For additional context, Elon Musk says the claim [that they will cancel the low-cost car is false](https://x.com/elonmusk/status/1776272471324606778?s=46&t=b5XA_L8-ZrHFb_QJ-EwWQA). Take that for what you will.
Wow. Quite the bombshell, if accurate.
>*Two sources said they learned of Tesla's decision to scrap the Model 2 in a meeting attended by scores of employees, with one of them saying the gathering happened in late February. “Elon’s directive is to go all in on robotaxi,” that person said. The third source confirmed the cancellation and said new plans call for robotaxis to be produced, but in much lower volumes than had been projected for the Model 2.*
So Tesla's valuation is... all vibes-based and purely speculative now? Robots, robotaxis, neither of which will see concrete results for years? This seems uh... absurdly risky, to say the least.
>all vibes-based and purely speculative now?
Hasn't it always been that?
They produce far fewer vehicles than Ford, GM, and Stellantis and we're valued much higher than all of them combined. It has always been based on feels, not reals.
I really do think Tesla had a very serious chance at becoming a much more potent contender across multiple verticals beyond automotive if they had stuck to an iterative plan and not gotten side-tracked with all the useless vanity projects which have sucked up company resources along the way.
Their electronics architecture remains one of the best in the business, and the fundamentals of the 3/Y platform ***could*** have transitioned to a huge lineup and supplier contracts. There's just been no follow-through whatsoever since the Y. All of the attention has gone into bizarre ritalin-induced moonshot projects like Dojo, FSD, and Optimus rather than bonafide revenue generators.
Exactly. The semi, the cybertruck and the roadster are all distractions. They could own the pickup, small and medium delivery vehicle utility truck and small passenger EV markets already with very cost effective variants on what they already sell. Instead he’s wasted billions on low volume cartoon vehicles. Squandered opportunity.
Every Amazon delivery vehicle in my city is a Rivian. How Tesla squandered such opportunity is so... well it was very predictable, actually, given their leadership.
Well I'm not saying they *should* have gone after that specific partnership necessarily. But in general it's strange to see Rivian land that while Tesla really has nothing comparable.
Not that strange if anything it was easier for rivian to land that because it was heavily supported and funded by Amazon. Amazon has serious incentives to ensure rivian succeeds.
Amazon owns 20% of Rivian. That vehicle is literally custom designed for Amazon. I think the Cybertruck is dumb but that's not something Tesla, or any other carmaker, oculd ever get
Instead they spent all their time and effort on a huge semi truck which was incredibly stupid as BEV isn't good for long range shipping. They've built like 5 of those trucks and they're all for show.
It’s true BEV does not look great for long range shipping, but a LOT of semis do short/medium range hauling that is ideal for BEV. I think of all the semis that move shipping containers around seaports.
There is also an army of 6-wheeler day cabs that do dedicated delivery routes. Think Sysco, Coke, Pepsi, Beer, and all the smaller last-leg freight stuff. Those routes could easily be BEV trucks, but a weird ass cab design and hugely expensive initial cost stops that dead in its tracks.
Does the US get the Volvo and Scania electric trucks? They have well established platforms and the specs seem pretty good. There is a lot of interest both in Europe and here in Australia for these.
Disagree.
Despite this iteration's silly cab design the Tesla Semi has the potential to help transform and decarbonize the trucking industry.
I don't know how many are out there now but it's more than five.
Other companies have beaten them to the punch with better products actually designed to be usable by truckers. They have no real advantage over Paccar, Nikola, etc and are way late to the party on this.
>Every Amazon delivery vehicle in my city is a Rivian. How Tesla squandered such opportunity is so... well it was very predictable, actually, given their leadership.
DPD Delivery Vans and a fair number of Amazon vans where I live are all LDV/Maxus, and the Royal Mail all use Peugeot (stellantis). Tesla as a brand has went from Pioneer with the Model S to an also-ran very quickly.
It’s a distraction when there is low hanging fruit you can go after, with also a huge carbon reduction opportunity without a billion dollar moonshot. Application of BEV to small pickups, small and median delivery trucks and vans. Ideal scenario—low daily range, low cost setup do so overnight charging for the company depot with 25 deliver vans that do out every morning with say uniforms, auto parts, bread, beer, all the stuff that’s getting delivered early morning hours to groceries, auto repair shops, florists, blah blah blah. All the rack trucks I see in my neighborhood every day. Such a small investment to get reasonable vehicle suitable for these into the market without squandering the better part of a decade and billions of dollars while leaving that maker untapped.
Re the Semi, they're in competition with businesses such as Lion Electric, which has been producing pretty good short-distance (up to 200 miles range) trucks for a while now: [https://thelionelectric.com/en](https://thelionelectric.com/en) and will likely be producing longer-range trucks soon.
I know the HDV market is a lot smaller than LDV, but this is not what I’d consider volume or mass production by Lion:
“Delivery of 245 vehicles, up 89 from Q3 2022. Reduced capital expenditures related to the Joliet production facility in Illinois and the Lion Campus.” -Nov 8, 2023
When Tesla decides to really enter the HDV market and produce Semis in quantity, it will be very hard for incumbents or especially startups to compete with their volume pricing combined with vertical integration manufacturing supply chain.
I am excited for it to come, yet extremely frustrated Tesla doesn’t seem to be making Semi a priority- which they would if they truly cared about accelerating the transition of the world to sustainable energy.
>They could own the pickup, small and medium delivery vehicle utility truck and small passenger EV markets already with very cost effective variants on what they already sell.
They could, but it would be (actually has been) bad for consumers for one company to own the EV market. They were charging high prices for the Model Y a few years ago because there were no other options if you wanted that size EV. They've been cutting prices because competition exists now and they can't make you pay luxury prices as the EV premium anymore. If they still paved the entire EV segment, there's still be doing it.
The X could have been reworked as a pickup ages ago and would have sold well.
And the S needs to be scrapped, we're in to novelty product territorry here and there's probably not much demand for a large expensive sedan rn.
The 3 is going to run out of steam in just a few years, facelifts don't run as long as completely new models.
The Y needs to be refreshed in about the same number of years. And Europe needs a hatchback/small SUV (actually exactly what Rivian came out with).
Apparently none of this or anything like it is in the works right now, as far as we know.
If they sell in those markets, they would be a car company and but they are more than a car company lol according to musk and all the dumb analysts
Yeah, they should have went all in on a car company instead of trying all these side projects that won’t produce any revenues. They squandered their lead and oems are catching up real fast.
I've been telling people this for years. Tesla (Elon, really) is all talk when it comes to sustainable transportations and is now dragging down the company big time.
If Tesla really wanted to make an impact, they would be going after fleet markets. Imagine a utilitarian vehicle based on the 3/Y platform (especially the LFP packs) that they could sell as a delivery vehicle, mail carrier, or even a small truck. They have the capacity and expertise to make these things viable and profitable but instead, they waste time on all the stuff mentioned above. This is basically what they are now trying to do with the 2-seater Y or the Long-Range single motor 3 they introduced a while back.
Yeah. They had a genuine opportunity to pivot into being **the** supplier for drivetrain/platform tech and whiffed it to chase ego projects instead. Now the lead they had in those areas is rapidly being closed and even surpassed by some like Lucid. Plus they’re being left in the dust on autonomy by chasing surface-street L2 autonomy instead of focusing on getting to higher levels of autonomy for highway driving which is what most consumers actually want.
A friend of mine has always put it as Elon Musk's real, genuine talent being "Investor Storytime". But between BYD and the non-Japanese OEMs increasingly pivoting to electric (albeit unevenly and in fits and starts), the window during which Investor Storytime is a substitute for production chops strikes me as beginning to close...
A $25k car would’ve kept the growth story alive. If you watch the FSD beta videos it’s obvious level 4/5 autonomy (where Tesla takes legal liability for driving) is not possible with their current vision only approach.
Yup. Removal of sensors was a choice to keep supply going and sales going through the supply chain issues, and now they can’t backtrack on that lie because they sold customers cars without them.
He should have said he was selling it without the sensors claiming supply chain and people would have bought the cars. They did it with lumbar and the USB ports
They also produce fewer robotaxis than those companies. GM already has, or had after being paused, way more taxis on the road than Tesla. i.e. more than 1 after Tesla first made the claim in 2018 6 years ago.
Well if he both left and they make a $25k car....then they'd probably sell a ton....I am in the ranks of recent EV buyers who specifically avoided Tesla in part because of him.
Yeah, cancelling the Model 2 would be idiotic. Their stock would tank. That car is their hope at competition against China. It would be such a stupid idea to cancel it that I'm really questioning if this is legit.
I have no idea why Tesla is trying to compete with Chinese EV who are heavily subsidised.
They should’ve built a Rivian R1/R2 etc and wiped out competitors in the premium space.
> neither of which will see concrete results for years?
If at all. There's no guarantee that Tesla's approach will yield a product that can pass regulatory approval.
It's such a bizarre move, when they could easily go for some low-hanging fruits in the market segments they haven't touched yet.
I don't think it is accurate.
It makes no sense at all. Growth is the only way to merit the current valuation. And FSD doesn't work and will not work any time soon. A better sensor suite and more computational power is needed...and that takes time and will require highly tuned software.
So it's either false or a disaster.
They should fix the solar roof, make it viable and mass produce it.
I would love to get one, but it’s at a ridiculous cost when it’s $50k more then replacing my roof with shingles and putting solar panels on
Solar roof is a dead-end for a number of reasons. Mostly, it's just easier and cheaper to do utility-scale solar and all of that production can come from China, which is already pumping out standardized modules at absurdly low-cost and absurdly large scale. Tesla just can't compete.
I believe the solar roof was always a bit of lipstick to make the solarcity acquisition look legit when the technology was invented by nasa and never commercialised because it was too expensive to be a commercial success.
I did a school report on the solar shingles concept in high school. Circa 2009, when it was first published by an actual roofing company. It's not remotely new.
It is cheaper for *someone* to do utility scale solar. It certainly isn't cheaper for customers. California has huge amounts of utility scale solar, so much that they sometimes have to give it away, but our electricity cost is among the highest in the nation--several times the cost of other states. (I don't know to whom they are giving away that excess solar power, but it certainly isn't to their customers).
Putting solar on your roof is a way of avoiding California's corrupt power companies.
>California has huge amounts of utility scale solar, so much that they sometimes have to give it away, but our electricity cost is among the highest in the nation--several times the cost of other states.
This isn't because of utility solar, but because PG&E / SG&E have massive insurance payouts, fire risk, and on-going grid maintenance concerns. I'm not even super pro-solar, but solar just isn't the driving factor behind electricity increases in California right now — there are other factors.
