CyberGus

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Who needs a marketing department, when you can lure your competitors' customers into a parking lot, surrounded by your products and driven by people that won't stop talking about how awesome it is?
 

Ogre

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Who needs a marketing department, when you can lure your competitors' customers into a parking lot, surrounded by your products and driven by people that won't stop talking about how awesome it is?
Don't even need that.

Imagine an F150 owner rolling into a stall and plugging in at the same time as a Cybertruck. 20 minutes later, the first Cybertruck rolls off and a second Cybertruck rolls up and plugs in. After 41 minutes, the Ford owner is unplugging at the same time as the second Cybertruck owner is getting ready to roll off.
 

Newton

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p̶r̶i̶u̶s̶ c̶,̶ y̶o̶t̶a̶ p̶i̶c̶k̶u̶p, ⼕丫⻏?尺セ尺ㄩ⼕长
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I mean... its a service that makes money, the more often its charging cars at near full capacity the more money they make.

plus, the less people are worried about charging issues, the more people are willing to get into ev's.
 

DarinCT

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Not sure what a MOAT is...but pretty sure I'm not one! BK
It's a stupid business term to describe the thing that maintains their position, typically a defense against their (business) advantage. Business(men) bloviating and picking their navel lint might then compare that to a competitive advantage, blah, blah, blah, zzzZZZzzz.

Tesla has many advantages, some are attackable and some are not. For example, the supercharger network is completely attackable - albeit slowly and since there is little to no profit margin in the SC network, it's not really a competitive advantage that lots of defenses should be put into. Another example is autopilot, Tesla's advantage is the extra data from extra miles, also something that can be attacked but not directly like a SC network so in that sense not so defensible. The third is the "killer advantage" which is the thing that other companies can't attack even if they wanted to, typically based on intellectual property(IP). One of Tesla's killer advantages - and I assert the only one that matters - is the lack of dealerships. That's cultural and based on business model not IP.

In the end, it's all just more navel gazing from business types (typically investors, retiree, media, and professors) who are no longer in business.
 


ajdelange

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Musk has promised several times that the SC network will "never be a profit center". This has always referred to Tesla users of it exclusively as there were never any other
I think this is up there with "Tesla doesn't make money selling cars". Aside from the OG unlimited Supercharger Teslas, every time we use a Supercharger, profit is generated.
Every time a SC is used Tesla gives away electricity for less than it costs them to deliver it. That's called a "loss"

The big question is how many hours of charging does it take before a Supercharger breaks even.
"We lose a little on each sale but we make it up in volume" is the old joke but here the answer is they will never break even until they start selling juice at a profit to the buyers of other OEMs vehicle.

I'm sure expanding the Supercharger network is more expensive than what they bring in by a large margin. But they are buying power for $0.8/ kWh and selling it at $0.28-0.31/ kWh.
I think you mean $0.08/kWh. Could you share with us the source of that number? In any case they used to give it away free for the life of the car but that was costing them too much so they decided to recoup some of the expense. Every time they have changed the pricing we are assured that they are not making a profit. Are they lying? The fact that in, for example, Newburg, NY, Tesla charges 28¢/kWh whereas EA charges 43 ¢/kWh suggests that they are probably telling the truth.

Tesla is playing the long game here. The Superchargers are a compliment to their cars, but they will be a big profit center.
Maybe someday but in order to be one they will have to sell electricity for more than 28¢/kWh. Doesn't matter whether it is to you all (I get it free) or Rivian drivers but it doesn't appear there is any profit in 28 ¢ killowatt hours.
 
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ajdelange

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For example, the supercharger network is completely attackable - albeit slowly and since there is little to no profit margin in the SC network, it's not really a competitive advantage that lots of defenses should be put into.
It is a tremendous advantage in that to sell cars you have to have it and Tesla is the only company that has it. For this reason it does not matter if it loses money. That money is a good investment in the future success of the company.
 
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Ogre

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For example, the supercharger network is completely attackable - albeit slowly and since there is little to no profit margin in the SC network, it's not really a competitive advantage that lots of defenses should be put into.
It's easy to put up a charger station. Putting up 50 or 100 charger stations is also easy. Creating a network where someone can drive from town to town and seamlessly plug into your network is extremely difficult.

Consolidation of these networks is inevitable. Eventually we're going to have 2-3 big networks each making fairly fat margins reselling power at 2-3x what they pay for it.
 

ajdelange

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I mean... its a service that makes money, the more often its charging cars at near full capacity the more money they make.
This gets us back to the joke about losing a little on each transaction but making it up in volume. The service right now does not make money.

plus, the less people are worried about charging issues, the more people are willing to get into ev's.
Through this mechanism it sells more cars thus Tesla is willing to lose some money in order to get the sales.

