[opinion] - hmmm…VW/Audi/Porsche may be in trouble…

[SoccerMan94043]

Tesla has held a 50% or so market share in EVs in the US for a long time.

They’re the PROBLEM for competitors, not the example to follow. It’s taken a 50% market share and government subsidies to barely turn a profit. This isn’t a business model that competitors can nor should try to replicate.

Instead of that nonsense, car manufacturers can easily look at their own books and determine which models sell well and sell at a profit.

It’s what Ford did and it’s why they killed their all electric F150 lightning as their gas powered F150 remains the number one seller by a long shot and turns a huge profit. Seems like a super easy business decision.

Likely a good short term decision but I think bad long term; we've seen countless companies go under because they didn't innovate and got out competed.

I have to assume Porsche will make good medium term decisions and not lose out on the investment they've already made (through Electric options across all of their cars).

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[Wivenhoe]

When making the investments in R&D and manufacturing plants, I think that the EV manufacturers trusted the governments to stand by the ICE bans and ‘fines’ for not achieving EV sales. The EU and UK and other governments have not only caved in by extending the bans but allowed heavily subsidised Chinese cars imports because they have caused the so called ‘cost of living crisis’. This has left the manufacturers exposed and decimated residuals on EV’s.

 

[Wivenhoe]

When making the investments in R&D and manufacturing plants, I think that the EV manufacturers trusted the governments to stand by the ICE bans and ‘fines’ for not achieving EV sales. The EU and UK and other governments have not only caved in by extending the bans but allowed heavily subsidised Chinese cars imports because they have caused the so called ‘cost of living crisis’. This has left the manufacturers exposed and decimated residuals on EV’s.

 

[whitex]

They’re the PROBLEM for competitors, not the example to follow.

So their problem is customers prefer to buy Teslas over their own product, but you say the solution is not to follow what Tesla is doing, then what? How are they going to get customers to like their products over Tesla (despite the brand damage done to it by Musk in 2025)? What could Sony have done to convince customers to keep buying Walkmans instead of iPods? After all, they were the best at Walkmans.

 

[69Mach390]

So their problem is customers prefer to buy Teslas over their own product, but you say the solution is not to follow what Tesla is doing, then what? How are they going to get customers to like their products over Tesla (despite the brand damage done to it by Musk in 2025)? What could Sony have done to convince customers to keep buying Walkmans instead of iPods? After all, they were the best at Walkmans.

The problem is that it took a 50% market share to be “successful.”

That isn’t a business model that can be repeated by multiple manufacturers. It’s a losing proposition.

The market frankly isn’t big enough to support diving headfirst into EV production and being profitable…… yet.

Consumers just plain aren’t willing to pay the premiums necessary that would make EVs profitable for the manufacturers.

I am speaking mostly about the US market. I don’t know much about how things are going elsewhere. But here? It kinda sucks for the manufacturers.

They’ve all been forced to cut production AND drop prices significantly, which only makes things worse for them. And this trend has been going on for a few years. The lack of governmental support in 2025 just made it worse.

This isn’t walkmans vs iPods. Those are an entirely different market than car manufacturing and much simpler to innovate, build, and make a profit on. Plus WAY less major competition.

There are over 40 car brands in the US competing right now and over 800 worldwide.

There is literally only room for 1 to succeed and be profitable in the US with a 50% market share.

If you’re the CEO one of those other 39 (and want to keep your job), would you try to “make a better Tesla” and beat them, or just keep making other profitable cars?

 

[whitex]

The problem is that it took a 50% market share to be “successful.”

That isn’t a business model that can be repeated by multiple manufacturers. It’s a losing proposition.

How do you figure? Tesla has less than 50% (somewhere in the 40's though, 43% in Q1 2025 last I looked) of less than 10% new car sales market. So 4% of all cars sold in the US. There is room for 25 manufacturers, each owning 4% of the new car sales. Simple math.

As a matter of fact, prior to 2012 when Tesla came out, nobody could even envision a profitable brand new car manufacturer that only owns 4% of the market. Thinking like that was why there hasn't been a successful new car company for decades before Tesla.

