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Comment by WheelsAtLarge | Hacker News Reader

I know at least one person that's decided not to buy a Tesla simply because their future is so murky and is not sure if they will be around for repairs. That's a problem they need to tackle now before it spirals out of control.

Also, it seems to me that Tesla should work with one of the big three automakers on manufacturing. Tesla has spent a lot of resources reinventing car manufacturing and yet they can't produce a vehicle that meets their needs. They need to focus on the high tech aspects and leave the mundane manufacturing to experts.

At the very least, Musk should trust his manufacturing experts on how to produce a car rather than try to make every decision by himself. He's a great marketer and should focus on that role and leave the rest to the experts.

Too bad they can't lower the cost of batteries enough. If they did that, they could lower the price of the car to a point where it would be a no brainer to buy one.

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> I know at least one person that's decided not to buy a Tesla simply because their future is so murky and is not sure if they will be around for repairs. That's a problem they need to tackle now before it spirals out of control.

I’m sure there is one person that made a decision on that basis but I’ve heard many more not-real customers speculating about this as if they were in the market, but they very clearly wouldn’t buy a Tesla anyway and would’ve found another excuse (hint hint: with so much negative noise and FUD and hatred by big media it’s not hard to find one). The reality is even if Tesla hypothetically goes bankrupt, it’ll most likely cause a change in who owns the equity at large and will likely not materially impact the customer base.

In general, it’s much easier to expand the customer base by solving real problems for people who are eager to buy stuff but can’t (for example, due to real charging problems in urban areas or the car being expensive) than to try to soothe a skeptic. This applies to VCs you pitch too. Spending time changing people’s mind is often futile, and in this case it’s not at all clear that it materially impacts Tesla. They are for the most part production constrained still.

A company that is production constrained does not need to lower the price of its products. It can keep the price the same or even increase prices. This is basic economics.

Tesla has already lowered the price of its vehicles 3x this year...

Two points: the basic model assumes there’s a single market to sell to, but different geos ramping up may spike your supply in one market while your other segment is not deliverable yet, causing short term supply spike in one segment while simultaneously being production-constrained in total.

For the Model 3 specifically, the price cuts are mostly in-line with tax credit phaseout and they have reshuffled features (AP features moved to more expensive FSD option for instance). of course the higher end vehicles faced more price cuts, but that speaks little of the demand of the base vehicle.

Basic economics also tells us that at some point substitutes will be found for your product. So, if product x1 is too expensive then x2 will do. It's not a 1 to 1 substitute but if it meets your needs then x1 will need to find a way to lower the cost or make it more attractive in other ways.

Tesla is not the only car manufacturer. There are plenty of transportation options to choose from. It has a niche now but it needs to sell large quantities to survive long term.

“Tesla has spent a lot of resources reinventing car manufacturing and yet they can't produce a vehicle that meets their needs.” Where are you getting this information? Design and manufacturing influence one another. None of the “leaders” in automotive space outsource their design or manufacturing. You need to control and master both to compete in this space. Perhaps you can take the Apple route and outsource the labor (Foxconn), but Apple still controls much of the manufacturing process such as introducing friction-stir welding to shrink the iMac or introducing unibody aluminum machining to the MacBooks and iPhones.

https://www.forbes.com/sites/lensherman/2018/12/20/tesla-sur...

To start with, this article of many articles on the subject. Plus Musk has spoken on the subject too.

Manufacturers have known for decades that over automation is a problem. The dream is to put raw resources at one end and get a finished product at the other without humans touching any of it. The closer you get to total automation the harder it gets to do it. There's a fine line that must be found.

Tesla has not shown that they have found the best manufacturing process so they should get help.

Also, it is almost never the best practice to produce a product 100% in-house. It requires too many resources and it's very hard to do it at the lowest cost especially in low quantities. They aren't producing their product 100% in-house but from what I've seen in the past they've tried to produce as much as possible in house. Like I said there's a fine line that needs to be found.

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