Tesla Model S, Third Fire

[tom66]

But what about the inbuilt subsidy in every gallon of gas?

[Robomeds]

Not exactly.  Were it not for HEAVY government gifts Tesla would be in the red.  I wish them luck but I also wish I didn't have to help buy $100k cars. 
When Tesla can get by without gifts from DC and Sacramento THEN we can call them a success.  Currently they are opportunists.

So what's different with Tesla and the rest of the US automotice subsidy industry?

Source:
http://www.ppbadvisory.com/uploads/a381-00464INS-Auto-Insight-May-2013.pdf

I'd rather have a government spend my tax dollars (if I was a Yank) subsidising the first serious automotive manufacturer in like 50 years or something, and one that is world leader in future technology, and than a ton of the other crap the government subsidies or pisses away money on.

With that data included we are spending over $10k per Tesla, not including the EV credits CA is extorting out of other car companies.  And who are we subsidizing?  Buyers of $100k cars.  I'm not at all convinced these guys are the future leaders in any technology so much as it's easier for other car companies who have to comply with Sacramento's la-la land ideas to simply pay Tesla for technology vs developing it themselves. 

When Tesla can stand on their own without my pocket book I will be happy for them and tell the people I know who work for them "good job". 

I would be happy to see Tesla break some of the dealer franchise laws but only if done in a way that the existing companies can do it as well. 

[free_electron]

That is another thing. Car makers keep harping on about how expensive it is to build in the USA.

Here is a new car maker that sets up shop , not only in California, but in Silicon Valley. Talk about a price premium.... Real estate is extremely expensive, labor cost and all the other cost.

I hate to burst your bubble but Tesla clearly aims to sell their cars as a toy for rich people. Most of their stores are located in shopping areas where people go in their Porsches, Ferraris, Bentleys etc. Tesla is the Apple amongst the car makers. The price doesn't really matter so they can produce in relative expensive areas. If you take a close look at the Model-S' chassis you can see it has not (yet) been optimised much for mass production (millions of cars per year). The design of the suspension and so on is also pretty standard.

As soon as Tesla has paved the way to make the batteries significantly cheaper and better you'll see Toyota, BMW, Volkswagen, etc come up with affordable EVs real quick. Each of these manufacturers has the knowledge to make an EV. They just wait until the batteries become available or bio-fuel turns out to be a better option. Going all EV is too big a gamble at this moment.

Tesla made that clear fro the start. Make expensove limoted run roadster as testbed. Make expensive perfomance sedan as initial run and convince people electric is feasible, make suv on third run, make modelE for everyone at 35000 pricepoint.

The model E will be shown in 2015 . That is only one year away. We are 5 days short of 2014 now...
The model e exists today in the secret lab of tesla. The model x has been shown and goes in production 8 mo ths from now. There are over 10000 pre-orders for the model x. All those people have alread forked out 5000$ just to be on the waiting list.

Clearly the strategy works

[zapta]

But what about the inbuilt subsidy in every gallon of gas?

Subsidies? In most places gas is taxed more than most products http://en.wikipedia.org/wiki/Fuel_tax .

That's another hidden subsidy for EVs.

[free_electron]

So what's different with Tesla and the rest of the US automotice subsidy industry?

$2908 per car is peanuts in Tesla subsidies scale. Here is one example  http://www.teslamotors.com/incentives/US/California

I'd rather have a government spend my tax dollars (if I was a Yank) subsidising the first serious automotive manufacturer in like 50 years or something, and one that is world leader in future technology, and than a ton of the other crap the government subsidies or pisses away money on.

That's expected. Everybody want other people money for their pet cause, often with good intentions. That's why DC (not the current) has so many activists and lobbyists.

Hang ln, EVERY electric vehicle is entitled to that! Nissan leaf , chevy volt , fiat 500 all qualify
So you cant hold that against tesla!

Tesla paid off their loan.

Sure they make money off selling green certificates or co certificates to who needs em, but so do plenty other companies! It's a free market.

[free_electron]

With that data included we

What is this 'WE' stuff ?

The 7500 is money that was paid by the EV buyer in taxes. They get it back, provided it came out ththe buyers pocket first. So there is no 'we' here.  Buyer benefit only if it was paid by buyer first.

The 2500 is available in CA for ANY electric vehicle. Not just tesla. Can't fault tesla here.

