back to article Subsidy-guzzling Tesla's Model 3 volumes a huge problem – Wall St man

Stocks sleuth Toni Sacconaghi Jr. has shed some light on why the market reacted badly to Tesla Inc's financials this week. The protracted launch of the Model 3 sedan, unveiled 18 months ago, has already seen Tesla's stock repeatedly bashed. Founder Elon Musk boldly predicted that the company would sell 100,000 Model 3s this …

  1. tiggity Silver badge

    No change

    Transfer of wealth to th rich, at the expense of the poor.

    That's modern capitalism at its finest

    1. SuccessCase

      Re: No change

      What complete and utter nonsense. The transfer is due to capital redistribution rules “justified” by politicians implementing environmental policies. The very opposite of capitalism. It’s pure environmental socialism. As is so often the case the politicians distorting the market, thinking they can do such a clever job of “fixing society” are the culprits who have created the market imbalances that allow for the inequity.

      1. Aitor 1

        Re: No change

        While it is politicians distorting the market (and I agree with it being contrary to capitalism) the justification for this is being a compensation for the unaccounted for external costs.

        Every time I start an ICE I create external costs for everyone, that are way way worse than those that come from an electric car.

        1. Chris Miller

          Re: No change

          Every time I start an ICE I create external costs for everyone, that are way way worse than those that come from an electric car.

          In the UK roughly 2/3 of the price of fuel goes in taxes. I think that ought to cover any externalities.

  2. Rebel Science

    No welfare for billionaires. Please.

  3. 0laf Silver badge

    Tesla also came out poorly in a reliability survey.

    1. jmch Silver badge

      "reliability survey..."

      The real shock in that survey is Alfa Romeo at #5 out of 32!!!. Mercedes at #23 is a bit of a surprise too

  4. Anonymous Coward
    Anonymous Coward

    For people my age

    it's impossible not to remember a certain (Sir) Clive Sinclair ....

    1. Danny 14

      Re: For people my age

      certainly a visionary. looking back, his ideas would have flouriahed with better tech and modern marketing.

      1. GruntyMcPugh

        Re: For people my age

        Certainly a visionary,....just unfortunate timing, what with Yuppies indulging in vulgar displays of wealth at the time, a modest transport was a hard sell.

  5. Anonymous Coward
    Anonymous Coward

    Musk, the new Jobs?

    Well, that's what some Tesla fanatics seem to think. They hang on his every word and action.

    They spout forth supporting him on things like his vanity tunnel in LA.

    He can do no wrong. SpaceX is going to save the world (after Tesla's have done it the first time) and unless an Electric car has a 'T' on the front, it is merely a concept or a compliance car.

    Their deviotion seems to knock Apple Fanbois into a cocket hat.

    Yet they seem oblivious to the fact that Tesla as it stands is a basket case from a financial POV.

    The Jury seems to be out the quality of the Model 3. It will probably be 2019 before we see any RHD ones here.

    I am an EV owner. I've had a Leaf for two years. Done 28,000 miles in it.

    Could it be better? Certainly but it does what it says on the tin.

    Do I want a Tesla? No thanks. Far too expensive.

    1. Rameses Niblick the Third Kerplunk Kerplunk Whoops Where's My Thribble?

      Re: Musk, the new Jobs?

      "I've had a Leaf for two years....... but it does what it says on the tin."

      It leafs?

      1. Michael Maxwell

        Re: Musk, the new Jobs?

        No, it doesn't leaf, but its owner can make like a tree and leave.

      2. /dev/null

        Re: Musk, the new Jobs?

        "I've had a Leaf for two years....... but it does what it says on the tin."

        It leafs?

        It leaves, surely?

      3. The elephant in the room

        Re: Musk, the new Jobs?

        Let's hope that Rameses Niblick the Third Kerplunk Kerplunk Whoops Where's My Thribble?

        there doesn't turn over a new Leaf!

    2. JLV

      Re: Musk, the new Jobs?

      ah, how far the mighty have fallen. critics (AC) are popping out if the woodwork.

      I'm a moderate fan of Tesla, the car, a doubter of Tesla's, the company, financials and an opponent of excessive electric car fiscal carrots.