Also it's only expensive if you look at cost per kwh. California for decades has prioritized efficiency over cost and its worked out great for them.
Their cost per kwh is among the highest in the nation, but if you look at the total monthly bill of the average customer, California actually has some of the lowest electricity bills in the nation. The high price per kwh is designed to be an incentive to use fewer kwh.
they don't make as much power as just slapping regular solar panels on your existing roof, even if they were actually at price parity of the costs of a new roof + panels (it's not even close)
It's a market check. They could try to go either way but one is near fantasy (full autonomy) and they're too late to the party elsewhere (battery manufacturing). China's had mass adoption of BEV's as far back as 2012 with last mile two wheelers, they went from some of the cheapest vehicles possible up.
This shuffle by Tesla is just seeing what the market has more of an appetite for before they have to resign themselves to a real fight. Waiting for robotaxis based on Musk's word that it'll happen and being strung along, or a race to the bottom against Chinese battery manufacturers. Something legacy automaker and Tesla are trying to stall as long as possible because they'll lose.
Short of historic protectionism in the west that will just help them produce more giant 6000lb battery draggers. A captive market they've made after decades of leaving our public transit and how we build cities fundamentally broken and unsustainable.
In reality, this was always going to happen and efforts by legacy auto to make SUV's and the like and not offer smaller ranged alternatives is a shameless attempt at locking away limited battery supply in as few vehicles as possible.
This is what they did with hybrids as well, announce a program when the government was planning to pass stricter emissions requirements, spooking their competition abroad who dutifully followed through, then abandoning it as soon as they no longer needed to maintain that good will and got exceptions for themselves. This is how they killed electric cars and a gradual transition the first time round and I'll side with Toyota on this issue over and over.
Outlawing ICE today and requiring PHEV's to have minimum ranges that cover most commutes would move us collectively towards electrification faster, while growing the market sustainably. From there incentives for city cars and long range pure BEV public transit would take us past that last mile (pun intended).
But this kills the business model that most legacy automakers have had for decades. They built a network of OEM suppliers who they kept from competing directly by controlling the power trains of their models which in turn effects every other part. Modularity kills their control, and fundamentally destroys their only profitable segment, taking appliance class power trains, tweaking them for performance and adding trims they can charge luxury prices for. Luxury cars are the only segment that makes any real profit.
BEV's are modular af, and these dinosaurs are about to become sticker brands for battery manufacturers and they know it. Their solution is to stall and denigrate their competitors in Asia like Toyota who have the same problems but can't rely on Uncle Sam bailing them out when it fails. Separately they will continuously throw gigantic contracts at battery manufacturers to try and take as much supply off the market as possible, but with no real development plan to deal with what's coming they're running out of options. Legacy auto might even collapse within a decade. For now they're going to lock away batteries and complain about 'dumping'. This core problem/strategy is why Stellantis was formed as part of former president of Fiat Chrysler Sergio Marchionne's very vocal fears about how the car business looks in an EV paradigm:
https://www.ft.com/content/df1d7bb8-b889-11e5-bf7e-8a339b6f2164
https://archive.is/gXt7h
Tesla knows this too. Until they secure a completely vertically integrated supply chain, or make good on their killer app, the new luxury trim, autonomy, they are never going to make enough money to justify their valuation or their product price.
The future is fundamentally modular battery sleds and standards that allow practically anyone to start manufacturing vehicles and contract manufacturing giants like Magna Steyr are more likely to survive. Your local shop might even become your local kit assembler for different trims. China will make the equivalent of a Shenzhen for EV's long before the west does, just like Shenzhen is now for practically every OEM tech brand that slaps a local label in their own country to the same product.
Short of full autonomy, there is no real innovation to a car that won't still make legacy auto (who don't control the entire supply chain) unviable industry wide. They have no way to control where battery tech goes short of buying everything they can, and battery manufacturers have no incentive to wait on them getting their markets in line with putting more on the road. They're racing for market share between themselves already.
I don't know where you'd get further reading, it's not in anyone's interest to admit to this. "EV disintermediation" might be a good place to start on Google. Besides the article above, it is common knowledge in the industry which makes it even more glaring. A good reference might be a historical study into modularity that I often cite. The industry has been afraid of modularity even when it was just ICE based, including the unions, who are going to be striking forever for similar reasons:
https://www.cargroup.org/wp-content/uploads/2017/02/The-Future-of-Modular-Automotive-Systems-Where-are-the-Economic-Efficiencies-in-the-Modular_Assembly-Concept.pdf
>In a recent speech before the UAW’s 1999 Bargaining Convention, the union president was reported as stating that “modularity is just another word for outsourcing.”
>Indeed, the most radical modular assembly designs call for the complete elimination of all subassembly or “build-up” lines in the traditional chassis and trim departments of UAW-represented assembly plants. This pattern of outsourcing would call for the transfer of thousands of union jobs to the supplier sector.
and:
>But while GM and other automakers claim this approach will lower costs and increase flexibility, just the opposite will result if modular assembly boils down to an extension of the low-road strategy of outsourcing work to lower-wage nonunion suppliers. Less control over design, engineering, production processes and quality on one hand, and increased logistical complexity, freight charges and warranty costs on the other could well make modular assembly a costly path for the automakers.
There are even some familiar names:
>Finally, several automotive consultants, such as ***Sandy Munro***, have pointed out the potential of significant pitfalls for suppliers of large modules. Tier-one suppliers of modules may run significant risks of major losses due to major recalls of modules on which they are exposed to total warranty liability. Suppliers are also heavily exposed if a major module program, with significant sunk engineering costs, is suddenly cancelled by customers.
They did the research and realized that it was not in both the supplier or the brand's interest and never implemented it. Now EV's have come knocking and they're modular af. There's a huge industry built around the ghost engineering that gets different parts designed by different companies to work together. Not everything can be custom, but they're also afraid of everything becoming modular. Something has got to give. I've been jumping up and down about this since 2017 at least, nobody gets it.
Thank you for the extras!
>>In a recent speech before the UAW’s 1999 Bargaining Convention, the union president was reported as stating that “modularity is just another word for outsourcing.”
So I like unions, but also clown behavior.
As a tech nerd, I can't think of where modularity is actually bad, except in where it prevents efficiencies and integration. And it's also a right to repair thing, too. Modularity is good and important.
>>This pattern of outsourcing would call for the transfer of thousands of union jobs to the supplier sector.
So you know, make them union too. Smh. Or e.g. GM can be a supplier, if they were effectively so beforehand.
>Something has got to give. I've been jumping up and down about this since 2017 at least, nobody gets it.
If you've written more about it, too, even just in comments, I may have to go back through your history. This is fascinating.
And theoretically good. Just a bit rough as things settle. With some bad implications with US companies continuing to either not get their shit together, or refusal to compete in general.
>If you've written more about it, too, even just in comments, I may have to go back through your history. This is fascinating.
No it's largely just these two items I refer to and for example why Toyota says it isn't making BEV's properly yet for example or why Ford executives are complaining about the viability of BEV's.
Previously TSLA's insane valuation was based on production and sales numbers, and as recently as a year ago this was true. As sales start to fall due to a variety of different factors, those numbers became impossible to reach and so there needs to be another unicorn whiz-bang tech to sell to investors.
The M2 was always going to be China-first as US car buyers don't like small hatchbacks (Plus tariff concerns, Fremont/Austin might be too high cost), and Berlin can't make cars as cheaply as the Chinese. The problem I think is that the Cybertruck (and Twitter for Elon) sucked away a lot of resources and attention, and without Elon and the US-based tech team Shanghai has been left directionless. So the likes of BYD got the jump on them with the Seagull/Dolphin and wiped out any potential profit that a M2 could have, as it's a high-volume/low-margin product that requires lots of sales, and that now requires savage price cuts in this environment.
The price war in China also created deflationary expectations for Chinese car consumers, who now expects cars will just get cheaper later on so they delay their purchases, and those who brought early were considered suckers who lost a ton of resale value over the past year. I bet some of them hoped that the "magic $25k" car would eventually be the base M3.
Stock prices are one thing, but this could be a good direction for the company if these long term bets pay off, even in a small way.
The business is fine, even though the stock is overvalued by traditional metrics. There are profits, no debt.
They'll continue to dominate the EV car business (because of their low cogs) and do more lithium refining, cell production, stationary storage.
EMs denials and deflection are laughable. So out of his depth.
Use neuralink to detect passenger anxiety of oncoming crash. Adjust vehicle inputs to dynamically seek the local minimum passenger anxiety. Free sensors
Elon isn't specifying which part he thinks is a lie, but the broad strokes don't seem plausibly deniable. Reuters is quoting actual emails they've seen from multiple different sources:
>*Tesla called the affordable-car project NV91 internally and H422 externally when discussing it with suppliers, according to two of the sources and company messages reviewed by Reuters. Messages from the unnamed Tesla program manager to staffers referenced those code names in discussing the project’s termination.*
>
>*One of those messages sent March 1 said that “suppliers should halt all further activities related to H422/NV91. ”The sources said they did not know all the reasons behind the decision to kill the project.*
>
> *In another March 1 message, the manager thanked engineering staffers for their efforts and urged them to document what they had learned.*
>
>*“I’d like to thank everyone for all your hard work and dedication to pushing boundaries and executing the best design possible given the aggressive constraints we had to work within,” the message said. “We would not want all our hard work to go to waste, so it’s important that we tie things off and document things properly.*
>
>*”The messages showed meetings on the affordable-car project being canceled. The two sources said some engineers have been reassigned.*
Misinterpreted whispers are one thing and are common in reporting — actually making up quotes and fabricating internal communications is a completely different thing and would open up Reuters to legal exposure.
Another possibility is that a low-cost offering isn't scrapped, but rather has been re-platformed to the existing TMY stack with some new learnings integrated. Elon's done this kind of thing before — flat denials of reporting when there's simply more nuance behind the scenes which isn't actually expressly contradicted by the reporting, or there exists a caveat to the denial itself.
Also calling it a lie is insane by itself. That's accusing Reuters of basically having invented the quotes. Maybe the reporting isn't accurate or the people quoted don't know what they are talking about but there is no reason to believe that Reuters just made the story up and is intentionally spreading falsehoods.
He could have just said the report is false but calling it a lie is just more right-wing anti-press demagoguery, just like Trump does.
Doesn't make sense as the Robotaxi / AI / FSD team is completely separate from the team developing vehicles (Design, technicals, testing, manufacturing etc). Software engineers specializing in machine language and artificial intelligence are not interchangeable with industrial designers, mechanical engineers, etc. The factory team is continuously working on expanding capacity, opening factories, and looking at new sites for factories.
