Black Tesla Model 2
Peter Neilson's picture

Tesla Is Making It Hard For Other Car Companies To Compete

Advancements in technology should end up costing less. At least that is the strategy. Automobile prices have risen significantly over the past 100 years even though technology has become better and cheaper. Telsa Motors says no to that trend and here is what they are doing about it.
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When Henry Ford made the assembly line happen, automobile prices dropped like a rock into a pond. The ripple effect that it had after that set a precedence that as technology and advancements occur, things should cost less.

Well, that victory was short-lived. As competition grew more intense, automotive makers had to pack their cars with better features to outsell each other. The issue with that is that it made cars more expensive, even though the value to the consumer increased.

With many types of technology, flat-screen TV's for example, initially had incredibly high prices. I recently went through a Costco and found a 60" HDTV for $395 (or something close to that). I bring this up because as technology advances, we should be able to find ways to make things more affordable, not more expensive.

A friend of mine recently bought a brand new 2020 Ford F-250 6.7L Diesel with the Roush package. The pickup has just about every option you can think of, minus the massage seats (yes, that is a thing). All this technology set him back a cool $120,000, all said and done. I about choked when I heard that.

The pickup is excellent, do not get me wrong on that, but after driving it off the lot, it now is valued at $80,000, but he owes more than that on it. The whole idea is rather disgusting to me, even if he can afford the $1400 a month payments.

My point here is that with new technology, we should be finding ways to keep a stable price or decrease the cost of our transportation.

Tesla Motors: Working Hard To Make Awesome Cars Affordable For All
Tesla started off by charging exorbitant amounts of money for the first-generation roadster. The trend of high-cost cars did not stop there, though. Early first-generation Model S owners spent a pretty penny too.

Red Tesla Model 2 Hatchback

It was not until the Model 3 came out that Tesla cars started to look like anyone could afford them. With a base price starting at $35,000, it seemed reasonable to own a luxury electric car. Elon and the company did not stop there.

The dream of having a complete EV revolution means that at some point, the base model cars have to be competitive enough to where other people will stop buying the gasoline counterparts.

Tesla motors have now made that possible with a new vehicle called the Model 2. With rumors of this compact electric vehicle costing between $19,000 to $25,000, it makes owning a Tesla very affordable.

How Tesla Beats The Competition
I can hear it already from the Nissan Leaf owners, who claim they have the best electric car. I can hear the Chevrolet Bolt owners squawking about the same thing.

Silver Tesla Model 2 Hatchback

Here is the deal, as cool as those cars are, the Tesla Model 2 will wipe the floor with them. Tesla has better tech, better batteries, and far more data on EVs than both of those cars combined. I could go on, but I will stop right there.

Conclusion
Tesla is lightyears ahead of everyone in the EV game. Maybe Nissan could have pulled something together if the Leaf wasn't such a garbage pile (no offense, Leaf owners, but the car just is not that great).

Tesla road mapped everything out and has been fulfilling its promises since 2006. Thanks, Elon; keep at it.

Until next time, have a great weekend, and I will see you in the following article. Ever wonder why Toyota keeps making hybrids?

Check out this wild new battery tech that Tesla has and why it will forever change the auto industry.

Peter Neilson is an automotive consultant specializing in electric cars and hybrid battery technologies. He holds a Bachelor of Science in Automotive Service Technology from Weber State University. Peter can be reached on Linkedin and you can tweet him at The_hybrid_guy on Twitter. Find his page on Facebook at Certified Auto Consulting. Read more of Peter's stories at Toyota news coverage on Torque News. Search Toyota Prius Torque News for more in depth Prius coverage from our reporters.