      But Musk's endeavors, which you so breezingly dismiss, are pretty impressive and pushing lots of engineering boundaries. In hindsight, moving electric cars from stodgy green perceptions to objects of (unwarranted?) desire was a marketing/engineering coup.

      Not many "captains of industry" have shaken things up quite so much, even if I am sure Musk also relies on reality distortion fields a bit.

      i.e. no problem with the article, but I sense a little tiny bit of unjustified peevishness on your end, dear.

      1. Charlie Clark Silver badge

        Re: Musk, the new Jobs?

        I'm a moderate fan of Tesla, the car, a doubter of Tesla's, the company, financials and an opponent of excessive electric car fiscal carrots.

        Got to admire Musk for his real entrepreneurial spirit and often putting his money where his mouth his. The conventional wisdom was always against the Model 3 and the financial engineering only seem to have confirmed this. The initial Tesla's were based on getting a Toyota car plant cheaply and the subsidies continuing to flow. This was always going to be difficult to repeat for the mass market.

        Still I suspect it's a win-win for Musk even if it fails: he'll easily be able to sell Tesla to another manufacturer, though I suspect some investors might well find themselves out of pocket.

        And he's bound to be back with another idea. Might be more shit like hyperloop but could also be something magical and revolutionary and personally I'd rather see a hundred more Teslas than another Facebook.

        1. c1ue

          Re: Musk, the new Jobs?

          Sell Tesla to another manufacturer? Like who?

          It certainly won't be a car manufacturer, unless Tesla continues to experience massive share price falls.

          Apple? Why would Apple want to buy a massive money losing enterprise?

          Can anyone else afford Tesla?

      2. Anonymous Coward
        Anonymous Coward

        Re: Musk, the new Jobs?

        > I sense a little tiny bit of unjustified peevishness on your end, dear.

        Not when there are questions popping around about the quality of Tesla's product, and not when Tesla's ability to manufacture said product is directly correlated to the amount of subsidies it receives from the federal government.

        I'm all for the federal government subsidizing EV R&D and EV manufacturing. On the surface, it sounds like a socially and environmentally responsible and sound policy. But at some point, I'd like to see a viable and useful product as outcome of al that R&D money, and not just status symbol hype.

        The only things we've seen thus far is are two models of overpriced vehicles labeled as "Luxury" - Model S and Model X - that are viable only in densely populated high-income tax bracket markets. I.e. the Bay Area, Silicon Valley, LA, and the Northeast Coast. Plus some minuscule numbers for urban areas in other parts of the US. If you want to have a good laugh, take a look at Teslarati's Demographics.

        With a starting sticker price of USD $70,000 these are not mass-market cars. And just like an iPhone X, their main function is that of a status symbol, not utilitarian.

        It's perfectly OK for Tesla to make $80,000 electric cars for rich people. I just don't see why rich people should have their luxury car - i.e. status symbol toy - subsidized.

        As of March 2017, we still have 10% of Americans who can't get any health insurance at all, and who face bankruptcy in case of an unexpected medical expense.

        1. JLV

          Re: Musk, the new Jobs?

          Don't get me wrong. I don't disagree with anything you say. Or what the article says.

          I find the OP on the other hand is a bit over the top in his criticism ;-) Not everything Musk touches turns to gold, that's pretty obvious. You could add the Solar City merger to iffy endeavors.

          But he's not only a huckster hack either, like genius boy makes him out to be.

      3. Jellied Eel Silver badge

        Re: Musk, the new Jobs?

        But Musk's endeavors, which you so breezingly dismiss, are pretty impressive and pushing lots of engineering boundaries. In hindsight, moving electric cars from stodgy green perceptions to objects of (unwarranted?) desire was a marketing/engineering coup.

        It helped that the Musk launched EV's into a market that had no memories of milkfloats. EV's aren't really anything new, and sadly for Tesla, the boundaries are pretty rigid and inflexible. Tesla would use 'smart' processes to revolutionise car production in ways that no other manufacturer since Henry Ford could have imagined. OK, so Ford managed to produce somewhat more Model T's per quarter than Tesla can manage, but hey, that's progress! I'm sure once those pesky battery production and supply chain issues are sorted, the build quality will improve.. And once non-Tesla employees get to drive away their $30.. I mean $45k+ Model 3's, they'll be ecstatic about all the features and options in their new dream car!

