And this was without the sub-20k car that would be announced by Musk on Investor Day 1st March 2023. That will drive nails in many a company.
ACDC8 wrote:The other misleading factor in this thread, is that the original article says that 10% of new car sales last year were EV, thats not a very accurate metric to determine a trend given the current state of the new car market with empty lots, fewer choices if one needs a car today versus waiting a year plus for a preferred vehicle.
I agree that it is faulty logic to assume a trend will continue independent of market conditions. To take an example from another industry, look at Peloton. Most of the press focuses on how the end or at least decline of the pandemic (a market-skewing event if there ever was one) allowed for the reopening of gyms which thus presumably cratered the market for at-home exercise equipment. Less discussed is that there are only so many people who are willing to cough up several thousand dollars in purchase and ongoing subscription costs for “connected fitness” products. Once the initial market is saturated further growth becomes difficult, as is reflected in Peloton’s stock price.
The analogy to EVs is two-fold: there are only so many people who are willing or able to pay premium prices for EVs, and secondly, as discussed in this thread, EVs don’t make sense for all consumers for various reasons. To the first point the sub-20k consumer is a value shopper who will only consider an EV if it provides equal or better value to other alternatives. Any drop in the price of gasoline/petrol shifts the value calculation in favor of ICE. Same thing if and when tax incentives are phased out. Both of these have a market-skewing influence. And to the second point, to grow beyond the initial market demand EVs (or some other technology) have to overcome the range limitations and other reasons that make them unsuitable for many buyers.
Having said that, assuming Tesla can take out enough cost to profitably sell EVs in the sub-20k segment, what’s to stop other manufacturers from doing the same thing? Tesla’s not going to have some secret recipe no one else can replicate. I hardly see many nails being driven in other companies for that reason.