Creating an affordable EV at mass consumer scale is a much harder problem than creating a luxury EV at modest volume. However, if there was anyone I would bet on making this work and building an amazing car, it would be Elon Musk and team.
SUVs are everywhere. Light trucks are everywhere. Minivans are everywhere. Most of these are in the $35K+ range (the F150 -- the top selling US vehicle -- has an average selling price of $41,776). Even a decently equipped Honda Accord (along with light trucks, the most popular car in the US. Not the Civic, but the Accord) is pushing past $30K.
Often the median and the average skew. But minus actual data beyond just anecdotes, the average is the best we have.
Since this doesn't include used cars, I think it's fair to say that the average household is spending less than that.
Yet the #1, most popular vehicle sold in the US, the Ford F-150, sells for over $41K generally. There are many other completely ordinary, most certainly mass produced, vehicles in that price range. Bought by entirely "normal" people.
These discussions always remind me of a great Onion article (http://www.theonion.com/article/sociologist-considers-own-be...) about projecting one's own lot across the population at large, and using our own situation and choices to define "normal".
Obviously it will be "mass-produced" for any reasonable definition of the phrase. My point was that this is still a luxury vehicle that will be purchased by people whose wallets will be able to handle production problems.
"Yet the #1, most popular vehicle sold in the US, the Ford F-150"
There is a reason for that. That is a work vehicle.
"These discussions always remind me of a great Onion article about projecting one's own lot across the population at large, and using our own situation and choices to define "normal"."
This is hilarious because it's exactly what I'm responding to. Some set of the HN crowd, despite this entire discussion, still seems to think $40k is a normal amount of money to spend on a car. It isn't. And, again, I think the evidence is on my side. The median family does not, in fact, buy $40k cars, regardless of whether you think I'm projecting or not.
Here, for example, is some information on median used car prices:
One minor counter to this is that you shouldn't get too caught up in the hype about this being a mass-produced car. HN and tech journalism is a bit of a bubble. Normal people do not spend $35-40k on a car.
You are moving the goal posts around to somehow derive a win through some simply wrong statements. That's hardly uncommon, and is the manifestation of ego.
There is a reason for that. That is a work vehicle.
The overwhelming bulk of F150s are bought for personal use, which is exactly why the average price is so high now. The work truck doesn't have the leather interior and xenon lighting package.
And, again, I think the evidence is on my side.
I have no idea what your "side" even is (though your core claims are simply wrong, it seems that you're trying to say that this is such an exclusive, abnormal price range of cars that the buyers are more forgiving? I find that almost impossible to believe: if you want to see an angry, demanding customer, get to know someone with a BMW 3-series). There are almost 18 million new vehicles sold in the US per year. The average price is pushing towards $35K. This is where Tesla is getting involved (I don't think anyone makes cars for the used car market...), exactly at the sweet spot of the average price.
Your priceonomics link has literally zero relevance to this, or data applicable to this discussion.
You desperately want to be right, and that's a pretty common sentiment. Fine. But your original claim was simply wrong (elsewhere you twisted it to not only somehow claim that these people aren't "normal", but also that people who buy a more expensive car are wrong and shouldn't be doing it anyways), however much you claim that people missed your ethereal point. The Tesla 3 absolutely falls within the realm of mass produced cars, and millions of entirely "normal" people are buying that price range of vehicle. They are targeting a completely ordinary market.
And then this is where it gets weird: they then tell you, nope, you're wrong, your point was whatever they first interpreted it to be, no matter that you just clarified that that wasn't your point and tried to clear up the confusion.
Please don't do this. It's a really uncharitable and unnecessary way to conduct a discussion. I just told you what I intended my point to be. What do you gain by claiming that I'm hiding some other actual point? What would I gain by hiding some other point? In this particular case, I didn't even put any blame on the reader. I blamed myself and apologized for being unclear. If that's goal-post moving, then what hope do any of us have?