        (Is it available in black?)

    3. Doctor Syntax Silver badge

      Re: Musk, the new Jobs?

      "Certainly but it does what it says on the tin."

      A voice from way back in the depths of time - a Leitz salesman commenting on a rival's microscopes. "Tin. Good quality but tin.".

    4. unwarranted triumphalism

      Re: Musk, the new Jobs?

      Careful now, you're not allowed to criticise The Anointed One here.

      Apparently because he's Doing Something he can do no wrong.

      1. JEDIDIAH

        Re: Musk, the new Jobs?

        At least he's doing something versus inventing a new form of financial derivative. You want to whine about wealth transfer from the middle class to the rich, then complain about that kind of shenanigan.

        Money thrown at people like Tesla might actually result in something real coming out of the ashes.

  6. Howard Hanek

    Electricity always flow toward ground

    Pity that electric cars end up consuming more resources isn't it, including tax dollars, newsprint, video time, social media posts and those unproductive hours spent charging and towing.

    1. Captain Scarlet
      Paris Hilton

      Re: Electricity always flow toward ground

      Well to move anything it will need energy of some form?

    2. This post has been deleted by its author

      1. Anonymous Coward
        Anonymous Coward

        Re: Electricity always flow toward ground

        You can just go and do other things instead.

        Like enjoying the range of quality food and reasonably priced merchandise at any UK motorway services area.....

        1. JEDIDIAH

          Re: Electricity always flow toward ground

          ...assuming there's enough room. Make refueling into an extra high latency experience then you're likely to be stepping on a bunch of extra people waiting around for no good reason.

  7. Anonymous Coward
    Anonymous Coward

    Electric cars ...

    are the one half of the autonomous car coin. So we'll need a halfway house.

    "JohnnyCabs" weren't that far from where we'll be. Except you won't be able to manually drive them at all.

    1. Michael Maxwell

      Re: Electric cars ...

      But...but...but Arnold ripped up the Johnny and drove it like a stick!

  8. larryg


    I'm a fan of The Register but "Subsidy-Guzzling" really? Frankly, I think that electric cars deserve a subsidy. I lived in the UK for a couple of years too long ago. I had two cars that had very small engines. One was under 1 Liter the other barely over. Engine sizes may have changed but It's a different story in the States. I have a 2004 Honda civic, it's a very energy efficient car by U.S. standards but it has a 4.3 liter. I live in Texas were Trucks and Suvs rule. We basically subsidize 18-wheelers by not charging them for registration near what we should. The highways are almost never not 'under construction'. More 18-wheelers on the roads tearing them up every year.

    Sorry a bit of a flame... but I agree with JLV. They have done wonders for the boundaries of car manufacturing and frankly I don't think there would be Leaf's without Tesla. Also, Like you said they are not able to supply in large quantities so subsidies are not going to be large (as a whole). Why are you 'hating' on Tesla? Read Der Speigal. I've seen many articles that are worried they are falling behind. Here I've seen several anti-Telsa articles... why?

    1. frank ly

      Re: Guzzling?

      "... 2004 Honda Civic ..... 4.3 liter ..."

      I find than amazing, the Civic is a small car. I have a 2.0 litre engine in my 2000 Ford Mondeo and it pulls like a train and can cruise comfortably at 80mph for hours on the motorway. About 10 years ago, I drove my neighbour's 2.5 V6 Mondeo and it went like a rocket. Why do american cars have such large engines?

      1. larryg

        Re: Guzzling?

        Part of it, I believe is just we're afraid to go too small. If you come to the states and get sandwiched between two 18 wheelers, you'll know what I mean. I envy the small efficient European cars. We need electric cars. If nothing else to start minimizing these large oil and gas corporations.

        1. moosemiester

          Re: Guzzling?

          Where do you think the electricity to run these cars come from? Oil, gas, coal... Please research how the cobalt in the lithium-ion batteries used by EV's is mined by children as young as 10 years old.

