Is Tesla's Goose Cooked? Porsche And Audi To Work Together On Future EV Platform

Nope, they will have a lot of work to do to actually "produce" compelling EVs. So far there has been a lot of talk and nothing hitting the market. They might have one super expensive EV out in 2018, they won't even make a dent until 2020 or 2021.

They definitely won't be able to take down Tesla with that timeline, but I really feel bad for Ford and GM. If they don't wake the hell up, VW/Audi/Porsche and Mercedes are going to ravage the US makes running on outdated tech.

Wrong, Mercedes is already developing more tech with Bosch and let's not forget, Mercedes has a 9% stake in Tesla (which helped Save Tesla from bankruptcy) in addition to parts like the gear selector in Teslas

Yup and just Remember Tesla still relies on Benz for the following
- The "transmission" shift stalk
- The indicator stalk
- Cruise control stalk
- The steering wheel
- The air suspension (if fitted)
- The door window controls.
- Automatic Trunk Switch

So yea, not a bad move on Benz's part at all!

We have several unrelated factors at play:

(1) Can Porsche/Audi/Volkswagen deliver compelling EVs to market soon enough to erode Tesla's market share?

(2) Can Tesla continue to keep doing business as it has, running at a loss, tapping into capital markets for cash, etc.? For how long?

(3) Will someone else create a compelling EV that impacts Tesla *and* Volkswagen/Audi Group's (VAG's) plan?

There are too many variables at hand to accurately predict the future.

Actually - telling the future is not as hard as you make it seem.

No matter how long - eventually someone will come out with a compelling EV that will be "newer" than the Tesla model S - AND eventually someone will also come out with an EV that will compete with the Tesla 3. If those suppliers are already luxury car makers - all the more competition.

And that is when the ONE PRICE - no haggling - sales model of Tesla will go down the drain. At the very same time - there will probably be a lot more places (Dealers) to buy the other cars as well as get them serviced. Tesla will end up with the short end of the stick and will have to pivot into a dealer based sales solution - too late - and our headline will come true

@TomM: the dealership is actually a bad thing for EV - case in point: the Bolt EV.

4 months into its life in public and the Bolt barely cracked the 1000-unit sales per month only once, even as it became available in 7 states with a combined population of 93 million people. Call it production constraint or whatever you want (no one buys that story anyway), but the Bolt EV is clearly a failure. There may be many reasons for this disaster, but many accounts blame it on the dealership where knowledge about EV and motivation to sell it are lacking.

Sorry - Henry - but YOU are using the wrong marketplace to jump to a conclusion.
1 - The Bolt is still too early in its roll out to ever determine how it will sell. Many dealerships are still to be brought up to requirements (Tools among others) before they can sell the product. Remember - the Bolt STILL has more interior room than a Model S - and the great GM marketing machine still has not even begun to support these sales. ANd the BOLT handily out delivers the Model 3 - and has - as you note - for several months. And GM actually made a profit in the last 4 quarters as well - something Tesla still has not done.

2 - The problem is not the Bolt - it is when the marketplace has LOTS of choices - maybe two or three years later. At that point - when the Model 3 is a CHOICE among several options - the DEALERS competing for sales is where the Tesla loses out. If they attempt to stick to their rigid pricing scheme - people will buy other options - especially when pricing is an issue. Add in the fact that other manufacturers will have the ability to provide parts and service locally rather than a couple of places per state. (Sales as well). And of course - Tesla's locations do not compete with each other for service or sales - they maintain the same pricing - but for other vehicles I may have the choice of 6-8 dealerships within 30 miles of my home - (and I live in Rural NJ - no Tesla dealer ) - competing on price and offering service that does not require a 100 mile tow to the TEsla dealer to reset the computers means something to the average person who has to watch their money.

3 - I continue to believe that unless the government continues its support of EVs (Trump may end the subsidy) - the current cost of ownership of an EV - the lack of availability of quick recharge - the remote locations for sales and service - and the cheap price of gas will reduce EVs to an also ran position. There will be only so many people looking to buy one - and when they weigh ALL of the considerations - using an old line Manufacturer has LOT of advantages for the average american buyer. We will need a common infrastructure - decades away (what good is a recharge station if there are 10 cars waiting to use it?) - and even then - the ICE cars will still have advantages that an EV cannot fulfill - My average usage is still beyond the capability of a pure EV.

...and still, to this day...not ONE mention of actual street price from Audi, Benz, BMW, or Jag for an all-electric EV. They are purposely hiding something for a reason.

There is enough space for multiple competitors in this expanding market. Having said that the first to market always has an advantage in
building brand recognition and securing market share.

The first to market has to successfully make the transition from having the early adopters buy their product into the mass market buying it. That's why the Model 3 turning those 400000 reservations into paid for deliveries and then adding more orders/deliveries to keep up the pace of growth is so critical to Tesla's long term success.Some make it,some don't. Remember My Space before Facebook? Commodore and Tandy PCs? A "fast second" to market can upset the first mover.

Tesla is that second, GM was first with the EV1/S10 EV.

