Tesla magic running low

[JohnD]

"Two years ago, car leasing group Octopus EV could barely keep up with the red-hot demand for Teslas that accounted for half its sales.

“Tesla had the market to themselves,” said Fiona Howarth, chief executive of Octopus EV, which has operations in the UK and US. Now the carmaker has “lost some of its competitive advantage”.

The scale of Tesla’s challenge was laid bare this week when its first-quarter sales fell short of the gloomiest Wall Street forecast. Threats are coming from multiple angles: cheaper Chinese brands such as BYD and MG, faltering demand in China and the US, its two key markets, and even the polarising personality of Elon Musk."



"But its status as the electric car champion — and one with a stock market valuation still dwarfing that of rivals — leaves Tesla particularly exposed. Unlike legacy manufacturers, it does not have petrol models to fall back on, and nor does it make hybrids, whose sales have picked up over the past year as buyers opt for something less than fully electric.

Cooling demand “poses a unique challenge for Tesla as it is seeing the greater slowdown is in its home (and largest) market, the US,” said Mike Tyndall, an analyst at HSBC.

The slowdown has sent Tesla’s shares down 31 per cent this year, making it the second-worst performer on the S&P 500. The group’s market capitalisation has almost halved from its late-2021 peak of $1.2tn, when investors’ faith in the messianic powers of Musk went unquestioned."


FT.com

 

[Fred Blogs]

But the EV market has slowed to a crawl across the board (as anyone with any sense knew it would). Same with hybrid technolgy although that hasn't been hit as badly. People are turning to petrol. Personally I would never buy a fully electric vehicle and I would only consider a hybrid if petrol wasn't available. My last new car I bought 18 months ago was purely petrol.

 

[Mottie]

The scale of Tesla’s challenge was laid bare this week when its first-quarter sales fell short of the gloomiest Wall Street forecast.

I wonder what word caught fun sponge JohnD's attention in that article?

Do you think one day he might post up news of someone/something/some company doing well apart from, of course, his European investments?

 

[mointainwalker]

In respect of the thread title I posted a while back that Sixt, one of Germany's largest rental agencies, was stopping purchases of Telsa's because the repair costs were much higher than budgeted, and Musk's unexpected price cuts meant big losses on their re-sales

 

[Avocet]

It's funny how stories can be "spun" to suit the intended audience, isn't it?

First of all, the "Tesla magic", well, yes, as new offerings come on to the market, Tesla is bound to lose market share. That would happen with any company. But remember, they're "losing share" from the coveted position of "World's best-selling car 2023"! (The Model Y). The vast majority of ICE manufacturers would give their eye teeth to be in that position! Also not helped by Tesla's long model replacement cycles. The Model S is now pretty long in the tooth, as is the Model 3. Elon, (not being a car manufacturer), thinks he can "download" his way to eternal youth, but customers are fickle and like a change of scenery.

Secondly, yes, the EV market over here is "cooling", but that's the rate of growth, that is cooling, not that they sold fewer this March than last March:

If you actually look at the real figures for March, you'll see that Battery EV registrations were 1% lower than this time last year as a percentage of total market share. So 15.2% of market share, rather than 16.2% last March. Reading the headlines in the tabloid press, you'd think nobody was buying EVs and everyone was buying petrol, but actually, the figures for petrol were 56.3% of registrations in March 2024 and 56.8% in March 2023, so they're also falling, but not by as much! If you look at the first two columns, the raw numbers, you can see that more EVs were still registered in March 2024 than in March 2023.

Now, this is the first year of the government's "ZEV Mandate", during which ,the percentage of EV registrations will have to be at least 22%, so they are some way off that, and will be starting to get worried, because the fines are £15k per car, short off the target. I would therefore expect government to intervene, and as they're skint, it will probably be more tax on ICEs, rather than more incentives on EVs...

 

[mointainwalker]

Hertz CEO resigns because of misjudged EV purchases. Same reasons as given by Sixt in my post #4

"Trouble and turmoil continue at rental car company Hertz.

The company, which announced in January it was selling 20,000 of the electric vehicles in its fleet, or about a third of the EVs it owned, is now replacing the CEO who helped build up that fleet, giving it the company’s fifth boss in just four years.

In the most recent quarter, Hertz took a $245 million hit to its earnings due to a drop in value of the EVs it was selling.

While the number of EVs bought by American customers surged 40% last year to top 1 million for the first time, there was less demand than some of the traditional automakers had expected as they moved to offer EVs. Tesla, the leader in US EV sales, started a price war for EVs just over a year ago, driving down the value of both new and used EVs, such as those in Hertz’ fleet. And the drop in prices hit Hertz bottom line since it reduced the money it could expect to get from reselling the vehicles."

https://edition.cnn.com/2024/03/18/business/hertz-ceo-departure-ev/index.html

"

 

[Avocet]

And that's the trouble with price wars. You hit your own residuals as well as the competition! This is the biggest single reason for high depreciation of EVs. And like any emerging market, it is likely to see severe fluctuations in the early years, as new developments come thick and fast, new entrants try to break into the market, and competition develops. As someone who (mercifully) isn't vulnerable to depreciation, I'm actually quite excited by this, as there should be some absolute bargains to be had, in the next few years.

