Rack up another $$$ week

Tesla at service center

Spotted this weekend in Burlington, VT. Caption contest?

Very little happened this week that wise TSLA shareholders didn’t anticipate, hence the non-feverish pace here at TeslaMondo. Been vacationing in Burlington, VT also. Yes, Tesla had another “record” quarter, but “records” happen a lot with fast-growing companies.

The world’s wrongest analyst, John Lovallo at BOM, said nothing about Tesla this week. Instead, BOM colleague John Murphy issued a grudgingly positive statement and raised the firm’s TSLA price target from stupid to ridiculous. This article says Lovallo no longer covers Tesla. Oh, how juicy! Ah, but Lovallo and Murphy have shared Tesla coverage in the past. It’s unlikely Lovallo was removed. He probably just strategically sat this episode out to avoid looking like a possum’s pecker.

Anyway, this week saw much analyst chatter and new investors climbing aboard. Some shorts undoubtedly covered. Pretty boring developments. Nice, but boring. A contrarian CNBC piece said Model X might flop for lack of a roof rack. People might cancel their orders, you see, when they discover they can’t carry stuff up there. Cancelled orders could hobble Tesla’s cash cavalry that’s supposed to rescue the company from certain death late this year. Couple problems with that thesis. First, Tesla has never shown a roof rack on any Model X image, so people who ordered an X probably aren’t expecting a rack. They want a high-performance crossover from a novel brand with massive cachet. Second, racks are so passé that if you drive to a Mercedes, Audi or BMW dealer, you probably won’t find a single SUV with a complete roof rack, meaning front-to-back rails and crossbars.

Tesla Model X roof arc k

See any functional racks here? Even on the G-Wagen?

But 10 years ago, every SUV had a full rack. Why the change? Roof racks are silly. They cost money and do nothing for most consumers except trap snow and ice, create wind drag and make wind noise. Consumers and automakers have finally acknowledged that most people do not have an outdoorsy, adventurous, spontaneous, active, clothing-optional, road-tripping lifestyle that overwhelms the internal storage capacity of a mid-size SUV. People simply drive to work, the grocery store, the mall, the school, and home again. No need for a roof rack, or tow hitch, or brushguard, or skid plate. How sad indeed. So if the Model X does stay flat and smooth up top, it might force women — allegedly the Model X target buyers — to see themselves as sexy even without nice racks. It’s about time.


3 thoughts on “Rack up another $$$ week

  1. Offgridman says:

    Re: caption contest.

    OK boss, you tell me, where’s the damn dipstick?


  2. “I swear I put the kids right here!”
    “But you don’t even have the kids seats!”


  3. Even worse, a dumber article on the 5th from the Motley Fool’s Adam Levine-Weinberg saying the Model3 is doomed. The reasons are so off that I thought it was remarkable. Main thesis: it will cost too much because 1.$7500 break won’t affect a lot of Model3 buyers (true) 2.the base model will be undesirable (very unlikely) so 3. only expensive versions will be bought highly limiting Tesla’s market (moronic).
    He cites the expense of options on the ModelS (and presumably the X too) as his only reason. But that completely ignores that fact that car makers make more money on options on the higher value cars much more so than the ~same option on a more modest vehicle. He says that since it is so easy to option a ModelS to $10-20k above starting price and since so many option up their cars it means that Model3’s will only be bought by people who put $10-20k worth of options on the car. Which is a stupid argument.
    It ignores that Tesla is specifically telling everyone that the profit margin on these cars is what it is to finance the building of the “affordable” Tesla. The extra expense is widely known and it is not something Tesla intends to carry over to the affordable car. It seems reasonable that Tesla intend to keep the affordable Tesla affordable. That doesn’t mean options won’t be important money makers or that many folks will want to buy options. They may even have outrageous options for the Model3, in fact I hope they do that, making a super-sedan or crossover. But I see every reason to think Tesla are going to do everything in their power to make the affordable Tesla both affordable and desirable enough in that form to sell to happy customers. In fact, they’ll have to go the other way at least a little I think and make sure Model3 has a few little extras that make it even more appealing than Tesla’s currently are.
    And the article completely ignored the value difference in maintaining and owning an EV compared to the equivalent ICE car that would be bought instead. Total cost of ownership is always a HUGE win for an EV but this “analysis” ignored that, they’re Fools indeed!
    Analyzing anti-Tesla individuals is sometimes fun and sometimes tiring but I want to keep up on what the other side are thinking (know thy enemy).


Leave a Reply

Fill in your details below or click an icon to log in:

WordPress.com Logo

You are commenting using your WordPress.com account. Log Out /  Change )

Google photo

You are commenting using your Google account. Log Out /  Change )

Twitter picture

You are commenting using your Twitter account. Log Out /  Change )

Facebook photo

You are commenting using your Facebook account. Log Out /  Change )

Connecting to %s