Want the 2500? Buy an electric
Want a return o. Taxes you already paid ? Buy an electric

Note: i did not say buy a tesla. The incentives are for any electric.
You can not blame tesla that it is getting a 10k handout because it is simply not true. All EV get the handout.

[tom66]

But what about the inbuilt subsidy in every gallon of gas?

Subsidies? In most places gas is taxed more than most products http://en.wikipedia.org/wiki/Fuel_tax .

That's another hidden subsidy for EVs.

Subsidy in the wars, diplomatic missions, politics it requires. And the many thousand deaths a year that air pollution causes. And the environmental damage from oil spills - like Deepwater Horizon and Exxon Valdez. 

[mtdoc]

But what about the inbuilt subsidy in every gallon of gas?

Subsidies? In most places gas is taxed more than most products http://en.wikipedia.org/wiki/Fuel_

Oil, gas and fuel ethanol industry subsidies dwarf the compaitively tiny EV support.   

Of course subsidies for traditional ICE auto manufacurers is also very large.

And then there are the enormous tax payer costs asssociated with clean up and health effects of ICE fuel production and resultant tail pipe emission pollutants, etc., etc, etc...

This "unfair subsidies for EVs" meme is a red herring not supported by the facts.

[echen1024]

Not exactly.  Were it not for HEAVY government gifts Tesla would be in the red.  I wish them luck but I also wish I didn't have to help buy $100k cars. 
When Tesla can get by without gifts from DC and Sacramento THEN we can call them a success.  Currently they are opportunists.

So what's different with Tesla and the rest of the US automotice subsidy industry?

Source:
http://www.ppbadvisory.com/uploads/a381-00464INS-Auto-Insight-May-2013.pdf

I'd rather have a government spend my tax dollars (if I was a Yank) subsidising the first serious automotive manufacturer in like 50 years or something, and one that is world leader in future technology, and than a ton of the other crap the government subsidies or pisses away money on.

Provided we are simply pissing money away on certain people that seem to be in their 20s and 30s, who are unwilling to work or go to college with grants, and simply take welfare, I would much prefer to see that money go to things like Space exploration and etc. For seniors, that's a different story. Theyd eserve the help.

[zapta]

Oil, gas and fuel ethanol industry subsidies dwarf the compaitively tiny EV support.

You need to normalize by the number of users/cars. It's like comparing food cost in China and Monaco.

[mtdoc]

Oil, gas and fuel ethanol industry subsidies dwarf the compaitively tiny EV support.

You need to normalize by the number of users/cars.

Fair point. However once you add in all of the costs/ subsidies supporting  ICEs (including the  trillions spent on wars to secure access to oil - and caring for the casualties) I suspect their subsidies may still be much higher.

And keep in mind, most of the EV subsidies are only up front costs to get an EV economy started. Once established in large numbers, the costs will be negligible relative to the ever increasing costs of running ICEs.

[tom66]

To be clear Tesla actually said their first would be very expensive, second would be more moderately priced and third would be "everymans" car. The Model X doesn't fit in this pattern, they should have perhaps specified "platforms", the Model S platform is similar to X etc.

[EEVblog]

It is not about funding the car industry but paying companies to keep labour intensive production work in the country.

Sorry, but I fail to see the difference?

[quote
One of the problems with government funding of companies is that companies start to rely on the government to help them instead of looking for new markets or gradual downsizing.
[/quote]

Has Tesla demonstrated that?
I don't think so. IMO they are one of the most aggressive and bold reaching auto companies on the planet.
If I was to subsidise anyone it would be them, not one of the 80yo dinosaurs.

[EEVblog]

$2908 per car is peanuts in Tesla subsidies scale. Here is one example  http://www.teslamotors.com/incentives/US/California

This is an entirely new industry and the future of motoring, so by it's very nature is has to be a greater subsidy!
No news here at all.

[EEVblog]

With that data included we are spending over $10k per Tesla, not including the EV credits CA is extorting out of other car companies.  And who are we subsidizing?  Buyers of $100k cars.

Sorry, but you are demonstrably wrong.
Tesla's state of the art manufacturing plant in California, the huge push for better and higher volume battery technology (didn't they just single handedly double the world's supply of lithium batteries?), the push for better (and local) motor and control technology. And I'm sure the list is endless.

[nctnico]

It is not about funding the car industry but paying companies to keep labour intensive production work in the country.

Sorry, but I fail to see the difference?

One of the problems with government funding of companies is that companies start to rely on the government to help them instead of looking for new markets or gradual downsizing.

