We are paying too much for EV in the US.

[ab13]

Tesla has way more competition in China. It is exactly going to plan, in that China allowed Tesla to fully own their own factory in China so they would set up shop there and local companies could benefit by copying all the supply chain. It was fairly obvious to me that was the long term plan.

Sponsored

 

[Pushrods&Capacitors]

How about investing in more modern manufacturing facilities in the US, making more of the battery components in the US. Car manufacturers are investing in new facilities for EV batteries in the US. The answers should be more efficient supply chain, reliable, cost competitive made in the USA.

This is being done already, where have you been? As well as a bi-partisan bill to fund domestic semiconductor factories/options to provide supply chain stability. And with NAFTA you keep part of the federal EV credits ($3750?) with Mexican or Canadian built vehicles rather than requiring they be U.S. built.

But, in the end, it’s basic Macroeconomics right? The countries with the comparative advantage re: labor/labor costs are going to continue to be major players.

 

[Mirak]

I think tax incentives could actually contribute to higher prices. What do you think?

Hold on a sec... are you seriously suggesting that US auto manufacturers raised their prices commensurate with the tax credit? Why would they do that? And who could have ever predicted such a thing?

 

[bostonman]

Tesla sold in China are using batteries produce in China. They are smaller in capacity but they are costing a lot less and that's why Tesla can offer the discount.

China EV rebate is now gone in 2023 and on the top, China economy is really bad there. Big foreign manufacturers are leaving China because they believe Xi might attack Taiwan eventually and the similar Russia/Ukraine playbook might seize foreign investment .

 

[gordonf238]

I guess the answer is to shutdown US and Mexican factories and import all EVs from China, right?

That's what Polestar is doing. Prior to our purchase of the Mach-E, I had test driven Polestar 2. It's an expensive, luxury vehicle. In the end, I learned it was made in China.

No thanks. Not if my life depends on it.

 

[FullyCharged]

Mexico labor costs have been lower than China labor costs for a little while now, something many do not realize. The cost issue isn’t vehicle assembly costs but component costs, logistics, regional overhead. Plus… good old fashioned supply / demand dynamics are definitely in play throughout the entire supply chain (dealers, OEM’s, component suppliers, raw material sources, etc).

 

[Pushrods&Capacitors]

Tesla dropped China prices due to slack demand and surplus inventory...

Ding ding ding. We have a winner! Exactly this. Tesla is hemorrhaging right now due to China’s economic/Covid woes and Elon being a gd idiot and buying/running Twitter into the shitter. Discounts are inevitable.

 

[Mirak]

It’s not that simple. We can’t produce the battery minerals because it destroys the environment. We have lithium deposits but won’t mine them for that reason.

I'm just so thankful to these children for mining the cobalt so I can own a $60,000 car that saves the environment.

Cobalt Red (macmillan.com)

 

[Pushrods&Capacitors]

That's what Polestar is doing. Prior to our purchase of the Mach-E, I had test driven Polestar 2. It's an expensive, luxury vehicle. In the end, I learned it was made in China.

No thanks. Not if my life depends on it.

You do you Gordo, def your prerogative. However, as much as I despise China and its labor/human rights record I can’t escape it since I’m a consumer. I’m glad some off-shoring will be shifting to on-shoring but that’s gonna be a mixed bag imo.

My recent examples:

• Replaced high-end ($3500) made in Japan Denon AV Receiver circa 2009-2010 with new equivalent Denon AV receiver now made in China.
• Replaced 25 year old ($2000 msrp in ‘97) Velodyne FSR-18 servo-subwoofer made in San Jose, CA with an SVS PB-3000 ($1499 msrp) made in China.
• The new units are superior to the old ones because technology marches on and China, woe as it may be, has long since achieved parity with the former major manufacturing players where quality/process are concerned.

 

[MachEMaster]

Completely agree. I never think the MME is expensive becasue there is no ICE version to straight-up compare it to. But when I look at the price difference between the ICE and electric Kona models.

In Canada the ICE Kona starts around $25k, the electric starts at $47k. Granted the base electric may have more standard features than a bone stock ICE Kona, but still, that’s a massive gap.

You think that is a wide gap!? Have a look at the price gap between a Chevy Spark and a Chevy Bolt! Lol

 

[RT1 MME266]

Tesla has way more competition in China. It is exactly going to plan, in that China allowed Tesla to fully own their own factory in China so they would set up shop there and local companies could benefit by copying all the supply chain. It was fairly obvious to me that was the long term plan.

Good point. Which make us wonder if tax incentives should be going to creating more supply side competition.

More competitions, modern facilities, automation and lowering the production cost will be better consumers and US companies. More than Tax$ credits that was taken away by higher EV prices because car makers know they can charge more. In some cases US$ tax maybe subsiding foreign car makers because their prices are well below the thresholds.

 

[RT1 MME266]

Mexico labor costs have been lower than China labor costs for a little while now, something many do not realize. The cost issue isn’t vehicle assembly costs but component costs, logistics, regional overhead. Plus… good old fashioned supply / demand dynamics are definitely in play throughout the entire supply chain (dealers, OEM’s, component suppliers, raw material sources, etc).

Totally.

 

[RT1 MME266]

100% agree

I've seen a recent quote that 95% of Tesla suppliers in China are local (within a few hundred miles).
That is a huge departure from the massive outsourcing efforts auto manufactures have been doing for the past 30+ years.
This is what the IRA should be all about IMO bringing back US based production including all the parts and components that go into the automobile.
Ford, GM and others are stepping up efforts but the current supply issues with parts that have stopped Ford production it will take some time.

Parts and Components. Tell me about it... My MME RT1 is still in the garage waiting for A/C condenser replacement, it is been 11 weeks now... @Ford Motor Company ??

 

[roamtheworld]

I'm just so thankful to these children for mining the cobalt so I can own a $60,000 car that saves the environment.

Cobalt Red (macmillan.com)

This is why LFP batteries need to be produced in record numbers. Most EVs in China use LFP batteries and Tesla switched Model 3s back in 2021 and Model Ys in China use LFPs as well

I know Ford and Rivian have LFP battery plans they just need to come sooner rather than later.

https://news.energysage.com/teslas-shift-to-lfp-batteries/ as example of just one plan

 

[yngwenli]

I'm just so thankful to these children for mining the cobalt so I can own a $60,000 car that saves the environment.

Cobalt Red (macmillan.com)

Some of us would actually want a LFP battery if available. Tesla has that option I think.

Sponsored