          The idea that these vehicles are somehow better for the environment than gasoline/diesel cars is pure hype.

          1. Paul

            Re: Guzzling?

            it's only in the US where renewable energy sources haven't been developed.

            in the UK, there have been times this year when renewables have been producing so much power that the price of electricity has become NEGATIVE. That means you could have been paid to use electricity.

            And there have been more times when renewables have produced all the electricity the UK was using at the time, with no need for any fossil fuels to be burned.

            If that doesn't prove that renewables can provide for a non-trivial amount of a nation's needs, I don't know what can.

            1. Charlie Clark Silver badge

              Re: Guzzling?

              If that doesn't prove that renewables can provide for a non-trivial amount of a nation's needs, I don't know what can.

              The problem that still needs to be solved with renewables is providing sufficient power all the time. I'm a big fan of renewables but, as your example shows, we're moving into the problems associated with over-production. Negative market prices indicate that the market is failing. This is typically on sunny and windy days in spring and summer, because renewables producers are paid for every kwH the produce. But the grid has to be built to provide enough power also on cold, dark and still winter days.

              We need storage options that are both big and resistant to manipulation so that excess generating power isn't wasted. You can, of course, use excess power to convert CO2 and H20 to methane and other hydrocarbons but you can't do it for less than the current cost of extracting them from the ground so they wouldn't be competitive unless you were able to sell them without duty. That would be an invitation to abuse. But we already have plenty of those: one of the reasons that electric cars are so cheap to run is that they're produced from duty-free fuel. The renewable gravy train has also opened a lucrative but ludicrous subsidy for oil because the fertiliser for subsidised maize that gets turned into E10 is itself made from oil…

              1. Anonymous Coward
                Anonymous Coward

                Re: Guzzling?

                There are renewable options that are very reliable in power output (tidal lagoons for instance), but energy storage options can arise when required. Pumped storage is possible if it can be politically acceptable to do it.

                Nuclear - especially if you could utilise a cleaner power station technology that can utilise more of the fuel rod (although admittedly Nuclear seems to be moving backwards rather than forwards nowadays).

                However If every car is electric, whatever you do at the power grid can instantly be reflected at the car level. You take one coal power station out of commision and replace it with a renewable alternative then the day it goes lie every electric car owner gets the upgrade to a 'greener' source of fuel.

                "Where do you think the electricity to run these cars come from? Oil, gas, coal..."

                How do you think the oil gets refined? Large amounts of electricity.

                1. Bodhi

                  Re: Guzzling?

                  "How do you think the oil gets refined? Large amounts of electricity."

                  And where do you think refineries get their electricity from?

                  Small hint - not the National Grid.

      2. larryg

        Re: Guzzling?

        oh really sorry. I was wrong. My honda is a 1.7. I was thinking of another vehicle I used to own but realize it was one of the must fuel efficient cars in 2004. Those Mondeo's are in a different class. A friend had one a long long time ago and it wasn't meant as a fuel efficient car :)

      3. Mark 85

        Re: Guzzling?

        Why do american cars have such large engines?

        A couple of reasons I can think of off the top of my head... There's a difference in operating RPM. Historically, American engines worked at lower rpm as we have miles and miles of nothing but miles and miles of highways. Big cubic inch engines, mid-range RPM and higher gearing for the highway. Europe.. smaller engine, higher RPM, and nominal gearing. As late as the '70's and some of the 80's, European cars (not the high performance types) wore out faster due to the RPM requirements and hours spent at speed. I believe that's changed quite a bit so smaller engines are happening here in the States due to better fuel management, turbocharging, etc.. Old habits die hard.

        1. Anonymous Coward
          Anonymous Coward

          Re: Guzzling?

          "A couple of reasons I can think of off the top of my head"

          Actually the reason US cars had big engines was they were cast iron and cheap. Because CI has poor thermal characteristics and doesn't like tension, cast iron engines tend to be low revs and low compression. Thus you need a big engine to get enough performance.

          It really shows when you see the SAE figures versus the manufacturer horsepower. One common GM engine was manufacturer rated at about 220HP. Marinised, where people were going to run it at 70% or more of nominal power all day long, it was a 55HP engine.

