Tesla's US Revenue Dropped 39% In 3rd Quarter - What Does THAT Tell You About EVs In The US?

Imagine what BEV sales in North America would be without any gov't incentives. It could be even lower than 2%. The Chinese market is being driven by policy. You are penalized for owning an ICE car vs being encouraged to buy a BEV. This distorts the market for a desired end - cleaner air. But it isn't how the market would operate if left to its natural state.

#Sh*t.Show #Not.Mass.Market

Few consumers care about EV. Adoption is coming at a snail's pace.

https://www.eei.org/issuesandpolicy/electrictransportation/Documents/FINAL_EV_Sales_Update_April2019.pdf

(a) EV market share grew to 1.8% in March 2019, up from 1.6% in March 2018

(b) EV marketshare is growing but still represents a tiny fraction of all cars in the U.S.

(c) EV sales as a fraction of all new car sales were 1.5% in Q1 2019.

(d) Global EV sales totaled about 2.1 million for 2018, an increase of 64% compared
to the total sold in 2017.

(e) Approx 1.18 million ELECTRIC VEHICLES are on the road in the U.S.as of March 31, 2019

"Adoption is coming at a snail's pace."

True, but partially due to lack of availability. Not counting Tesla, there's only 4-5 "affordable" EVs available in all states. And of course there's still a sizable percentage that have no way to charge while at home (street parking, rentals, apartments). Charging at public chargers pushes the driving cost per mile much closer to conventional cars. There's quite a few very affordable used EVs available now, but almost none of them have even 100 miles of range, so another notch against adoption.

It shows people are waiting for quality. The Taycan is sold out and production has to be increased.

It shows that they were sending a lot of their production out of the US. They still have a large backlog of orders for US buyers, so overall demand doesn't appear to be slacking. Once they get the China plant spooled up, they won't be sending cars from CA there.

I just wish the Model Y wasn't so much a clone of the 3. I don't care for the minimalist dash, and the way the roof slopes towards the rear takes a lot of usable space away. I was hoping it would be something for me to consider when my current lease expires, but from the images I've seen, I'll likely pass and look more closely at the ID.4.

A 39 percent decline in revenue and price decrease spells market saturation. Elon says they have a backlog of orders yet new customers get their cars very quickly, not indicative of a backlog. EVs have significant drawbacks that limit their appeal to only the die hard fans.

Tick Tock

You've been ticking and tocking for a long time and still have much longer to go.

Most folks who wanted the cache of a Tesla have already bought one. Tesla doesn't have any exciting new product in the pipeline to replace the Model S and Model X, so they're not getting that many repeat sales. Meanwhile incentives are declining. Costs are going up. Profit margins are going in the wrong direction. The only reason they showed a profit this last quarter is because of accounting tricks.

On top of that, the quality of the service at most Tesla centers has fallen to abysmal levels. There are complaints galore on the Tesla forums.

In Europe the car sells because their governments are mandating the populace buy electric. Otherwise those folks would still be driving diesels that get 55 mpg.

Brilliantly stated.

The Model Y is a massive miscalculation on the styling. It needed to look like a real crossover not a high roof Model 3.

The X should be a high priority for replacement rather than the pickup and Semi and it should be ditching the parakeet doors and looking more like a Tesla X7 when it's done.

The S could be replaced by an "X5" product.

The sooner that Elon is kicked to the curb, the sooner Tesla can prosper.

It tells me Tesla is finally serious about Europe and China.

In other new a pal who can afford to drive whatever he wants, but loves value and needs space for kids, retired his 10 year old MDX and replaced it with a Kia Telluride. And he loves it and the new Thule 4-bike rack he just picked up. Don't doubt the appeal of these new SUVS from Korea.

It tells you that they are reaching a saturation point in the USA - where they cannot sell without the tax incentive they are losing - they have reached the 200,000 sold mark and their tax incentive Phases out as of the end of this year. It was halved to $3,750 at the beginning of this year as well. Having to sell at full price against others will be a problem for them.

As in Norway where sales dropped 97 percent once the incentives ended. EVs are interesting, but have significant drawbacks and are far more expensive than ICEs. An interesting toy. Hybrids make so much more sense yet consumers don't understand the advantages.

Tesla's incentive dropped this quarter vs. other EVs, so it is now close to a $6k disadvantage versus manufacturers that have just started selling electric cars. There will be another drop in January to $0 in federal incentives, and then as other automakers catch up with sales, the playing field will be leveled with EV incentives. I'd expect an uptick this quarter, a drop in Q1 and then an uptick in Q2 for US sales.

Well Tesla's problems still remain. Searching sales but not addressing quality control problems that continue to plague them. Without a dealer base getting them fixed can be a time consuming process. The model 3 and the Y are but ugly. But those vehicles are what Tesla needs to survive because they represent volume. The X and the S do have the higher profit margin but Tesla simply does not sell enough of them. The nail in the coffin is coming once the Taycan, Etron, VW EV 4 are on the US market. They will then be hit on all sides of the price spectrum. Then it will be time to get rid of Musk and sell Tesla to a larger auto concern. that's the only way it will survive.

Tesla's problem don't really reflect the EV situation so much in the US. Tesla has its charging stations and is more high end. The infrastructure issue and perception is the primary drag on EV sales. If you have enough infrastructure and fast charging stations you don't need the 300 to 400 mile range so much. Most people could function just fine on a 200 to 300 range as their only vehicle provided the infrastructure is there.

Tesla has a major advantage with infrastructure since they can utilize any charging station + the supercharging network and all of their cars (except for my ultra rare trim) have 210-380 miles of range.