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Transportation Businesses

Former GM Product Czar: Tesla a "Fringe Brand" 267

Posted by samzenpus from the get-a-haircut dept.
cartechboy writes There's been plenty of skepticism when it comes to Tesla. The Silicon Valley startup unveiled an all-electric car that stunned the world and had many other automakers rolling their eyes. Fast forward to 2014 and Tesla's preparing to launch its third model, the Model X. Production of the Model S sedan is humming along, and this new automaker continues to make headlines multiple times a week. Industry veteran Bob Lutz was the champion behind the Chevrolet Volt, and has been quite vocal about Tesla from the beginning. So what's his view on the company now? He said Tesla will remain a "fringe brand" until it launches its next generation of vehicles and the smaller, less expensive Model 3. Speaking Wednesday on CNBC's "Squawk Alley" finance show he said that Tesla's stock price was "kinda high" at the moment.
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Former GM Product Czar: Tesla a "Fringe Brand" More

Former GM Product Czar: Tesla a "Fringe Brand"

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  • How does the quote go...? (Score:5, Insightful)

    by Chris Mattern ( 191822 ) on Monday September 29, 2014 @04:02PM (#48022109)

    "First they ignore you, then they laugh at you, then they fight you, then you win."

    • Re:How does the quote go...? (Score:5, Informative)

      by MightyMartian ( 840721 ) on Monday September 29, 2014 @04:05PM (#48022143) Journal

      FTFY

      "First they ignore you, then they laugh at you, then they fight you, then you win, and then their paid lobbyists have you legislated out of business.."

    • From that it follows that anybody being ignored is destined to win?

      • If it helps, the quote came from a person who was ignored, then fought, then lost, but it commonly misattributed to someone much more successful.

        The quote is so full of bluster, and bravado, you just can't take it seriously.

    • Yeah ... but ... it's true. (Score:5, Insightful)

      by GodInHell ( 258915 ) on Monday September 29, 2014 @04:19PM (#48022279) Homepage
      Check out the chart at Wikipedia [wikipedia.org] the Model S sold about 40,000 cars this year. Compare that to the significantly less sexy Nissan leaf with its 130,000 sales - or GM's total sales for 2014 January - June of 4.9 Million vehicles. See, GM's sales report for Q2-14 [gm.com].

      Tesla is a great car company and likely to be an even bigger deal in the battery market - but compared to GM, it's sales barely register.

      On the stock front - GM's market cap is 51.8B, Tesla's is 30B. So, yes, Tesla is probably a bit overpriced right now - people are buying what Tesla will be, not the company it is today.

      • Re: Yeah ... but ... it's true. (Score:5, Informative)

        by tysonedwards ( 969693 ) on Monday September 29, 2014 @04:32PM (#48022411)
        Tesla actually has a significant profit margin per car sold (25%) versus GM at 0.7% for this latest quarter across all of their divisions. That's where the massive disparity comes from. When you can sell luxury cars at a much higher price with much higher margins, volume doesn't mean dick.

        • Re: (Score:2, Informative)

          by Anonymous Coward
          It also doesn't hurt that they are given zero emission car credits from the California government for each car sold that they then turn around and sell to GM, Toyota, etc for about $30K per Model S. That is where they are getting most of their profit.

        • Re: (Score:2)

          by geekoid ( 135745 )

          "...volume doesn't mean dick."
          of course is means something, don't be daft.

          • Re: Yeah ... but ... it's true. (Score:5, Insightful)

            by tysonedwards ( 969693 ) on Monday September 29, 2014 @05:19PM (#48022793)
            Tesla made 750m in profits last year off of 40,000 Model S sales.
            GM made 31.8m in profits last year off of 130,000 Nissan Leaf sales alone.

            Tesla is generating 3 billion dollars per year in revenue, and of that 750 million is profit.
            All of GM combined is generating 155.42 billion dollars per year in revenue, and of that 1.087 billion is profit.
            If Tesla sells an additional 18,000 cars per year (58,000 total), they will surpass GM's Combined Yearly Profit.

            That is why Tesla is doing well in the stock market, considering that they don't need much staff to build their products, they just build what is already sold, and they don't need to sell many cars to generate a lot of profit for their investors.