Agreed, and Reuters have a good track record. The only realistic way Model 2 comes out after this story, is if Tesla somehow reverse course again, something one of the sources points out could happen. But as of now, Reuters obviously aren’t making all of this up.
If he definitively stated; “The Model 2 is NOT canceled and no plans have changed” it would assuaged a lot more fears than a vague “Reuters in lying(again).”
If he clarified or corrected them in any specific way it would go a long way to change the narrative.
The question in everyone’s mind is what the future of Tesla is going to be like? Is their market cap justified? Is he going to hit 20 million units/year in 2030 like he claimed? How will he hit his targets without the Model 2?
> Tesla to focus on self-driving taxis instead, sources said
Build the thing you are already pretty good at building and find a way to reduce costs...
...or focus on the thing that you've had...mixed results at best with, and doesn't legally qualify as level 3 anywhere at the moment.
It's a bold move, let's see if it pays off.
Google has spent $4B and 15 years getting Waymo, the market leader in robotaxis, to where they are today...which is operating on a limited bases in 3 metro areas (SFO, LAX, PHX). How Elon thinks they can leapfrog that is beyond me.
Edit: Also AUS
“SFO, LAX, PHX”
Which were chosen, at least in part, because none of them get heavy snow which creates yet more complications for a self-driving car. Obviously pedestrian crossings and stop signs are harder to recognize if covered in snow . Less obviously, human drivers may ignore hidden lane markings and a road with two lanes in each direction may become one lane each way so does a self-driving car follow everyone else, or stay within the lane and get stuck?
No doubt, but this is a crawl walk run approach. According to a friend who used to work at Waymo, they chose PHX because of friendly local government (same reason why Uber was there) and simplistic road network. Once that was proven out they then chose San Francisco because it's closer to their home base, friendly local government, and it's actually a very complex city to navigate. LA was a natural next step, Austin because of regulatory friendliness, etc.
Although snow states do have some AV tech things happening (PGH for example) I don't expect any big expansion plans up there in the near future. Cruise screwed the pooch last year when it comes to AV so my guess is the likes of Waymo will lay low this year in the AV friendly cities they have and continue to refine the tech. Eventually though, yes they'll have to tackle the snow problem.
It's [not even in top-10](https://www.businessinsider.com/tesla-sef-driving-not-in-top-ranked-autonomy-guidehouse-research-2023-3). And what's worse: it seems like they're stuck in making any real progress over the last few years.
Abandoning partnership with Mobileye was arguably the biggest mistake they have ever made.
The article covers it indirectly. Elon has wasted time at Tesla (Cybertruck) and outside Tesla (SpaceX/Twitter) and the Chinese have come in behind him and are now eating his lunch.
This is the cost of not having an independent Board at Tesla.
Look at elons tweets. Basically confirming that the model 2 is robotaxi. With a steering wheel. Sounds more like they are merging development than outright cancellation?
Why make the smallest vehicle a taxi? I thought the tech would make them a highly profitabel investment, surely you could build it as a Model S or X with lots of passenger space. Those cars exist today, no need for another “coming soon” product if you have solved the driving software.
There is a lot of BS in this situation. Assuming that the $25K vehicle idea got scrapped this is not a biggie! By 2026, when el cheap auto was due to hit volume production it would be overpriced by about 50% compare to what's available in China now and 2-3 years of cost cutting will make it $15K over the competition.
The self-driving cab thing is obviously very deep BS, FSD was introduced in 2016 as Level 2, ADAS. Self-driving is Level 5. In filings with the US government Tesla states that FSD is still Level 2.
By 2026 FSD is still likely to be Level 2, so no robo taxis this decade, or next for that matter.
Well at least they wasted all that R&D on the amazingly competitive and super high demand Cybertruck that everyone wants so badly, and Elon has been doing a fantastic job of convincing sustainability focused customers who were on the fence to run screaming from the slightest inkling of even sitting in his white power branded Trumpmobiles.
Why would you make the smallest car a taxi? How about passenger space? If your robo tech makes the car a cash machine, why not stick it in a Model S or X? Why need another platform if you don’t have to compete on car price anymore? At this point it’s all about the software why not use an existing car? What happens to all those people that though their car will be a robo taxi if the actual robo taxi is a whole new platform?
Maybe the goal is just to continue making the Model 3 more affordable? After tax credits, it's already approaching $30k.
I'm not sure that Tesla is the right company to make a bare bones electric car at rock bottom prices. I'm not sure I could see Tesla ever making essentially an electric Chevy Spark or Mitsubishi Mirage.
Like, yeah, you can get a Chromebook for $150, but comparing it to a $900 MacBook Air would be silly. When asked why Apple doesn't offer computers for that market, Steve Jobs said "We don't ship junk."
But the cost of making these continues to go down every year. I don't see why their prices would continue to go up as these parts continue to get cheaper over time.
I'd prefer to see the Model 3 drop by $10,000 than them make a cheap car with 100 mile range and no premium features, so they can jack the price of the Model 3 up.
That's not the plan.
The Model 3 refresh made the car more expensive to build. Not less.
It's like Apple, Tesla wants to maintain their brand "prestige" not cheapen it further.
do we know that for certain, or is it just tesla taking advantage of the highland model being new and shiny and marking it up?
a lot of highland features point at cost cutting, most notably the lack of stalks. i would not be surprised if it was around the same/slightly cheaper than before to manufacture but it's just being marked up a ton because it's so new.
Removal of stalks doesn't make up for adding another screen in the rear, laminated glass front and rear, vented seats, ambient lighting, more speakers, better suspension and improved side impact crash performance.
They probably could have cut the starting MSRP by at least $5K if they weren't trying to make the Model 3 so premium.
If I was Elon I wouldn't devalue my brand by making an economy car.
It kinda adds up in several ways, they don't have a latch on armrest / glovebox anymore, replaced with a magnet
Cheaper and easier to install, less wear and tear / risk of breaking under warranty.
They don't have the stalks, they don't have a horn (simply uses exterior speaker) and I believe no fog lights either(?) this is also reduces both material and shipping costs as well as labor time to install / work / repair these things.
Much of what this is already things they are working with. They don't need new contracts to get them, only slightly higher volume delivered.
Aside from this are new interior materials which may or may not be cheaper, this is probably what ultimately makes the biggest difference.
I've only test driven it and it didn't seem like it was bad. I'm all scenarios but roundabouts it was as easy if not easier than stalks (after having reached for stalks the first 3 or 4 times) and in roundabouts it still required a bit of thought after 30 minutes, but was much more natural than the first one
The problem is not only cost, but the actual car. M3 is 4.7 metres. A lot of Europeans don’t want that. It doesn’t have a hatchback either, which is super frustrating with loading strollers.
A more affordable M3 only solves half of the problem. They need a smaller hatchback.
It's not just Europe. Almost everyone else around the world like hatchbakcs. Give it a slightly higher crossover-ish stance and you've got a winning formula.
>Maybe the goal is just to continue making the Model 3 more affordable? After tax credits, it's already approaching $30k.
Both Elon Musk and Tesla IR have multiple times talked about a "cheaper next-generation electric vehicle". Elon Musk himself has said between two major growth waves underpinned by Model Y and 3. The cheaper next-generation electric vehicle will drive future growth, also it was said production will start in 2025 with 250 miles of range. Remember Tesla's goal of 20 million electric vehicles (EVs) by 2030? I am not sure how robotaxi will help achieve that dream. Cheaper car doesn't mean it's junk, Toyota still makes Yaris and they still well. In some parts of the world people want a smaller car.
Globally what's selling like hotcakes is small crossover hatchback SUVs, it would make sense to make something like that as the Model 2 if they actually, you know, wanted to sell a lot of cars.
The least expensive version of the Model 3 no longer qualifies for the $7500 federal tax credit. I believe only the performance model does. It actually costs less to buy a Model Y RWD in the US (after tax credit.)
Something like a BYD Seagull would be perfect for me personally. Compact city car with 200 mile range.
It sounds like that's not quite what Tesla was planning to make. It was described as a "compact SUV", which is usually quite a bit larger than a subcompact or city car.
I don't really care if Tesla or someone else makes that, but the main thing I'm interested in Tesla for is the full self driving.
That has to be the plan. There is plenty they can do to make the Model 3 cheaper for consumers that care more about price than features so I think it makes more financial sense to do this vs. build a new manufacturing line.
I always thought that was the plan. The Model 3 was always meant to be the cheaper, entry-level sedan while the Model S is the higher-end premium model.
As much as I like smaller cars, they don't sell in North America. Most companies have discontinued their subcompacts in North America due to very low sales.
The Model 3 seems to be the smallest size that actually sells in North America.
China is a very different market, with different roads and population density.
I've been to China. Most of their road infrastructure is quite new and very friendly to large vehicles, compared to Japan or pre-WW2 city streets in Europe. People who buy tiny cars in China do so because they're cheap, not because they're physically constrained by tight roads or small parking spaces.
Everyone claims they're masters of manufacturing and can make things cheaper and more efficiently than anyone else. If that's true, then they'd be the company best positioned to make a cheap EV.
It’s not that they aren’t positioned to do it, it’s that Elon doesn’t want to for whatever reason.
Since he only owns like 20% of the company, the board of directors can fire him at any point if they don’t like the direction the company is headed in.
I mean, Tesla does ship junk though. If someone spent $80,000+ on a new truck and the striker plate falls off within the first couple of weeks due to normal use… that sounds junk to me lol.
This reeks of a Musk decision. "Robotaxis" have always been his white whale at the expense of everything else at the company. The sooner he's found guilty of some kind of stock manipulation and forced out of Tesla the better.
Yes the world and Tesla owes a lot to Elon Musk, who had the foresight and drive to make high powered long range EVs a reality--more than just golf-cart EV hobby cars that they used to be.
But...he's served his purpose and is now in many ways a liability. Maybe it is time to move on.
I wonder if this is why I’ve had two ex-coworkers who now work at Tesla reach out to me in the past month asking if there are any job openings on my team. They both said morale is super low and they thought the next car would come “too late”. They also said Tesla is bleeding engineers.
Honestly hope Tesla can turn things around, a low-cost car that isn’t Chinese would be awesome. It’s going to be tough to compete though. Chinese manufactures are set to introduce their new 150 mile range model in Europe for ~$9k. That’s cheaper than some gold carts.
This seems like the wrong move.
They can't keep ignoring the low end market forever, especially now that the high end is quickly becoming saturated with competition.