Consumers just plain aren’t willing to pay the premiums necessary that would make EVs profitable for the manufacturers.

Tesla profit margins are higher than most ICE cars. Chinese EV's are in cheaper than western ICE cars. So again, the math tells you, this EV premium is negative for consumers, if US didn't have protectionist tariffs in place. You could argue Chinese government subsidies, sure, but then please consider western subsidies of the oil industry, and ICE car manufactures (remember the 2008 bailouts in the US, IIRC only Ford didn't require billions of government money to survive?).

They’ve all been forced to cut production AND drop prices significantly, which only makes things worse for them. And this trend has been going on for a few years. The lack of governmental support in 2025 just made it worse.

Ok, how come they were forced to make so much deeper cuts than Tesla? What is causing Tesla sales to get hit less, it can't be Elon's 2025 political antics - those have actually made it worse for Tesla sales.

This isn’t walkmans vs iPods. Those are an entirely different market than car manufacturing and much simpler to innovate, build, and make a profit on. Plus WAY less major competition.

They are not identical, but there are a lot of parallels. Walkmans and iPods played music on the go. Walkmans were less complex, cheaper to produce than iPods. Walkmans were cheaper to buy too, i.e. consumers had to pay a premium for an iPod over a Walkman. Yet, which product won? Consumers want modern cars, Tesla is just the only one that can sell in the US. Chinese EV's would sell like hotcakes here too. Consumer choice is what determines who wins. Political lobbying for protectionism only goes so far.

There are over 40 car brands in the US competing right now and over 800 worldwide.

There is literally only room for 1 to succeed and be profitable in the US with a 50% market share.

If you’re the CEO one of those other 39 (and want to keep your job), would you try to “make a better Tesla” and beat them, or just keep making other profitable cars?

Again, your math is wrong - see the beginning of this post. Tesla has less than 4% of US new car market, so there is plenty of room. Even in purely ICE market, automotive company is not going to do very well on 2.5% (1/40-th) of the market, unless they are selling to niche markets like Ferrari).

 

[69Mach390]

How do you figure? Tesla has less than 50% (somewhere in the 40's though, 43% in Q1 2025 last I looked) of less than 10% new car sales market. So 4% of all cars sold in the US. There is room for 25 manufacturers, each owning 4% of the new car sales. Simple math.

As a matter of fact, prior to 2012 when Tesla came out, nobody could even envision a profitable brand new car manufacturer that only owns 4% of the market. Thinking like that was why there hasn't been a successful new car company for decades before Tesla.


Tesla profit margins are higher than most ICE cars. Chinese EV's are in cheaper than western ICE cars. So again, the math tells you, this EV premium is negative for consumers, if US didn't have protectionist tariffs in place. You could argue Chinese government subsidies, sure, but then please consider western subsidies of the oil industry, and ICE car manufactures (remember the 2008 bailouts in the US, IIRC only Ford didn't require billions of government money to survive?).


Ok, how come they were forced to make so much deeper cuts than Tesla? What is causing Tesla sales to get hit less, it can't be Elon's 2025 political antics - those have actually made it worse for Tesla sales.


They are not identical, but there are a lot of parallels. Walkmans and iPods played music on the go. Walkmans were less complex, cheaper to produce than iPods. Walkmans were cheaper to buy too, i.e. consumers had to pay a premium for an iPod over a Walkman. Yet, which product won? Consumers want modern cars, Tesla is just the only one that can sell in the US. Chinese EV's would sell like hotcakes here too. Consumer choice is what determines who wins. Political lobbying for protectionism only goes so far.


Again, your math is wrong - see the beginning of this post. Tesla has less than 4% of US new car market, so there is plenty of room. Even in purely ICE market, automotive company is not going to do very well on 2.5% (1/40-th) of the market, unless they are selling to niche markets like Ferrari).

Forget the total car market, we are only talking about EVs here. The US EVs only account for 12% of total sales and the growth is quite slow.