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Comments

Every time I ask a Tesla owner to list the tech that makes some kind of difference they can't come up with anything meaningful. What is it? Dog mode? Cheetah mode? Flush-mount door handles? A big tablet stuck to the dash looking like a high school shop project? Maybe Autopilot? (Which never gets good reviews from independent analysts.) OTA? ... Is that the big tech you talk about? Most driving is done locally. How about listing all that tech that makes a difference in how cars are used most? I'd like to hear.
You don't really explain how you got to the $19,000 Tesla "Model 2" pricing, but my guess is that you started with Tesla projected price target of $25K, and then subtracted the proposed Green bill tax subsidies of $7,000, which actually could be a net cost of $18K. But it is very possible that the proposed Model 2 is 2-3 years away (as Elon projected) and it could actually be a China-only model, using LFP batteries. The current Model 3 is priced at $37K, so the net price if the green bill passes would be $30K. Potentially Tesla could have factored in the tax subsidy already, and the Model 2, with it's lower performance, size, and range, could end up starting at $32K, with a net price of $25K. But Tesla could much more easily de-content a bare bones Model 3 to lower the price $5K, and that way hit the $25K price point without having to build another model. Keep in mind that the refreshed Chevy Bolt now starts at that same $32K price, and they would also have a net price of $25K, and therefore make some compelling competition at that lower price point.
It is *very likely* that the $25K Tesla is already factoring in "savings" meaning it is not really $25K. There won't be a $19K new Tesla anytime in the near future.
Timothy, Do you have strangers ask you to justify why you think that your car is better? Clearly that is a question asked by someone who doesn't want to buy your car. From your negative comments I think that there is no answer that would change your view about Tesla cars. And that is actually OK. because EVs are not for everyone, but oddly most people who actually own an EV won't ever go back to wanting a fossil fuel powered car in the future. EVs are ideal for local driving, because that is where they really excel over gas vehicles that are horribly inefficient in stop and go traffic.
I own a Bolt. Love it. Won't go back to ICE. When I see comments about superior Tesla tech I often ask the question: What is that tech that is so much better? I never get a response. So I really want to know. What is the superior Tesla tech that people are claiming, that actually makes a difference in how most people do most of their driving? The tech that makes Tesla better than other EVs?
Ironically, I see more Tesla haters among Bolt owners than other EVs. Is it because Tesla gets all of the press attention? To answer your question, it is Tesla's whole approach to car building that sets them apart. They are certainly influenced by building economically, but they always work to build a better EV, with more efforts in engineering than marketing. Whereas legacy automakers struggle even with the value of building a competitive EV. I always liked the Bolt. It was a great collaboration between GM, Daewoo, and LG, as was the Spark EV before it. The only problem with the Bolt was the fact that GM didn't support it the way that it deserved, like the Volt before it. If GM had lead with a dozen EREV and BEV models back in 2013, and committed to EVs as Tesla has, then they would been at the forefront of the upcoming EV wave, as Tesla is now. As to particulars, the Tesla stays ahead with hundreds of big and small innovations like the Octovalve, one piece frame castings, Autopilot/FSD, their own 4680 batteries, heat pump and circuitry cooling, the supercharger network, superior performance, superior efficiency, efficient Giga-factories, and the list goes on. You would serve the EV movement better by showing what GM is doing right with EVs, rather than trying to shoot down Tesla.
As is typical, you didn't identify any Tesla tech that makes a difference in how most people drive their car most of the time. All companies continually refine and advance their tech, not just Tesla. Just because I ask a Tesla owner to identify what Tesla tech actually makes a difference, that does not make me a Tesla hater, any more than you are a GM hater because you feel they have dropped the ball, which isn't necessarily the case. If you happen to see more Tesla "hate" among Bolt owners, perhaps it is a backlash from the incessant hate directed towards GM, the Bolt and Bolt owners that seems to continually spew from Tesla owners. Just read the typical comments especially on Electrek if you really think that is not the case.
Wow! Do you honestly believe that Tesla's Octovalve, one piece frame castings, Autopilot/FSD, 4680 batteries, heat pump and circuitry cooling, the supercharger network, superior performance, superior efficiency, efficient Giga-factories, are all not valuable in owning a Tesla EV, and that they do not affect people driving EVs normally? Those are some pretty thick blinders that you are wearing. Of course other EV automakers (and all automakers) have technical innovations that make their vehicles appealing and competitive. It is exactly the combination of ALL the Tesla-specific innovations listed above (and dozens more) that come together to produce an EV product lineup that is well ahead of their competition, on many levels. That certainly doesn't mean that buyers won't prefer to buy EVs or gas powered vehicles from other automakers, because other EV designs and features may simply be a better match for other buyers. And importantly gas powered vehicles make up over 90% of new vehicle sales, which makes them the biggest competition for every EV automaker.