          Daimler and BMW always showed that with proper design and use of aluminium you could get much more powerful, lighter and reliable engines that could run for extended periods at near 70% of rated HP - I remember someone commenting that Mercedes made 200/200 cars, i.e. that could do 200kph for 200000km. And I've been in more than one of them. But these light, powerful, reliable engines come at a price - foundry technology and machine tools which would have required major capital investment in the US. So it didn't happen until foreign manufacturers started up in the US and, despite the cheerleading for US makers in the comics, started to dig into the market.

          Small engines are the product of modern materials and CAD/CAM. Less friction, more efficiency, and easier thermal management.

          1. Anonymous Coward
            Anonymous Coward

            Re: Guzzling?

            You can make iron engines high power and high rev, maybe not up to the best you can do with alloy, but way past normal operating margins. Typical max revs for example in standard consumer grade engines are around 6-7,000 rpm, and I've certainly had some experience with iron engines that rev to 9-10,000 rpm (one even a BL A Series pushrod engine that was good for 9,500 rpm in limited bursts - in a road going Cooper S). So the ability to make and maintain engines with reasonable outputs is not reliant on alloy technology.

            Far more likely that the reason is economy in manufacture and "good enough" syndrome. Large, lazy iron block 6 and 8 cylinder engines were quite adequate for the demands placed on them and they are/were cheap and easy to manufacture. Also they are very tolerant of poor maintenance and are easily serviced. Alloy blocks are far less tolerant of coolant variation and demand the use of specialty coolants mixtures to prevent corrosion though this is far less a problem now such mixtures are common.

            1. Anonymous Coward
              Anonymous Coward

              Re: Guzzling?

              "You can make iron engines high power and high rev, maybe not up to the best you can do with alloy, but way past normal operating margins. "

              Oh, you can. But it requires advanced FEA and CAD for the very highest outputs, and it requires very careful control of your metallurgy and casting processes. "Cast iron" is a big range of substances - my one time engineering director remarked that stainless steel is basically a cast iron with lots of additives. Austenitic or pearlitic? Nodular? Ease of casting is traded against desirable mechanical and lubrication properties. Corrosion resistance depends on composition but may have to be offset against mechanical or tribological properties. And those determine maximum revs and MEP. For Diesel engines CI is often the way to go, but a designer of the 40s and 50s - when many old US engines originated - would be astonished at the properties of modern materials.

              What the US makers did not want to do in the 1980s and beyond was invest in technology. It was easier to stuff a porous block with water glass than to fix the cause of casting porosity. Variation in strength? Make the walls thicker. Mind you, nor did British manufacturers.

              The issue of corrosion of aluminium blocks was fixed long ago. The only obvious case where it is a problem is if someone wants to raw water cool a marine engine, and a proper double circuit takes care of that along with giving much more even temperature throughout the block.

      4. John Brown (no body) Silver badge

        Re: Guzzling?

        "Why do american cars have such large engines?"


      5. JEDIDIAH

        Re: Guzzling?

        You really want to be squished by cement mixers and tractor trailers on the freeway?

        Do you want to be going the same speed as the rest of traffic when you're ready to merge into it?

        In some places (Germany, some places in the US) the on-ramps are insanely short.

    2. Phukov Andigh Bronze badge

      Re: Guzzling?

      so now that there IS a Leaf and others, why continue the subsidies?

      the "goal" is completed. Everything after the Model S is merely transferring money without generating any significant engineering. Paying for what is essentially "marketing" or "changing driver's minds about what an EV is" could be done a lot cheaper by hiring ad agencies instead of helping the wealthiest Silicon Valley residents get a 100K car for 80K.

      1. larryg

        Re: Guzzling?

        I wouldn't say the goal is complete at all. All the major car companies hate the idea of electric cars. Gas cars have a huge market on after-market parts and maintenance not to mention the huge oil/gas industry. Until electric cars are affordable and have a large enough market share this trend could be reversed. The battery is still limiting on rage as well.

        The goal is complete when electric cars are the main car on the road.

        "Silicon Valley residents get a 100K car for 80K". I understand your sentiment but I think it's misplaced. Where still talking very small numbers here in government subsidies and it helps keep this emerging market going.

