[timr]

Actually, the reason GM "doesn't care" about the Volt (I'm exaggerating here; they obviously care a little bit) is because they're rational: electric cars are not popular with mass-market consumers, and it's far from clear that they're going to become popular.

GM is investing in what sells, and right now (i.e. for the last decade or two), that's SUVs and light trucks. Which doesn't bode well for Tesla, at least in the near term.

You can certainly argue that fuel prices are going to go up and make electric cars popular. The question is: does it happen before Tesla goes broke?

(Edit: downvoting doesn't change facts. From GM's own 2017 outlook [1]: "Ten all-new or recently redesigned crossovers are expected to drive GM’s sales and share higher in 2017, including the Chevrolet Equinox and GMC Terrain, which will compete in the industry’s largest segment." And they're not joking about that last part. As of February 2017, SUVs and Trucks dominate the list of most-popular vehicles sold in the USA [2].)

[1] https://www.gm.com/investors/sales/us-sales-production.html

[2] https://www.cars.com/articles/top-10-best-selling-cars-febru...

[mikeash]

EVs are unpopular because cheap ones aren't very good yet. You have to choose between almost unusably short range, or a very high price. Something like the LEAF is affordable, but only useful as a city car. A Model S is a great car, but extremely expensive.

The cost is coming down. Chevy is now selling the Bolt, which has pretty good range, for under $40,000. Tesla's Model 3 is coming soon. More will follow. The high cost comes from the batteries, which are getting cheaper all the time.

I'm not sure that "unpopular" is quite the right word. A lot of people really like Teslas. Most of them can't afford them. The desire is there, the means is not (yet).

It's smart to invest in what sells right now... until things change and that's no longer what sells. GM is investing in what sells today. Tesla is investing in what might sell in a decade or two. Tesla's approach isn't certain but if they're right then GM is going to relive their experience of the 1970s where they take way too long to react to a changing market.

[hacktothefuture]

100% agree but they have to be careful with the idea that "It's smart to invest in what sells right now... "!

The story is so reminiscent of Kodak. Huge 'titanic' of a ship that saw the writing on the wall, actually released digital cameras but the bulk of their infrastructure, employees and expenditures were in traditional film cameras. Once the industry fully shifted they still couldn't change course and died a slow agonizing death as taking pictures became a commodity that came 'free' with your cellphone.

[rootusrootus]

Aside from market share, it doesn't seem like much of a risk to go with what works now and save the big EV push for later. GM still came out with the Bolt, which is an excellent competitor for the Model 3. Not too pretty, but the numbers are all very good. So they know how to do it, and when the sales are there they can scale up production of whatever they're marking 10 or 20 years from now. I'd bet on GM in a battle with Tesla, to be honest, though Musk has a lot of chutzpah.

[ghaff]

It's a little different though. Kodak was invested in a huge consumables business and neither they (nor really anyone else) figured out a way to translate that sort of pay per use model to the digital world.

GM doesn't get money from gas (though their dealers do get money from maintenance which is hypothetically(?) lower with electric vehicles. Different anyway.)

[jrockway]

Kodak was a chemical company that was expected to start making semiconductors or consumer electronics. It's all "photography" but the film and digital industries are very different.

[paganel]

I've had the exact same discussion with somebody else today on /r/futurology, more exactly I told him that "under $40,000" it's still pretty damn expensive for a small hatchback. My 1.4l European small hatchback costs around 13,000 euros new, you just can't expect people to not take into consideration the huge difference between the 2 prices.

[yawz]

I'm not sure if this year all figures are the same, but when I was car-shopping in November, Colorado state granted up to $6,000 in tax credits for new EVs. Federal tax credit was $7,500. And on top of that, Nissan was adding their own discount for their new Leafs.

So, nobody pays the full price of an EV at the moment. You can currently buy 1-2 year-old, certified Nissan Leafs for less than $13,000.

[rootusrootus]

With the number of reservations Tesla has for the Model 3, we are going to find out rather quickly what effect losing the big tax credits has on electric adoption. Maybe that is hidden somewhat by the leasing -- buying an EV right now is foolish, leasing is a much better choice. Even the Model S is going through the auctions at half MSRP or sometimes less, and less prestigous cars like the 500E are auctioning at 4K or so. Anybody who purchased on outright a few years ago is going to be extremely upside down for a while longer.