Creating an affordable EV at mass consumer scale is a much harder problem than creating a luxury EV at modest volume.
...which was advanced in the context that regular people wouldn't be as forgiving with Tesla's production problems as current owners have been. My point then (and now) was that we shouldn't get too carried away with that line of thinking, because the Model 3 is still going to be a luxury car that will be purchased by people who can afford to deal with some issues.
People who buy new BMWs (by analogy) know that they're going to cost more to fix than a used Honda Civic.
That was my entire point. If it wasn't clear, then I'll take the blame for that. What I won't cop to is some sort of concealed sociological attack. Now, if I know what's good for me, I'll shut up :P
He claimed :Normal people do not spend $35-40k on a car.
He further clarified that his definition of normal person to be one that doesn't tend to buy new cars, only used.
You point out that 18 million new cars are sold per year and that average new car price is over 30K a year. That completely misses the point that approx 60 million cars are sold in the US per year or around 1/3 of cars sold are new cars. The average price of a used car sold in the US is around $18,800. Therefore the average car sold is A) used B) cost less than $30K.
Number of Used cars sold: http://www.cnbc.com/2014/08/22/used-car-market-showing-no-si...
Average price of a Used car: http://www.edmunds.com/about/press/used-car-prices-increase-...
Um, just wow. I find it hilarious that you seem incapable of understanding you are talking about new cars while dionidium is talking about used cars.
And then you go off the rails with some strange conspiracy theory about dionidium labeling people as not normal and that people buying luxury cards as wrong when no such thing happened.
I think you should apply your words to yourself and reflect a bit.
"Normal people do not spend $35-40k on a car."
That is dionidium's phrasing, and you're throwing slurs at me? Really?
"you seem incapable of understanding you are talking about new cars while dionidium is talking about used cars"
In a conversation that can only be about new cars, in a discussion that was about mass production (wait..were they talking about the mass production of used cars?)
EDIT: I realize now that talmand is simply a troll, and I apologize for biting.
I see you didn't reflect upon yourself. You really need to stop projecting. I suspect you are just having fun with us.
Normal people do not spend that much money on a car, new or used.
I would have to assume that all used cars were mass-produced at some point in the past, or were all used cars hand manufactured?
>> If you have nothing to add, maybe keep your nonsense to yourself.
Oh, yeah, you're just having fun at our expense.
1) It is absolutely true that they sell more retail trucks than fleet trucks
2) I was merely pointing out that it wouldn't be the most popular vehicle on the market without the fleet sales
3) This has nothing to do with my original point and I probably shouldn't even have responded to it
If you want controversial, here you go: a lot of people in this thread own cars that cost $40k and up on a salary that doesn't justify it. They think they can justify it. Everyone is telling them they can afford it. Their friends all have similar salaries and similar cars.
But they're spending too much.
http://www.financialsamurai.com/the-110th-rule-for-car-buyin...
Also is driving for Uber really good financial advice ?
And why do people use gross income. Should use net income. It's not like you can deduct your car on taxes.
Fact 1: there are a lot more super-expensive cars than super-cheap cars.
Fact 2: The guy you replied to is talking about what a family spends on a car, not what they spend on a new car
Fact 3: income inequality means there are a lot more poor families than wealthy families. income distribution in america is not a bell curve.
Regarding "Fact 2", I have no idea what they're even arguing. Their core point was absurd, and they really truly seem to think it's the rich who are buying $35K cars (not "normal", despite being utterly normal for new cars), which is laughable nonsense.
This is all just a diversion. The Tesla 3 is absolutely in the center of the average new car, that normal people buy. Tesla makes, unsurprisingly, vehicles for the new car market. Tens of millions of completely normal Americans buy new cars yearly.
Rebutting an argument by claiming it is not based on any evidence? While providing absolutely no evidence of your own? Okay, cool.