        There are very large sums of money being wasted with little to no long term advantage to the average person. Why focus on this small emerging market? I am upset that we basically subsidize many businesses that don't need it. I mentioned the 18 wheelers but there's the whole corn industry and much much more. At least Tesla is working to make the world better.

        1. Doctor Syntax Silver badge

          Re: Guzzling?

          "All the major car companies hate the idea of electric cars."

          I doubt it. They just like anything that sells well. Stronger emotions, positive or negative, won't be worth bothering about.

    3. Charlie Clark Silver badge

      Re: Guzzling?

      Frankly, I think that electric cars deserve a subsidy.

      Your logic is, for anyone outside the US, somewhat perverse. Car engine sizes in the US are somewhat analogous to motor sizes in vacuum cleaners in the EU: a bigger motor used to be seen as correlating with a more effective cleaner. Cheap energy has become a holy cow in America and has led to perverse pricing: the duty levelled on fuel that is supposed to pay for motorway maintenance has not been raised for years because would mean people having to pay more for their gas guzzlers, which are kept popular by tax breaks. There is simply no incentive to drive something with a smaller engine and meanwhile road maintenance lurches towards bankruptcy. Of course, more gas sales means bigger profits for the oil majors and extra helping for all those on the gravy train.

      So, what's the solution in the land of free enterprise and small government™? That's right, more subsidies.

      1. larryg

        Re: Guzzling?

        I agree with most of what you said but again... this focus on Tesla subsidies seems wholly unbalanced. Those are tiny comparative to others and I believe that Tesla is helping change things in the industry world wide. Why is all this negativity directed toward a company that has been doing what it promised. It said it would start high end and then go lower. It's not affordable for the average person yet but they've taken on huge risk and almost all the responsibility. Other companies have stalled on electric cars for years.

        I just don't agree with all this negative focus on Tesla. Especially in a world ruled by corporations, they seem to be one of the good guys.

        All the others usually do the best to do the least R&D they can and still charge a premium

    4. Anonymous Coward
      Anonymous Coward

      Re: Guzzling?

      There is no "4.3 litre" Honda Civic, the largest standard petrol engine fitted to a Civic is 2.0 litres (though there was a 2.2 litre 4 cylinder diesel available for a while from 2011). That is available in multiple markets, and is reasonably fuel efficient. This doesn't preclude a custom engine transplant, but the only "4.3" litre engines I can find are V8's from either Ford or GM, that seems unlikely. Custom Honda V6 installs have been done for racing/drag etc.

      Of course, if one calculated the ecological footprint of a vehicle over its lifetime, electric cars don't stack up well at all. But it's not actually about "saving the world", it's all about virtue signalling and seeming to do something. Heaven forbid that we actually use logic and reason when deciding on these things...

  9. Spudley

    The article says that this investor is concerned about the US subsidies that Tesla gets being dropped. He makes a few other points that are good, but on this specific point I think he's over-egging it somewhat.

    As noted by a commenter on El Reg's previous article about Tesla yesterday, the big subsidy on EVs that is under threat has only ever been available up to a certain limit, which Tesla is close to hitting anyway. Once the limit is hit, Tesla buyers will no longer qualify for the subsidy anyway.

    So even if the subsidy is dropped, It won't change much for Tesla. In fact, it might make Tesla *more* competitive, because as things stand, once Tesla hits the subsidy limit, their cars will get more expensive compared with competing EVs like the Bolt. If the subsidy is dropped, then the two would be back on level terms.

    The other thing that undermines this subsidy issue a bit is that Tesla is an international player. The subsidies may be under threat in the US, but the US is not even their biggest market; Europe is, and the attitude towards EVs in Europe and the rest of the world is strongly encouraging.

    The point about wealth transfer also strikes me as a red herring. It is perfectly accurate, but it's been that way all along; nothing has changed in that regard. In fact, once Model 3s are being sold in numbers, the argument will become a lot weaker.

    The one area where this guy does have a strong case is with the margins. Tesla really needs to work hard to get the margins up while keeping the price down. Model 3 is strongly billed as an affordable vehicle, so they have pressure on both sides. It's a tough proposition, and its going to be at least six months before we have any idea whether they're going to manage it.