 

[mointainwalker]

Tesla is planning to lay off 10% of its workers after dismal 1Q sales, multiple news outlets report​

Mon, 15 April 2024 at 4:43 pm CEST·1-min read

Tesla Layoffs​

DETROIT (AP) — After reporting dismal first-quarter sales, Tesla is planning to lay off about a tenth of its workforce as it tries to cut costs, multiple media outlets reported Monday.
CEO Elon Musk detailed the plans in a memo sent to employees. The layoffs could affect about 14,000 of the 140,473 workers employed by the Austin, Texas, company at the end of last year.
Musk's memo said that as Tesla prepares for its next phase of growth, “it is extremely important to look at every aspect of the company for cost reductions and increasing productivity,” The New York Times and CNBC reported. News of the layoffs was first reported by electric vehicle website Electrek.
Shares of Tesla fell 3% at the opening bell Monday after the news broke. They have lost about one-third of their value so far this year.
Tesla sales fell sharply last quarter as competition increased worldwide, electric vehicle sales growth slowed, and price cuts failed to draw more buyers. The company said it delivered 386,810 vehicles from January through March, nearly 9% below the 423,000 it sold in the same quarter of last year."

 

[Avocet]

Tesla is planning to lay off 10% of its workers after dismal 1Q sales, multiple news outlets report​

Mon, 15 April 2024 at 4:43 pm CEST·1-min read

Tesla Layoffs​

After reporting dismal first-quarter sales, Tesla is planning to lay off about a tenth of its workforce as it tries to cut costs, multiple media outlets reported Monday. (AP Photo/Ebrahim Noroozi, File)


DETROIT (AP) — After reporting dismal first-quarter sales, Tesla is planning to lay off about a tenth of its workforce as it tries to cut costs, multiple media outlets reported Monday.
CEO Elon Musk detailed the plans in a memo sent to employees. The layoffs could affect about 14,000 of the 140,473 workers employed by the Austin, Texas, company at the end of last year.
Musk's memo said that as Tesla prepares for its next phase of growth, “it is extremely important to look at every aspect of the company for cost reductions and increasing productivity,” The New York Times and CNBC reported. News of the layoffs was first reported by electric vehicle website Electrek.
Shares of Tesla fell 3% at the opening bell Monday after the news broke. They have lost about one-third of their value so far this year.
Tesla sales fell sharply last quarter as competition increased worldwide, electric vehicle sales growth slowed, and price cuts failed to draw more buyers. The company said it delivered 386,810 vehicles from January through March, nearly 9% below the 423,000 it sold in the same quarter of last year."

Disappointing about the general reduction in demand for EVs, but Tesla have had this coming for a while now. They have an ageing passenger car offering, and as the rest of the "legacy" car industry catches up, they're finding themselves facing tough competition.

 

[IT Minion]

Disappointing about the general reduction in demand for EVs, but Tesla have had this coming for a while now. They have an ageing passenger car offering, and as the rest of the "legacy" car industry catches up, they're finding themselves facing tough competition.

It isn't the legacy brands that are concerning Tesla. It's other new EV manufacturers like Nio and BYD, almost all Chinese.

Tesla are shooting themselves in the foot at the moment. The cyber truck has been another Model X sized distraction and the choice to ignore the Model 2 for another attempt to get an autonomous vehicle design built and sold in bulk is classic Musk.

 

[Odds]

Tesla, by far the country’s top maker of electric vehicles, is riding the wave of EV adoption. Its vehicles and technology offer a way to tackle climate change. Such a cutting-edge company is attractive to plenty of people looking for meaningful work. Not to mention that a position as a production associate, an entry-level factory floor job, currently pays around $25 per hour—less than what unionized autoworkers can expect, though much more than what most service-sector workers make. But a review by The Nation of more than 50 legal documents, government records at the Occupational Safety and Health Administration (OSHA) and the National Labor Relations Board, along with interviews with workers and their lawyers, paints a picture of a company whose factory floors are stuck in another century.

Dozens of Black workers have alleged that racism is not only rampant but tolerated at the company’s factories, from menacing white-power graffiti to Black workers being shunted to the most grueling jobs with no chance of getting a promotion. At least a dozen women have described a work environment thick with sexual innuendo and complain of inappropriate touching and catcalls hurled at them daily.

“There’s an atmosphere on the line that allows for mistreatment,” said J. Bernard Alexander III, an attorney at Alexander Morrison&Fehr, who has represented some of the workers at the Fremont plant. When workers feel desperate enough to complain, he continued, “there’s no responsiveness. As long as the line is moving, progress is being made, they can’t care less.”

The Nation.com

A long read that highlights explicit sexism and racism on the shop floor of Tesla factories in the US. A toxic culture that stems from the top down.

 

[Avocet]

That may well be so, (I don't care much for Musk as a person, from what I've seen), but it's not really anything to do with EVs "per se". If Musk ran a chocolate factory, I imagine the same allegations could be made.

 

[Odds]

Fair enough - but productivity is related to employee performance and the mad atmosphere Elon Musk generates around his staff must be a factor in so much racism and sexism. In one case a swastika was painted in a car park which wasn't removed, despite complaints. What the f. is going on with that guy.

 

[Avocet]

Fair enough - but productivity is related to employee performance and the mad atmosphere Elon Musk generates around his staff must be a factor in so much racism and sexism. In one case a swastika was painted in a car park which wasn't removed, despite complaints. What the f. is going on with that guy.

Born in South Africa. Possibly a cultural thing?

 

[Odds]

Born in South Africa. Possibly a cultural thing?

I wouldn't be surprised.
But the factory in Fremont California is in one of the more 'woke' states in America, far from the Deep South where such sentiments are rife.