06-29-2022, 12:37 AM
Yet another post detailing how Tesla is going to clown Ford, GM, and VW - from an au
<!-- SC_OFF --><div class="md"><p>You really need to have a good understanding of how traditional auto works. They make super tight margins on every new car sold. The dealerships don't make a ton either. </p> <p>The money on the repair part sale and service. This is where traditional auto makes the money. This keeps the castle gate closed at all times to new US companies trying to enter the market. It is also why they design and built shit cars that fall apart right after the warranty expires.</p> <p>Any new US company will (and always does) go belly up in a matter of years because they simply can't price to compete off the lot, and their fleet is not mature enough to generate that sweet repair part business. </p> <p>Now flip the market to electric cars that require little to no maintenance = no repair revenue. Now your entire model falls apart overnight. You are now forced to price the profit on the front end of the transaction, and now you realize that you are the one that can't compete with Tesla, which is making huge margins, at a lower cost.</p> <p>People in the car business understand this as a fact = and they all know that their business is going to be reamed. Look at Ford - they can't make money on the mustang, that is an unattainable long-term business plan with no backend parts business. Same with GM and their trucks. Look at where the Hummer is priced at. Why do you think a dealership would double MSRP?</p> <p>Why do you think Polestar splitting off from Volvo? Why is Ford going direct? The business model has changed because Tesla forced them to.</p> <p>Tesla was able to bypass this general rule because they were electric - at a time when the environment was becoming more and more important.</p> <p>Tesla has a MASSIVE lead in technology, infrastructure, marketing, and revenue. GM just lowered pricing on the Bolt. Tell me again Mary how you are going to lead yourself to the white house to pull favors for UAW votes. </p> <p>And anyone that pulls the "Tesla quality" hasn't ever owned a Tesla. I have paid $400 on repairs for my car with 120K miles on it. I couldn't walk into the Mercedes dealership for under $1400 in repairs. An oil change is between $200 and $400 for Christ's sake.</p> <p>Buy the dip -</p> </div><!-- SC_ON --> submitted by <a href="https://www.reddit.com/user/thebiglebowskiisfine"> /u/thebiglebowskiisfine </a> <br/> <span><a href="https://www.reddit.com/r/investing/comments/vmz2yg/yet_another_post_detailing_how_tesla_is_going_to/">[link]</a></span> <span><a href="https://www.reddit.com/r/investing/comments/vmz2yg/yet_another_post_detailing_how_tesla_is_going_to/">[comments]</a></span>
<!-- SC_OFF --><div class="md"><p>You really need to have a good understanding of how traditional auto works. They make super tight margins on every new car sold. The dealerships don't make a ton either. </p> <p>The money on the repair part sale and service. This is where traditional auto makes the money. This keeps the castle gate closed at all times to new US companies trying to enter the market. It is also why they design and built shit cars that fall apart right after the warranty expires.</p> <p>Any new US company will (and always does) go belly up in a matter of years because they simply can't price to compete off the lot, and their fleet is not mature enough to generate that sweet repair part business. </p> <p>Now flip the market to electric cars that require little to no maintenance = no repair revenue. Now your entire model falls apart overnight. You are now forced to price the profit on the front end of the transaction, and now you realize that you are the one that can't compete with Tesla, which is making huge margins, at a lower cost.</p> <p>People in the car business understand this as a fact = and they all know that their business is going to be reamed. Look at Ford - they can't make money on the mustang, that is an unattainable long-term business plan with no backend parts business. Same with GM and their trucks. Look at where the Hummer is priced at. Why do you think a dealership would double MSRP?</p> <p>Why do you think Polestar splitting off from Volvo? Why is Ford going direct? The business model has changed because Tesla forced them to.</p> <p>Tesla was able to bypass this general rule because they were electric - at a time when the environment was becoming more and more important.</p> <p>Tesla has a MASSIVE lead in technology, infrastructure, marketing, and revenue. GM just lowered pricing on the Bolt. Tell me again Mary how you are going to lead yourself to the white house to pull favors for UAW votes. </p> <p>And anyone that pulls the "Tesla quality" hasn't ever owned a Tesla. I have paid $400 on repairs for my car with 120K miles on it. I couldn't walk into the Mercedes dealership for under $1400 in repairs. An oil change is between $200 and $400 for Christ's sake.</p> <p>Buy the dip -</p> </div><!-- SC_ON --> submitted by <a href="https://www.reddit.com/user/thebiglebowskiisfine"> /u/thebiglebowskiisfine </a> <br/> <span><a href="https://www.reddit.com/r/investing/comments/vmz2yg/yet_another_post_detailing_how_tesla_is_going_to/">[link]</a></span> <span><a href="https://www.reddit.com/r/investing/comments/vmz2yg/yet_another_post_detailing_how_tesla_is_going_to/">[comments]</a></span>