> Regarding "Fact 2", I have no idea what they're even arguing
Their core point was if you're discussing people who buy new cars, you're already skewing away from the poorer demographics. People spend less on average to buy a car, than they do to buy a new car.
> The Tesla 3 is absolutely in the center of the average new car, that normal people buy
The tesla 3 is a little above the average price that people pay for a new car, among the fraction of people who buy new cars. Which most people don't do.
Again, the data tells us that an enormous number of completely normal, ordinary Americans buy new cars regularly, and that they spend a lot. Anecdotes or personal projections can give us a completely skewed notion about this (e.g. I know zero people who own a gun. Therefore no one owns guns), but if you compare the data to your anecdote, clearly they don't correspond.
And FWIW (which is little), every one of my neighbors has vehicles worth well over the average. In the exurb town I live in on the outskirts of major city, you never, ever see an older car, or a junker, or anything of the sorts. Burger flippers have shiny new Kias. The middle class have giant SUVs. And so on.
That's what we're discussing. That the amount people pay for a car, is less than what people pay for a new car. That's the only point I leapt in to defend, and if you're arguing with me against other points, then you're talking to the wrong guy.
Look- the average number of arms for a tennis player is less than 2. Similarly, some (perhaps most) people spend their car-acquiring dollars on used cars. So, the average amount people spend on a car is less than the average sale price of a new car. QED, end of discussion.
Now, you want to argue that among people who buy a new car, $35k is acceptably average? Okay, fine, whatever, I don't care, and neither does anybody else in this thread.
This conversation is specifically and only about new cars, in this case the Tesla Model 3. It is outrageous that you're implying that I'm the one diverting the conversation, when the very root post by dionidium was a completely irrelevant non-sequitur as they injected some completely irrelevant sociology bias into the conversation. If we were discussing the average price of a fast food meal, would a comment about a Cup O' Noodles have any relevance?
No one cares to argue what people pay for used cars, or for no car at all, because that is irrelevant to this discussion.
I understand that's certainly how you've been behaving. Despite several people trying to disabuse you of that notion.
Average (or mean) is the sum of the values divided by the number of values. Because of the way it is calculated, it is more likely to skew when the data includes extremely large or extremely small values. Median on the other hand is a way to measure the "middle value". For data sets of odd cardinality, it is simply the middle value, and for even cardinality, it is the mean of the two middlemost values. You can have a large number of extreme values with no effect on the median value, depending on the data.
As an example let us look at a hypothetical neighborhood. We have a family making 50k, another 100k, another 150k. Their average salary is 100k with the same median. Assume some super rich guy making 10 million. Our average goes up to several million dollars, but the median sits at 125k, more representative of where the data is clumped.
None of this to say that median is a good measurement in what I'll call malicious data sets. Imagine a data set with 1000 entries of negative 10m and 1000 of positive 10m. If I add a new data point of 5000, this is my median but doesn't represent my data at all.
Bonus: there's also "mode" which measure the value that has the most entries. E.g. in a set of 1 2 2 2 3 4 5, mode is 2.
On the other hand median just gives you the value that split the distribution in two exact parts.
Price/Income distributions are the perfect match if you want to see avg bias taken to its extreme.
e.g.
median of [2,2,2,2,2,2,2,100] = 2 average of [2,2,2,2,2,2,2,100] = 14.25
That's the mean price though, and the price curve has a very long tail. The median is significantly lower.
I think the Tesla 3 is going to do very nicely in that market given its artificial constraints.
Given the lethality of air pollution in Beijing, I'm not sure it's fair to call "artificial" those emission-limiting constraints.
Otherwise, you'll also have to call "artificial" the constraint that one can't shoot/knife/strangle people who go out of their ways to be pains in asses, however genuine and natural the urge might seem :-)
Other than that, yes, China is likely to be a very good market for Tesla, at least until local knock-off become available. I'd actually be surprised if Tesla's worldwide production matched China's demand.
