Question: What is stopping from a new or old entrant from creating a $10-15K electric car? American mfg may be slightly better at automation than China.
This is a common misconception. Chinese manufacturing is far more automated, and getting more automated, than American manufacturing.
Automation in American manufacturing basically stalled in the 2000s.
Doubtful. It’s hard for a country which has been consistently outsourcing the production of anything remotely complex to do better than one which has been the top producer of manufactured goods for decades. Tesla tried and mostly failed.
Plus automation is expensive and require large volume to be profitable. American cars historically have limited appeal abroad and the market is extremely competitive which doesn’t help.
The flaws in Teslas cars are mostly design choices (plastic seats instead of cloth/leather, bad ergonomics due to focus on minimalist aesthetic, uncomfortable suspension setup etc, etc). Some of it is following trends, some of it is Elons stupid ideas.
Financially it seems like Teslas big problem is the AI-investments. Burning unfathomable amounts of cash on useless software, instead of putting that money towards developing their model lineup and improving quality on things that matter.
That manufacturing edge is the reason Tesla is still profitable despite its massive drop in sales.
These two parts don't really go together from my point of view. Tesla is often pricing a car with mid-range quality as a premium model.
Personally, I think they are not very competitive anymore in the segments they operate in. They used to have first mover advantage but now historic manufacturers have similar cars on offer. At the entry level, in as much as they have a vehicle there, they are not competitive at all compared to the Asian manufacturers.
I am more worried about the plummeting sales than the AI investments.
To get down to Model Y-level costs, I would have had to settle for a barebones ID4 or an MG. In that comparison the Model Y is a wonder of pace, space and grace.
I don't like my Model Y, I sort of hate it, but if I had to make the choice again and the relative prices (and my car-needs) were the same, it would be a tight race. I'm pretty sure there will be better options next time, though.
The choices are different now, Tesla is no longer a winner. That despite the tariffs, without which nobody would buy Teslas.
So, i think 10-15K car in US has no buyers, and no margin to make it worth for the manufacturer.
There's just no one willing to buy these entry level cars, except as maybe second commuter cars.