Has Tesla demonstrated that?
I don't think so. IMO they are one of the most aggressive and bold reaching auto companies on the planet.
If I was to subsidise anyone it would be them, not one of the 80yo dinosaurs.

How would subsidising Tesla help to keep & create more jobs? They employ about 3000 people versus over 700,000 working in the rest of the US car industry.

Tesla took a government loan because they could. Its cheap money they didn't need in the first place so they paid it back when convenient. Do you say no to free loan to (temporarily) reduce your money spend on interest?

And it is far from certain EVs are the future of motoring. You may see it that way but as many people already stated there are numerous problems to overcome from which the availability of electricity, battery technology and the availability of materials for the batteries are the major ones.

[zapta]

Fair point. However once you add in all of the costs/ subsidies supporting  ICEs (including the  trillions spent on wars to secure access to oil - and caring for the casualties) I suspect their subsidies may still be much higher.

That's a myth. China has access to oil and is not involved in wars.

And keep in mind, most of the EV subsidies are only up front costs to get an EV economy started. Once established in large numbers, the costs will be negligible relative to the ever increasing costs of running ICEs.

That's what every activist/lobbyist says, I will force you to pay for my pet cause but it's for your own good. It's one thing to support basic research, it's another to give people money to buy product X.

[EEVblog]

Tesla took a government loan because they could. Its cheap money they didn't need in the first place so they paid it back when convenient. Do you say no to free loan to (temporarily) reduce your money spend on interest?

They didn't need it?
I was under the impression they were weeks away from bankruptcy at one point.
A new emerging technology company in one of the most important industries in the country borrows some government money and then pays it back - call me silly, but I don't see the issue here...

And it is far from certain EVs are the future of motoring.

What's your point?
So just don't bother supporting alternatives to ICE cars?
Not to do so is very foolish IMO.

You may see it that way but as many people already stated there are numerous problems to overcome from which the availability of electricity, battery technology and the availability of materials for the batteries are the major ones.

Umm, how exactly do you think those difficult challenges get overcome? Especially in an (ultimately doomed) industry as entrenched as the ICE car industry.

[EEVblog]

It's one thing to support basic research, it's another to give people money to buy product X.

Unfortunately you fail to comprehend the sheer entrenched inertia of the ICE car industry, and the massive challenges of overcoming that, and the many positive reason there are to support doing that.
You also forget that there are subsidies for ICE cars too, and their fuel. If your argument is that electric cars are more heavily subsidised than ICE cars, then you are down to mere semantics over the relative values. In which case your argument has no real weight.

[NiHaoMike]

The US auto industry, for the most part, has been a disappointment. GM developed an electric car (EV1) in the late 90s that outperforms today's Nissan Leaf, but instead of marketing it, they decided to throw away their hard work and let competitors take the market. They very well could have become the leader in EVs and hybrids if they decided to go that route.

Tesla seems to be the best US auto maker so far. There just needs to be a range extender option (OEM or aftermarket) for those who prefer to own only one car.

As for now, hybrids are very practical. They should heavily tax cars getting less than 25 MPG highway in order to subsidize EVs and other energy efficient vehicles.

[tom66]

Tesla has a 500 mile pack in the works, apparently. Would this eliminate range anxiety for most? I don't know about others but I don't mind stopping 1 hour to recharge after a 7~8 hour drive. I couldn't do it any other way.

The reality is most people owning Model S can probably afford to fly long distances. Some who stretched probably not. But those who dropped $120k on a car probably can. The supercharging network isn't just for S. I really hope they make supercharging free or very cheap on the next low cost model. That will be a big hit for EV practicality. Soon, other automakers will start licensing the Tesla supercharging network.

People said free charging for life wasn't sustainable. But look at the energy usage. That's standing at just over 2 million kWh. At a bulk rate of $0.06/kWh (average is $0.11/kWh) that's $120k. If Tesla has sold ~20,000 vehicles that's about $6 per vehicle over 1 yr of usage. Let's assume people use their cars for 10 years, that's $60 total energy. Given the huge number of purchases it must have encouraged, that's a great return on investment. Most marketing managers would drool over that ROI.

It alone costs $50~150k to put a station in, but they will need hardly any maintenance over their lifespan which is likely to be 20~30 years.

So building the network now for the luxury models and trickling it down to the cheaper models: the luxury models pay for the network construction and everyone benefits from cheap or free supercharging.