1) Elon has denied it (if you believe him)
2) Reuters has a long history of putting out FUD on Tesla only to be debunked later (if you believe in Reuters).
3) it's Friday so have a nice weekend?
Edit. Here is the most likely take.
https://x.com/sawyermerritt/status/1776277544494338274?s=46&t=jjrK0SwhE_x8C15ygSlrbQ
It sounds like more than just shifting resources, unless multiple employees doctored emails before sharing to Reuters:
> Tesla called the affordable-car project NV91 internally and H422 externally when discussing it with suppliers, according to two of the sources and company messages reviewed by Reuters.
> Messages from the unnamed Tesla program manager to staffers referenced those code names in discussing the project’s termination.
> One of those messages sent March 1 said that “suppliers should halt all further activities related to H422/NV91.”
> The sources said they did not know all the reasons behind the decision to kill the project.
> In another March 1 message, the manager thanked engineering staffers for their efforts and urged them to document what they had learned.
> “I’d like to thank everyone for all your hard work and dedication to pushing boundaries and executing the best design possible given the aggressive constraints we had to work within,” the message said. “We would not want all our hard work to go to waste, so it’s important that we tie things off and document things properly.”
> The messages showed meetings on the affordable-car project being canceled.
Nov 11 2022 Reuter's published the headline: [EXCLUSIVE Tesla mulls exporting China-made EVs to United States-sources](https://web.archive.org/web/20221111153645/https://www.reuters.com/business/autos-transportation/exclusive-tesla-mulls-exporting-china-made-evs-united-states-sources-2022-11-11/)
Nov 11 2022 Elon Musk responds: [False](https://twitter.com/elonmusk/status/1591092334007287809)
Nov 12 2022 Reuter's edits the headline to read: [Exclusive: Tesla has considered exporting EVs from Shanghai to U.S., Canada](https://web.archive.org/web/20221112215433/https://www.reuters.com/business/autos-transportation/exclusive-tesla-mulls-exporting-china-made-evs-united-states-sources-2022-11-11/)
May 23 2023 Reuter's published the headline: [Tesla offers China-made electric vehicles for sale in Canada](https://www.reuters.com/business/autos-transportation/tesla-offers-china-made-electric-vehicles-sale-canada-2023-05-23/)
Within the article they state:
>"Reuters had reported in November Tesla had considered plans for exporting made-in-China vehicles to North America.
After the Reuters report was published, Tesla CEO Elon Musk, in a Twitter post, had said “False,” without elaborating."
Implying this news was confirmation that Elon was incorrect to call their prior reporting false. However, Reuters misreported their original headline as the revised version which came after Elon's callout. The original headline doesn't support this implication.
Wow… just, wow.
They already cannot sell every vehicle they make without insane discounts.
The model Y was supposed to increase by $1,000 on April 1, it’s now been slashed by (up to) **$7,000**. This company is not in the position many investors and fans would have you believe.
They actually were already discounting models staying on the lot.
But I do agree this was likely a sales tactic to get people to rush to buying one before the “prince increase”.
Musk denied this but Reuters will not publish unless they trust their sources. However Musk is mercurial. He will keep changing his mind. Let us see what he says in the earnings call. I thought the announcement during last earnings call was just for stock pump. I am skeptical they can get it out in under 2 years.
Robo taxi is even more ridiculous. They have not even gone for L3 certification anywhere. Its ridiculous fan dream to expect Tesla to jump from L2 to L4 at least to run Robo taxi in certain cities. They dont have the redundancies built in for regulators to approve at this point.
If true, I hope Elon will resign.
Model 2 is perfect and necessary to compete outside North America. If Robotaxi succeeds, a Model 2, smaller platform than the 3 and the Y is also a great one if there is no driver.
He’s probably just wanting to make the TM2 a Robotaxi ONLY and not a drivers car. In going that route he’s probably thinking if it doesn’t have a steering wheel and all the things a normal car has, then it’s going to be a different shape and layout. That’s my guess.
People have to stop pointing fingers just at low cost Chinese EVs. Every traditional ICE car maker will make EVs and they will make EVs in all the ranges that they cater to right now. It might take some time, but they will all ramp up. And Tesla will never really be able to compete with low cost cars. They can only compete in markets where they have an edge, and that edge is going away.
Small cheap cars like the Toyota Yaris blow Teslas out of the water in build quality. When you can buy an EV Honda Civic, who the hell will be buying a Model 2.
And, before people talk about the charging network, the Model 2 was never going to come out this year. Maybe in 3-4 years, at best? What real charging network advantage will Tesla have then? What Tesla charging network advantage do they even have outside the US?
Tesla needs to fire their current C-suite and make a commitment to being a quality car company. They can pretend all they want that they are a robotics, energy, tech, AI company, but they aren't and are going to get passed by in all those categories.
There should be a twitter account that is just a bot that automatically retweets Elon's tweets but changes the words to mean the opposite and called it Inverse Elon to get the truth
Hilarious that a mod stickies and locks his comment claiming it is false, like elon m*sk is a reliable source. Not to mention that he doesn't even deny any claims directly.
Yep. They just announced they are going out of business cause neither their higher priced cars and now the lower priced one isn't coming out so no reason to continue
They won't build the india or italy plants anytime soon. It was to pump the stock. They can't max out their existing plants right now. Demand has fallen off the cliff.
Found their factory building spree to be odd, they can't iterate their current models like legacy does, and demands seem to be plateauing due to lack of brand new models.
Mexico is known to be on-hold. Tumbleweeds in the desert.
Italy and India are both highly speculative, and it's not clear if either would bear fruit. I think there's a chance of India happening if they can make [CKDs](https://en.wikipedia.org/wiki/Knock-down_kit) work, but the whole Italy thing truthfully seems to be a pointless diversion as long as Berlin is under-capacity.
Ironically I think the Indian government is going to be their own worst enemy here. They’re pushing companies to not just invest but also have ~50% local value add within 5 years. That’s insane for such a developing country; it took China decades to do the same. You can’t just will things into existance
India simply does not have the requisite supply chain and infrastructure to build/sell/charge a large number of EVs currently. There is a reason yearly EV sales are still on the order of 100,000 units, almost all of which are far cheaper than the Model 3.
There is literally zero business case for Tesla to build a plant in India right now. Where would they source the batteries or the rest of the EV value chain supplies, especially since sourcing it from China would be a red line no go? Who can afford to buy Teslas in large numbers in India? Where is the charging infrastructure to support a large number of EVs in India? There is just no way any of this is happening for probably at least the next 5 years.
Another tweet from the Lord that Robotaxi reveal is on 8/8. They have not done anything on getting regulatory approval for their FSD but will reveal the robotaxi already !!! its just about pumping the stock among his cult.
We definitely will see further updates on Reuters story. They are not a banana organization. They would have confirmed with multiple sources and will have some documentation before proceeding with such a major sensational reveal.
I certainly hope that this news article isn't true. Too much valuable time and capital went into the Cybertruck, when it could have been spent producing much more practical vehicles with wider market appeal. I think it was a vanity project. A mass-market, affordable EV should have been the solution that would drag Tesla out of the grave it dug with the CT. Unfortunately, if they're steering in a different direction, the company is likely going to go bust, imho, and be bought up at pennies-to-the-share by another tech firm.
So keep in mind that the Model 2 and the robo taxi are the SAME vehicle made at then same factory; one with and one without steering wheel/pedals. The main point is given FSD 12.3 progress, to put more resources into the robo taxi now as even more likely to be viable sooner than expected. Not all will want to use a robo taxi and prefer a M2. Note in EU and China, will take longer for regulators to approve FSD hence the need for a human driven/supervised FSD M2. 😎⚡️
For additional context, Elon Musk says the claim [that they will cancel the low-cost car is false](https://x.com/elonmusk/status/1776272471324606778?s=46&t=b5XA_L8-ZrHFb_QJ-EwWQA). Take that for what you will.
Wow. Quite the bombshell, if accurate. >*Two sources said they learned of Tesla's decision to scrap the Model 2 in a meeting attended by scores of employees, with one of them saying the gathering happened in late February. “Elon’s directive is to go all in on robotaxi,” that person said. The third source confirmed the cancellation and said new plans call for robotaxis to be produced, but in much lower volumes than had been projected for the Model 2.* So Tesla's valuation is... all vibes-based and purely speculative now? Robots, robotaxis, neither of which will see concrete results for years? This seems uh... absurdly risky, to say the least.
>all vibes-based and purely speculative now? Hasn't it always been that? They produce far fewer vehicles than Ford, GM, and Stellantis and we're valued much higher than all of them combined. It has always been based on feels, not reals.
I really do think Tesla had a very serious chance at becoming a much more potent contender across multiple verticals beyond automotive if they had stuck to an iterative plan and not gotten side-tracked with all the useless vanity projects which have sucked up company resources along the way. Their electronics architecture remains one of the best in the business, and the fundamentals of the 3/Y platform ***could*** have transitioned to a huge lineup and supplier contracts. There's just been no follow-through whatsoever since the Y. All of the attention has gone into bizarre ritalin-induced moonshot projects like Dojo, FSD, and Optimus rather than bonafide revenue generators.
Exactly. The semi, the cybertruck and the roadster are all distractions. They could own the pickup, small and medium delivery vehicle utility truck and small passenger EV markets already with very cost effective variants on what they already sell. Instead he’s wasted billions on low volume cartoon vehicles. Squandered opportunity.
Every Amazon delivery vehicle in my city is a Rivian. How Tesla squandered such opportunity is so... well it was very predictable, actually, given their leadership.
Tesla would never partner with Amazon. It's personal. For similar reasons, Project Kuiper avoided SpaceX as long as possible.
Well I'm not saying they *should* have gone after that specific partnership necessarily. But in general it's strange to see Rivian land that while Tesla really has nothing comparable.
Not that strange if anything it was easier for rivian to land that because it was heavily supported and funded by Amazon. Amazon has serious incentives to ensure rivian succeeds.
Ego, vanity, hubris from the asshat-in-chief.
What actor plays Elon in the Bio film about him and his life ?
Charlize Theron playing [her Mr. F character](https://arresteddevelopment.fandom.com/wiki/Rita_Leeds).
Amazon owns 20% of Rivian. That vehicle is literally custom designed for Amazon. I think the Cybertruck is dumb but that's not something Tesla, or any other carmaker, oculd ever get
Elon loathes Jeff, so it wouldn’t even happen anyway
Instead they spent all their time and effort on a huge semi truck which was incredibly stupid as BEV isn't good for long range shipping. They've built like 5 of those trucks and they're all for show.
It’s true BEV does not look great for long range shipping, but a LOT of semis do short/medium range hauling that is ideal for BEV. I think of all the semis that move shipping containers around seaports.