        • Re: Yeah ... but ... it's true. (Score:5, Informative)

          by Anonymous Coward on Monday September 29, 2014 @04:55PM (#48022627)

          Tesla actually has a significant profit margin per car sold (25%) versus GM at 0.7% for this latest quarter across all of their divisions. That's where the massive disparity comes from. When you can sell luxury cars at a much higher price with much higher margins, volume doesn't mean dick.

          You don't understand their business models.

          If Tesla is claiming a 25% margin, then that's solely on the direct cost of the car and doesn't account for overhead such as the capital depreciation. It doesn't matter how much money they make over the direct cost of the car, what matters is the profitability, money left over after ALL expenses of the company. In accounting circles that's called Net Margin, and Tesla has not has a positive net margin in it's history; they are burning cash to claim market share. That only works for so long.

          Last year Tesla lost $75M, which is an improvement over the $350M they lost last year and the $250M they lost before that:

          http://finance.yahoo.com/q/is?s=TSLA+Income+Statement&annual

          GM makes .7% on their cars. This is a bid for market share. That's ok though, because GM doesn't make money selling cars. They make money on *financing* cars; their auto loan and lease divisions are the real money generators; the physical cars are just an entry point. GM made $5B last year, which was a 3.4% net margin over gross revenues.

          I'm a fan of Tesla, but seriously if you're going to make a comparison at least get the facts right and don't obfuscate it with pointless numbers.

        • Margins and profit margins are two different things, don't get them confused. I think the point is that the high end market for Tesla may have limited upside, and therefore they will need to move significantly more to the lower end to have long term sustainable growth. Time will tell, but its not wise to completely ignore a person who has significant business insight and experience, there is usually some underlying basis.

      • Re: (Score:2)

        by suutar ( 1860506 )

        This. Yes, right now Tesla is absolutely a fringe player. But all the signs seem to point to them growing to be much more substantial, especially once (as Bob himself said) they get their next tier of lower price, less frills up and running.

        • Absolutely, I want a Tesla Model S - I would gladly buy one if I could. I would joyously be part of Telsa's sales - but that doesn't change the numbers. Tesla is a tiny player making big waves - hopefully its just the signs of a new beast rising from the deep - but companies should be evaluated based on their numbers, their vision and their leadership - Tesla has only two of those going for it right now.

      • Chevy sells approx 2,000 volts per month or 24,000 a year. Compare that to the much more expensive Model S selling 40,000.

        Yeah overall, they are being traded as a growth stock, but look at those numbers. Can you imagine how much they would sell with a car the same price as the volt?

    • "The fact that some geniuses were laughed at does not imply that all who are laughed at are geniuses. They laughed at Columbus, they laughed at Fulton, they laughed at the Wright brothers. But they also laughed at Bozo the Clown." That is how the quote goes. Tesla is for giving rich people a fancy toy. Nothing more.

      • Being Portuguese, I'm damned happy that my ancestors laughed Columbus out of the country.

        Only a grade A moron arrives in America and says to himself "I have arrived in India!".

        The Earth's radius was known with some precision back then. Nobody with an education really believed that the Earth was flat. Anyone with half a brain who planned exploration would've figured out that the continent whose existence was vaguely known was not far enough to be India.

        • Re: (Score:2)

          by rsborg ( 111459 )

          Only a grade A moron arrives in America and says to himself "I have arrived in India!".

          Is it really the case, or was this justification for conquest of the new world - I don't think the business world has changed significantly in the past few centuries - we put a new name on some business model, but the underlying goals and direction is the same.

          In this case, I can clearly see it as "something to tell the people and our competitors" - if the mission fails, no hint is left that it is the "new world" that was failed, only what others have failed at before (ie, faster route to India). If the mi

        • Are you serious? It was an amazing trip. One can say anything one wants about going west (in order to go East) but until it's done it's unproven and highly experimental. You say you're Portuguese - then take another look at how long it took voyagers to go from the Canary Island to rounding the cape of Africa. It took technological innovations (the caravel among others) and decades.

          Then here comes a guy who says that he'll sail west instead and you say he was a moron for mistaking the Carribean for the I

      • Re: (Score:2)

        by geekoid ( 135745 )

        Tesla is a cutting edge car, and they are planning on less expensive models.
        Initially, the automobile was a fancy tow for the rich.