Now if they sell to other OEMs customers at a profit they could make some money from charging or at least offset some of the losses they incur in serving their Tesla customers. Perhaps they could use those earnings to subsidize the rates to Tesla users ever more!
 
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ajdelange

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It's easy to put up a charger station. Putting up 50 or 100 charger stations is also easy.
If it's so easy why does it take years to install one? And there is a huge investment involved too, Eight stalls ~ 2 Mil?

Creating a network where someone can drive from town to town and seamlessly plug into your network is extremely difficult.
If installing a station is easy then networking them is a trifle too. Satoshi Nakamoto created the whole Bitcoin network with one page of C++ source.

Consolidation of these networks is inevitable. Eventually we're going to have 2-3 big networks each making fairly fat margins reselling power at 2-3x what they pay for it.
Your electric utility sells electricity for typically 4 - 6 times what they paid for it. Nevertheless the margins are pretty thin.
 
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I do 99% of my charging at home but i sure hope this will mean that other networks will also be open to tesla! Around here i've seen several tesla owners use a chademo adapter but i'd like to see one big open network, i don't care about branding.
 

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I think you mean $0.08/kWh. Could you share with us the source of that number? In any case they used to give it away free for the life of the car but that was costing them too much so they decided to recoup some of the expense. Every time they have changed the pricing we are assured that they are not making a profit. Are they lying? The fact that in, for example, Newburg, NY, Tesla charges 28¢/kWh whereas EA charges 43 ¢/kWh suggests that they are probably telling the truth.
They buy power at $0.08/ kWh. They sell it at $0.28/ kWh. The margin/ profit on that sale is $0.20 per kWh. How about when Tesla has solar panels installed at Superchargers and pays $0.00/ kWh but sells power for $0.28/ kWh. Again, that is profit.

Are we at least agreed on this basic principal?

That equipment depreciates on an accelerated basis depending on the expected life of the equipment. After 2-3 years the depreciation decreases, but the revenue remains the same. This is basic accounting. Eventually, that cash flows back into Tesla's bottom line.

Musk likes to talk like Tesla as if it's a charity, but Tesla has proven they are quite good at making money. If you think Tesla is running the Superchargers with no plans for profits, maybe you figure they are going to open source their Full Self Driving software too?
 

Ogre

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I do 99% of my charging at home but i sure hope this will mean that other networks will also be open to tesla! Around here i've seen several tesla owners use a chademo adapter but i'd like to see one big open network, i don't care about branding.
You can charge at other networks, I've done it. It's just a pain in the ass because their infrastructure sucks.
 

Crissa

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I wonder if the MachE driver selling drugs at the Supercharger will realize that all the Teslas around him are recording lol
Extra-market sales have the problem of no third-party intervention in cases when one of the partners renegs on the agreed upon deal. You even have this problem when buying something on Craigslist!

This is the source of much of the violence associated with the black market.

Having so many cameras neither of them controls will make sure that both participants actually follow through on the deal.

Teslas aren't more expensive? They sure seem to be when you look at the prices.
Divide by miles of range, compare feature sets, etc - always shows Tesla as priced competitively.

If you think Tesla is running the Superchargers with no plans for profits, maybe you figure they are going to open source their Full Self Driving software too?
Musk has said that they intend to and do run the Superchargers revenue neutral, and don't internally charge the build-out against the Supercharger network internally, just replacement/repair. This is pretty visible on their kWh prices at the point of charge.

The profit comes from software and hardware sales.

This is like how Apple doesn't charge for its operating systems, downloads, or basic web support. It means users can use what they bought without any worry that they'll go out of support until long after the hardware's expected lifetime. (Of course if you need repair, want to sell software, want personalized support...)

-Crissa
 
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Ogre

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Musk has said that they intend to and do run the Superchargers revenue neutral, and don't internally charge the build-out against the Supercharger network internally, just replacement/repair. This is pretty visible on their kWh prices at the point of charge.
What happens when US Government airdrops $7b worth of subsidies into the mix?

And then we add non Tesla vehicles to the mix.

Fundamentally, the equation has changed. While Tesla may have run things revenue neutral, that doesn't mean they will into the future.

This is like how Apple doesn't charge for its operating systems, downloads, or basic web support. It means users can use what they bought without any worry that they'll go out of support until long after the hardware's expected lifetime. (Of course if you need repair, want to sell software, want personalized support...)
Apple does not give away their OS or other services to third parties. (Mostly not anyhow)

Things have changed. Tesla is adapting.
Sponsored

 
 




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