Tesla Drops USA Prices up to 20%

[leadcounsel]

The numbers are easy to find. In 2022 Tesla had a YOY growth of more than 40%. Almost every other car maker had a decline.
The Model Y was the #6 selling car of any kind; the Model 3 was #15.

I'll also add that the average consumer was battered from around 2021 until now for a host of macro-economic reasons including inflation and huge wealth redistribution scams. That reflects why average car sales are down. Meanwhile, the wealthy elite glass grew significantly thru these same wealth redistribution scams. The middle class had to suspend vehicle purchases, while the wealthy were able to go buy luxury Teslas. It's quite obvious from the numbers what's occurred.

Since 2020, hundreds of new billionaires were created in the US, yet trillions of dollars were lost in the markets and the working middle class bore the brunt of these losses, along with inflation pains.

 

[leadcounsel]

It will be interesting to see what happens with Tesla. It's primarily a technology company with some diversity in energy and solar, obviously vehicles, data and information harvesting. But like I mentioned up thread, we know tech companies can go from king of the hill to irrelevant very quickly.

How does one explain a 65% drop in stock price in less than a year? That is alarming. For any company, but especially a image centric technology company where the head guy has gone from hero to enemy so quickly in the eyes of his major customer base. And, when the illusion of "save the planet" and climate change nonsense is being exposed for the frauds they are, the "virtue signaling" of Tesla ownership tends to evaporate. For instance, Joe Rogan had a guy on his podcast that exposed a lot of these lies and the cobalt mining. It was apparent to me that Rogan was a big less enthusiastic about his Tesla thereafter.

A quick history reflection shows other relatively large tech companies, each with their own competitive advantages, and products most of us owned or used, that crashed and were gone seemingly overnight. Some of these had a near total grip on their particular market. That list includes AOL, Palm Pilot, Blockbuster, Compaq, MySpace, Circuit City, and Netscape come to mind. At one point I used/owned most of these products.

The point is, I don't envision how Tesla can continue to grow its market shares. For them to sell cars, there needs to be an infinite supply of millionaires who want them. Anyone with a desire and cash, probably already bought theirs. And when it offers what is almost surely going to be a poor resale value, or poor lifespan, or every expensive maintenance, the spell is going to wear off. Just my opinion.

 

[Ws6]

I thought Tesla fit & finish has improved over the past few years.

It has, especially the Texas cars, but it's still not with its peers.

 

[edyvw]

Exactly. And when another competing vehicle emerges and sells, your market share goes down.
Look at all the legacy car market that Tesla has won.

True.
But it won’t be sustainable as most sale is based on trend+govt. help.
And that is why prices are down.

 

[RhondaHonda]

I've been waiting, since day 1, to see if GM/Ford/Honda/Toyota/Fuji/HMG.... will swoop in and take over Tesla. Still waiting.

At what point, do all those, not 'replicating' anything special companies, swoop in and take 'em over?

All companies are fragile to some extent. Tesla grew because of a great social credit score. And now, their value dropped because of a not so great social credit score. Remember the SCS for when you're applying for a loan, mortgage, creditcard.... we're sorry, you were denied because of what you posted on some chat/comment 'site, even though you have all bills paid on time, a secure and great paying job, money in the bank..... Your online opinion hurt our feelings. Almost as bad as going to the sporting goods stores, spotting a product, and having the big bank credit card refuse the transaction because of the product type or name of the sporting goods store, or being a bank that has done all transactions with a certain business or individual, and then simply drop them.

Is Tesla even a car manufacturer? or a carbon credit trading company?

How would GM, Toyota or anyone else go about purchasing the outstanding shares of Tesla? They don’t have enough money to buy the shares.

I’m all for the price decreases and would consider a model 3 as a commuter/local car. It’d be perfect for my daily use.

 

[Sam_Julier]

What does BMW bring to the table? Declining sales and market share? Low margin business model?

BMW brings nothing.

 

[i6pwr]

I feel the new battery technology is one reason for this.

Alot of R&D into the current EV's, along with their lithium ion batteries.

Need to get these EV's purchased before other manufacturers get rolling with sodium ion.

 

[97prizm]

Right now it's bringing terror to the hearts of shareholders too, and Elon as he see his wealth slowly dwindling away.

He's the only person in History to lose $200 Billion dollars.

 

[JeffKeryk]

True.
But it won’t be sustainable as most sale is based on trend+govt. help.
And that is why prices are down.