    • Re: (Score:2)

      by geekoid ( 135745 )

      It's a complete BS saying based solely on biased hind sight.

      Because there are thousands of:

      "First they ignore you, then you go out of business"
      "First they ignore you, then they laugh at you, then you go out of business"
      "First they ignore you, then they laugh at you, then they fight you, then you go out of business"
      "First they ignore you, then they laugh at you, then they fight you, then you win., for a while."

      Being around for a while doesn't mean what you peddle works.

      The guy is right. Until they have a mor

      • Re: (Score:3)

        by Dahamma ( 304068 )

        Until they have a more affordable version, the with be a niche. Bugati is also a niche. Niche doesn't mean bad.

        Bad example. Bugatti isn't a niche, Bugatti is just a marquee brand of the Volkswagen Group.

        And while obviously Tesla will remain relatively small until they have the pricing and capacity to sell more cars, that's not really a very good definition of a niche. They are backordered for months and have already announced longer term plans for their next 2 models. That's called *startup*, not a niche.

        As far as the price - maybe it's high, but also maybe Bob Lutz doesn't quite understand the concept of stock v

    • Re:How does the quote go...? (Score:5, Insightful)

      by LWATCDR ( 28044 ) on Monday September 29, 2014 @04:58PM (#48022647) Homepage Journal

      Actually I expected this level of FanBoi response it is a real shame that people don't bother to read anymore.
      "He said Tesla will remain a "fringe brand" until it launches its next generation of vehicles and the smaller, less expensive Model 3. "

      Just how right can anyone be. The current Tesla is in the same price range as the Audi A8, MB S Class, and BMW 7 series. In other words a lot more than the average annual income in the US.
      When it launches the Model 3 and if it can for a good price it will be moving into the mainstream.

      So exactly how is this in anyway ignoring them or even fighting them. Sounds like simple facts and observation to me.

  • Fringe Brand (Score:3)

    by nospam007 ( 722110 ) * on Monday September 29, 2014 @04:02PM (#48022113)

    Look who's talking.
    Somebody from a 'Killer Brand'.

    • Look who's talking.
      Somebody from a 'Killer Brand'.

      "Let's destroy innovation and excitement around this place, boys. After all... We make a living fleeting Federal and municipal organizations with white vans and cars that NOBODY will steal..."

      Remember the '72 Malibu SS? The '68 Impala? It's been a LONG time.

  • Tesla is worth 60% of GM ! (Score:5, Informative)

    by macpacheco ( 1764378 ) on Monday September 29, 2014 @04:06PM (#48022151)

    GM market cap 51.8B
    Ford market cap 58.44B
    Tesla market cap 30.66B and this is after a major drop in stock price, I believe it has been higher than GM !
    A fringe brand that is worth over half of the big auto boys... Fringe my a..
    If only any other brand got rave reviews like Tesla is getting. Specially in customer satisfaction.

    • Re:Tesla is worth 60% of GM ! (Score:5, Funny)

      by l0ungeb0y ( 442022 ) on Monday September 29, 2014 @04:09PM (#48022183) Homepage Journal
      Well from GMs perspective, until Tesla gets a Government Bailout they will remain a fringe brand.

    • Re:Tesla is worth 60% of GM ! (Score:4, Insightful)

      by HornWumpus ( 783565 ) on Monday September 29, 2014 @04:13PM (#48022227)

      Crispy Cream Donuts was once worth more than the entire remainder of the US baking industry.

      Before you think of shorting, remember 'The market can remain irrational longer then you can remain solvent'. Buy out of the money put options instead, much safer. If you can find someone making the market.

      • I've wanted to buy into some Tesla stock for a long while, but I didn't have the liquid funds when they had their IPO. Since then I haven't thought of it when their stock price has had a sane P/E ratio, or more accurately a valuation that was anywhere near in line with the actual value of their assets. Stock values of businesses that are popular in the media and making lots of headlines rarely have any connection to the actual worth of the company, Facebook stock being a great example.

      • There's a bit of open interest all the way out to Jan2016 options.

        https://www.google.com/finance... [google.com]

        Obviously a lot more on the call side than the put side though.

