Why Toyota is not selling electric cars

Salvage title?

They’re out here.

Come on out.

 

a salvage tesla has crappy resale price? that would never happen with prius.

 

Out here you could get a wrecked Prime for $9500:

2017 Prius Prime- Plug in


2017 Prius Prime- Plug in - cars & trucks - by owner - vehicle automotive sale

Some work required .

 

Following the ever changing messages from GM is very difficult for some. They usually don't pick up on nuisances or the ambiguous approach. You had to pay attention... in the past. Not anymore though. EV had been the problem to overcome... which is how Volt came about and was heavily promoted... until it became obvious all the low-hanging fruit had been picked. Clearly not part of the plan, that entire concept of engine & motor was abandoned in favor of the antithesis... which how we got Bolt.

Lesson learned in this case is you need to recognize an automaker without a well understood purpose. It was always a follow-the-money approach, which can be a huge gamble. GM lost. Toyota is wise enough to hold true to clear goals, which allows them to both be flexible and to diversify.… a business model GM still is unwilling to adopt. Understanding that fundamental difference is vital. Sadly, most people don't even recognize it... hence drawing the quoted conclusion.

In short, much can come from having a solid plan and being willing to wait.

 

That is fine, people have different needs. If you regularly drive over 200 miles out in a day, you don't want to have to sit around waiting for a charge to get home. If you have an excavation business, you aren't going to haul your skid steer and excavator around with a BEV. If you have a family of 6 or 8, you aren't going to haul them in a BEV, at least nothing currently available. Reassess in 5 or 10 years, who knows what will be available then.

 

Chrysler Pacifica PHEV will do the 6 category

 

While I don't agree with your specific interpretation and classification of consumer vehicle use or desire, note that there are only what, 2 or 3 vehicles out there now to choose from that fit "your" narrow definition of what the average Joe or Jane defines as unrestricted, affordable...or to some even desirable. I buy not only what works and can afford, but what is versatile and looks good as well. Not everyone wears the same style shoes and clothing. When the alternative market ALSO realizes that, they will do much better. Even the hybrid manufactures have begun to show they realize this based on their latest diversity of offerings. Will I ever buy a BEV or any other alt. powered vehicle? Maybe...but not as my primary or sole vehicle. Our kids and their kids will have different choices, but that future has yet to show it's true fruition. YMMV

 

The key word he said was BEV.

Chrysler did a poor job implementing the EV drive mode compared to the Prime and Volt. Anything more than a quarter push on the accelerator will turn on the ICE. The ICE will also turn on when you turn on the heater and the temperatures are below 40F. There's also no EV/HV button.

 

<AHEM>
So when I get my ordered, standard range, Tesla Model 3, what would be the trade-in value for which Toyota hybrid?

Bob Wilson

 

No.

Well, “yes and no,” but mostly “no.”

Model 3 sales toward the end of last year were waaay high (Tesla Model 3 Sales Shatter All Records In December 2018) to the point where Toyota admitted that its having a substantial impact upon Prius sales (Tesla Model 3 is affecting Prius sales, admits Toyota - though still not convinced on EVs - Electrek).

Now, North American sales are down quite a bit 1Q19 compared to 3Q18 and 4Q19. There appear to be three main reasons for that:
* They shipped a lot of cars before the end of last year when the incentives go down from $7500 to $37500,
* They diverted sales in North America manufacture and ship a boatload (literally and figuratively) to Europe (Tesla Could Be A Lone Success In 2019 As European Model 3 Sales Catch Fire),
* They’re eating through their 400K backlog, meaning that total demand is down.

The big question in my mind is how much is the third: That they’ve satiated global demand for BEVs, and can they support their massive-growth strategy.

Their profitability is way down this month, March 2019, largely because they’re paying off a *big* chunk of debt (nearly a billion — https://www.bloomberg.com/news/articles/2018-12-06/tesla-is-said-to-plan-using-stock-cash-mix-to-pay-off-march-debt). That plus reconfiguring the company for $35K standard-range model lead to the layoffs and store closures. Well, that plus they had such a huge sales ramp to ship a lot of cars to Europe last year.

I personally am not sure about closing the stores. It seems like a huge opportunity for publicity lost. However, things have changed, a lot. When they opened the “studio” here in Austin, the word on the street was “Tesla? Oh yeah, I think I’ve heard of those guys” to nowadays when I see a dozen or more Teslas on the streets every day. The stores probably are a pretty big liability for the amount of exposure they already have.

The Model 3 is *not* low-margin! Sandy Munro, of Munro and Associates, was very down on Tesla for their build-quality issues (a very reasonable concern, and especially body-panel gaps). However, their teardown analysis left “a lot of crow being eaten around here,” finding the Model 3 to be “solidly profitable” “over 30%” (

).

 

You should reexamine exactly what Munro said. He did not say that Tesla was making 30% margin on the Model 3. And he could not know what the margin is from a tear down. Margins are determined by audit, not tear downs.

