Ex-Ford CEO on Tesla Growth

July 3, 2020

Mentions importance of CO2 reduction goals globally.

24 Responses to “Ex-Ford CEO on Tesla Growth”

  1. dumboldguy Says:

    If you can’t go to casinos because of the virus, take part in the great stock market crap shoot instead. I cannot believe that Tesla has a bigger market cap than Toyota.

    • leslie graham Says:

      You have to see the bigger picture.
      Tesla is going for nothing less than control of the global energy market.
      The cars will soon be a small sideline.
      I bought shares at 350. They will go to 2000 this year.

      • dumboldguy Says:

        Good luck with your crap shoot. At least you bought so low that when the SHTF, you’ll have something left. Pity the poor lemmings that bought at 1500 or 1600.

        (And the “big picture” today in the US is an impending virus crisis even bigger than the first one—-maybe you should tun some of that “wishful thinking paper” into gold and put it under the mattress?)

        • leslie graham Says:

          I agree it is a bit of a crap shoot. But the way I see it we don’t have any choice but to convert to zero emission fuels. Tesla is the leading company in this respect so it makes sense to invest in them. So far I have trebled my (rather meagre) investment despite ferocious negativity from – well – just about anyone with a vested interest in the status quo.
          It’s obviously not the only company I have invested in. I’ve got a few hundred shares in the SOLO single occupancy electric commuter car too. Again – it just seems obvious to me that there will be a huge demand for a car like that.
          Battery manufacturers are another favourite of mine. That way it doesn’t matter if it’s Ford or Tesla that leads the market – they will all need batteries.
          Artificial meat – yeah – gotta be a winner.
          Robots that do basic surgery? How did we ever manage without them?
          You get the idea.
          I don’t like Musk – he’s an egotistical prick in my opinion. But he also happens to be a big-thinking visionary no matter how flawed he might be as a human being. And his Tesla car company is just a means of making a few bucks so he can REALLY get down to the business of replacing the fossil fuel energy supply with the Elon Musk energy supply.
          I make no apologies for trying to make a few bucks on the back of it.
          And anyone buying in at 1500 in the future. If they stay for the long haul they will still make a decent return. In my opinion of course. I guess we will both have to wait a decade or so to see who is right. But my view is that EV’s will replace ICE very suddenly in aroung 2025 to 2030 and that’s what I’m basing my crap shoot on.

  2. rhymeswithgoalie Says:

    There’s a fight in Austin right now about giving Tesla major tax breaks to set up a plant in SE Travis County.

    Independent of its product or its market cap, I am totally against the city giving any company tax breaks.

    • Gingerbaker Says:

      I imagine you would have to do the math. No tax breaks (for a time) vs the benefits of thousands of jobs, many of which would be high-tech.

      At least Tesla is making a product that improves the world.

      • dumboldguy Says:

        A product “that improves the world?” LOL Yep, just like all that fossil fuel that TX produces and uses—-“better living through air pollution and global warming”.

        • Gingerbaker Says:

          Tesla makes these newfangled contraptions that look just like cars, but don’t burn gasoline. Which reduces carbon emissions drastically, thus improving the world.

          If you go the website called “Google”, you can type the word “Tesla” into the little box, hit enter, and then the page will automatically give you a list of thousands of articles about Tesla cars.

          Assuming you get that far, you could, potentially, find out about how these weird cars work. They use this mysterious stuff called “electricity” to energize devices called “Motors” in order to move the car from place to place.

          I dare say you will be delighted to introduce yourself to the topic.

          • dumboldguy Says:

            Thank you, but I know enough about the topic already, particularly the part here Tesla products are manufactured using a lot of fossil fuel-generated electricity and later run on fossil fuel-generated electricity.

            Tesla’s main “benefit” to date has been to generate lots of $$$ for stockholders. (and the pickup does NOT look like a car in spite of having wheels—-more like someone’s wet dream)

          • Gingerbaker Says:

            LOL. I have pre-ordered a Cybertruck!

          • dumboldguy Says:

            Why? Because you want your neighbors to laugh at you?

          • Gingerbaker Says:

            Why?

            Because it will be the last car I will have to buy. All stainless steel, million mile battery and drive train. My daughter will inherit it and may never have to replace it in her lifetime.

            Because it is completely practical. Hauls/carries anything. I can play drums in a band again! Get plywood. Haul dirt. Tow a boat or trailer. Huge interior space with seating for 6. Extremely comfortable ride. No maintenance. Cheap to run.

            Goes anywhere with full air suspension, the ground clearance of a military Hummer, huge wheel travel. 4-wheel drive for Vermont snow. You can sleep/camp/go overland in this thing. Drive Baja at high speed.

            Faster than my Infiniti G35 coupe from 0 to 60 mph and I am just getting the 2-motor version. Probably corners as well – that’ll have to be seen, but I am optimistic.

            And it fits in my garage with 2 inches to spare even though it doesn’t need a garage because it has no paint.

            My neighbors won’t laugh at me – they will be envious. Or will have already received theirs. I was far from the first on my street to go electric. And there are 650,000+ reservations ahead of mine, so it will be a while.

            That’s why.