You are grasping a straws. The EV-1 was a limited program, leased in California, and not an effort to produce a mass market vehicle for sale. Tesla is pioneering a nationwide vehicle sales effort, albeit currently heavily focused on wealthy West Coast urban areas, and a couple of similar areas on the East Coast. Outside of those areas Model S/X sightings are rare. The Bolt, Model 3 et. al. are aimed the nationwide mass market, which means they have to penetrate the real middle class USA "flyover country". USA average middle class income is mid $50K range, well below the range that techies make in those West Coast cities. That will be the test.

GM leased the EV1 also in Arizona and the S10 EV also in GA and it had plans to expand to the Northeast (DC, NY/NJ, Boston). Then the "regulatory climate" changed and they scuttled the program -- the biggest mistake they ever made according to ex. CEO Rick Wagoner.

Agree, they will have some catching up to do. US auto companies are full of old white men who still lives in the glory days of ICE, kind of reminds me of a certain president actually, they deserve the fate of Nokia if they choose to continue in that fantasy.

All of these expert talk is getting tiresome. Those who think Tesla will thrive, go long on its stock. Those who think otherwise, short their stock $25,000.

Porsche and Audi are the same company!!!! They share virtually everything technologically.

Breaking news; German Tesla deliveries surge by 157% in deliveries year-over-year.

When you sold two cars last year and sell 4 this year you have a mind blowing 100% increase. The % of increase numbers are pointless. Actual volume is the better measure.

Car4life1 Wrong Merc sold its shares in Tesla long ago for $780M and severed supply relatonships for its turdburger Smart Hybrid. This was a nice ROI on its $50M capital injection that saved Tesla from BK early in its life before bringing the roadster to market.

As far as Tesla succeeding -didn't they just surpass Ford in terms of market value? Musk must be doing something right and has had some nice successes before with other business ventures. Is he a bullshitter -yes and frankly all good marketers are. Coked up Billy Mays here....

We keep hearing how all these other manufacturers are going to whip Tesla's ass. All I can say is bring it on as it is good for us -the consumers. Lets see the final product and pricing before we announce Tesla as officially being dead.

Is Tesla perfect no. May it still fail -maybe. Does Musk say and do some dumb things -yes either because of his passion, market hype for capital raise or maybe he is starting to believe his own BS.

Despite all the odds Musk has created multiple products and not all good (electric Aztec/Model X) but unlike every other EV ,manufacturer the Model S and Model 3 are good looking vehicles if you can get past wheels that fall off and autocrash.

Tesla will survive and I for one am kicking myself for not buying stock in this thing years ago but hindsight is 20/20.

Lol, daimler's stake in Tesla was only then beginning of their relationship, test drive a Tesla near u for more, parts mentioned borrowed from Benz are listed above

If tesla can deliver and support their products it will be tough to stop them...they have brand power with the masses (a la apple) that no other car company has. Problem is that they have a big problem delivering product on time.

I am 100% behind Tesla (I'm very long on its stock and a future Model 3 owner) but I welcome all other companies' serious effort to make the EV work for the mass - except the half-ass effort shown by GM and Ford. After all, global participation in EV was envisioned by Musk in his master plan and his release of Tesla patents.

Serious plans by VAG, MB and BMW are validation of the EV. The ones who should worry are the dinosaurs such as GM and Ford who can't think beyond their trucks and large SUVs (yes I know it's where the money is, but that's exactly what will make them extinct). The Europeans and the rest of the world are smart enough to know that the ICE automobiles are on borrowed time. And the smart ones do plan more than 5 years down the road.

They can have their trucks and make them electric at the same time, but that would cut into the profit margins way too much.

Ford and GM are making huge investments in EVs. GM already has viable product on the market and likely has more coming. Ford has committed a huge investment to EVs. The real laggards are FCA, Honda, and Hyundai/Kia.

People are forgetting economies of scale in driving down cost of producing an EV. Tesla sells a tiny fraction of what Audi and Porsche (combined) do globally. VWAG will have significant leverage over its EV parts suppliers and will be able to negotiate cheaper prices for its parts than Tesla will be able to because it will buy parts in much larger volumes than Tesla will.

So Audi/Porsche will have cheaper production cost than Tesla, a wider range of selling prices from cheaper (Audi) to very expensive (flagship Audi and Porsche EVs) and overall higher margins due to the lower cost.

How does Tesla compete with a competitor than can produce 3x the global volume of EVs and do it at a higher profit margin due to the lower production cost?

Is the Tesla brand really that strong where it can make a competitor that produces many multiples of its global volume and can do it at a higher margin irrelevant?

I doubt it. The Tesla business model will be forced to change because the Germans can produce much greater volume at a higher profit margin and already have a dealership network that is several times the size of Tesla both in the United States and around the world.

The Germans also bring brand image to the fight. Porsche it an iconic sports car maker and Audi has a global following for its luxury and technological innovation.

Yeah, that's why their sales are highest than ever, before the Model 3 is even out.

Howndo you ghink the German will "compete on volume" as long as they don't have their own battery factories?
Just asking.

Check some facts! panasonic is THE partner for Tesla producing batteries in their Gigafactory.
So your exampla would HELP Tesla.