[elihu]

> GM is investing in what sells today. Tesla is investing in what might sell in a decade or two.

It seems to me that the Bolt and Model 3 should be pretty similar in terms of cost, range, and price. The main difference is the Tesla brand / visual design and probably more self-driving tech in the Model 3. Am I missing something?

[vvanders]

Superchargers.

I regularly make a ~300mi roundtrip with our Tesla, I wouldn't own one today if that wasn't possible.

[edit]

Before anyone brings up ChaDeMo(I have the adapter), SAE combo neither are nearly as fast(120kW) in real-world use and have nearly as much market penetration.

The super-charger network is also something that's planned and built-out with the intention of being to make the major arterials rather than having a patchwork of various companies providing chargers.

[mikeash]

Non-Tesla fast charging stations also tend to be broken a lot, and are installed in small numbers, often single units. It's tough to plan a trip where you need a charge at a particular location when you could be screwed if a single spot is occupied or out of order. Most Tesla locations are 6 spots or more, and they're much better about fixing them when they break.

[vvanders]

Yup, and the just added real-time status on the nav map so you can see how many slots are available and re-route if needed.

[mikeash]

Have you made use of that feature yet? I've poked at it on the nav system, but haven't had to use any Superchargers since it came out.

[mikeash]

The Bolt can't really make road trips because the fast charging network it can use is pretty bad. (That's in the US. Supposedly Europe is a lot better in this respect.) Even where the facilities exist, the Bolt's charging rate is about half of what Tesla can do.

The self-driving/driver-assistance tech gulf is pretty big. The Bolt is fairly basic, while the Model 3 will have at least Tesla's Autopilot 2 hardware, which they say will be sufficient for full self-driving once the software is done. Even if that doesn't work out, it'll have excellent traffic-aware cruise control and lane keeping at the least.

I'd say the brand is also fairly important. Not (just) because Tesla is "cool," but because Tesla is committed. Supposedly GM is planning for something like 50,000 Bolts per year, so it seems like yet another car where dealers will try to steer you to a nice pickup truck or something instead, and finding someone willing to service it could be tough.

Putting it all together, and it seems like GM is putting their toe in the water, while Tesla is balls-to-the-wall (forgive the mixed metaphor).

[anchpop]

> probably more self-driving tech

I probably shouldn't be sharing this but I know someone who is working on the Bolt and he told me they've been having a lot of trouble integrating self-driving tech that's close to Tesla's

[beamatronic]

How hot is the market for a used Model S? It seems you can get a decent one for under $50,000. Is this generally regarded as a good deal? I know an "early adopter" who has had a Model S for many years, and I've lost count of the number of times it has left him and his family stranded.

[mikeash]

At that price you're probably looking at a pre-Autopilot car, which I'd probably avoid. Autopilot is great, for one thing, but also because Tesla's build quality got substantially better over time. I don't think it's because of Autopilot, but its introduction makes for a decent dividing line between old and new.

I haven't looked too hard at the used market, but it looks like a decent way to get one for less. This web site lists a bunch that Tesla is selling through their CPO program if you want to see what's out there:

https://ev-cpo.com/hunter/

For what it's worth, I have an early 2015 Model S and it's had a few minor problems, but nothing close to leaving me stranded.

[rootusrootus]

I am very interested to see how this plays out. Gas prices drive interest in electrics, and electrics drive down gas prices. Maybe the future of the consumer car market is going to split largely between gas-powered pickups and electric-powered sedans/crossovers.

This of course completely ignores the potential effect of self-driving cars. I'm still skeptical we'll see large scale automated driving for at least 10-20 years.

[mikeash]

I think gas prices are driving EVs less and less. It's still a factor, for sure, but things like performance, noise, maintenance, and convenience are driving it heavily as well. Of all the reasons I love my Model S, fuel savings are pretty far down the list, although I certainly don't mind!

[Robotbeat]

Yeah, that's the thing. If gas ever gets back up to $4/gallon in the US, EVs which are just somewhat competitive at $2/gallon are going to be radically competitive.

However, if EVs become widely used, then the lower demand for gasoline will mean gas prices stay low. So long-term, EVs need to compete with low gas prices anyway, even if prices creep back up in the near-term.