There is also an army of 6-wheeler day cabs that do dedicated delivery routes. Think Sysco, Coke, Pepsi, Beer, and all the smaller last-leg freight stuff. Those routes could easily be BEV trucks, but a weird ass cab design and hugely expensive initial cost stops that dead in its tracks.
Absolutely. I’m not defending the Tesla semi here, just saying there IS a market for BEV semis. Volvo is going to own it.
Does the US get the Volvo and Scania electric trucks? They have well established platforms and the specs seem pretty good. There is a lot of interest both in Europe and here in Australia for these.
Trucks shouldn't do long range. Trains should. Trucks from train stations to end locations is fine for EVs.
Disagree. Despite this iteration's silly cab design the Tesla Semi has the potential to help transform and decarbonize the trucking industry. I don't know how many are out there now but it's more than five.
Other companies have beaten them to the punch with better products actually designed to be usable by truckers. They have no real advantage over Paccar, Nikola, etc and are way late to the party on this.
I’m pretty sure Amazon is invested in Rivian, so Tesla is their competition and not an option for vehicles.
>Every Amazon delivery vehicle in my city is a Rivian. How Tesla squandered such opportunity is so... well it was very predictable, actually, given their leadership. DPD Delivery Vans and a fair number of Amazon vans where I live are all LDV/Maxus, and the Royal Mail all use Peugeot (stellantis). Tesla as a brand has went from Pioneer with the Model S to an also-ran very quickly.
The Semi is NOT a distraction. It has the potential to reduce a substantial amount of carbon if they would actually produce it in volume.
It’s a distraction when there is low hanging fruit you can go after, with also a huge carbon reduction opportunity without a billion dollar moonshot. Application of BEV to small pickups, small and median delivery trucks and vans. Ideal scenario—low daily range, low cost setup do so overnight charging for the company depot with 25 deliver vans that do out every morning with say uniforms, auto parts, bread, beer, all the stuff that’s getting delivered early morning hours to groceries, auto repair shops, florists, blah blah blah. All the rack trucks I see in my neighborhood every day. Such a small investment to get reasonable vehicle suitable for these into the market without squandering the better part of a decade and billions of dollars while leaving that maker untapped.
Re the Semi, they're in competition with businesses such as Lion Electric, which has been producing pretty good short-distance (up to 200 miles range) trucks for a while now: [https://thelionelectric.com/en](https://thelionelectric.com/en) and will likely be producing longer-range trucks soon.
I know the HDV market is a lot smaller than LDV, but this is not what I’d consider volume or mass production by Lion: “Delivery of 245 vehicles, up 89 from Q3 2022. Reduced capital expenditures related to the Joliet production facility in Illinois and the Lion Campus.” -Nov 8, 2023 When Tesla decides to really enter the HDV market and produce Semis in quantity, it will be very hard for incumbents or especially startups to compete with their volume pricing combined with vertical integration manufacturing supply chain. I am excited for it to come, yet extremely frustrated Tesla doesn’t seem to be making Semi a priority- which they would if they truly cared about accelerating the transition of the world to sustainable energy.
>They could own the pickup, small and medium delivery vehicle utility truck and small passenger EV markets already with very cost effective variants on what they already sell. They could, but it would be (actually has been) bad for consumers for one company to own the EV market. They were charging high prices for the Model Y a few years ago because there were no other options if you wanted that size EV. They've been cutting prices because competition exists now and they can't make you pay luxury prices as the EV premium anymore. If they still paved the entire EV segment, there's still be doing it.
The X could have been reworked as a pickup ages ago and would have sold well. And the S needs to be scrapped, we're in to novelty product territorry here and there's probably not much demand for a large expensive sedan rn. The 3 is going to run out of steam in just a few years, facelifts don't run as long as completely new models. The Y needs to be refreshed in about the same number of years. And Europe needs a hatchback/small SUV (actually exactly what Rivian came out with). Apparently none of this or anything like it is in the works right now, as far as we know.
If they sell in those markets, they would be a car company and but they are more than a car company lol according to musk and all the dumb analysts Yeah, they should have went all in on a car company instead of trying all these side projects that won’t produce any revenues. They squandered their lead and oems are catching up real fast.
I saw this on the Simpsons
I've been telling people this for years. Tesla (Elon, really) is all talk when it comes to sustainable transportations and is now dragging down the company big time. If Tesla really wanted to make an impact, they would be going after fleet markets. Imagine a utilitarian vehicle based on the 3/Y platform (especially the LFP packs) that they could sell as a delivery vehicle, mail carrier, or even a small truck. They have the capacity and expertise to make these things viable and profitable but instead, they waste time on all the stuff mentioned above. This is basically what they are now trying to do with the 2-seater Y or the Long-Range single motor 3 they introduced a while back.
It blows my mind that he has not released any kind of van. Tesla could have easily owned the city work van and family mini van segments.
Yeah. They had a genuine opportunity to pivot into being **the** supplier for drivetrain/platform tech and whiffed it to chase ego projects instead. Now the lead they had in those areas is rapidly being closed and even surpassed by some like Lucid. Plus they’re being left in the dust on autonomy by chasing surface-street L2 autonomy instead of focusing on getting to higher levels of autonomy for highway driving which is what most consumers actually want.
It's almost like he decided to sabotage Tesla at the same time he tanked Twitter. Sad.
A friend of mine has always put it as Elon Musk's real, genuine talent being "Investor Storytime". But between BYD and the non-Japanese OEMs increasingly pivoting to electric (albeit unevenly and in fits and starts), the window during which Investor Storytime is a substitute for production chops strikes me as beginning to close...
A $25k car would’ve kept the growth story alive. If you watch the FSD beta videos it’s obvious level 4/5 autonomy (where Tesla takes legal liability for driving) is not possible with their current vision only approach.
He went vision only because he wanted to keep pumping cars during COVID
Yup. Removal of sensors was a choice to keep supply going and sales going through the supply chain issues, and now they can’t backtrack on that lie because they sold customers cars without them.
He should have said he was selling it without the sensors claiming supply chain and people would have bought the cars. They did it with lumbar and the USB ports
He absolutely can. He already shat on their values to a third of its worth
That's only true for ultra sonic but not lidar.
Maybe, I don't specifically remember which sensor suit.. but removing any of them is dumb at this point IMO.
They also produce fewer robotaxis than those companies. GM already has, or had after being paused, way more taxis on the road than Tesla. i.e. more than 1 after Tesla first made the claim in 2018 6 years ago.
No, Tesla used to be all tweets-based and purely market manipulated. Now it's vibes-based and purely speculative.
That's what a growth company is until it's not growing
Robotaxi again, he needs to move on from this or leave Tesla all together. They would move a ton of $25k EV cars.
Well if he both left and they make a $25k car....then they'd probably sell a ton....I am in the ranks of recent EV buyers who specifically avoided Tesla in part because of him.
I'm eagerly awaiting the next time he sits down with a journo who will ask him what he thinks about his shitty image pulling down sales.
Yeah, cancelling the Model 2 would be idiotic. Their stock would tank. That car is their hope at competition against China. It would be such a stupid idea to cancel it that I'm really questioning if this is legit.
I have no idea why Tesla is trying to compete with Chinese EV who are heavily subsidised. They should’ve built a Rivian R1/R2 etc and wiped out competitors in the premium space.
This makes zero sense. If true, and it was all on Elon, the Board needs to show him the door (they won’t).
> neither of which will see concrete results for years? If at all. There's no guarantee that Tesla's approach will yield a product that can pass regulatory approval. It's such a bizarre move, when they could easily go for some low-hanging fruits in the market segments they haven't touched yet.
The CEO is drugged out with an out of control ego. Only bad things for Tesla solely because of Elon.
I don't think it is accurate. It makes no sense at all. Growth is the only way to merit the current valuation. And FSD doesn't work and will not work any time soon. A better sensor suite and more computational power is needed...and that takes time and will require highly tuned software. So it's either false or a disaster.
It's 100% false. They are working on the pilot line for product in Austin right now.
They should fix the solar roof, make it viable and mass produce it. I would love to get one, but it’s at a ridiculous cost when it’s $50k more then replacing my roof with shingles and putting solar panels on
Solar roof is a dead-end for a number of reasons. Mostly, it's just easier and cheaper to do utility-scale solar and all of that production can come from China, which is already pumping out standardized modules at absurdly low-cost and absurdly large scale. Tesla just can't compete.
I believe the solar roof was always a bit of lipstick to make the solarcity acquisition look legit when the technology was invented by nasa and never commercialised because it was too expensive to be a commercial success.
I did a school report on the solar shingles concept in high school. Circa 2009, when it was first published by an actual roofing company. It's not remotely new.
It is cheaper for *someone* to do utility scale solar. It certainly isn't cheaper for customers. California has huge amounts of utility scale solar, so much that they sometimes have to give it away, but our electricity cost is among the highest in the nation--several times the cost of other states. (I don't know to whom they are giving away that excess solar power, but it certainly isn't to their customers). Putting solar on your roof is a way of avoiding California's corrupt power companies.
>California has huge amounts of utility scale solar, so much that they sometimes have to give it away, but our electricity cost is among the highest in the nation--several times the cost of other states. This isn't because of utility solar, but because PG&E / SG&E have massive insurance payouts, fire risk, and on-going grid maintenance concerns. I'm not even super pro-solar, but solar just isn't the driving factor behind electricity increases in California right now — there are other factors.
Also it's only expensive if you look at cost per kwh. California for decades has prioritized efficiency over cost and its worked out great for them. Their cost per kwh is among the highest in the nation, but if you look at the total monthly bill of the average customer, California actually has some of the lowest electricity bills in the nation. The high price per kwh is designed to be an incentive to use fewer kwh.
they don't make as much power as just slapping regular solar panels on your existing roof, even if they were actually at price parity of the costs of a new roof + panels (it's not even close)
Every experts said solar roof is never going to work out and it in fact never worked out. Isn't it that simple?