    • Re: (Score:2, Insightful)

      by Anonymous Coward

      You might want to learn to look at stocks. Market cap is simply a multipler of price x # of shares; if a company is overvalued then it's market cap will be high, so market cap is not a good indicator of if it's actually overvalued; they're measuring the same thing.

      http://finance.yahoo.com/q?s=GM

      http://finance.yahoo.com/q?s=TSLA

      Look at EPS, or earnings per share. Tesla -$1.35, GM $1.19; Tesla is losing $1.35 for every share whereas GM earned $2.39 for every share, and gave to it's shareholders $1.20 each!

    • That's exactly the trouble.

      If you buy today and the stock goes down, people like those in TFA will continue to say it was overpriced and you are a bad investor.

      If you buy today and the stock keeps going up, then you become praised as an early adopter.

      Unfortunately my crystal ball is broken so I cannot tell which direction the investment will go. I'm either making a bad investment or becoming an early adopter, only time will tell which.

    • Re:Tesla is worth 60% of GM ! (Score:5, Insightful)

      by David_Hart ( 1184661 ) on Monday September 29, 2014 @04:36PM (#48022459)

      GM market cap 51.8B
      Ford market cap 58.44B
      Tesla market cap 30.66B and this is after a major drop in stock price, I believe it has been higher than GM !
      A fringe brand that is worth over half of the big auto boys... Fringe my a..
      If only any other brand got rave reviews like Tesla is getting. Specially in customer satisfaction.

      Market cap is nothing but a virtual valuation based on how investors value future revenue. It's basically a bet that the company will continue to grow profitability at an increasing rate. In the case of Tesla, there is a lot of cheer-leading investors in the stock. To maintain that level of growth, Tesla does have to come out with a product that is appealing to a much larger audience than the current product offerings. Today's investors are betting on a mass appeal product, that people will buy the product, and that Tesla will gain a decent share of the overall automobile market.

      The point that the ex GM Czar makes is correct. Until Tesla can execute on this vision, they will remain a fringe or niche brand. There is a risk that Tesla will screw up in execution, misunderstand the market, etc. Only time will tell if they can succeed.

    • Re: (Score:2)

      by geekoid ( 135745 )

      So you not only don't understand market cap, you also didn't read what he was talking about?

      Hint: Tesla is NOT worth 60% of GM.

      Yes, Tesla is a fringe product. And it will be until there are less expensive models.

  • It's true (Score:5, Insightful)

    by prelelat ( 201821 ) on Monday September 29, 2014 @04:07PM (#48022157)

    It's a fringe brand in that Ferrari is a fringe brand. I don't think most people wouldn't want one but I don't know a soul who has one. Very few have seen them. They aren't exactly a larger brand. IF they can mass produce a model in a reasonable price range comparable to a modern model of car it will take off. Right now it is in the fringe but I don't think it will stay there. That's exactly what the guy in the article said. He didn't say Tesla was a bad idea or that it won't take off, he said it's not there yet but this next model could very well take it there.

    It will be exciting to see where we go from here.

    • Re: (Score:2, Interesting)

      by Anonymous Coward

      Pretty much, the Tesla is not the "everyman's car"-maker, not by a long shot.

      In fact, thinking about how they approached the market (i.e. as a guilt free toy for the wealthy to buy online) they may have cracked it, let some other motorcar company sort out how to make a greener Ford, Tesla can enjoy a high end niche and avoid the mistakes other revolutionary car manufacturers made (Mr. Preston Tucker) and patent the shit out of tech, business models and become the 300 lb gorilla of the battery / fuel cell ma

    • It's a fringe brand in that Ferrari is a fringe brand.

      Yes, but I think BMW and Mercedes are better comparisons, at least with respect to price range.

      I don't think most people wouldn't want one but I don't know a soul who has one. Very few have seen them.

      I know several people who have Teslas, but no one with a Ferrari. I've not only seen, but test-driven a Tesla, but not a Ferrari. In fact, assuming you're not in a state that is making Tesla's life hard, getting a Tesla test drive is easy. A Ferrari, not so much.

      • i don't think the gp's post was equating the tesla with a ferarri. The ferrari is an example of a fringe brand. It's not dominating the auto market place in volume. It has it's core customers and is clearly not a failure of a company. "fringe" is simply a car that isn't for everyone.