IMO, if Tesla do have supercharging as an option, it -needs- to be a one-time payment, or free. I hope it's free. A $500~1,000 payment will almost certainly cover every kWh a vehicle will ever use. I hope they do not try a "$50/mo" scheme or such.

[EEVblog]

Tesla has a 500 mile pack in the works, apparently. Would this eliminate range anxiety for most? I don't know about others but I don't mind stopping 1 hour to recharge after a 7~8 hour drive. I couldn't do it any other way.
The reality is most people owning Model S can probably afford to fly long distances.

Those who can afford the Tesla likely have a petrol car for really long distance stuff.
Currently, you'd have to do some planing and a bit of compromise on any trip in order to use a fully electric car for long trips.
Those who need to do both short and long trips routinely are better off with something like the Volt.

[lemmegraphdat]

History has shown that no dick head was ever able to stop a new technology from coming out. That's why we have air travel and the internal combustion engine. We'll get an electric car that most people will want to own. There would have to be an outright government ban on the things to stop it, and that aint gonna happen.

[nctnico]

And it is far from certain EVs are the future of motoring.

What's your point?
So just don't bother supporting alternatives to ICE cars?
Not to do so is very foolish IMO.

Governments do enough through tax incentives to try and make people buy EVs. The problem is that the cars aren't there yet except for the terribly expensive ones Tesla is making. The best selling electrical cars are plugin hybrids which will probably run mostly on fuel.

You may see it that way but as many people already stated there are numerous problems to overcome from which the availability of electricity, battery technology and the availability of materials for the batteries are the major ones.

Umm, how exactly do you think those difficult challenges get overcome? Especially in an (ultimately doomed) industry as entrenched as the ICE car industry.

The ICE car industry is far from doomed. I travel a lot through Europe and the availability of bio-fuel increases steadily. Next year I plan to replace my car and ethanol readiness/convertability is definitely a concern for the 'new' car. Instead of waiting for technology to become available/affordable (which is still uncertain) I gradually reduce my fossil fuel consumption based on proven technology available today.

Besides that there is still a lot which can be improved on the efficiency of ICE based cars to enhance mileage. A lot of ICE based cars out there are awfully inefficient. Getting those replaced will cause an enormous reduction in the use of fuel and CO2 emissions. Lets improve the way we use current technology first and then see if we really need something new. Like NiHaoMike says: What needs to be done is to put more taxes on fuel and people will start to buy efficient cars they actually can afford today.

You may see the ICE based car industry as entrenched and some kind of Goliath that needs to be taken down. IMHO that idea is wrong. The ICE car industry knows very well the oil is going to run out and they are looking for alternatives otherwise they'll simply go out of business. They can't make oil out of thin air. They also can't make affordable cars which run on thin air so there has to be a compromise to make a gradual change. In Europe car manufacturers are facing a new (more reliable) test cycle to determine fuel efficiency in 2017 and a very strict average CO2 emission limits in 2020. Basically their nuts are already between a vice which is gradually tightened. David has done his job already in Europe.

What we will be seeing are increasingly efficient cars which can run on fuel blends with an increasing amount of bio-fuel in them. That should give 20 to 40 years to get to sustainable electricity production and the battery technology to a point where an EV is viable and affordable for everyone. The fact most big car manufacturers seem to have given up on EVs is a big sign on the wall though. If they could produce an EV which people can afford they certainly would have done that. Due to the numerous tax incentives it would have given sales a more than welcome boost.

Tesla may be succesful in a niche but don't let yourself get fooled by that. They have to spend serious money (probably dwarfing the development budget for the Model-S) to create an economy model and then they'll run into the same problems as the 'big' car manufacturers: they have to compete with ICE based cars in a market where people look at the price first. To make things worse tax incentives will only go so far. When more EVs are on the road governments will look for income from EVs as well. For example: in the NL people will have to pay tax for EVs purchased after the 1st of Januari 2014. Shortly after that we'll probably see road taxes based on the distance travelled (those plans have been postponed a few times because the technology isn't ready).

[Rufus]

People said free charging for life wasn't sustainable. But look at the energy usage. That's standing at just over 2 million kWh. At a bulk rate of $0.06/kWh (average is $0.11/kWh) that's $120k. If Tesla has sold ~20,000 vehicles that's about $6 per vehicle over 1 yr of usage.

Wow they are some crazy numbers - $6 at $0.06/kWh is 100kWh or 1.5 x 67kWh batteries worth. So your ROI and cost predictions are based on Tesla owners supercharging less than once every 6 months...