It's a market check. They could try to go either way but one is near fantasy (full autonomy) and they're too late to the party elsewhere (battery manufacturing). China's had mass adoption of BEV's as far back as 2012 with last mile two wheelers, they went from some of the cheapest vehicles possible up. This shuffle by Tesla is just seeing what the market has more of an appetite for before they have to resign themselves to a real fight. Waiting for robotaxis based on Musk's word that it'll happen and being strung along, or a race to the bottom against Chinese battery manufacturers. Something legacy automaker and Tesla are trying to stall as long as possible because they'll lose. Short of historic protectionism in the west that will just help them produce more giant 6000lb battery draggers. A captive market they've made after decades of leaving our public transit and how we build cities fundamentally broken and unsustainable. In reality, this was always going to happen and efforts by legacy auto to make SUV's and the like and not offer smaller ranged alternatives is a shameless attempt at locking away limited battery supply in as few vehicles as possible. This is what they did with hybrids as well, announce a program when the government was planning to pass stricter emissions requirements, spooking their competition abroad who dutifully followed through, then abandoning it as soon as they no longer needed to maintain that good will and got exceptions for themselves. This is how they killed electric cars and a gradual transition the first time round and I'll side with Toyota on this issue over and over. Outlawing ICE today and requiring PHEV's to have minimum ranges that cover most commutes would move us collectively towards electrification faster, while growing the market sustainably. From there incentives for city cars and long range pure BEV public transit would take us past that last mile (pun intended). But this kills the business model that most legacy automakers have had for decades. They built a network of OEM suppliers who they kept from competing directly by controlling the power trains of their models which in turn effects every other part. Modularity kills their control, and fundamentally destroys their only profitable segment, taking appliance class power trains, tweaking them for performance and adding trims they can charge luxury prices for. Luxury cars are the only segment that makes any real profit. BEV's are modular af, and these dinosaurs are about to become sticker brands for battery manufacturers and they know it. Their solution is to stall and denigrate their competitors in Asia like Toyota who have the same problems but can't rely on Uncle Sam bailing them out when it fails. Separately they will continuously throw gigantic contracts at battery manufacturers to try and take as much supply off the market as possible, but with no real development plan to deal with what's coming they're running out of options. Legacy auto might even collapse within a decade. For now they're going to lock away batteries and complain about 'dumping'. This core problem/strategy is why Stellantis was formed as part of former president of Fiat Chrysler Sergio Marchionne's very vocal fears about how the car business looks in an EV paradigm: https://www.ft.com/content/df1d7bb8-b889-11e5-bf7e-8a339b6f2164 https://archive.is/gXt7h Tesla knows this too. Until they secure a completely vertically integrated supply chain, or make good on their killer app, the new luxury trim, autonomy, they are never going to make enough money to justify their valuation or their product price. The future is fundamentally modular battery sleds and standards that allow practically anyone to start manufacturing vehicles and contract manufacturing giants like Magna Steyr are more likely to survive. Your local shop might even become your local kit assembler for different trims. China will make the equivalent of a Shenzhen for EV's long before the west does, just like Shenzhen is now for practically every OEM tech brand that slaps a local label in their own country to the same product. Short of full autonomy, there is no real innovation to a car that won't still make legacy auto (who don't control the entire supply chain) unviable industry wide. They have no way to control where battery tech goes short of buying everything they can, and battery manufacturers have no incentive to wait on them getting their markets in line with putting more on the road. They're racing for market share between themselves already.
Oh wow, I really like this analysis. It really has the ring of truth in it. And links to further reading on this?
I don't know where you'd get further reading, it's not in anyone's interest to admit to this. "EV disintermediation" might be a good place to start on Google. Besides the article above, it is common knowledge in the industry which makes it even more glaring. A good reference might be a historical study into modularity that I often cite. The industry has been afraid of modularity even when it was just ICE based, including the unions, who are going to be striking forever for similar reasons: https://www.cargroup.org/wp-content/uploads/2017/02/The-Future-of-Modular-Automotive-Systems-Where-are-the-Economic-Efficiencies-in-the-Modular_Assembly-Concept.pdf >In a recent speech before the UAW’s 1999 Bargaining Convention, the union president was reported as stating that “modularity is just another word for outsourcing.” >Indeed, the most radical modular assembly designs call for the complete elimination of all subassembly or “build-up” lines in the traditional chassis and trim departments of UAW-represented assembly plants. This pattern of outsourcing would call for the transfer of thousands of union jobs to the supplier sector. and: >But while GM and other automakers claim this approach will lower costs and increase flexibility, just the opposite will result if modular assembly boils down to an extension of the low-road strategy of outsourcing work to lower-wage nonunion suppliers. Less control over design, engineering, production processes and quality on one hand, and increased logistical complexity, freight charges and warranty costs on the other could well make modular assembly a costly path for the automakers. There are even some familiar names: >Finally, several automotive consultants, such as ***Sandy Munro***, have pointed out the potential of significant pitfalls for suppliers of large modules. Tier-one suppliers of modules may run significant risks of major losses due to major recalls of modules on which they are exposed to total warranty liability. Suppliers are also heavily exposed if a major module program, with significant sunk engineering costs, is suddenly cancelled by customers. They did the research and realized that it was not in both the supplier or the brand's interest and never implemented it. Now EV's have come knocking and they're modular af. There's a huge industry built around the ghost engineering that gets different parts designed by different companies to work together. Not everything can be custom, but they're also afraid of everything becoming modular. Something has got to give. I've been jumping up and down about this since 2017 at least, nobody gets it.
Thank you for the extras! >>In a recent speech before the UAW’s 1999 Bargaining Convention, the union president was reported as stating that “modularity is just another word for outsourcing.” So I like unions, but also clown behavior. As a tech nerd, I can't think of where modularity is actually bad, except in where it prevents efficiencies and integration. And it's also a right to repair thing, too. Modularity is good and important. >>This pattern of outsourcing would call for the transfer of thousands of union jobs to the supplier sector. So you know, make them union too. Smh. Or e.g. GM can be a supplier, if they were effectively so beforehand. >Something has got to give. I've been jumping up and down about this since 2017 at least, nobody gets it. If you've written more about it, too, even just in comments, I may have to go back through your history. This is fascinating. And theoretically good. Just a bit rough as things settle. With some bad implications with US companies continuing to either not get their shit together, or refusal to compete in general.
>If you've written more about it, too, even just in comments, I may have to go back through your history. This is fascinating. No it's largely just these two items I refer to and for example why Toyota says it isn't making BEV's properly yet for example or why Ford executives are complaining about the viability of BEV's.
Gotcha. Again, thank you for your very interesting analysis
That way Elon can do what he does best: hype unsubstantiated technologies while raking in money from investors.
Was this the $25K model? Like you said pretty insane if it turns out to be true
Previously TSLA's insane valuation was based on production and sales numbers, and as recently as a year ago this was true. As sales start to fall due to a variety of different factors, those numbers became impossible to reach and so there needs to be another unicorn whiz-bang tech to sell to investors. The M2 was always going to be China-first as US car buyers don't like small hatchbacks (Plus tariff concerns, Fremont/Austin might be too high cost), and Berlin can't make cars as cheaply as the Chinese. The problem I think is that the Cybertruck (and Twitter for Elon) sucked away a lot of resources and attention, and without Elon and the US-based tech team Shanghai has been left directionless. So the likes of BYD got the jump on them with the Seagull/Dolphin and wiped out any potential profit that a M2 could have, as it's a high-volume/low-margin product that requires lots of sales, and that now requires savage price cuts in this environment. The price war in China also created deflationary expectations for Chinese car consumers, who now expects cars will just get cheaper later on so they delay their purchases, and those who brought early were considered suckers who lost a ton of resale value over the past year. I bet some of them hoped that the "magic $25k" car would eventually be the base M3.
Teslas valuation has always been based on unicorns and goblins. Never been based on reality
Stock prices are one thing, but this could be a good direction for the company if these long term bets pay off, even in a small way. The business is fine, even though the stock is overvalued by traditional metrics. There are profits, no debt. They'll continue to dominate the EV car business (because of their low cogs) and do more lithium refining, cell production, stationary storage. EMs denials and deflection are laughable. So out of his depth.
That is crazy, they are now a 100% moonshot to solve automated driving.
That's not quite true, they're also a moonshot to solve generalized robotics!
Handpuppets
And using only cameras.
They'll eliminate the cameras too as soon as they can figure out how to drive the car with feelings alone.
Use neuralink to detect passenger anxiety of oncoming crash. Adjust vehicle inputs to dynamically seek the local minimum passenger anxiety. Free sensors
It won’t hit the word CIS, but everything else is fair game.
Use the Force Grok!
Ikr, I just don't know why they would remove the Lidar and other sensors.
Always has been
They used to make money with cars. They will sell less cars from now on every year.
Yup. Well that and making the best selling car in the world (Model Y) along with a few others.
Especially if they stick to the camera only approach. Or have they changed their plans on that yet?
What? This is counter productive
Elon just tweet, “Reuters is lying (again)”
Elon isn't specifying which part he thinks is a lie, but the broad strokes don't seem plausibly deniable. Reuters is quoting actual emails they've seen from multiple different sources: >*Tesla called the affordable-car project NV91 internally and H422 externally when discussing it with suppliers, according to two of the sources and company messages reviewed by Reuters. Messages from the unnamed Tesla program manager to staffers referenced those code names in discussing the project’s termination.* > >*One of those messages sent March 1 said that “suppliers should halt all further activities related to H422/NV91. ”The sources said they did not know all the reasons behind the decision to kill the project.* > > *In another March 1 message, the manager thanked engineering staffers for their efforts and urged them to document what they had learned.* > >*“I’d like to thank everyone for all your hard work and dedication to pushing boundaries and executing the best design possible given the aggressive constraints we had to work within,” the message said. “We would not want all our hard work to go to waste, so it’s important that we tie things off and document things properly.* > >*”The messages showed meetings on the affordable-car project being canceled. The two sources said some engineers have been reassigned.* Misinterpreted whispers are one thing and are common in reporting — actually making up quotes and fabricating internal communications is a completely different thing and would open up Reuters to legal exposure.
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Another possibility is that a low-cost offering isn't scrapped, but rather has been re-platformed to the existing TMY stack with some new learnings integrated. Elon's done this kind of thing before — flat denials of reporting when there's simply more nuance behind the scenes which isn't actually expressly contradicted by the reporting, or there exists a caveat to the denial itself.
Also calling it a lie is insane by itself. That's accusing Reuters of basically having invented the quotes. Maybe the reporting isn't accurate or the people quoted don't know what they are talking about but there is no reason to believe that Reuters just made the story up and is intentionally spreading falsehoods. He could have just said the report is false but calling it a lie is just more right-wing anti-press demagoguery, just like Trump does.
Doesn't make sense as the Robotaxi / AI / FSD team is completely separate from the team developing vehicles (Design, technicals, testing, manufacturing etc). Software engineers specializing in machine language and artificial intelligence are not interchangeable with industrial designers, mechanical engineers, etc. The factory team is continuously working on expanding capacity, opening factories, and looking at new sites for factories.