    • Re: (Score:3)

      by Animats ( 122034 )

      It's a fringe brand in that Ferrari is a fringe brand. I don't think most people wouldn't want one but I don't know a soul who has one. Very few have seen them.

      We get a warped view here in Silicon Valley. Lots of Teslas. No Supercharger stations, though. There are a fair number of electric car outlets around, of too many varieties.

    • Re: (Score:2)

      by Rinikusu ( 28164 )

      There's quite a few here in Los Angeles. The issues here are mostly related to population density. Rich tech moguls don't really have to worry about street parking and figuring out how to charge the damned things overnight like the rest of the plebes. And, realistically, the average American is having a hard enough time paying for a mortgage (lol), much less trying to pay for a $70k car that's got limited range, requires a dedicated charging station that they don't have a spot to install, etc. I like Te

    • Re: (Score:2)

      by DogDude ( 805747 )
      Speak for yourself. I see, on average, one a day, and I know several people that have one. I'd buy one if I liked large cars, but as soon as they come out with a smaller model, I'm buying one, no question.

    • I see a Ferraris occasionally... I see a lot more lamborghinis, porches, and my neighborhood is littered with corvettes and classic cars of the 50s and 60s.

      I live in the mid-west sports cars and classic cars are everywhere.

    • Comment removed based on user account deletion
    • I wouldn't call Ferrari a "fringe brand" anymore. Not since the 1980s, anyway, and even then their racing pedigree made them a household name almost everywhere in the world. Koenigsegg, Pagani, Noble, and a few others are fringe brands that make one off vehicles or limited run vehicles that only car enthusiasts know much about. That's what makes them fringe, their obscurity. Tesla started off as a fringe brand hand making every Roadster six years ago, but once they started mass producing the Model S they st

    • It's a fringe brand in that Ferrari is a fringe brand. I don't think most people wouldn't want one but I don't know a soul who has one. Very few have seen them. They aren't exactly a larger brand. IF they can mass produce a model in a reasonable price range comparable to a modern model of car it will take off. Right now it is in the fringe but I don't think it will stay there. That's exactly what the guy in the article said. He didn't say Tesla was a bad idea or that it won't take off, he said it's not there yet but this next model could very well take it there.

      It will be exciting to see where we go from here.

      There is a difference... Ferrari isn't a "fringe" brand, it's a luxury brand. Ferrari never set out to be a daily driver. Tesla, however, has always stated that they were going to first target the luxury/sports car market and then use profits to develop a commuter vehicle with a much larger mass appeal. Based on their own vision, they are still a fringe brand.

    • It's a fringe brand in that Ferrari is a fringe brand. I don't think most people wouldn't want one but I don't know a soul who has one. Very few have seen them. They aren't exactly a larger brand. IF they can mass produce a model in a reasonable price range comparable to a modern model of car it will take off. Right now it is in the fringe but I don't think it will stay there. That's exactly what the guy in the article said. He didn't say Tesla was a bad idea or that it won't take off, he said it's not there yet but this next model could very well take it there.

      It will be exciting to see where we go from here.

      It depends on where you live. In California they are almost commonplace, especially in the metro areas. A closer cousin to Tesla than Ferrari would be Audi, BMW, Mercedes, Porsche, etc. They are expensive and only the affluent can afford them, but not so crazy expensive that you need to be a CEO or rock star.

    • Re: (Score:3)

      by dbc ( 135354 )

      Well, I actually have two friends that have Teslas, see other Teslas on the road often, and Leafs are common as dirt. That has a lot to do with the climate, commute patterns, and infrastructure here in Silicon Valley. That said, the Tesla is a fringe brand for many of the reasons that you say -- it is expensive, its infrastructure needs are scarce in most places, and if you live where cab climate control is necessary, prepare to sacrifice range for that. As Telsa moves down the price curve and Leaf moves

    • It's a fringe brand in that Ferrari is a fringe brand. I don't think most people wouldn't want one but I don't know a soul who has one. Very few have seen them. They aren't exactly a larger brand. IF they can mass produce a model in a reasonable price range comparable to a modern model of car it will take off. Right now it is in the fringe but I don't think it will stay there. That's exactly what the guy in the article said. He didn't say Tesla was a bad idea or that it won't take off, he said it's not there yet but this next model could very well take it there.