Tesla got to a 50% market share before becoming profitable. And even then it was mostly due to Carbon credits initially.

But whether it’s 50% or 43% there isn’t room for 40 manufacturers to follow suit.

None of that really matters though, the bottom line? Only ONE manufacturer in the US is making a profit on EVs. And one more (GM) is barely making a variable profit this year (if you ignore all the R&D and manufacturing plant costs). The rest are losing up to billions of dollars.

ICE manufacturing on the other hand? Profitable. It’s that simple.

And things aren’t sunshine and rainbows for Tesla either. Two years ago they cut their prices by $15,000 to $50,000 per model. They were able to make up for some of that due to their volume of sales, but it killed the market for everyone else.

I’ll ask again- if you were CEO of one of these big manufacturers that makes EVs and ICE vehicles, what decisions would you make for 2026? Right now the CEOs seem to be looking at things the same way I am.

And if they opened up the US market to Chinese EVs like you’re suggesting, how would that impact your decision as CEO? (If it were me, then I would DEFINITELY run away from EVs as it would be impossible to compete with those cheap Chinese cars).

 

[whitex]

Forget the total car market, we are only talking about EVs here. The US EVs only account for 12% of total sales and the growth is quite slow.

Tesla got to a 50% market share before becoming profitable. And even then it was mostly due to Carbon credits initially.

But whether it’s 50% or 43% there isn’t room for 40 manufacturers to follow suit.

None of that really matters though, the bottom line? Only ONE manufacturer in the US is making a profit on EVs. And one more (GM) is barely making a variable profit this year (if you ignore all the R&D and manufacturing plant costs). The rest are losing up to billions of dollars.

ICE manufacturing on the other hand? Profitable. It’s that simple.

And things aren’t sunshine and rainbows for Tesla either. Two years ago they cut their prices by $15,000 to $40,000 per model. They were able to make up for some of that due to their volume of sales, but it killed the market for everyone else.

Ok, so your entire argument relies on the fact that EV market will never ever grow. If that is true, you are right - why would other companies try to compete for 10% (or 12%, though that number I believe is inflated by ending of incentives, which drove a lot of sales before the end date)? Kind of like iPods and Walkmans, right? At fist, MP3 players had a tiny market share, at some point they hit that 10%, and I bet Sony executives made the same argument "Apple is the only one making money in this MP3 player market, and they own half of it or more, not enough room there for another company, let's stick with the Walkman, which has a large share of portable cassette players already, and we're innovating with Diskman!".

 

[69Mach390]

Ok, so your entire argument relies on the fact that EV market will never ever grow. If that is true, you are right - why would other companies try to compete for 10% (or 12%, though that number I believe is inflated by ending of incentives, which drove a lot of sales before the end date)? Kind of like iPods and Walkmans, right? At fist, MP3 players had a tony market share, at some point they hit that 10%, and I bet Sony executives made the same argument "Apple is the only one making money in this MP3 player market, and they own half of it or more, not enough room there for another company, let's stick with the Walkman, which has a large share of portable cassette players already".

No, the argument has multiple points INCLUDING the fact that the EV market is only growing very slowly in the US.

I can bullet point it if it helps-

1. The EV market is growing much slower than the number of EV models being introduced which means LESS sales per model.

2. Because of #1, the volume necessary to reach profitability becomes further out of reach

3. Downward price pressure along with increased costs of manufacturing compounds the issue

4. Loss of tax credits in the US hurts things by an additional $7500 per model for many cars

5. On the flip side, the same manufacturers losing billions because of the above points are making money selling their other cars.

6. Tesla is the only exception and it’s because they dominate the market, but there’s only room for 1 manufacturer to have that kind of market share.


This is why we see more EV models being delayed and/or canceled in the US.

Not sure why you’re stuck on the iPod, they don’t even make them anymore:

 

[whitex]

The EV market is growing much slower than the number of EV models being introduced which means LESS sales per model.