But yeah. Once batteries are cheap enough, then electric vehicles may actually become cheaper than internal combustion engine vehicles /upfront/, in addition to the much lower running costs.

[Digit-Al]

Here's a couple of questions for those out there with more knowledge of the subject than me. Firstly, how long do you think it will be before there is a thriving second hand market in EVs? Secondly, do EVs currently hold their value better than traditional vehicles?

I think you can only say EVs are a success when a used market is thriving. Many people can't afford new after all.

[mikeash]

There's a pretty decent market for used Model Ss out there. It's not huge, since Model Ss of sufficient age don't exist in great numbers, but it's not too bad.

I've been looking at cheaper used EVs for a second car. There are lots of used LEAFs out there, some Smart EDs, and a couple of Focus Electrics, which look really nice if you don't mind the short range, but aren't very popular at all. These cars seem to drop in value a lot for the used market. I saw several that were not all that old going for under $10,000.

Teslas seem to retain their value better. I'd guess it's partly because the car is more desirable, and partly because Tesla treats their batteries a lot better, so they can be expected to last longer. The LEAF in particular was known for a while for losing quite a bit of range in just a few years.

As far as how they'll retain their value in the long term, it's hard to say. EVs should lose less value due to things like drivetrain wear, since you don't have a bazillion moving parts in an engine and transmission to go wrong. But they'll lose more value to battery degradation. Much will hinge on how well the batteries age and how much they cost to replace in 10+ years.

[vkou]

One of the reasons for why there are so many used LEAFs on the market, is that a lot of EV early adopters sold their Leaf to buy a Tesla. If you wanted an EV, and could afford it, the specs on the Model S are much better.

This is not really great news for the low-end EV market, though - if the average person isn't interested in a midly used <$10,000 EV, how well will a $35,000 (With no frills - the average vehicle will probably be closer to $40,000) EV sell for?

Keep in mind that after years of making cars, Tesla is still struggling with quality control, supply chains, and repairs.

If we took a time machine, and traveled back to the early 00s, would you have dropped $40,000 on a vehicle made by Kia?

That's roughly where Tesla is today, in terms of maturity. I'm sure it will get better - but it may take a decade.

[mikeash]

> This is not really great news for the low-end EV market, though - if the average person isn't interested in a midly used <$10,000 EV, how well will a $35,000 (With no frills - the average vehicle will probably be closer to $40,000) EV sell for?

I don't understand this. The <$10,000 EV in question has a range of maybe 80 miles, probably less at this point. The $35,000+ EV will have a 200+ mile range and access to an extensive fast-charging network for trips beyond that.

Personally, I've stopped looking at the <$10,000 EVs in favor of waiting for a Model 3, because even though it's far more expensive, it's also far superior.

Tesla has no trouble selling Model Ss and Xs today even though they start at $68,000 and go up well into the 100s. They have a metaphorical line out the door for the Model 3. Tesla is struggling with quality control and such, and it could come back to bite them down the road, but it's not making it hard for them to find customers now.

[VintageCool]

Used LEAFs are super cheap because they have short range, and new LEAFs have a 50% larger range. The tech keeps getting better and making old electric cars less desirable to the market of buyers looking for an electric car.

[Robotbeat]

Well, I bought my '12 Volt used for under $10,000 with 60,000 miles. At the time I bought (last year), they were usually about $12,000 at a dealer, and trade-in about $8000 for the same car. I got mine from a friend who wanted to trade-in (to get a new Volt... the Gen 2 Volts--starting with 2016--are even better than Gen 1), so we both got a good deal. Fantastic car.

Anyway, there are plenty of used electric cars out there if you're happy with the models that have been out for a few years.

[Robotbeat]

The whole point of advertising is to make something popular that isn't already or to maintain popularity for something that would otherwise decline in popularity. As long as all GM is doing is sniping at other electric cars while doing general broad-based advertising of their fossil fuel powered vehicles, they're not lifting a finger to expand the EV market.

I wouldn't worry about Tesla, anyway. Tesla has huge brand clout and advertises by making really awesome, inspiring vehicles. You want the fastest production sedan? There's only the Model S. And Model X is, after all, an SUV/crossover. And Model 3, which isn't, will be the basis for the Model Y, which /will/ be a crossover and/or light truck. Again, Tesla will be perfectly fine on the demand front.

