Tesla is gradually losing the attention from consumers. From the product point of view, both Model Y, Model 3, Model S and Model X are old products many years ago, and it is difficult to stimulate consumers’ increasingly critical nerves.
Reuters previously said that Tesla had abandoned the production plan of Model 2, a low-priced electric vehicle with a price of 25,000 US dollars. Musk denied this and said that the unmanned taxi Robotaxi will be released on August 8 to fight back.
But in today’s consumption environment, cheap cars are the magic weapon to increase sales, and the significance of Model 2 is obviously greater than that of Robotaxi. Especially for Tesla, which is in the downward trend of sales.
From a macro policy point of view, the situation facing Tesla is even more difficult.In order to protect the interests of traditional car companies, the support for pure electric vehicles in the United States and Europe began to decline, and Europe was also erratic in the transformation of new energy.
In order to slow down the penetration of new energy vehicles in the world and gain more time for the local traditional automobile industry, some policy makers deliberately slowed down the progress of industrial transformation. However, Tesla, the core new energy automobile enterprise in Europe and America, was the most seriously injured.
Musk, who has been involved in the torrent of global economic and industrial games, has begun to face a fierce battle. His embarrassing role also determines that he must point out a new direction for the enterprise-Robotaxi unmanned taxi is the answer he gave.
After all, it can’t be rolled up
Reuters previously reported an exclusive news that Tesla had abandoned the production plan of Model 2, a low-priced electric vehicle with a price of 25,000 US dollars, because the China market was too big, which caused Tesla’s share price to plummet by more than 6%.
Musk, who has always disliked the media, also stood up and responded that "Reuters is lying". However, a few hours later, Musk suddenly announced that Tesla will release the driverless taxi Robotaxi on August 8.
Because Musk didn’t specify which part of Reuters’s content was "lying" and suddenly released Robotaxi unmanned taxi, it shows that Tesla’s cheap car project is very likely to be cut off or postponed.
Reuters’s news is not groundless. Previously, several people familiar with the matter revealed to the media that Tesla cancelled the development of the entry model Model 2 and turned to the development of driverless taxi business on the car platform.
Providing consumers with affordable electric vehicles has always been the goal pursued by Musk. To this end, in recent years, Tesla took the lead in opening several rounds of price wars.
However, starting from this year, Tesla’s strategy of sinking the market through price reduction has become increasingly difficult to work. Even if Tesla’s $25,000 Model 2 is released, it is already difficult to form enough competitiveness-the price of BYD Qin Plus has dropped to 79,800 yuan this year, which is only $10,000.
The popular dream that Tesla always wanted to do, BYD realized it ahead of schedule. The low-cost model built by China automobile manufacturers through full-stack self-research and mature supplier system can make the product price drop continuously under the blessing of scale effect, so as to truly benefit the people and win the most sinking market.
Of course, the threat of China car companies to Tesla is not limited to low prices, but also poses a threat to Tesla’s Model 3 and Model Y in terms of cost performance.
In recent years, in the press conference of new energy brands in China, the words "the best within N" frequently appear. This clearly reflects a current situation:It’s really difficult to roll the cost performance of products in China, because you will meet more roll kings.. Xiaomi automobile confirms this point. At the beginning of development, SU7 was "sticking to the face" around Tesla Model 3, and the final starting price was 30,000 yuan cheaper than Model 3, which completely forced the palace.
What makes Musk feel uneasy most is probably the unique pricing method of China car companies.
Yu Chengdong, managing director of Huawei, CEO of BG, and chairman of BU, a smart car solution, talked about the price of Zhijie S7. He once said that there was a heated debate within the company about the pricing of this model. At present, the prices of the four versions are all at a loss. We just want more consumers to experience Huawei’s products, and hope that the cost can be balanced with the quantity in the future.
I thought everyone came out to make money, but they just wanted to make friends with consumers. Lei Jun once said, "Every time Xiaomi sells a car, it is a loss. The first price of the top version is 350,000, which is also a loss. Finally, it is directly set at 299,900. Anyway, it is vomiting blood."
Of course, car companies are not vomiting blood in vain. Take BYD’s successful experience as an example. In the first three quarters of last year, when the bicycle price dropped by 17,000 yuan, the bicycle cost dropped by 21,000 yuan, the gross profit margin of the automobile business increased to 25.6%, and its earning power even surpassed Tesla.
To put it bluntly, selling cars at a loss is just a means, and its business model is to promote sales through price reduction, and then realize profit through scale effect. Of course, if you really can’t make a profit, it’s also good to "make friends" with consumers, and you can launch new products with lower positioning in the future to achieve profitability.
It’s just that it’s hard for Musk, and China car companies have given up all the roads he wants to take.
Become "Didi"
Musk’s obsession with Robotaxi was reflected long ago. It is mentioned in the Biography of Musk that his grand vision is to build a vehicle that can drive completely automatically without any human intervention.
In this way, Tesla owners can lie at home and let the car work outside to earn money. Users use software to summon Robotaxi like a car, but there will be no driver in the car.
The reason why Musk was able to shout out the release of Robotaxi on August 8 was due to the progress of FSD fully automatic driving.
At the end of March this year, Tesla launched the version of FSD V12.3, and the suffix cancelled Beta. Generally speaking, Beta stands for the Beta version, although Musk has previously explained that the beta suffix of FSD does not mean the beta version in the usual sense, but to reduce the blind trust of car owners. Now removing the FSD after Beta means that Tesla has become more confident in its autonomous driving technology.
FSD V12.3 has made great changes in the algorithm level, completely abandoning the previous methods that relied on manual coding rules and machine learning models, and instead fully adopting the end-to-end neural network AI system.