BYD already produces electric cars that are even subsidized in many cities. However, the people in Beijing buying Teslas would rather buy a BMW or Audi anyways if they could get the license plates for them, and they wouldn't be caught dead in a Chinese-brand car (and the way the BYD electric taxis have been rumored to just explode, they think being caught dead in them is a possibility).
If Chinese demand is sufficient, I'm sure tesla would just open up a factory or two in China to supply it. They might even take on a Chinese partner in a JV given that they are so willing to share patents with competitors anyways (with the bonus that the partner would provide much of the RMB capital to startup, it's the one thing China has a lot of).
Really? I can't imagine anyone who's actually driven a Tesla wanting to go back to an ICE vehicle.
People aren't buying Teslas because they're greener or cheaper to operate or even because of government incentives (although those are additional, feel-good benefits).
They're buying them because they're better cars. Faster, quieter, more fun to drive, filled with the latest technology.
EV's are great for a number of use cases but they are not even close to a viable option for many uses of ICE's at the present. No doubt this will change but even if a Tesla is a 'better car' than my daily driver 'Faster', 'Quieter', 'more fun to drive' and 'filled with the latest technology' do not move the needle for me relative to 'can function anywhere on the European continent without any worry whatsoever', 'fuels up in < 5 minutes to 'full charge' and another 600 km of range', 'does not require specialty knowledge or a dealership for basic maintenance'.
Oh, and if with 'faster' you are talking about acceleration then I really don't know why that would even be a factor because in normal daily driving that's the least of your problems and so on. This appears to be an argument based mostly on emotion rather than actual facts around transportation.
Taxi services, commuting, local transport are all excellent use cases for EVs. Going longer distances a hybrid is right now probably the best you can do and it will be a while before EVs will be able to compete across the board with ICE's. You'll know when we have achieved parity because gas stations will start closing, or will replace pumps with EV super charging stations en-masse.
NB Is anyone looking into solving this particular problem - because it's one that a lot of people will face.
1 - I mention this as it is inconceivable to me that I would move simply to have a different kind of car.
Some boroughs of London are quite well covered, with charging points every 1-2 blocks or so (Westminster), where as other parts are pretty useless (Camden). Because the charge point spots are reserved for EVs only, and can only be used while charging, you can usually find an available one pretty easily.
There's talk of designing charge points that can easily be attached to existing street light poles, so in terms of infrastructure the cost to implement charging points on every street should not be unreasonable, once the demand is there.
I see Teslas and BMW i3's parked on the street near me regularly in London with no obvious access to a nearby charging point, so it's certainly possible to use an EV this way at the moment - if not entirely as convenient as having your own charge point. If you're only driving around the city then you probably don't actually need to charge all that often (maybe once a week or so), and for long-distance trips you can stop at a fast charger or supercharger.
Now that's a sensible idea.
I have seen a couple of Teslas in Edinburgh - but they look like people commuting into the city. Not seen an electric car parked anywhere that looked like the owner lived there.
Our car usage doesn't really fit with current electric cars usage - but I'd love to try if we had a suitable home and a need to commute by car (both my wife and I walk to work at the moment).
Edit: Another option would be to buy a garage - but at £60K to £80K that would rather defeat the purpose of buying an electric car to save money!
I'm assuming that the council will install charging stands at some point - if these had dedicated parking (and no residents parking charge!) then that would encourage people to use them.
Some properties in the street have coal holes in the road - that might an interesting place to install charging paraphernalia.
What was the range of the first ICE vehicle I bought on a tank of gas? 300 miles. What's the range of the Tesla model S? Also 300 miles.
For most consumers, they will actually spend less time waiting for fuel, since the Tesla charges in your garage at night while you're otherwise occupied, and an ICE vehicle requires you to wait in freezing outside temperatures while fueling it about once per week.
Not sure if this is still planned, but at one point the intention was to have automated stations that would pull off your battery and replace it with a freshly-charged one, which should take about the same time as a gas station stop.
