SpaceX would not go public until the Mars colonization was part of the equation at least. Too bad, I was hoping for an earlier play, but his reasons are valid - paraphrased: quarterly profit pressures and Space travel produce conflicting pressures and don't mix well
 

Jonathan Hewitt

Active Member
Feb 19, 2013
1,487
4,737
New Hampshire
[#3]
[#6] Is far away and unpredictable. If they can achieve that other automakers are going produce EV or hybrid which make more sense to 98% of population e.g. $15 to $20k hybrid with 50 mileage (prius C is that range but can't compare apple to orange with unknown model3)

Say again about Prius C drivers not being in the right range for a Model S? ;)
20130604_115851.jpg
 

CapitalistOppressor

Active Member
Jun 18, 2012
1,622
0
Nicely done.

Regarding Myth #7, Tesla needing ZEV credits to maintain profitability... does anybody have any more insight on this? I've had a discussion with a friend, and he agrees with the pundits that state this is the one significant red flag with Tesla's viability.

Other than Elon's predictions, any concrete evidence that suggests that Tesla can/will get by without the credits now/soon?

Thanks.

-sc

Yes.

Here is a thread I posted on the matter -

Regulatory Credits - How BMW and Daimler Will Fund Tesla's Conquest of the World

As to your friends concern about it being a "red flag," it absolutely is in isolation. If the Model S had been in production for several years and was relying on ZEV credits to be profitable, that would be a clear "red flag".

Unfortunately for that argument, ZEV credits are hardly a new thing for Tesla. Tesla made ~$42m in Q4 of 2012 on credits, and still managed to lose $90 million dollars on $306m in revenue.

They doubled production in Q1, going from 2,400 units sold to 4,900; went from $306m in revenue to $562m; doubled their regulatory revenue to ~$85m, and went from losing $90m, to a profit of $11m.

Clearly the $43m+ swing from credits is a significant factor, but it doesn't account for the ~$100m swing towards profitability. Especially when you consider that while most metrics doubled (with production), revenue only went up by ~$257m.

So lets examine the logic of "red flag". Fundamentally it is based on a static view of the company. If the company is demonstrating clear progress to profitability irregardless of credits, than instead of being a "red flag" its a red herring.

And Tesla is demonstrating exactly that progress. The majority of the switch to profitability had nothing to do with credits, especially when you look at it on a revenue weighted basis. Tesla moved to profitability in Q1 by carving massive extraneous costs out of their bottom line, including the massive overtime and major supply disruptions that were a key feature of Q4.

These improvements were not instituted by fiat on January 1st. They were rolled out over time, and my data shows that many of these issues were resolved by the end of February. So 2/3rd's of the quarter was basically spent at relatively high levels of inefficiency. March was much better, but my data from May and April show even more improvements. The point though is that Q4 is a snapshot of Tesla at its most inefficient, Q1 shows them starting to clean up their act, and by the start of Q2 they were in reasonably good shape. My data from April and May show continued improvement (though not of the magnitude in February).

Against this backdrop of clear improvement, ZEV credits are just noise. What your friend should be looking at is the probability that Tesla is soon going to be profitable regardless, and regulatory revenue isn't going anywhere. It might decline over the year as automakers fulfill their 2012-2013 quota, but they still need to purchase credits in 2014, and in 2015+ the production quota is dramatically higher, and as yet very few automakers have products in place to address the issue.
 

EVNow

Well-Known Member
Sep 5, 2009
12,586
33,636
Seattle, WA
Sorry you feel that way. I knew what I wanted 15 years ago, and I planned and saved for this car since then. I have worked in a hospital laboratory for the past 25 years and make a little less than the average nurse, so I would call myself average, at least.
You are an exception - so are some others here who have bought S with average incomes. Infact many here may have bought S with incomes less than the average Leaf owner's income.

But, if you could get stats on the family income of all S owners, I'm sure the median would be over $250k.

The average new car price in the US is just above $30k.
 

xhawk101

Active Member
Supporting Member
Apr 16, 2012
1,161
288
Saint Petersburg fl
Agreed. We shouldn't dis other high end car owners and rub them the wrong way. I wouldn't risk turning them off. It is likely that they are going to be members of the family some day.

I'm not a big fan of comparing Elon Musk with Steve Jobs. Steve Jobs rubbed me the wrong way. I couldn't stand to watch his presentations. But, he made a more polished mousetrap and marketed it.

Elon blows me way and I hang on his every word. He built a new and better mousetrap that markets itself.

Agree entirely


Sent from my iPad using Tapatalk HD
 

kenliles

Active Member
Jun 7, 2012
3,060
8,376
Against this backdrop of clear improvement, ZEV credits are just noise. What your friend should be looking at is the probability that Tesla is soon going to be profitable regardless, and regulatory revenue isn't going anywhere. It might decline over the year as automakers fulfill their 2012-2013 quota, but they still need to purchase credits in 2014, and in 2015+ the production quota is dramatically higher, and as yet very few automakers have products in place to address the issue.

emphatically this- thanks CO;
Now I will admit and advise some short term caution. The current price and valuation of TSLA is almost unarguable, hmmm let's say aggressive. It will be a challenge for the 'dumb-money' when the next quarter or 2 report something less than Q1 earnings per share and perhaps a Q2 loss- so the valuation timing and belief model from where we sit today (not the mid thirties of yester-month) will be, let's say tested with equal aggression. That said, I'm completely in agreement with CapOp- long term you would best be served looking at the potential for profit without the credits. If those goals are being met (as I suspect) - katie bar the door on valuation

- - - Updated - - -

Disagree that elon<jobs based on apple cash position. In terms of humanity and inventive genius, elon already beats jobs IMO

I agree and I'm the one that made the point because the comparisons were made on industrial business basis. Not in terms of humanity and inventive genius - if that's the measure we need to throw Einstein and Mozart, etc. into the discussion. But I'll note, these get into subjective opinion that have no end-- and I'll also note, Steve Jpbs didn't rub me in any way, the right or the wrong, so i don't know what that means- I plead ignorance
 

gameon

Member
May 29, 2013
212
2
CO
You are an exception - so are some others here who have bought S with average incomes. Infact many here may have bought S with incomes less than the average Leaf owner's income.

But, if you could get stats on the family income of all S owners, I'm sure the median would be over $250k.

The average new car price in the US is just above $30k.

I agree with you. Many thinks every one can afford S model. Tesla will be one of the ev manufacturer in 5 years because you will see others in market with model 3 price range.
 

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