 

OK, so ~2:55 into the video: “[Sandy] The Model 3 is profitable. So I have to eat crow; I didn’t think it was going to happen this way, but the Model 3 is profitable. ... Over 30%. [interviewer] Nobody in the automotive industry is getting 30%. [Sandy] Yes they are but not in the electric field.” And so forth.

If your point is that we don’t know what their manufacturing costs are relative to this, then yes. They’re not going to release that info, so no way to know. But at this level, >30% for an EV is unheard-of.

If Tesla’s going to go bankrupt, I don’t think it’ll be because of profit margins being too low. It’ll be over-optimism in growing their business in the future, rather than cleaning up their balance sheet. In that regard, we’ll just have to see.

 

I don't think there was a tax break to the manufacturers. There was, maybe still is, a huge CAFE loophole for flex-fuel vehicles. It's essentially the same as calculating the MPG of a PHEV while ignoring. For CAFE, the gasoline in the E85 was ignored. The loophole let the companies avoid CAFE fines, but without it, they could have found other ways of doing so.

Part of the low efficiency with E85 is because the engines didn't have the compression ratio to take advantage of the higher octane rating. A serious flex-fuel attempt would have started with a premium fueeld engine.

In Tesla's early days, they entered partnerships helping others put out a compliance BEV. The drive train in the second generation Rav4 EV is all Tesla. The partnerships included the other company getting some Tesla stock. Toyota basically sold theirs off as soon as they could(TSLA is now worth more). As far as I know, Daimler still has their TSLA stock, and might even have other connections
still in place.

Another thing making Daimler owning Tesla more likely than Toyota is that when the Model S beat everybody within their segment, including Lexus, the Europeans took them seriously. The potential threat from Tesla is why there are power PHEVs from those companies available now, and BEVs now arriving.

Except their car sales are also in decline. 2018 Camry sales in the US dropped over 11% from 2017 figures, and the first two months of this year's sales are lower than last year. The now gone Taurus outsold the Avalon in 2018 and 2017.

I only read an article on the platform's(called MEB, IIRC) unveiling. Has me thinking they are serious about BEVs. You don't invest in a platform that won't work for a car without a plug when you could just make do with ICE platforms for BEVs.

I haven't followed the cars because most are going to Europe(I'd consider the dune buggy). VW doesn't have a secured battery supplier at this time, so that may also limit what they ship to NA.

We use more nuclear than coal in eastern Pa.
There is no place where can plug into this grid average, and most plug in sales are on grids cleaner than that average.

The pro-hydrogen and anti-BEV arguments like to ignore the existence of PHEVs.

Chrysler wanted to keep everything simple in order to not overwhelm their typical customer.

Outside North America, the Prime does not have an EV only mode. Press too far on the accelerator, and the ICE will come on too.

The stores are Tesla's only advertising. So they may not be needed anymore. Then some locations may no longer be getting foot traffic outside of Tesla's control. On top of that, some states(Texas) don't allow you to buy a car at the store; they can only direct you to the website.

 

Waiting is the reason that background was shared, to ensure everyone was on the same page when this next chapter begins.

In just a few weeks, the event enthusiasts tried so desperately hard to avoid at all costs will play out. Tax-Credits for GM will be reduced by 50%. To distract from that ugly reality of Volt not having any plug-in hybrid successor, GM announced they would expand their EV offering by revealing 2 new models based upon the Bolt design. The promise was that would happen within the next 18 months. Our wait is now into the 17th month. Not a peep from GM still. Why is this acceptable for GM but not for Toyota?

It's a double-standard that needs to get proper attention. Engineering by press-release has been a chronic problem that no one seems to take issue with, to the point where that is accepted as legitimate advertising... even though there is no actual product to sell... not so much as the basic detail sometimes.

This is why the "not selling" topic shouldn't be taken at face value, which far too many people do. We fall into a group-think and lose perspective on progress & goals.

Toyota is very actively producing & selling components vital for EV deployment, in high-volume for a profit. Refinements to those components and associated software continue on with lots of real-world exposure. So while they wait for that next-gen battery, no time is wasted in the meantime. That setting of the stage also includes drawing of interest away from traditional vehicles. It's a win-win with immediate benefits.

 

I don't understand Tesla closing its stores. I know SOME people will by a car without driving it first but how many? I sure wouldn't. I know a ton of Model 3s had deposits before the car even existed. One of the reasons I didn't consider the model 3 is because there is nowhere to test drive one within 200+ miles of me and a nearly 4 hour drive. And, I guess soon, within ANY distance of me. That pretty much means I'll never buy a Tesla which is too bad because if they get their reliability back up, they are compelling cars.

 

Indeed. You can only buy them on-line here, but (pure coincidence I’m sure, haha) they have computers at the “stores” (technically called “studios”) dialed into Tesla’s website along with “very helpful” employees who do all the on-line sale work for you.

 

It's simple. The stores are closed because of cash flow their hit to profitability. It is a desperation move. I am like you -- I must test drive and inspect the car before I buy.

 

I think the terms of the on-line sales are that you can get a complete refund if you turn it back in before 1000 miles or so-and-so amount of time.

 

Why do you assume it means you can't test drive a Tesla?