Don't introduce so many unique models. Tesla has stuck with 5 models, 2 primarily (S & X are experimental models which make little to no money, Cybertruck has been a flop saleswise) , for a reason. Perhaps learn from Tesla there?

Because of #1, the volume necessary to reach profitability becomes further out of reach

Make a product that is competitive in the world, not just USA (Tesla sells not insignificant volumes outside the US).

Downward price pressure along with increased costs of manufacturing compounds the issue

That affects every car manufacturer, no? Or are you saying making ICE car is getting cheaper, but EV factory workers are more expensive?

Loss of tax credits in the US hurts things by an additional $7500 per model for many cars

True, though only for US manufactured EVs, where Tesla seems to have lost the most, so it should help competitors which have been hurt less by this, no? Even my 2023 Taycan which I picked up in February 2023 did not qualify for the $7,500 credit (or any credit, even the sales tax I paid on it was disallowed by the feds as a deduction).

On the flip side, the same manufacturers losing billions because of the above points are making money selling their other cars.

Why are they losing billions? Because they cannot move the same volume as Tesla? If so, well, what is their product missing that causes customers to choose Tesla over their model? If it's because they cannot design a product as inexpensive to manufacture as Tesla, well, learn and get competitive! Any other reason you might think?

Tesla is the only exception and it’s because they dominate the market, but there’s only room for 1 manufacturer to have that kind of market share.

Again, true if you assume the market will never grow. However, even there, shouldn't one of the incumbents who have been doing this for decades be able to run circles around Tesla by producing a better product cheaper? Or does Tesla have something that the other guys don't? Remember, they were the underdog, started from scratch, nobody thought they would survive. Perhaps there are things to be learned here by the incum

This is why we see more EV models being delayed and/or canceled in the US.

In other words the incumbents are throwing shit at the wall and see what sticks? Again, they ought to learn from Tesla, S/X shared a platform, so did 3/Y. Software is shared by all 5 models.

Again, bottom line is this, the newcomers like Tesla are making better products, the incumbents are making excuses.

 

[whitex]

Not sure why you’re stuck on the iPod, they don’t even make them anymore:

iPod evolved (got absorbed?) into an iPhone, check out its sales and market share (and share of portable cassette and disk players). Perhaps EV's will evolve into autonomous flying vehicles, who knows.

 

[69Mach390]

Don't introduce so many unique models. Tesla has stuck with 5 models, 2 primarily (S & X are experimental models which make little to no money, Cybertruck has been a flop saleswise) , for a reason. Perhaps learn from Tesla there?

Make a product that is competitive in the world, not just USA (Tesla sells not insignificant volumes outside the US).

That affects every car manufacturer, no? Or are you saying making ICE car is getting cheaper, but EV factory workers are more expensive?

True, though only for US manufactured EVs, where Tesla seems to have lost the most, so it should help competitors which have been hurt less by this, no? Even my 2023 Taycan which I picked up in February 2023 did not qualify for the $7,500 credit (or any credit, even the sales tax I paid on it was disallowed by the feds as a deduction).

Why are they losing billions? Because they cannot move the same volume as Tesla? If so, well, what is their product missing that causes customers to choose Tesla over their model? If it's because they cannot design a product as inexpensive to manufacture as Tesla, well, learn and get competitive! Any other reason you might think?

Again, true if you assume the market will never grow. However, even there, shouldn't one of the incumbents who have been doing this for decades be able to run circles around Tesla by producing a better product cheaper? Or does Tesla have something that the other guys don't? Remember, they were the underdog, started from scratch, nobody thought they would survive. Perhaps there are things to be learned here by the incum

In other words the incumbents are throwing shit at the wall and see what sticks? Again, they ought to learn from Tesla, S/X shared a platform, so did 3/Y. Software is shared by all 5 models.

Again, bottom line is this, the newcomers like Tesla are making better products, the incumbents are making excuses.

Yes, they basically threw shit at the wall to see what sticks.

And it didn’t stick.

I said this 4 years ago: I thought car manufacturers for the US market were crazy to all try to jump into the EV market at the same time and build basically the same car:

We got 40 different versions of the “Model Y” from different manufacturers. And almost all of them are sales flops.