There are more than 300,000 lines of C++ codes written by engineers in the FSD V11 version control stack, but in the V12.3 version, there are no regular codes, only neural networks. Thanks to FSD’s powerful autonomous learning ability and more than 1 billion kilometers of driving data, FSD’s driving level is rapidly improving.
According to the test of American bloggers, the current version of FSD V12.3 has been able to achieve automatic driving in a variety of complex road conditions, including road conditions without drawing lines, cut-in sidewalks, red-light rails and other scenes.
Moreover, the driving experience of FSD V12.3 is very close to that of an old driver. For example, when passing by a road where there will be an intersection every short distance, FSD V12.3 will not let the vehicle mechanically move closer to the top speed, but choose a human comfortable speed.
This technology is not cheap. The price of FSD in North America is $15,000, and the optional price in China market has to exceed 60,000 yuan. However, Musk has long thought of a solution. According to his vision, the owner who joins the Robotaxi team can make a profit of 30,000 US dollars every year and become a wealth management product to help users repay their car loans. If the vehicle itself can help you make money, it seems that spending more money is nothing.
Despite this, there are still many doubts about whether Robotaxi can save Tesla’s short-term decline.
The vision of making vehicles a financial tool is beautiful. However, even if Tesla can successfully launch Robotaxi on August 8, it will take a certain period of test before it can be widely used.
Especially for driverless taxis, a traffic accident-whether the responsible party is the company’s car or not-will bring great trouble and even a devastating blow to the company in public opinion and law.
Previously, Cruise’s unmanned taxi had a traffic accident in San Francisco. After another car hit a pedestrian, Cruise’s unmanned taxi did not recognize someone under the car in front, and continued to run over people, causing the latter to be seriously injured. With the intervention of California and federal regulators, Cruise announced that all unmanned taxis would be completely shut down for technical safety risk assessment. After that, the Cruise business was shut down, layoffs were substantial, and the valuation was halved.
Tesla’s Robotaxi vision is beautiful enough, but it may also bring unpredictable risks to the enterprise itself.
Stay away from the trend
You know, Model 3 has been on the market for 7 years, and Model Y is already a model four years ago. Today, Tesla is in urgent need of a new explosion. However, the low-priced models can’t compete with China car companies, and the global market price is high and cold, and the prospect of Robotaxi is hard to say clearly. In fact, Tesla’s growth has been hindered.
While Tesla’s sales are stagnant and China’s new energy vehicles are booming, the logic of overseas pure electric vehicle market growth seems to be challenged.
Kang Linsong, Chairman and CEO of Mercedes-Benz Group Co., Ltd., said at the annual general meeting that he would abandon the all-electric vehicle plan. Kang Linsong said that in view of the fact that the popularity of electric vehicles has not reached expectations, Mercedes-Benz will no longer adhere to the original goal of fully turning to electric vehicle sales in major markets before 2030.
GM also made a strong statement that "the company will fully turn to electric vehicles in the future", and it also ended in vain, giving up the goal of producing 100,000 electric vehicles in the second half of 2023 and producing 400,000 trams in the first half of 2024.
According to Edmunds’ insight, in the global market, the average selling price of electric vehicles is $59,400, which is much higher than the $44,800 of traditional fuel vehicles.In today’s global economic slowdown and shrinking demand, it is inevitable that the market space of pure electric vehicles will not be broken if the price is too high.
This is also reflected in Tesla’s sales in the first quarter of this year. The data shows that Tesla delivered a total of 386,810 vehicles, far below the analyst’s previous average expectation of 449,080 vehicles. This is also the first time that Tesla has fallen below the 400,000-vehicle mark since the third quarter of 2022, which is over 8.5% lower than the delivery of 422,875 vehicles in the first quarter of last year.
According to data from Carisyou, a Korean research institute, and the Ministry of Trade of Korea, Tesla sold only one car in the Korean market in January this year in South Korea, the home base of international cheap fuel vehicles..
As a result of various problems, Tesla did not give a clear sales guide in 2024 at the latest financial report meeting, which triggered concerns about Tesla’s sales in the capital market. Tesla’s share price has dropped from the highest point of $299 last year to $172 today, which is not a small drop. It can be seen that investors do not have too many illusions about Tesla’s short-term and medium-term future performance.
Tesla’s share price performance (since listing)
Judging from the changes in the international situation, the situation has not fallen to the side of Musk.
Take the American market for example, in order to protect the interests of traditional automobile manufacturers, they relaxed the emission standards of automobile exhaust, and the support for pure electric vehicles began to decline. In 2032, the proportion of pure electric vehicles in new cars was reduced from 67% to 35%, and it was also stipulated that power batteries must be produced in China, so that consumers could get the government’s price subsidy of $7,500 per vehicle.
A similar situation has occurred in the European market. With the news that European automobile giants have suspended the development of new energy automobile industry or stopped the transformation of new energy in order to maintain their advantages in the field of fuel vehicles, automobile giants have begun to play a game with policies in terms of economic and social effects.
The final result of these games can only make the development trend of European and American automobile industry and new energy vehicles drift away.
Write it at the end
It can be seen that with the rise of new energy automobile enterprises in China, European and American automobile enterprises have suffered a huge impact, and returning to the fuel vehicle market is more like a forced choice than taking the initiative.
Musk himself had a clear judgment on this:
Under the unfavorable situation, the new moat he chose for Tesla is autonomous driving and its derivative Robotaxi market. This basically means giving up the cheap car market, and it is also an attempt to gain more added value.
Whether this direction can bring enough business increment to Tesla, at least at present, is uncertain-especially if the domestic Baidu unmanned taxi has not made enough progress and effect.
For Musk, it is not a comfortable role to be caught in the political and economic games of major countries, but it is also the price of success in that year.
