On the other hand, they didn't need to create the company, the product and distribution network from scratch in a competitive environment. They had R&D and testing facilities, engineer workforce, factories and supply chains in place.
They are just excusing themselves out of this blunder. They sat on their asses changing the grill shapes and let an upstart undercut them.
It's easy to undercut another company if you're willing to make a loss.
If Tesla reaches profitability you can bet there will be a lot of other EVs on the road within two years from that point precisely for the reasons you listed in your first paragraph.
There been some dry spells for Porsche as well, when it was losing on the order of billions within a year. This does not reflect to maturity of internal combustion engine technology or viability of luxury vehicle business of Porsche.
That statement connected two non contradicting issues. Porsche could make that premium electric car, and it could stay in black.
Yes, they probably could. But the question really is whether or not they'd make a profit on that premium electric car. In other words, if they'd cross-subsidize from other income then quite probably Porsche as a whole would still be in the black but that doesn't mean they're turning a profit on the EVs, you'd have to break it out in order to establish that.
Based on the quote from the article my guess would be that they would not be making a profit on the EVs.
Tesla is as much a manufacturing upstart as it is a charger network upstart. Both parts can grow side by side. Shoehorning a charger network that is starting from zero into an existing, massive manufacturing and development organization that is perfectly tuned to the well trodden path would face a whole class of difficulties that simply don't exist in the all-new company.
> Shoehorning a charger network that is starting from zero into an existing, massive manufacturing and development organization that is perfectly tuned to the well trodden path would face a whole class of difficulties that simply don't exist in the all-new company.
But Mercedes would be ideal for that.
They own shares in most taxi companies in Europe, so they can start by electrifying them.
And the taxi companies HQ could each get a bunch of superchargers.
Which would immediately create the densest supercharger network in the world. And it would be profitable from day one.
>They sat on their asses changing the grill shapes and let an upstart undercut them
Or...maybe no one has figured out how to produce an economically viable electric car yet, Tesla included?
I mean, if already having the company, product and distribution is such a huge advantage, then the competitors have massive leverage, no? Or do you think Tesla has "already won"?
They did have massive leverage, the whole point of my post was they did not manage use it and are blame-shifting.
Tesla loses money due to continuing massive capital investment into production facilities, they still sell each car for more than what it costs to produce.
It is a rapid growth problem, certainly one of those things that Porshe executives are not familiar with.
But isn't always the game with ground-breaking technologies though? At first you don't make as much money, but you're laying the road for the big thing. And when the revolution begins, you're the one making the big bucks.
Not always at all. Also often, the forerunner disappears when other companies jump in at a later, proven, profitable stage of the technology, when both technology and the market are ready for mass production.
This. Ever heard of Myspace? Altavista? When making a market, watch out for well equipped and funded upstarts going to get you. Next victims of their own success: Docker.
I think in those cases, it was a matter of a better-designed, clearer-headed product taking space from a not-so-well-designed product. That's not what would happen here, because Tesla is already the creme de la creme. In fact, Tesla executing so well is the only reason EVs have seen their recent "resurgence" in the first place. And remember that Tesla isn't the first company to make electric cars.
I also think people underestimate by a lot how hard making new things is. It's not just a matter of coming in with more money. It's almost deceptive on Tesla's part that the cars seem simple. But if it really were so simple the Model S would already have competition. And when you're talking about someone who has raised a company that lands rockets in the middle of the ocean, competitors are fooling themselves if they think even just a superficial copy is going to be easy. This is something they have to bring their A game to at all levels.
Look back at 100 years of automobile manufacturing. The big companies we have today are the survivors. As recently as this century, Rover Group, a company that was around for a century and made a great product ceased to be.
The tax perks in many countries that have buoyed up Tesla sales are ending. So perhaps manufacturers don't see now as a good time to enter a market containing risk. Better to wait it out and plan accordingly.
They had some excellent ones too. Rover 600 & 75 were good cars. Many major manufacturers have had life-threatening failures in recent years resulting in recalls. Some surviving brands were much, much worse than Rover Group at quality. Lancia still exist, Alfa Romeo exist. Fiat in the 1980s, no thanks, I'm not paying for rust.
The Italian cars did rust at the slightest hint of damp weather but you soon forgot about that when you got behind the wheel. They had flair, style and driver engagement in abundance.
When I look back at the Rovers my dad drove they were as dull as dishwater and very poor quality.
They own Here maps, have laser-mapped all of Europe, work on self-driving cars, and own several european Uber-competitors and have stakes in many smaller taxi companies.
They are just excusing themselves out of this blunder. They sat on their asses changing the grill shapes and let an upstart undercut them.