ICE cars on the other hand? Doing just fine.

Here is a visual chart for what happened to EV prices vs the rest of car prices in the last few years. EVs had to cut prices significantly while gas car prices continued to rise:

 

[whitex]

We got 40 different versions of the “Model Y” from different manufacturers. And almost all of them are sales flops.

Hmm.. so why did the original Model Y win over the other 40? Your theory please.

Here is a visual chart for what happened to EV prices vs the rest of car prices in the last few years. EVs had to cut prices significantly while gas car prices continued to rise:

All new technologies goes through this. You should compare the price of the computers on the moon lander in 1969 against a $0.30 microcontroller today which has more processing power and more memory, while taking up 100,000 times less space.

 

[69Mach390]

Hmm.. so why did the original Model Y win over the other 40? Your theory please.

All new technologies goes through this. You should compare the price of the computers on the moon lander in 1969 against a $0.30 microcontroller today which has more processing power and more memory, while taking up 100,000 times less space.

Model Y was first to mass market and did the same thing every high volume car has done for years- simple plain and cheap.

But again, how they got there or why, doesn’t matter. You can’t have 40 competitors follow the same model.

Maybe ONE of the 40 could replace the Model Y with a better product and take the top spot, but there just plain isn’t enough volume of sales for them all to get to 250,000+ units in sales to be profitable.

Here are the sales numbers for the first half of 2025.

You think Nissan just needs to make a better Ariya to 10X their sales?

And keep in mind this is the “best of the best” as in the top 10 models in terms of sales.

Here is a list of 73 models from major manufacturers currently for sale in the US-
https://www.caranddriver.com/features/g32463239/new-ev-models-us/

If you include the small specialty models it’s over 130.

So if #10 in the “top 10 list” only sells around 20k/yr you can imagine how pitiful the sales are when you get towards the bottom of the list.

You need to quit comparing car manufacturing to small electronics. The economics don’t compare. You won’t be able to cut the costs in the same way.

 

[whitex]

Model Y was first to mass market and did the same thing every high volume car has done for years- simple plain and cheap.

I think this is where your knowledge has a huge gap. I drove Teslas for over a decade. I switched my wife into a Tesla after 3 years. When I changed her car from a Tesla to an Audi eTron, over 2 years later I still hear from her how things "just worked" on a Tesla, as compared to the Audi. There is a night and day different between user experience of a Tesla and the other guys (I hear some Chinese EVs come close, but I've never owned one, I'm US based).

My elderly parents who hate most new technologies, only got smartphones during the pandemic because Canadian government made the vaccination records digital and life without a smartphone was just too hard, they got a Model Y and don't ever plan to switch to another type of car again. If they ever do need another one, it will be another Model Y, because it just works (and they've owned different brands during their life, with Toyota being their all time favorite before the Model Y).

I think I figured out where you and I disconnect. You truly have never experienced a car that just works, you get in the car, no ON/OFF button, no key, you can leave the driver seat with passengers in the car and the car won't just shut off (like an Audi for example, after 60 seconds, even if you leave the key inside), or the OTA update pops up a message and asks you when you'd like to apply the OTA (typically while sleeping, and then you get back into the car which tells you the update is done), vs. Porsche's complex "turn off pre-conditioning, turn the car off, wait for message to appear, etc, etc)".

I now get it, you simply have not had experienced it - probably similarly to a Walkman user who never tried an iPod saying "iPod is more expensive, but otherwise does the same thing - plays music through my headphones".

Other people have experienced it, which is why they keep going to Tesla. The ONLY thing that is keeping my wife from going back to a Tesla is Elons political antics, seriously, the "it just works" principle is unbeatable. If it wasn't for Elon getting into politics, I would have been trading in less than a year old eTon for a Tesla.

Your stance of "Model Y won because it was first for market" is like saying "iPhone's success is purel due to being first to market". It wasn't, nor was Tesla the fist EV.

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