Tesla Must Be Protected

[Arthur Hanson]

Tesla is key to competing against the Chinese in the area of high-tech cars. Tesla incorporates numerous high-end sensors, Nvidia chips, Micron memory along with state-of-the-art battery systems. Tesla is a key part of the tech structure of the US and even competes in space with Space X. If the US does not embrace and nurture a crown jewel of the tech world, the entire US economy could be in trouble. Full disclosure, I own no Tesla stock, but TSM and Micron stock who are both suppliers to Tesla. The Chinese are building an auto plant that is 650,000 sq. ft, and they are preparing to dominate this important economic space. The US is no longer immune from the rest of the world and must be able to continue to compete on the world stage.

 

[delong.height]

Well, you can buy Tesla stock or car to show your support. And I believe in most region, they are doing great still. Same statement can be made towards any American company. And it's backfiring Tesla badly since you've got a close association between its brand and Elon.

 

[KevinK]

The US is no longer immune from the rest of the world and must be able to continue to compete on the world stage.

Absolutely agree with the last bit. But when it comes to BEVs, China may have already won the game, without most of the US or EU even noticing it... In 2024 China bought 3x as many BEVs as the US or EU, with no end of growth in sight. And with a internal auto market that is 2x the size of either the US or EU, and with US and EU growth slowing, Chinese makers are hitting a level of scale that gives them huge cost advantages (12K vs 30K for cheapest Tesla) over the rest of the world. Tariffs and protectionism only postpone the inevitable in my books. The best thing we could do is drive US manufacturing and supply chains for Chinese EVs here, under prevailing US labor rates and labor laws. But I'm betting the fossil fuel industry and "big 3" would fight that tooth and nail.

View attachment 1742499666481.png

 

[delong.height]

And you know what is going wrong with this person. This doesn't sound well to me.

 

[hist78]

Tesla is key to competing against the Chinese in the area of high-tech cars. Tesla incorporates numerous high-end sensors, Nvidia chips, Micron memory along with state-of-the-art battery systems. Tesla is a key part of the tech structure of the US and even competes in space with Space X. If the US does not embrace and nurture a crown jewel of the tech world, the entire US economy could be in trouble. Full disclosure, I own no Tesla stock, but TSM and Micron stock who are both suppliers to Tesla. The Chinese are building an auto plant that is 650,000 sq. ft, and they are preparing to dominate this important economic space. The US is no longer immune from the rest of the world and must be able to continue to compete on the world stage.

First things first, Tesla needs a dedicated full-time CEO.

 

[Jumper]

First things first, Tesla needs a dedicated full-time CEO.

This was always biggest strength and weakness of Tesla. Like it's great if the CEO has big power and is really dedicated but Elon doesn't pay any attention to Tesla and has such a big stake in the company it's practically impossible to oust him.

 

[Xebec]

First things first, Tesla needs a dedicated full-time CEO.

It's interesting as Gwynne Shotwell basically runs SpaceX in her COO position, while Tesla does not appear to have an obvious 'successor' to Musk.

While Tesla does have a COO (+chairman of the board) - Robyn Denholm, it's not clear how much she is running Tesla.

 

[Xebec]

Absolutely agree with the last bit. But when it comes to BEVs, China may have already won the game, without most of the US or EU even noticing it... In 2024 China bought 3x as many BEVs as the US or EU, with no end of growth in sight. And with a internal auto market that is 2x the size of either the US or EU, and with US and EU growth slowing, Chinese makers are hitting a level of scale that gives them huge cost advantages (12K vs 30K for cheapest Tesla) over the rest of the world. Tariffs and protectionism only postpone the inevitable in my books. The best thing we could do is drive US manufacturing and supply chains for Chinese EVs here, under prevailing US labor rates and labor laws. But I'm betting the fossil fuel industry and "big 3" would fight that tooth and nail.

View attachment 2895

The Australian market and some sections of the EU markets are getting taken over by Chinese EVs already - those markets have a lot less automaker protectionism than say Japan, Germany, the USA, or Korea. If the Chinese EVs are going to take over outside of China (and I think they will) - it'll probably be AU and Norway first.

Also FWIW - Toyota was ranked "worst climate lobbying score of any automaker" - https://electrek.co/2024/05/14/toyo...worst-automaker-on-climate-lobbying-globally/

I think Tesla is the only American maker that has a cost structure that can begin to compete with the Chinese EV makers.

 

[KevinK]

I think Tesla is the only American maker that has a cost structure that can begin to compete with the Chinese EV makers.

That’s true, but Musk seems like he’s driven off a mental cliff with the failing CyberTruck, AI and robocar pivot, and massive diversion into politics. Not sure if that is survivable.