[timr]

"The whole point of advertising is to make something popular that isn't already or to maintain popularity for something that would otherwise decline in popularity."

You can't push on a string. Consumers buy bigger cars when gas prices are low, and more efficient cars when gas prices are high. It's why Toyota (which has built a brand identity around fuel efficiency) does worse when fuel prices go down.

Marketing can influence consumers' affinity for brands and perception of product quality. It can't change economics.

"Tesla will be perfectly fine on the demand front."

I'm sure there's a market. After all, Lamborghini is "perfectly fine on the demand front", too. But will the demand for electric vehicles justify a valuation on par with General Motors? That's the rub.

[kbenson]

> Marketing can influence consumers' affinity for brands and perception of product quality. It can't change economics.

Actually, I would say marketing is one of the few things that actually can change economics, since it affects perception. Marketing can make someone think they need a new car when they don't, or that a car is affordable than an alternative when it really isn't (given financing, fuel economy, services, etc which are not always taken into account).

People don't make decisions based on reality, they make decisions based on their perception of reality. If you can change that perception, you may change their decisions.

[timr]

You can make all the theoretical arguments you want, but the fact remains: when gas prices go up, sales of trucks and SUVs goes down. And vice-versa.

You think car companies want to change their assembly lines and tooling, if they can magically change consumer buying habits with a bit of advertising? Come on.

[kbenson]

> You can make all the theoretical arguments you want, but the fact remains: when gas prices go up, sales of trucks and SUVs goes down. And vice-versa.

If I was attempting to make an argument against that, I would have done so. You seem to have mistaken my comment as some rebuttal to your entire argument. I just thought one specific point was interesting, but not entirely correct from my point of view.

> You think car companies want to change their assembly lines and tooling, if they can magically change consumer buying habits with a bit of advertising? Come on.

Since you're asking, no, I don't think car companies want to change anything. That doesn't mean they won't be forced to change, and I think being forced to change rarely works out as well as noticing the trends and changing along with, or better yet, slightly in advance of those trends.

It's obvious by the change in types of cars bought based on gas prices that gas prices influence buying decisions for many people. But influence does not necessarily mean control. Many factors go into the decision of which car to purchase, electric or not. Fuel cost is but one of those factors. Tesla has shown that there are people that buy based on other decisions, since the price of a Tesla means that fuel costs are basically moot. Luxury, performance and status are all factors that the automakers and intimately familiar with marketing towards and selling to, usually each to varying degrees with different products. That they've left these areas mostly untapped for electric vehicles after Tesla has shown there is a market, since there were 400k+ Model 3 preorders as of roughly a year ago, leaves many people confused, and I don't think it can be entirely explained away by gas prices. That's enough presales a year ago to be on par with yearly Camry sales. GM is obviously doing something to try to tap into this with the Bolt, but that's still one entry and at the low-end.

[prolly_a_moron]

>But will the demand for electric vehicles justify a valuation on par with General Motors? That's the rub.

Yep. Building cars for the mainstream is a low-margin, capital-intensive business. That doesn't go away because Musk is brilliant.

[elihu]

Most people just need their car to get around and will migrate to whatever is the cheapest option with the capabilities they want. Right now, electric cars cost more. Eventually, they will probably be cheaper than gas. When that happens, the market for electric vehicles will be essentially the same as the market for vehicles. (Gas may still be needed in the medium-near-term for things like pulling a trailer up a long hill.)

[afuchs]

By what definition is the Model S the fastest production sedan? Its top speed is limited to 155 MPH (249 km/h) 155 mph (249 km/h). Compare that to the Aston Martin Rapide S at 203 MPH (326 km/h), or the more affordable Dodge Charger SRT Hellcat, who's top speed as given by the manufacturer is 204 MPH (328 km/h).

[Nadya]

The other common measurement of 0->60 acceleration and not top speed. The proper description would be "quickest production sedan" instead of "fastest production sedan" but I digress.

[chrishacken]

Close to 200,000 Prius's are sold each year. While that's no where near the "best selling" car, their Camry (400,000 cars a year), that's substantial.