They're well-made, sure, but they're foremost a luxury and status symbol. They're better than other status symbols because they actually have functional value that comes close to their market value, but they're still a status symbol.
However it seems that Tesla is actually trying to reduce its price point to make their products more affordable -- and that they're not as interested in treating their product as a fashion brand (yet).
Not sure why this opinion is downvoted, but I agree.
The Model S is quite an engineering feat, particularly the D. But the Model 3? There are quite a few cars in that segment that have the performance and "luxury" of that car for cheaper. Being electric (and a Tesla) is the only selling point, and I don't value it that much.
I want an electric car as a commuter; something that I can go back and forth to work in every day, and charge at night. A high-torque, RWD electric car is a tough sell for the winters we get here, especially at the ~$50,000 CDN it will likely cost.
Once they get used to it, I think Tesla will be a hit. It's just not that way yet.
and btw, bmw already sell a EV for under 35k for over a year.
Burning coal (especially when coupled with electric motors, which have efficiencies of 90%+) is more efficient than burning gasoline.
Neither is anyone else. People buy Teslas because they are the best car money can buy.
I can't imagine you can make a valid case that there is one best car that money can buy, presumably for everyone who can afford one.
2. To match your claim, it would have to have the highest reviews on every publication/outlet.
I'm simply pointing out how vast your claim is that somehow every single car buyer who can afford one would want to buy one. Think about the luxury large SUV market, or the coupe market, or the exotic coupe market, or the super-luxury sedan market, etc.
The thought of charging your vehicle with electricity is seen as a low-class activity, for those who can't afford a "real gasoline" vehicle.
I expect it to be a great car but I see people looking at it who really aren't in a position to do so.
Repairing this thing out of warranty will be even more of a joke than with regular new cars (and that's already an economic tragedy.)
The only significant repairs I can imagine on this vehicle are replacing the tires or brakes. As long as the oil changes and maintenance are done regularly, I highly doubt the engine will have any problems until 200,000 miles or so, at which point the vehicle will be almost 20 years old and have cost about $1,000 a year to drive.
New vehicles are incredibly reliable (compared to vehicles produced in the 20th century) and are likely to last a long time, although the electronics will surely be dated when they are 20 years old.
The tesla vehicles have an 8 year warranty on the battery pack, which is the only item besides tires, brakes, and windshield wiper blades that is likely to wear out.
This is Tesla marketing through and through. Look at all the problems the Model S owners have had and reconsider the statement.
Cars the size of the 3 place in the teens to mid twenties though there are examples outside those ranges. The issues EVs have always faced is that many families if not individuals cannot afford a car with any limitations. By that I mean, both cars have to be able to wholly do the duty of each which usually involves going anywhere at any time.
Two hundred mile EVs might change that but only to a point. It will take a proliferation of charging stations and change in public use of them.
Between the Tesla 3 and Chevrolet Bolt the real change here is that the consumer EV market, the "median price market" has finally matured. All previous generation EVs which include the Leaf, i3, Focus, and eGolf, are as near to being obsolete as they can be. Sure they use still but their range limitation is even more exaggerated, especially at the price points being set by GM and Tesla
That may be true for the US market but Tesla is selling globally now. Trucks don't sell very well in Europe for example.
I don't think you've been car shopping much recently. 'Economy' cars like the Honda Civic, Mazda 3, Toyota Camry, etc. can easily push up against $30k with a few options. For some real sticker shock look at minivans, a Honda Odyssey can easily hit $40k-50k out the door.
With a five year loan or a three year lease and a bit of trade in from a previous car you can easily be driving a $35k car for just a few hundred bucks a month.
I'm having trouble finding a median car sale price -- there are a bunch of articles about the average cost of new cars -- but I doubt most families actually are spending that much on transportation. Once you cut out used cars, those without cars, and those spending significantly less for their Kia or Hyundai or whatever, I think you'll find that very few people spend $40k on a car. That's a luxury purchase.
