The New Tesla for $35,000

Yahoofinance had an article about Tesla today.

 

First, their new Model 3 has received advanced reservations from buyers amounting to 150,000 vehicles.  This is praised by the press, and, of course, Tesla is "doing things differently" in all kinds of ways, including the method of ordering the cars without having to go through a dealer. 

 

The base price of the Model 3 is expected to be 35,000, but most are actually expected to cost between $55,000 and $60,000 with buyer upgrades, including a bigger battery pack to increase the driving range per "fillup."  The first Model 3s are expected to be delivered by late 2017. 

 

Then, as you read down to the end of the article, part of the "enthusiasm" for the Model 3 early orders is the $7500 federal tax credit for buying an electric car.  Oh.  I didn't know there was such a tax credit.  A tax credit is powerful.  If you figure an overall tax rate of about 20%, that means it would zero out all taxes on the next $37500 of gross income.

 

The tax credit is set to phase out when 200,000 electric vehicles have been sold.

 

So, is this really a free market system for selling Teslas ?  Or not ?  Is the car economically viable, or does it need to be propped up by subsidies that are paid for BY THE REST OF US, WHETHER WE LIKE IT OR NOT ?

 

The answer is, they are not economically viable.  And Elon Musk is just continuing in his role as con-man non pareil.  He is different from most traditional con-men in that he uses "technology" and "the new" as his product.  He is a master-manipulator of a certain kind of personality-type.

 

Which brings us to the buyers.  Of course there is a certain percentage of people who are very taken in by what I would call "the CULT of the NEW."  They constantly fawn all over anything that is new, must buy it, and then this boosts their self-esteem because they can go to their friends and be admired because they are so "hip and now."  They show off their new purchase and feel so good about themselves.  But then, time passes, and they have to find something else "new" to go out and blow money on.  This process is repeated over and over, and becomes a lifetime habit.  What these people don't realize is that "the more things change, the more they stay the same."  And they also don't realize that with their worhip of the "new," they are only making horses asses out of themselves, and blowing a lot of money for nothing. 

 

Reminds me of the frenzy of car purchasers in 1957 - when the first "fins" appeared, and in 1958, 1959, and 1960, when the "fins" got bigger and bigger, and the chrome trim got progressively more massive.  But by about 1960, the "fin" thing had run its course.  No one really talked about "fins" any longer, and the auto industry had to look for some other trick to go out and market.