    My other concern is that Tesla are pushing too hard, too fast with expanding their product line. They have the Tesla Semi demo coming up this month, and they keep talking about Model Y as well. I think they really need to take a breather right now and let the Model 3 production settle down.

    So after all that, my take is that no, I probably wouldn't buy Tesla stocks right now. But I also wouldn't be selling them if I had them already, and I certainly wouldn't be shorting them.

    1. Anonymous Coward
      Anonymous Coward

      there are more subsidies

      than just the Federal and State kickbacks to buyers

      there are also the "carbon offset" the state of California ends up paying Tesla for. gives away essentially "carbon credits" which are then resold. Money from nothing.

      there was the previous "alterative vehicle fund" created in California by expanding taxes on fuel. Not sure if it's still ongoing or in what form, but the tax on fuel (supposedly "the refineries") hasn't decreased our cost at the pump yet.

      there are other breaks given to the company, political protections from SEIU which travels many states away to protest car companies that don't want unions but won't bus people a half hour to the former NUMMI plant. Tax breaks within the State, which the State covers by reallocating various state taxes and Federal monies to make up the difference.

  10. Lee D Silver badge


    Incapable of producing more than a couple of hundred in periods that other car manufacturers are reliabily producing hundreds and hundreds of thousands (for reference: Ford Fiesta, UK June 2017 sales: 8601 cars - Ford sold 40 times more, of one model, in one month, in one country, than Tesla produced of its big money-grabbing headline, subsidised cars in a quarter...)

    Only sustainable under subsidy.

    Run by a billionaire, and some investors who'll probably see nothing back until it by some miracle starts producing actual sensible numbers of cars.

    When will people start writing Tesla and Musk off as "threw money at problem, failed to even make a profit let alone fix problem".

    1. deive

      The Fiesta cane out in the 70s, ford have had 40 years to perfect their production lines to be fair...

      I'm not a big fan of the subsidies as the do end up transferring money to the your middle classes, like subsidies for solar power for homeowners. What would be a better option though? Without Tesla we probably wouldn't have the leaf, bolt, or others.

      I wish I had a spare 100k the model s is the fastest accelerating production car in the world, and does so silently and with no emissions. That's what does it for me.

      1. Anonymous Coward
        Anonymous Coward

        "The Fiesta cane out in the 70s, ford have had 40 years to perfect their production lines to be fair"

        If you think today's production lines are the same as those of 40 years ago, you haven't been keeping up. Rather a lot has happened between hand assembly with spanners and mallets, and today.

      2. Anonymous Coward
        Anonymous Coward

        This is only true if you consider direct emissions. Lifetime eco-footprint for a Model S is the equivalent or worse than a extra large SUV. And for all it's straight-line acceleration a Model S is slower than most cars around something like the Nurburgring as it cannot sustain a high power output without thermal issues. So great for traffic light cowboys and over compensated virtue signallers, and not a lot else.

        1. Steve Todd


          Your info that the Model S uses as much CO2 in its lifetime is pure bunk. See

          You’ll also be hard pushed to find a situation on normal roads which is similar to driving around the Nuremberg ring. Normal driving is about pulling away from lights, accelerating past problems etc. You don’t need the power for more than a few seconds at a time. With electric it’s there instantly and in great globs, no need for the engine or turbocharger to spool up.

  11. P. Lee

    Clarifying the situation

    I think the question is not whether a fledgling industry is being subsidised or not.

    The question is whether a very rich person, with a fig-leaf of car-making, is unduly enriching himself further, pretty much risk-free, by collecting government incentives, while accruing all the IP benefits should the research pay off.

    Is the problem that the payoff to the people who are funding the subsidies is unclear?

  12. unwarranted triumphalism

    Only *my* subsidies are morally acceptable.

  13. FrMo

    Tesla is doing us all a service

    Elon Musk and Tesla are getting an awful lot of opprobium for bringing out a series of practical electric cars which go most of the way to solving the technical difficulties which have held electric cars back for decades. This is crazy. They are (amongst others like Nissan and BMW) doing the world a service and should get credit for it.

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