      It will be exciting to see where we go from here.

      Ford was a 'fringe' brand too. Then the Ford Model-T hit the market and the Ford brand took off. Every car company, hell every company period, that manufactures something you can put a brand logo on starts off as a 'fringe' brand. Ferrari is more of a niche brand, for most of their history they have been a small volume manufacturer that caters to the super rich elite, they remained a niche brand when they created watered down versions of their super sports cars to appeal to the less illustrious segment of s

  • Bob's smokin' crack (Score:3)

    by tekrat ( 242117 ) on Monday September 29, 2014 @04:07PM (#48022159) Homepage Journal

    GM wishes it could get Tesla's customers... Witness the Cadillac version of the Volt, $70,000 price for a Volt with a better interior -- The Cadillac ELR. How many Volts and ELRs combined does GM have to sell to even come close to the Tesla?

    • Re:Bob's smokin' crack (Score:5, Funny)

      by HornWumpus ( 783565 ) on Monday September 29, 2014 @04:16PM (#48022255)

      The Volt outsells Teslas. Sorry to burst your bubble.

      • Preferred the Volt ? (Score:5, Interesting)

        by perpenso ( 1613749 ) on Monday September 29, 2014 @04:30PM (#48022387)

        The Volt outsells Teslas. Sorry to burst your bubble.

        Go ask those Volt owners if they aspired to own the Volt, if they preferred the Volt or if they settled for the Volt?

        • That affects the color of their money how?

          • That affects the color of their money how?

            It affects customer retention, future money. It Tesla comes out with affordable cars GM is in for serious competition.

            • Re: (Score:2, Informative)

              by Anonymous Coward

              Price of 2015 Chevy Volt - $34,345, 60 month loan price per month $587

              Price of a Model S - $69,900 , 60 month loan price per month $1,187

              Anticpated Price of a Model 3 - $50,000, 60 month loan price per month $855
              http://www.ibtimes.com/2017-tesla-model-3-starting-price-50000-according-sobering-report-teslas-future-challenges-1690822

              I think on a commodity product like an automobile, customer retention will be dictated far more by the average wealth of the consumer and less so on brand. Brand makes a differen

        • The Volt outsells Teslas. Sorry to burst your bubble.

          Go ask those Volt owners if they aspired to own the Volt, if they preferred the Volt or if they settled for the Volt?

          i'm sure GM is perfectly happy to have people settle for the volt.

          • The Volt outsells Teslas. Sorry to burst your bubble.

            Go ask those Volt owners if they aspired to own the Volt, if they preferred the Volt or if they settled for the Volt?

            i'm sure GM is perfectly happy to have people settle for the volt.

            You mean GM is perfectly happy that people don't have an affordable option. The point is once those people have an affordable option the meaningfulness of past sales becomes apparent, i.e. not very meaningful at all.

      • The Volt isn't an electric car. It's maximum range on batteries is 38 miles. So, as an electric vehicle, it's 19 miles going, 19 miles return, and if you need headlights and wipers be prepared to get out and push it at the end.

        Apples and Oranges ...

      • Cadillac has a luxury version of the Volt that sells for approximately the same price as the Tesla. No one buys it.

        The fact is, comparing Tesla sales to Volt sales is idiotic. They aren't remotely similar cars and they aren't remotely competitive.

        The Tesla Model S is outselling every single brand in its class. Porsche Panamera sales in California have fallen to non-existent.

        I'd bet damn near no one shopping for a car in that price range who drives a Tesla would buy anything else. It's that good.

      • Re: (Score:2)

        by tekrat ( 242117 )

        Citation??

        I see an article that claims GM has sold only 58000 Volts over three years, and I know that Tesla has sold more than that in the same amount of time.

        Anecdotal: I see way more Teslas on the road than Volts, and I live in NJ. Admittedly, I'm near the NYC area where the wealthy love to show off fancy cars, but still, way more Teslas, by far, and I'm a fairly good car spotter while driving to work.

    • GM wishes it could get Tesla's customers...