 

[Yunus]

It will be hard to save Tesla when its CEO keeps shooting it foots. Getting involved in politics and leading a huge reform effort can be very polarizing, and will definitely fire-back for a large consumer market like cars. Mixing business and politics is a dangerous game.

 

[kvas]

Tesla does not appear to have an obvious 'successor' to Musk.

They have Tom Zhu, at least for the automotive part. I haven't heard so much about him in the last year though.

 

[fansink]

That’s true, but Musk seems like he’s driven off a mental cliff with the failing CyberTruck, AI and robocar pivot, and massive diversion into politics. Not sure if that is survivable.

Tesla’s tech keeps the U.S. in the EV fight. China’s massive, sure, but Musk has pulled off wild stuff before. It's going to be a crazy ride.

 

[KevinK]

Tesla’s tech keeps the U.S. in the EV fight. China’s massive, sure, but Musk has pulled off wild stuff before. It's going to be a crazy ride.

The pivot to robocars and AI seems like the only way in my mind for Tesla/tech to triumph over the mundanity of manufacturing cost reductions and efficiency at huge scales, as China has perfected. But that means a massive disruption in how we get around, and the perceived American way of life. Then again, I have two 20-something kids, both with significant others in SF and LA, and they only have one car between the 4 of them, and only 2 drivers licenses ! And when was up at a restaurant near my son’s place in SF Noe Valley, every 3rd car that went by the restaurant’s window was a Waymo. So we might be seeing the harbingers of the future.

 

[KevinK]

The Australian market and some sections of the EU markets are getting taken over by Chinese EVs already - those markets have a lot less automaker protectionism than say Japan, Germany, the USA, or Korea. If the Chinese EVs are going to take over outside of China (and I think they will) - it'll probably be AU and Norway first.

My view is that Chinese BEVs will take over every market that doesn’t have tariffs, especially those that are cost sensitive, given their ability to produce $12K high-quality tech-rich sedans. If I were China, I would also be looking for ways to package BEVs with C2H with solar PV panels/inverter/chargers for regions that have a weak grid.

One telling sign of what’s coming - China is rapidly expanding their auto export fleet. They have to do this given all the money the central and local governments have pumped into BEV manufacturing capacity. Meanwhile, Trump thinks we should go back to a fossil fuel and tariffs world to make America stronger in manufacturing.

China is building new ships at record pace to turbocharge its car exports

Shipyards are rolling out huge vessels capable of carrying 8,600 cars as China’s auto industry seeks to accelerate its global expansion.

www.scmp.com

 

[Daniel Nenni]

Tesla is key to competing against the Chinese in the area of high-tech cars. Tesla incorporates numerous high-end sensors, Nvidia chips, Micron memory along with state-of-the-art battery systems. Tesla is a key part of the tech structure of the US and even competes in space with Space X. If the US does not embrace and nurture a crown jewel of the tech world, the entire US economy could be in trouble. Full disclosure, I own no Tesla stock, but TSM and Micron stock who are both suppliers to Tesla. The Chinese are building an auto plant that is 650,000 sq. ft, and they are preparing to dominate this important economic space. The US is no longer immune from the rest of the world and must be able to continue to compete on the world stage.

I do not own a Tesla but I do admire their technology. Tesla was the first car company that I saw reading SemiWiki (from the Tesla domain). This was maybe ten years ago. I did a search for Tesla on LinkedIn and saw some former AMD people, a couple of them I was connected to. Tesla was developing their own chips. The first Tesla cars used off-the-shelf chips from Nvidia and Mobileye if I remember correctly.

This is deja vu with Apple back with the iPhones. Once Apple started with custom silicon everyone followed. Now all of the car companies are on SemiWiki trying to catch up with Tesla custom silicon.

Without industry disruptors like Apple and Tesla where would we be? Without custom silicon where would the semiconductor industry be? That is the first thing I think of when I see people bashing Tesla. That and the 125k+ hard working Tesla employees that are being bashed as well.

 

[Daniel Nenni]

Tesla’s tech keeps the U.S. in the EV fight. China’s massive, sure, but Musk has pulled off wild stuff before. It's going to be a crazy ride.

I agree completely.

Do you remember what happen with solar panels back in the Obama administration? The US Government spent billions of dollars helping companies fend off the Chinese but failed miserably. I do not remember all of the details but I had friends working in the industry (Solindra) and it was a debacle. I guess there was not enough tech in panels for us to disrupt the Chinese?

I remember flying into Shanghai during the daytime and seeing solar panels on all of the buildings and wondering why the US did not do the same.

 

[Arthur Hanson]

China has the advantage of few environmental controls and the use of slave or near slave labor that's willing to work for wages no westerner could even survive on. It is also a command-and-control economy that no westerner would tolerate.

I agree completely.