[timr]

Ford sold 66,000 F-Series pickups in February 2017, alone. Small car sales are declining, across the board.

https://www.cars.com/articles/top-10-best-selling-cars-febru...

[chrishacken]

You can't really compare the "F-Series" with a single car. A more accurate comparison would probably be all sedan's with the F-Series.

But yes, trucks are on the rise again.

[sremani]

I am an Volt owner and I approve your comments. GM with BoltEV and Volt has demonstrated they are up with the EV tech, did they make miscues? Yes, no doubt. But the market needs to educated and for now Tesla is the Apple of Cars and the only brand Customers are willing to be educated from. Nissan Leaf had a decent start, but they cut too many corners, and I do not recommend Leaf. i3 is too limited.

Even though I whole-heatedly recommend Volt esp. Gen2. The market is not ready yet, and GM is doing what an established Car company does. Tesla's life depends on pushing EVs, so they are who they are.

[vvanders]

You're getting downvoted because you missed the argument that I presented.

It's not about what market segment that sells, it's that dealers have no incentives to sell electric vehicles since there's no margin on services and maintenance.

[caminante]

(Assuming non-material edits by the parent,) IMHO, he didn't miss your argument.

The topic's GM and GM dealerships. You said GM has to fight the GM dealerships due to conflicting interests, whereas, he's saying GM and the GM dealerships don't want "non" mass-markets customers to begin with (i.e. no conflict).

[erikpukinskis]

> GM is investing in what sells, and right now (i.e. for the last decade or two)

Yup. They haven't adopted the Andy Grove/Bill Gates/Larry Ellison philosophy of "Only The Paranoid Survive," yet. They are banking on the expectation that if/when consumer interest spikes they'll be able to use their influence to jump to the front of the line, like they did with past ICE competitors.

The question is... will the electric car market be more like the ICE market where paranoia is (apparently) unnecessary, or the semiconductor/software markets where it is (apparently) quite important.

[greglindahl]

I'm having a hard time connecting the facts with the discussion. Are you saying that GM should have made a crossover instead of the Volt/Bolt? Are you saying that Tesla doesn't have a crossover?

[timr]

"I'm having a hard time connecting the facts with the discussion. Are you saying that GM should have made a crossover instead of the Volt/Bolt? Are you saying that Tesla doesn't have a crossover?"

GM already has a crossover line. In fact, it has a bunch, and they sell really well:

http://www.gmfleet.com/vehicle-search/by-body-style/suvs-cro...

Point out Tesla's crossover SUV with the range of a gasoline vehicle and the price point of a Chevy Equinox ($25k). I'll wait.

[chc]

> Point out Tesla's crossover SUV with the range of a gasoline vehicle and the price point of a Chevy Equinox ($25k). I'll wait.

Whoa — you have to realize what you just did there, right? This is a massive shifting of the goalposts from what you said Tesla's problem was earlier, which is that SUVs and light trucks are what sells.

Anyway, I don't think most people with SUVs actually go through a full tank of gas a day, so having completely equal range doesn't seem like that big an issue. So now it sounds like Tesla's major problem is that they're competing with the Range Rover rather than the Equinox.

[astrange]

How large are those cars? No wonder traffic is so bad.

[hockley]

This kind of proves the thesis. EV is a hobby for the legacy guys that competes with much more powerful (by revenue) business units in the company. It's like expecting Kodak to compete and win with their own digital camera.

[sremani]

Every one does not start with a blank slate, that is a luxury Tesla has as an upstart. GM is "saved" to save jobs by US government. GM has paid back, but its operational reality depends on selling "profit-making" vehicles, which are SUVs and Trucks, pair it with cheap gas prices, there is a strategy for GM to be profitable.

Tesla on the other hand, lives and dies by its EV performance, and their approach to the market at higher end kept them alive along with loans from US with few strings attached (for various reasons).

Tesla did not "break through" any thing. If any thing, existence of BoltEV and Volt does demonstrate couple of things, a legacy car company when there are profits are going to turn on dime and make shit ton of EVs, if that is what market wants.

Tesla has brand recognition behind it, but again as some one pointed out when the market for EVs in high demand and profitable, from BMW to GM, you will have them roll EVs in millions.