You have probably already realised this if you've lived on the planet for more than 20ish years, but the majority of people certainly seem to be quite insane.
I think you're a bit out of touch. "Few" options? You can get a very, very high end Honda Civic at $30k+, in my opinion. Considering you can get a base Civic for around $16k-$18k, adding on a "few" options isn't going to almost double the price. You have to add quite a few options to get near that $30k number. Or pick a higher end Civic to start with.
> For some real sticker shock look at minivans, a Honda Odyssey can easily hit $40k-50k out the door.
First those are big vehicles so yes, obviously they're going to cost more. But $40k to $50k is with many options as well. You can get a base Odyssey between $28k to $30k depending on where you shop. Not everyone adds $10k to $20k in option.s In fact I would be shocked if any majority of customer adds on so many options.
It would be difficult to spend $30k on a new standard-engine Mazda 3. Mine was $18k brand new. The top standard-engine trim is around $25k. That other $10-17k is another $165-285/month over 5 years at 0% interest, and that is not an insignificant amount of money to many/most people.
If you can't save that much monthly in gas, and all you want is a boring, basic, reliable car, it's not worth it (yet). Tax incentives help, but Tesla is going to hit the 200,000 vehicle limit well before filling even all the Model 3 pre-orders.
Mazda doesn't even have a car in this segment. You should be comparing it against a BMW 3-series, Audi A4, Acura TL, Mercedes C-series, Lexus GS.
All of those vehicles start in the 30s, and you would be lucky to get out the door with reasonable options under $50K. You could probably get the BMW up to almost $100K when you start considering the M package and various sports options.
Indeed, that was my point. The claim that "'economy' cars like the Honda Civic, Mazda 3, Toyota Camry, etc. can easily push up against $30k with a few options" is trying to assert that people buying those kinds of cars are in the Model 3 market. But they really aren't. People buying small luxury sedans like the ones you've mentioned probably are, though.
The parent comment was talking specifically about what people pay and not about the price tag at the new car dealer.
This means the difference between what the median new-ish car price is when sold to an individual, vs. what the median price is for a new car sold to an individual is massive.
Honda Civic LX is 18,640, while the high-end "Touring" trim is $26,500.
http://automobiles.honda.com/tools/build-price/trims.aspx?Mo...
Mazda 3 is $17,845 to $25,795.
And these are at MSRP, and lulz to anyone who can't manage to get a car below MSRP. Pushing up against $30k? Are you kidding me?
Maybe a "racing" model, like Ford Focus ST or Subaru WRX (a small, but very powerful engine, costs premium) will get you to $30k. But you can deck-out these starter vehicles and keep costs around $20k easily.
And as others have said: normal people don't buy new cars.
IMHO, one of the biggest problems from the tech side (I know that there are many hard problems, but this concerns me the most) is battery manufacturing.
They already have built the gigafactory which produces (or will produce) more batteries (or the power they produce) than the rest factories in the world.
But battery technology must have a breakthrough and probably sooner than most of us think. Currently known lithium reserves will 'support global demand until 2100' (https://en.wikipedia.org/wiki/Lithium#Reserves). Also, very efficient battery recycling and reuse must be further developed.
I hope that in 100 years, we'll discover and develop battery technology which is affordable, ecological (will not deplete Earth's recourses completely), efficient (e.g. power to weight ratio), etc. I know that there is development going for this, but I think it will be a long time until new battery tech will be in our home.
If all else fails, you can extract an essentially limitless amount from seawater, but that would be much more difficult and expensive that current methods, so nobody's bothering to find out how to do it cheaply at scale (yet?).
In any case, elemental lithium is a very small part of the cost of a lithium-ion cell, so this shouldn't impact the EV market much. And you can already recycle the lithium from batteries, so once you have enough to support the world's transport needs, you're pretty much set.