Do you remember what happen with solar panels back in the Obama administration? The US Government spent billions of dollars helping companies fend off the Chinese but failed miserably. I do not remember all of the details but I had friends working in the industry (Solindra) and it was a debacle. I guess there was not enough tech in panels for us to disrupt the Chinese?

I remember flying into Shanghai during the daytime and seeing solar panels on all of the buildings and wondering why the US did not do the same.

I agree completely.

Do you remember what happen with solar panels back in the Obama administration? The US Government spent billions of dollars helping companies fend off the Chinese but failed miserably. I do not remember all of the details but I had friends working in the industry (Solindra) and it was a debacle. I guess there was not enough tech in panels for us to disrupt the Chinese?

I remember flying into Shanghai during the daytime and seeing solar panels on all of the buildings and wondering why the US did not do the same.

I have a close friend and genius engineer who was sad about the government giving money to fools in the solar energy sector that all they were good at was collecting government grants and burning money. At the time a decade or more ago, he said the tech behind the efforts the government gave money to were literally pathetic. At least Tesla produces a serious impressive product. About a week ago, I had the pleasure or riding in a Tesla that just had the latest self-driving software and it was so good it was mind blowing and I'm an auto guy.

 

[KevinK]

At the time a decade or more ago, he said the tech behind the efforts the government gave money to were literally pathetic.

Remember, Tesla was one of those companies (at the time, the solar part was SolarCity, under a couple of Musk’s cousins, but using Musk’s funding). There seems to be a collective forgetfulness about how much in federal incentive / tax credit money both Tesla and SolarCity sucked down during the Obama era. Neither would have survived without it. I do own both Tesla Solar and Tesla vehicles. But in my books, Musk has taken his eyes off the ball in both those product areas due to foolish diversions partially because he’s poorly suited to the boring, but important process of continuous innovation, vs his favored disruptive innovation.

Tesla’s tech keeps the U.S. in the EV fight. China’s massive, sure, but Musk has pulled off wild stuff before. It's going to be a crazy ride.

Given the late night all hands meeting at Tesla, the pivot to new growth is going to be via millions of CyberCabs and legions of Optimus robots.

Elon Musk made more promises about Optimus and Cybercabs at Tesla’s surprise all-hands meeting

“I have, like, 17 jobs.”

www.theverge.com

 

[hist78]

China has the advantage of few environmental controls and the use of slave or near slave labor that's willing to work for wages no westerner could even survive on. It is also a command-and-control economy that no westerner would tolerate.


I have a close friend and genius engineer who was sad about the government giving money to fools in the solar energy sector that all they were good at was collecting government grants and burning money. At the time a decade or more ago, he said the tech behind the efforts the government gave money to were literally pathetic. At least Tesla produces a serious impressive product. About a week ago, I had the pleasure or riding in a Tesla that just had the latest self-driving software and it was so good it was mind blowing and I'm an auto guy.

From financial management, product competitiveness, market conditions, business model, speed of innovation, management and leadership, to corporate governance (Board of Directors), Tesla has been facing many challenges over the past several years.

Suddenly, I noticed many similarities to what we witnessed and experienced with Intel. Tesla truly needs a full-time CEO - before it's too late.

 

[OneEng]

Tesla is key to competing against the Chinese in the area of high-tech cars. Tesla incorporates numerous high-end sensors, Nvidia chips, Micron memory along with state-of-the-art battery systems. Tesla is a key part of the tech structure of the US and even competes in space with Space X. If the US does not embrace and nurture a crown jewel of the tech world, the entire US economy could be in trouble. Full disclosure, I own no Tesla stock, but TSM and Micron stock who are both suppliers to Tesla. The Chinese are building an auto plant that is 650,000 sq. ft, and they are preparing to dominate this important economic space. The US is no longer immune from the rest of the world and must be able to continue to compete on the world stage.

I disagree.

Tesla has stagnated. Tesla has milked its success. It was already rapidly losing share to the traditional ICE OEM's before its fearless leader decided to alienate over half of the world by becoming the poster child for right wing politics.

Losing Tesla will do nothing to the US economy. The many other automakers (many of them ALSO U.S. based companies) will pick up the volume (as they already are).

The BYD offerings are quite impressive to be sure. While some of my collogues believe that their incredible prices are wholly due to the Chinese government putting its fingers on the scale, I tend to believe that this is only partially true. BYD has also created a vertically integrated supply chain that is impressive to say the least.

Still, there will be more than enough markets that are shielded by insane tariffs on BYD to maintain competitiveness for their national brands to flourish IMO.

Tesla won't be going away any time soon, but I expect (as do most analyst) that their share of the EV market will settle down around 10-15% in the long run while the traditional OEM's will pick up the rest.

Just my thoughts. YMMV.