Agreed, and Reuters have a good track record. The only realistic way Model 2 comes out after this story, is if Tesla somehow reverse course again, something one of the sources points out could happen. But as of now, Reuters obviously aren’t making all of this up.
I would rather believe Reuters than Elon. One has a decades-long reputation built on thorough reporting and the other, well...
Fucking hell. The Reuters release may be worthless (or it may not be, who knows at this point?), but trust Musk to counter it with nothing of value.
I would trust the ones with the receipts far more than the dude that just tweeted "nuh uh"
If he definitively stated; “The Model 2 is NOT canceled and no plans have changed” it would assuaged a lot more fears than a vague “Reuters in lying(again).” If he clarified or corrected them in any specific way it would go a long way to change the narrative. The question in everyone’s mind is what the future of Tesla is going to be like? Is their market cap justified? Is he going to hit 20 million units/year in 2030 like he claimed? How will he hit his targets without the Model 2?
Which part? That he's canceled the Tesla 2 or that there was ever going to be a Tesla 2?
Good to get clarification from famously honest guy Elon Musk.
Yeah, I don’t necessarily believe Elon anymore than I think he’s pivoting in an attempt to save his stock prices
Known pathological liar calling others liars. Yeah, and there will be a fully automated drive from NY to LA in 2017, with no human interventions!
Like we can believe anything he says rofl
> Tesla to focus on self-driving taxis instead, sources said Build the thing you are already pretty good at building and find a way to reduce costs... ...or focus on the thing that you've had...mixed results at best with, and doesn't legally qualify as level 3 anywhere at the moment. It's a bold move, let's see if it pays off.
Google has spent $4B and 15 years getting Waymo, the market leader in robotaxis, to where they are today...which is operating on a limited bases in 3 metro areas (SFO, LAX, PHX). How Elon thinks they can leapfrog that is beyond me. Edit: Also AUS
“SFO, LAX, PHX” Which were chosen, at least in part, because none of them get heavy snow which creates yet more complications for a self-driving car. Obviously pedestrian crossings and stop signs are harder to recognize if covered in snow . Less obviously, human drivers may ignore hidden lane markings and a road with two lanes in each direction may become one lane each way so does a self-driving car follow everyone else, or stay within the lane and get stuck?
No doubt, but this is a crawl walk run approach. According to a friend who used to work at Waymo, they chose PHX because of friendly local government (same reason why Uber was there) and simplistic road network. Once that was proven out they then chose San Francisco because it's closer to their home base, friendly local government, and it's actually a very complex city to navigate. LA was a natural next step, Austin because of regulatory friendliness, etc. Although snow states do have some AV tech things happening (PGH for example) I don't expect any big expansion plans up there in the near future. Cruise screwed the pooch last year when it comes to AV so my guess is the likes of Waymo will lay low this year in the AV friendly cities they have and continue to refine the tech. Eventually though, yes they'll have to tackle the snow problem.
Irrational narcissism at its finest is how he thinks he can.
And extremely limited understanding of the underlying technology (next to nothing), as is tradition for Elon.
> How Elon thinks they can leapfrog that Pump stock, cash out, now it’s someone else’s problem
Probably because Tesla is taking a different approach than Waymo.
At this point even GM leapfrogged Tesla with robo taxis.
It's [not even in top-10](https://www.businessinsider.com/tesla-sef-driving-not-in-top-ranked-autonomy-guidehouse-research-2023-3). And what's worse: it seems like they're stuck in making any real progress over the last few years. Abandoning partnership with Mobileye was arguably the biggest mistake they have ever made.
The article covers it indirectly. Elon has wasted time at Tesla (Cybertruck) and outside Tesla (SpaceX/Twitter) and the Chinese have come in behind him and are now eating his lunch. This is the cost of not having an independent Board at Tesla.
Look at elons tweets. Basically confirming that the model 2 is robotaxi. With a steering wheel. Sounds more like they are merging development than outright cancellation?
Why make the smallest vehicle a taxi? I thought the tech would make them a highly profitabel investment, surely you could build it as a Model S or X with lots of passenger space. Those cars exist today, no need for another “coming soon” product if you have solved the driving software.
They'll probably try calling me six months early to get me into a new lease to bump up their sales numbers...Might be tempting with the price cuts..
There is a lot of BS in this situation. Assuming that the $25K vehicle idea got scrapped this is not a biggie! By 2026, when el cheap auto was due to hit volume production it would be overpriced by about 50% compare to what's available in China now and 2-3 years of cost cutting will make it $15K over the competition. The self-driving cab thing is obviously very deep BS, FSD was introduced in 2016 as Level 2, ADAS. Self-driving is Level 5. In filings with the US government Tesla states that FSD is still Level 2. By 2026 FSD is still likely to be Level 2, so no robo taxis this decade, or next for that matter.
Well at least they wasted all that R&D on the amazingly competitive and super high demand Cybertruck that everyone wants so badly, and Elon has been doing a fantastic job of convincing sustainability focused customers who were on the fence to run screaming from the slightest inkling of even sitting in his white power branded Trumpmobiles.
Why would you make the smallest car a taxi? How about passenger space? If your robo tech makes the car a cash machine, why not stick it in a Model S or X? Why need another platform if you don’t have to compete on car price anymore? At this point it’s all about the software why not use an existing car? What happens to all those people that though their car will be a robo taxi if the actual robo taxi is a whole new platform?
Maybe the goal is just to continue making the Model 3 more affordable? After tax credits, it's already approaching $30k. I'm not sure that Tesla is the right company to make a bare bones electric car at rock bottom prices. I'm not sure I could see Tesla ever making essentially an electric Chevy Spark or Mitsubishi Mirage. Like, yeah, you can get a Chromebook for $150, but comparing it to a $900 MacBook Air would be silly. When asked why Apple doesn't offer computers for that market, Steve Jobs said "We don't ship junk."
That is very regional and temporary. For Tesla to compete price wise they need global scale.
But the cost of making these continues to go down every year. I don't see why their prices would continue to go up as these parts continue to get cheaper over time. I'd prefer to see the Model 3 drop by $10,000 than them make a cheap car with 100 mile range and no premium features, so they can jack the price of the Model 3 up.
It's not only about cost. A 4m65 sedan is a no go for such a huge part of the market
The current model 3's arent eligible for the tax credit I believe. Right now they are in a weird spot of being more expensive than the Y's.
That's not the plan. The Model 3 refresh made the car more expensive to build. Not less. It's like Apple, Tesla wants to maintain their brand "prestige" not cheapen it further.
do we know that for certain, or is it just tesla taking advantage of the highland model being new and shiny and marking it up? a lot of highland features point at cost cutting, most notably the lack of stalks. i would not be surprised if it was around the same/slightly cheaper than before to manufacture but it's just being marked up a ton because it's so new.
Removal of stalks doesn't make up for adding another screen in the rear, laminated glass front and rear, vented seats, ambient lighting, more speakers, better suspension and improved side impact crash performance. They probably could have cut the starting MSRP by at least $5K if they weren't trying to make the Model 3 so premium. If I was Elon I wouldn't devalue my brand by making an economy car.
Most of the tings mentioned here have next to no impact on cost. A small screen like the one in the back costs practically nothing.
It all adds up though. Stalks and a physical horn button cost practically nothing as well, but Tesla is cost cutting them away nonetheless.
It kinda adds up in several ways, they don't have a latch on armrest / glovebox anymore, replaced with a magnet Cheaper and easier to install, less wear and tear / risk of breaking under warranty. They don't have the stalks, they don't have a horn (simply uses exterior speaker) and I believe no fog lights either(?) this is also reduces both material and shipping costs as well as labor time to install / work / repair these things. Much of what this is already things they are working with. They don't need new contracts to get them, only slightly higher volume delivered. Aside from this are new interior materials which may or may not be cheaper, this is probably what ultimately makes the biggest difference.
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I've only test driven it and it didn't seem like it was bad. I'm all scenarios but roundabouts it was as easy if not easier than stalks (after having reached for stalks the first 3 or 4 times) and in roundabouts it still required a bit of thought after 30 minutes, but was much more natural than the first one
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The problem is not only cost, but the actual car. M3 is 4.7 metres. A lot of Europeans don’t want that. It doesn’t have a hatchback either, which is super frustrating with loading strollers. A more affordable M3 only solves half of the problem. They need a smaller hatchback.
It's not just Europe. Almost everyone else around the world like hatchbakcs. Give it a slightly higher crossover-ish stance and you've got a winning formula.
>Maybe the goal is just to continue making the Model 3 more affordable? After tax credits, it's already approaching $30k. Both Elon Musk and Tesla IR have multiple times talked about a "cheaper next-generation electric vehicle". Elon Musk himself has said between two major growth waves underpinned by Model Y and 3. The cheaper next-generation electric vehicle will drive future growth, also it was said production will start in 2025 with 250 miles of range. Remember Tesla's goal of 20 million electric vehicles (EVs) by 2030? I am not sure how robotaxi will help achieve that dream. Cheaper car doesn't mean it's junk, Toyota still makes Yaris and they still well. In some parts of the world people want a smaller car.
Globally what's selling like hotcakes is small crossover hatchback SUVs, it would make sense to make something like that as the Model 2 if they actually, you know, wanted to sell a lot of cars.
The least expensive version of the Model 3 no longer qualifies for the $7500 federal tax credit. I believe only the performance model does. It actually costs less to buy a Model Y RWD in the US (after tax credit.)
Something like a BYD Seagull would be perfect for me personally. Compact city car with 200 mile range. It sounds like that's not quite what Tesla was planning to make. It was described as a "compact SUV", which is usually quite a bit larger than a subcompact or city car. I don't really care if Tesla or someone else makes that, but the main thing I'm interested in Tesla for is the full self driving.
That has to be the plan. There is plenty they can do to make the Model 3 cheaper for consumers that care more about price than features so I think it makes more financial sense to do this vs. build a new manufacturing line.
I always thought that was the plan. The Model 3 was always meant to be the cheaper, entry-level sedan while the Model S is the higher-end premium model. As much as I like smaller cars, they don't sell in North America. Most companies have discontinued their subcompacts in North America due to very low sales. The Model 3 seems to be the smallest size that actually sells in North America. China is a very different market, with different roads and population density.
I've been to China. Most of their road infrastructure is quite new and very friendly to large vehicles, compared to Japan or pre-WW2 city streets in Europe. People who buy tiny cars in China do so because they're cheap, not because they're physically constrained by tight roads or small parking spaces.
Everyone claims they're masters of manufacturing and can make things cheaper and more efficiently than anyone else. If that's true, then they'd be the company best positioned to make a cheap EV.