      GM wishes it could keep its Volt customers. My two Volt owning friends lover their Volts, their spouses too, however they all really wish they could afford a Tesla. When Teslas become more affordable, GM is in trouble. Well, more trouble than they are normally in.

  • Alibaba (Score:3)

    by oh_my_080980980 ( 773867 ) on Monday September 29, 2014 @04:15PM (#48022249)
    And Alibaba isn't over valued?

  • s/tesla/apple/g (Score:3)

    by whyde ( 123448 ) on Monday September 29, 2014 @04:27PM (#48022357)

    Amara's Law: prov. The effect of a technology will be overestimated in the short run and underestimated in the long run.

    What seems like just a fringe now, from far away, will soon be the whole surrey with the fringe on top when it gets closer.

    • Dipshit's Law: Quotable "laws" are rarely accurate, rarely referenced properly, and rarely attributed correctly.

      From Murphy to Moore, these "laws" are nothing more than shit for idiots to bandy about in the absence of actual comprehension, thought, or opinion.

  • So? (Score:5, Insightful)

    by morgauxo ( 974071 ) on Monday September 29, 2014 @04:32PM (#48022415)

    What's wrong with calling Tesla a "fringe brand". Sorry but if you can afford a Tesla you ARE on the fringe!

    I don't think that really says anything bad about Tesla itself. Any new car company in the US that can survive as long as Tesla has in the face of the big three has nothing to be ashamed of. The fact that the cars are relatively expensive.. of course they are! They aren't as mass produced as other cars are! Now if Tesla manages to get their cars to a point where they are no longer fringe and a regular person can and is likely to purchase one... that would be awesome! Even if they never get that far, even if Tesla closed up shop tonight I'd say lasting this long in the face of super entrenched and government supported incumbents was a good accomplishment.

  • From GM's point of view, Tesla IS a fringe brand. How many sales does GM lose to Tesla? Granted, some people may be in the market for a $60K Corvette and decide to buy a $80K Tesla Model S instead. But if you look at directly competing models, how many people decide to buy a Tesla instead of a $35K Chevy Volt? Basically, none. If you create a bell curve of all car models by selling price, Tesla will be in the fringe with the other cars that are close to 6 figures. Being a fringe brand doesn't mean you don'

  • "He thinks that the company will remain a "fringe brand" until it introduces its next generation of cars, the smaller and less expensive Model 3 currently planned for a late 2017 introduction.

    That's pretty much a reasonable statement. Telsa gets a lot of buzz and I'm sure a lot of wealthy people have them. Yet, it is not a common person's car until the less expensive models come in 2017.

    There's a lot of anticipation with Tesla and we all wait and see to see how it impacts the regular person with respect to

    • Re: (Score:2)

      by King_TJ ( 85913 )

      It's a reasonable statement if GM was also admitting that its attempts at electric cars are "fringe" too! The laughable part is when they speak with an attitude like they have the electric car thing all buttoned up.

      Quite frankly, if we want to talk about more affordable electric cars that typical consumers would be tempted to buy today? I'd look at such offerings as the electric version of the Kia Soul (should sell at the $35K - $38K price point) before I'd look at GM. The Chevy Volt is one of those cars

  • Until they start selling electric cars for about the same price as you can buy an otheriwise equivalent capability ICE vehicle, instead of having no less than a markup that is large enough to buy a whole other brand new car, there is no chance that they will become as ubiquitous as ICE vehicles.
  • Note: I'm a very happy Volt owner...

    However, GM is a publicly traded company... What else could they say? "Wow, the Tesla's a really great car..." How does that help their stock price? GM is in the business of selling cars and in doing so making their stock worth more. You're finding fault when someone is merely towing the party line and confusing a news story for a press blurb.

  • So was Honda...

    Hell, at one point even GM was "fringe"...

    Im not saying that Tesla will grow that size. Suzuki was, and IS a fringe brand. But saying "hey they're small now" is what screwed GM back in the 80s with the Japanese and Volkswagen invasion.

    Other bad (for GM) echos are the possible paradigm shift. What allowed the Japanese invasion in the 70's? They had better small car/low gas consumption cars. Here, Tesla has a huge tech advantage in electric right now. Could this be a tipping point? Dunno...

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