Tesla is turning up the heat on the competition. Their margins and factory speed are formidible weapons.
To your point, the trend is up, skyrocketing. What other car company would be deemed a miss that had 44% growth YOY?

The Highland refresh in Q3 (Elon time, so who the heck knows) should boost sales for customers like me.

As you say, the government subsidies will help Tesla sales. They are available to all car companies, but Tesla's US EV market dominance can be leveraged to grow even faster than the 50% growth forecast. Tesla was almost cheated out of the program, but instead lowered prices and got in.

If you really wanna speculate, what about including any sales of Tesla’s next-generation vehicle, which may be available next year? A low priced Tesla available to the masses? That's Civic Corolla territory. Wait for the March 1st Invertor's Day.

Interesting times ahead.

 

[JeffKeryk]

He's the only person in History to lose $200 Billion dollars.

And he's still the 2nd richest man in the world, right?
Word is, SpaceX with its Starlink satellite internet constellation will dwarf his Tesla billions.

 

[leadcounsel]

I'll speculate that the more folks get educated, the less interested in EVs they are. When folks are paying more to charge their cars than a tank of gas, interest will plummet. As rolling blackouts cripple cities, especially with the terrorism taking out grids, and/or the next storms or cyber attacks that kill grids, people are going to be losing massive interest in these EVs.

That combined with global energy problems, global wars, and our recession that is going to be a long cold depression for the next many years will see that Tesla struggles in 5 years, maybe doesn't survive in a decade. I know I would not be buying a car that costs twice as much that lasts maybe half as long, when there's no parts available and nobody knows how to fix them.

 

[leadcounsel]

Adding to my above comment, most people cannot afford a Tesla. For those that can, it's rarely their first or primary car. Instead it's a 2nd, 3rd, or 4th car. EG a toy. When there is a deep global recession and particularly a depression, people cut out wasteful spending on toys and tighten belts. Luxuries like boats and unnecessary cars get omitted. I see that, as Tesla's 10 year future.

He's the only person in History to lose $200 Billion dollars.

And he's still the 2nd richest man in the world, right?
Word is, SpaceX with its Starlink satellite internet constellation will dwarf his Tesla billions.

Yes. But his wealth could vanish, rapidly. He's lost more than half his wealth, which was once mid $300 billion and now mid $100 billion, around $150 billion. The rest could go just as quickly as the prior $200 billion lost.

In addition to the unwinding of the false promises of the EV vehicles as folks get educated on these, and the currently very bad economic times which are predicted to get extremely bad for the next years, Musk alienated his customer base, significantly. It may seem hard to fathom but his wealth isn't that secure and he could lose another $100 billion in a few quarters time if the stars align against him, particularly in our "cancel culture" climate.

 

[Trav]

Slashing prices by 20% is a sure sign things are not good at Tesla.

 

[JeffKeryk]

From Deutsche Bank today:

"Analysts wrote in a note, “Initial market reaction was to view this as a costly reactive move which will undoubtedly put considerable pressure on Tesla gross margins and earnings. Instead, we believe this likely is a bold offensive move, which secures Tesla’s volume growth, puts its traditional and EV competitors in great difficulty, and showcases Tesla’s considerable pricing power and cost superiority. Just as importantly, this could be the cut to end all cuts, helping reset Tesla’s 2023 estimates to a level where any further risk would be to the upside, and enabling investors to refocus on the considerable longer-term opportunity and next-gen platform, which will be presented at Tesla’s CMD on March 1.”

 

[edyvw]

Tesla is turning up the heat on the competition. Their margins and factory speed are formidible weapons.
To your point, the trend is up, skyrocketing. What other car company would be deemed a miss that had 44% growth YOY?

The Highland refresh in Q3 (Elon time, so who the heck knows) should boost sales for customers like me.

As you say, the government subsidies will help Tesla sales. They are available to all car companies, but Tesla's US EV market dominance can be leveraged to grow even faster than the 50% growth forecast. Tesla was almost cheated out of the program, but instead lowered prices and got in.

If you really wanna speculate, what about including any sales of Tesla’s next-generation vehicle, which may be available next year? A low priced Tesla available to the masses? That's Civic Corolla territory. Wait for the March 1st Invertor's Day.

Interesting times ahead.