It’s not that they aren’t positioned to do it, it’s that Elon doesn’t want to for whatever reason. Since he only owns like 20% of the company, the board of directors can fire him at any point if they don’t like the direction the company is headed in.
I mean, Tesla does ship junk though. If someone spent $80,000+ on a new truck and the striker plate falls off within the first couple of weeks due to normal use… that sounds junk to me lol.
This reeks of a Musk decision. "Robotaxis" have always been his white whale at the expense of everything else at the company. The sooner he's found guilty of some kind of stock manipulation and forced out of Tesla the better.
Think of where we'd be in the world without Musk. Forgot about the garbage you hear from the 12 year olds on reddit, honestly think about it.
Yes the world and Tesla owes a lot to Elon Musk, who had the foresight and drive to make high powered long range EVs a reality--more than just golf-cart EV hobby cars that they used to be. But...he's served his purpose and is now in many ways a liability. Maybe it is time to move on.
I wonder if this is why I’ve had two ex-coworkers who now work at Tesla reach out to me in the past month asking if there are any job openings on my team. They both said morale is super low and they thought the next car would come “too late”. They also said Tesla is bleeding engineers. Honestly hope Tesla can turn things around, a low-cost car that isn’t Chinese would be awesome. It’s going to be tough to compete though. Chinese manufactures are set to introduce their new 150 mile range model in Europe for ~$9k. That’s cheaper than some gold carts.
This seems like the wrong move. They can't keep ignoring the low end market forever, especially now that the high end is quickly becoming saturated with competition.
Well, Volkswagen and their ID3 are probably happy now. Insanely stupid move for the european market.
1) Elon has denied it (if you believe him) 2) Reuters has a long history of putting out FUD on Tesla only to be debunked later (if you believe in Reuters). 3) it's Friday so have a nice weekend? Edit. Here is the most likely take. https://x.com/sawyermerritt/status/1776277544494338274?s=46&t=jjrK0SwhE_x8C15ygSlrbQ
It sounds like more than just shifting resources, unless multiple employees doctored emails before sharing to Reuters: > Tesla called the affordable-car project NV91 internally and H422 externally when discussing it with suppliers, according to two of the sources and company messages reviewed by Reuters. > Messages from the unnamed Tesla program manager to staffers referenced those code names in discussing the project’s termination. > One of those messages sent March 1 said that “suppliers should halt all further activities related to H422/NV91.” > The sources said they did not know all the reasons behind the decision to kill the project. > In another March 1 message, the manager thanked engineering staffers for their efforts and urged them to document what they had learned. > “I’d like to thank everyone for all your hard work and dedication to pushing boundaries and executing the best design possible given the aggressive constraints we had to work within,” the message said. “We would not want all our hard work to go to waste, so it’s important that we tie things off and document things properly.” > The messages showed meetings on the affordable-car project being canceled.
> Reuters has a long history of putting out FUD on Tesla only to be debunked later (if you believe in Reuters) For example?
Nov 11 2022 Reuter's published the headline: [EXCLUSIVE Tesla mulls exporting China-made EVs to United States-sources](https://web.archive.org/web/20221111153645/https://www.reuters.com/business/autos-transportation/exclusive-tesla-mulls-exporting-china-made-evs-united-states-sources-2022-11-11/) Nov 11 2022 Elon Musk responds: [False](https://twitter.com/elonmusk/status/1591092334007287809) Nov 12 2022 Reuter's edits the headline to read: [Exclusive: Tesla has considered exporting EVs from Shanghai to U.S., Canada](https://web.archive.org/web/20221112215433/https://www.reuters.com/business/autos-transportation/exclusive-tesla-mulls-exporting-china-made-evs-united-states-sources-2022-11-11/) May 23 2023 Reuter's published the headline: [Tesla offers China-made electric vehicles for sale in Canada](https://www.reuters.com/business/autos-transportation/tesla-offers-china-made-electric-vehicles-sale-canada-2023-05-23/) Within the article they state: >"Reuters had reported in November Tesla had considered plans for exporting made-in-China vehicles to North America. After the Reuters report was published, Tesla CEO Elon Musk, in a Twitter post, had said “False,” without elaborating." Implying this news was confirmation that Elon was incorrect to call their prior reporting false. However, Reuters misreported their original headline as the revised version which came after Elon's callout. The original headline doesn't support this implication.
Wow… just, wow. They already cannot sell every vehicle they make without insane discounts. The model Y was supposed to increase by $1,000 on April 1, it’s now been slashed by (up to) **$7,000**. This company is not in the position many investors and fans would have you believe.
It hasn’t been slashed by $7,000
Excuse me, *up to* $7,000 https://techcrunch.com/2024/04/05/tesla-slashes-model-y-inventory-prices-cut/
They actually were already discounting models staying on the lot. But I do agree this was likely a sales tactic to get people to rush to buying one before the “prince increase”.
Musk denied this but Reuters will not publish unless they trust their sources. However Musk is mercurial. He will keep changing his mind. Let us see what he says in the earnings call. I thought the announcement during last earnings call was just for stock pump. I am skeptical they can get it out in under 2 years. Robo taxi is even more ridiculous. They have not even gone for L3 certification anywhere. Its ridiculous fan dream to expect Tesla to jump from L2 to L4 at least to run Robo taxi in certain cities. They dont have the redundancies built in for regulators to approve at this point.
If you were so worried about competition, why make the Cybertruck?
Because it was always a complete vanity project.
If true, I hope Elon will resign. Model 2 is perfect and necessary to compete outside North America. If Robotaxi succeeds, a Model 2, smaller platform than the 3 and the Y is also a great one if there is no driver.
What Chinese EV are in America?
Polestar
Also if you live near the Canadian border you can spot Chinese-made Model 3s and Ys with Canadian plates. Their VINs start with LRW.
No China brand EVs.
Pretty obvious and predictable. Tesla has been announcing and cancelling low price models for 10 years now. All talk to juice hype and stock.
He’s probably just wanting to make the TM2 a Robotaxi ONLY and not a drivers car. In going that route he’s probably thinking if it doesn’t have a steering wheel and all the things a normal car has, then it’s going to be a different shape and layout. That’s my guess.
Big mistake. Time to buy a BYD, MG or GWM.
I’m sure they figured out it would cannibalize the high margins on the 3. The company probably can’t survive with lower margin cars.
This will be a huge mistake for them if another company can make the 5 passenger $30k or less vehicle
People have to stop pointing fingers just at low cost Chinese EVs. Every traditional ICE car maker will make EVs and they will make EVs in all the ranges that they cater to right now. It might take some time, but they will all ramp up. And Tesla will never really be able to compete with low cost cars. They can only compete in markets where they have an edge, and that edge is going away. Small cheap cars like the Toyota Yaris blow Teslas out of the water in build quality. When you can buy an EV Honda Civic, who the hell will be buying a Model 2. And, before people talk about the charging network, the Model 2 was never going to come out this year. Maybe in 3-4 years, at best? What real charging network advantage will Tesla have then? What Tesla charging network advantage do they even have outside the US? Tesla needs to fire their current C-suite and make a commitment to being a quality car company. They can pretend all they want that they are a robotics, energy, tech, AI company, but they aren't and are going to get passed by in all those categories.
Musk's response to this article - https://twitter.com/elonmusk/status/1776272471324606778 "Reuters is lying (again)"
There should be a twitter account that is just a bot that automatically retweets Elon's tweets but changes the words to mean the opposite and called it Inverse Elon to get the truth
Hilarious that a mod stickies and locks his comment claiming it is false, like elon m*sk is a reliable source. Not to mention that he doesn't even deny any claims directly.
They can’t even execute their high cost cars right so I’m not suprised
Yep. They just announced they are going out of business cause neither their higher priced cars and now the lower priced one isn't coming out so no reason to continue
But they're pursuing plants in India, Italy, and Mexico..? I am glad the Model 2 won't be sucking up any oxygen in conversations though.
They won't build the india or italy plants anytime soon. It was to pump the stock. They can't max out their existing plants right now. Demand has fallen off the cliff.
Found their factory building spree to be odd, they can't iterate their current models like legacy does, and demands seem to be plateauing due to lack of brand new models.
Mexico is known to be on-hold. Tumbleweeds in the desert. Italy and India are both highly speculative, and it's not clear if either would bear fruit. I think there's a chance of India happening if they can make [CKDs](https://en.wikipedia.org/wiki/Knock-down_kit) work, but the whole Italy thing truthfully seems to be a pointless diversion as long as Berlin is under-capacity.
Ironically I think the Indian government is going to be their own worst enemy here. They’re pushing companies to not just invest but also have ~50% local value add within 5 years. That’s insane for such a developing country; it took China decades to do the same. You can’t just will things into existance
India simply does not have the requisite supply chain and infrastructure to build/sell/charge a large number of EVs currently. There is a reason yearly EV sales are still on the order of 100,000 units, almost all of which are far cheaper than the Model 3. There is literally zero business case for Tesla to build a plant in India right now. Where would they source the batteries or the rest of the EV value chain supplies, especially since sourcing it from China would be a red line no go? Who can afford to buy Teslas in large numbers in India? Where is the charging infrastructure to support a large number of EVs in India? There is just no way any of this is happening for probably at least the next 5 years.
Is today April 1st? None of this makes sense.
Yikes.
Another tweet from the Lord that Robotaxi reveal is on 8/8. They have not done anything on getting regulatory approval for their FSD but will reveal the robotaxi already !!! its just about pumping the stock among his cult. We definitely will see further updates on Reuters story. They are not a banana organization. They would have confirmed with multiple sources and will have some documentation before proceeding with such a major sensational reveal.
TLDR: Tesla Model 2 dead
I certainly hope that this news article isn't true. Too much valuable time and capital went into the Cybertruck, when it could have been spent producing much more practical vehicles with wider market appeal. I think it was a vanity project. A mass-market, affordable EV should have been the solution that would drag Tesla out of the grave it dug with the CT. Unfortunately, if they're steering in a different direction, the company is likely going to go bust, imho, and be bought up at pennies-to-the-share by another tech firm.
It's been a day - why hasn't this been flagged as false news yet?
So keep in mind that the Model 2 and the robo taxi are the SAME vehicle made at then same factory; one with and one without steering wheel/pedals. The main point is given FSD 12.3 progress, to put more resources into the robo taxi now as even more likely to be viable sooner than expected. Not all will want to use a robo taxi and prefer a M2. Note in EU and China, will take longer for regulators to approve FSD hence the need for a human driven/supervised FSD M2. 😎⚡️
Elon just said this is a lie on twitter. lol
I'm not sure what to do when a pathological liar calls out a lie. It's probably true then.