QOTD: Could Tesla Still Go Under?

Doug DeMuro
by Doug DeMuro

The world is abuzz this week with news of the all-new Tesla Model X, which is a minivan that looks like it may at any moment take flight and get tangled up in some power lines.

Yes, ladies and gentlemen, that’s right: Tesla has brought the first gullwing minivan to market, and people are excited. And not just slightly excited. Elon Musk is giving press conferences to delighted admirers. Tesla fans are running up and down the streets in Palo Alto screaming “THE TESLA IS COMING! THE TESLA IS COMING!” And Pacific Gas & Electric engineers are currently on the job trying to figure out how to get the first Model X down from some high-voltage wires near Tarzana.

Essentially, it is Tesla pandemonium.

But there are a few, shall we say, problems with the Model X. One of them is that these doors — which undoubtedly are at the heart of massive delays that have pushed back Model X production considerably — are so unconventional that they may end up turning people off.

Yes, they make it easier to get out of the car in tight spaces. But they open so high that I wouldn’t be able to fully release them in my tight garage. They also ensure you won’t be able to mount roof racks on your Model X: instead, you’ll have to use an enormous carrier that sticks out well past the rear bumper. And then there are the potential reliability concerns that come from buying a new piece of technology from a relatively new company.

Those aren’t the only issues. Maybe the biggest problem with the Model X is its price tag, which starts at a rather steep $130,000. You may have thought the Model S was a car solely confined to the wealthy, but the Model X brings things to a whole new level: there isn’t even some “entry level” $70,000 model to make it seem like it’s available to normal folk who want to own a cool new electric minivan.

Tesla’s problems go beyond the Model X. Remember when the Model S came out, and it was the coolest thing on earth, and you stopped to watch it go by whenever you saw one on the street? Well, that was several years ago, and it isn’t quite as cool anymore. These days, you probably don’t give the Model S a second look — and why would you? They’ve become totally ubiquitous, just like the Mercedes S-Class or BMW 7 Series.

Unlike the S-Class or 7 Series, though, the Model S probably won’t be getting a redesign anytime soon. While it should be slated for one next year, Tesla has certainly devoted all of its engineering effort to the Model X — proven by the fact that no Model S development mules have been spotted and Tesla hasn’t said a word about a Model S replacement.

Now, I don’t want to make it seem like I think things are all doom and gloom for Tesla. On the contrary, this automaker has done what nobody could fathom merely 20 years ago: create a totally new car company, with a totally new product, and get people to buy it. It’s amazing — and it has one of the most excited, energized fan bases around.

And the cars are excellent. The Model S is fun to drive and full of technology that makes even today’s most cutting-edge cars seem like they aren’t quite there yet. Let’s be honest: The gullwing doors, while potentially cumbersome, are pretty damn cool.

But I’m wondering if Tesla is “safe” just yet.

With only one new product and one (aging) product that may not find a replacement soon, Tesla doesn’t have much to hang its hat on. Combine this with the fact that Tesla has yet to turn a profit — and likely won’t until 2020, according to Elon himself — and you have to wonder whether Tesla really will survive.

Some people may call me crazy, considering that Tesla has already sold so many cars and created such a fiercely loyal owner and fan base. But what if there’s some widespread problem with the gullwing minivan? A GM ignition defect, or a Takata airbag recall, or a VW emissions scandal, perhaps? What if people don’t buy it in the numbers they’re hoping for? What if the idea of a $130,000 family SUV just doesn’t sit well with consumers, no matter how cool the doors are?

Could Tesla still fail, even this far into the game?

Or with its reputation so strong and brand loyalty so cemented, have they finally reached a safe harbor where we can now accept them as the fourth American car company?

Doug DeMuro
Doug DeMuro

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  • HotPotato HotPotato on Oct 03, 2015

    Here are a couple o' fun facts about government subsidies. * Your government's tax policy subsidizes oil and gas companies, even though they're in the most profitable business on Earth (ask ExxonMobil). * The inflated military budget of the USA (equal to that of China, Russia, Saudi Arabia, France, United Kingdom, India and Germany combined) and associated foreign policy, are dedicated largely to ensuring the plentiful supply of oil and gas. Whether it's propping up a Saudi monarchy indistinguishable from ISIS, guarding Oxy's Columbian oil pipeline, sacrificing American soldiers and Iraqi civilians to regime change, or just refusing to rescind GW Bush-era handouts to the "ohl bidness", the costs are socialized onto you the taxpayer, and the profits are privatized to Royal Dutch Shell, ExxonMobil, etc. Subsidies to Tesla could increase beyond imagination and still be a tiny speck compared to the direct and indirect subsidies to oil and gas. And subsidies to BEV efforts actually prevent death and injury due to war and pollution, whereas direct and indirect subsidies to the fossil fuel industry do the opposite. Maybe those who oppose subsidies should take aim at the big ones that kill people, not the small ones that can save lives.

    • See 4 previous
    • Vulpine Vulpine on Oct 04, 2015

      @RideHeight "So are Ob*m*’s Wars going to be any less expensive?" Which ones are those?

  • Ruggles Ruggles on Oct 04, 2015

    RE: "Simply put, PCH, the car makes more money than it costs to build. If that's not profit, what is? The fact that the company is SPENDING more than it makes in order to grow does not mean the car itself is not profitable." It costs less to build than it makes ONLY if you don't add in all of its costs. There is a difference between margin (gross profit) and net. When a car is sold in a dealerships and makes $2K gross profit, it loses money after subtracting the overhead and selling costs. Tesla needs a lot more margin than it currently makes to be viable. That's why they need economies of scale that will be difficult for them to achieve before their competitors do.

    • See 8 previous
    • Vulpine Vulpine on Oct 05, 2015

      @Vulpine What's that about not being part of a circus, Pch? Hey, at least you made me smile this time.

  • Wolfwagen I have worked as a manager in both union and non-union locations. The best union employees were the ones who were indifferent to the union or told them to get bent. The worst ones were the ones who would run to the union for every little thing, even when it was their own actions that caused the problem or because they could not understand their own contract
  • Harry HOW i RECOVER MY LOST OR STOLEN FUNDS:You should gather and document all relevant details about the theft, such as transaction IDs, wallet addresses, and any communication with the scammer if any, and then proceed to message SYLVESTER. G. BRYANT to get back your lost/ stolen funds by sharing the evidence you've compiled. he was the only one who was able to recover my funds I was so surprised he got back my money worth $52k but glory be to God and all thanks to him.. here is his contact below: Instagram: Yt7crackerszEmail: Yt7crackersz@ gmail,com
  • Daniel J I had read an article several years ago that one of the issues that workers were complaining about with this plant is that 1/3 of the workforce were temporary workers. They didn't have the same benefits as the other 2/3 of the employees. Will this improve this situation or make it worse? Do temporary workers get a vote?I honestly don't care as long as it is not a requirement to work at the plant.
  • Kosmo Tragic. Where in the name of all that is holy did anybody get the idea that self-driving cars were a good idea? I get the desire for lane-keeping, and use it myself, occasionally, but I don't even like to look across the car at my passenger while driving, let along relinquish complete control.
  • Bof65705611 There’s one of these around the corner from me. It still runs…driven daily, in fact. That fact always surprises me.
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