They are not tuning up anything, except in minds of cultish followers.
I didn’t catch that Tesla is developing ICE? Can you tell us more about it? Are they developing competition to RAV4? Highlander? Pilot? etc? I would really like to know it.
Get out of Bay area. There is interesting world out there.

 

[leadcounsel]

From Deutsche Bank today:

"Analysts wrote in a note, “Initial market reaction was to view this as a costly reactive move which will undoubtedly put considerable pressure on Tesla gross margins and earnings. Instead, we believe this likely is a bold offensive move, which secures Tesla’s volume growth, puts its traditional and EV competitors in great difficulty, and showcases Tesla’s considerable pricing power and cost superiority. Just as importantly, this could be the cut to end all cuts, helping reset Tesla’s 2023 estimates to a level where any further risk would be to the upside, and enabling investors to refocus on the considerable longer-term opportunity and next-gen platform, which will be presented at Tesla’s CMD on March 1.”

Deutsche Bank is NOT the most credible source in the world. It's a grossly mismanaged financial institution ripe with corruption and fraud. Stock price has been tanking for 10 years. In 2019, DB nearly collapsed bringing down entire economies....
https://news.bitcoin.com/deutsche-bank-collapse-could-crash-global-financial-markets/

https://www.globalbankingandfinance.com/deutsche-banks-rollercoaster-ride-towards-more-stability/

 

[edyvw]

From Deutsche Bank today:

"Analysts wrote in a note, “Initial market reaction was to view this as a costly reactive move which will undoubtedly put considerable pressure on Tesla gross margins and earnings. Instead, we believe this likely is a bold offensive move, which secures Tesla’s volume growth, puts its traditional and EV competitors in great difficulty, and showcases Tesla’s considerable pricing power and cost superiority. Just as importantly, this could be the cut to end all cuts, helping reset Tesla’s 2023 estimates to a level where any further risk would be to the upside, and enabling investors to refocus on the considerable longer-term opportunity and next-gen platform, which will be presented at Tesla’s CMD on March 1.”

Same guys who said that it is really big problem acquisition of Twitter and drop in stock prices, to which Tesla cult responded that it is all grand, secret plan by Musk?

 

[JeffKeryk]

Tesla is not playing nice with the competition. They will continue to take market share from legacy car manufacturers, who are already margin strapped.
Tesla slashing prices is not good news for their competition. This is how business works. Watch.

 

[edyvw]

Tesla is not playing nice with the competition. They will continue to take market share from legacy car manufacturers, who are already margin strapped.
Tesla slashing prices is not good news for their competition. This is how business works. Watch.

Again, what they have to offer to bunch of people picking up kids at school today? I have not seen one Tesla, but saw slew of Toyota’s, Honda’s, VW’s, JEEP’s etc.
Tesla does not compete at all in that segment. Until EV offer what today’s Sienna or Pilot offer, it is not any kind of competition. Only competition can have Tesla in its own game. Tesla is nit developing ICE, others are developing EV. Others can afford to experiment with EV; they sell other vehicles too, and don’t burn $44bln occasionally to compensate for other deficiencies.

 

[leadcounsel]

Tesla is not playing nice with the competition. They will continue to take market share from legacy car manufacturers, who are already margin strapped.
Tesla slashing prices is not good news for their competition. This is how business works. Watch.

Which is more likely? Your explanation, or the fact Tesla badly missed Q3 sales expectations, widespread fears of global recession and reduced demand, and collapsing stock price?

While it is accurate that Tesla has seen a large increase in sales, it's not meeting target numbers and that's a bad sign for a young company. Can they weather it, burn thru a lot of cash, buy back their own shares? Time will tell. I bet, no.

https://www.theguardian.com/technology/2022/oct/19/tesla-quarterly-revenue-elon-musk

Tesla misses quarterly revenue expectations amid fears of slowing demand​

"Company posts $3.3bn in net income and $21.45bn in revenue as vehicle production outstrips delivery.
While some analysts remain bullish about Tesla’s growth, they caution that the company needs to be careful about how much it increases the prices of vehicles given the wider economic slowdown. The company said that while each of its factories saw record production, that “supply chain bottlenecks” including battery supply chain constraints “remain immediate challenges”."

Wait, I thought Tesla controlled all supply chain internally? I am confused.

I go by what I observe in the world. Outside of ritzy elite neighborhoods where millionaires own numerous vehicles, I never see Teslas anywhere. They simply are not owned or driven by the masses, and to be really impactful and survive one needs a product that is driven and owned by the masses.