      • rhymeswithgoalie Says:

        That’s just it: The construction of the plant itself would provide short-term jobs, and Tesla’s tendency toward advanced automation means it wouldn’t even provide a thousand jobs…maybe even just a few hundred.

        Austin’s workforce is too attractive at the moment to be giving discounts to companies.

    • jimbills Says:

      Tax breaks for individual companies distort the market so that the big guy has an advantage over the little guy. They only go to those with enough clout or insider influence. Tesla has that now – but they didn’t in the beginning, and who knows how many start-ups or existing businesses are being stifled now because of an unfair playing field.

      A Walmart moving into a small town will get tax breaks that were never offered or even considered for a local grocery store that had been there for decades, and the local store can’t compete with that.

      For the big company themselves, local tax breaks are often necessary for them to even consider some place or another. There is always going to be some area willing to offer them. Some areas are already appealing without the tax breaks, though. I think Musk wants to get out of California and into a less regulated state like Texas enough that he’d go to Austin with or without the tax incentives.

      Amazon decided to move to NYC without the tax breaks. It’s just too appealing a site. Cortez was right:
      https://www.theguardian.com/technology/2019/dec/06/amazon-new-york-city-offices-lease

      Queens gets the economic boost from Amazon moving there and gets to keep the billions it would have lost to help support the city.

      For a local government, they are eyeing the boosts to the economy and the resulting increase to local taxes that can come from that. Whether it works out enough to offset the breaks offered is questionable:
      https://www.americanprogress.org/issues/economy/reports/2018/11/01/457771/realities-economic-development-subsidies/

      “….the fundamental reality that, far too often, economic development incentives are irrelevant to decision-making, fail to meet promised results, take away from existing or potential public services, lead to zero-sum competition among governments, and lack appropriate oversight.”

      A local politician is most likely to just think about the immediate political benefits to themselves for adding jobs to the community.

      All this leaves aside that tax breaks essentially line the pockets of the already wealthy, boosting profits for shareholders, while denying local revenues and services that could be used for the poor.

      Whether one thinks Tesla is a company of miracle Earth-saving technologies or not isn’t relevant to the discussion about local taxes. Tesla will go somewhere – they’ll get the tax breaks in some state, and if they don’t, they’ll find some country willing to offer them. Or, they’ll have a product strong enough to not need the incentives in the first place.

      • jimbills Says:

        It’s still too early to tell whether Reno benefited greatly from Tesla being there, but here are two updates:
        https://www.rgj.com/story/news/politics/2019/07/22/nevada-bet-big-tax-deals-companies-like-apple-tesla-did-work-goed-sisolak-economic-development/1718892001/

        https://www.theguardian.com/cities/2018/jul/03/all-humanity-has-left-the-area-the-cities-paying-for-tesla-gigafactory

        ‘Critics of the system say there is no doubt who ultimately pays.

        “It’s the working stiffs,” said Bob Fulkerson, of the Progressive Leadership Alliance of Nevada.’

        For the record, I do support Tesla’s right to exist. I agree that EVs are better than ICE vehicles. But, do they really need the tax breaks? They seem to be doing fine – at least as far as their business valuation. And there are those who pay in real terms for those tax breaks.

        • Gingerbaker Says:

          The hardships some people are suffering according to those articles are not from lost tax revenues, but rather from the impact on low-income rentals caused by the influx of many thousands of relatively affluent workers. This would have happened if Tesla got no tax breaks.

          Nevada is a staunch Republican state and has very low taxes/public assistance programs ( 7th worst) so suffering is inevitable there. Property taxes are capped, for example.

          • jimbills Says:

            It’s not an either/or situation. Yes, rising property values force hardships on long-time poorer residents, and that is a big issue. It does happen any time any area has a sudden influx of new jobs. But additionally, a 10-20 year tax abatement (like Tesla got in Nevada, worth $1.4 billion) makes a busier community with more residents more prone to shortfalls in funding for schools, local transport, fire and police, local roads, and other services.

            From the Guardian article:
            ‘Stephen Driscoll, the city manager, said despite surging population growth and increased strain on police and fire departments and schools, his annual budget had increased from $65m to $70m in the past two years – about the level of inflation. “So I’m at net zero.”’

            ‘Even so, fresh budget cuts could eliminate bus routes for nearly 4,000 elementary and middle school students in an effort to save $550,000.’

            You write:
            ‘Nevada is a staunch Republican state and has very low taxes/public assistance programs ( 7th worst) so suffering is inevitable there. Property taxes are capped, for example.’

            Nevada sucks for the little guy, but the Tesla deal itself makes it specifically worse for poorer residents of those local communities. I’m guessing the only reason why that could possibly be justifiable thing to you is that it is helping Tesla.

            I just sympathize with those who might not look at this as a great deal.

          • Gingerbaker Says:

            Yes, but all of this is predictable – natural consequences of the extreme pro-business climate and the influx of thousands of new workers. A more responsible administration would have increased revenues to cover the shortfalls.

            And how much of all this is just Tesla blaming? City managers across the country would love to have had rising budgets. Many have seen cuts over these same periods, not increases. But the article seems dead set on framing this as a Tesla problem, when this same story is being told everywhere in the US. Indeed, the article is somewhat schizophrenic about the benefits of Tesla, as if the people who are complaining about their condition have no idea about tax abatements being the cause of their woes. Possibly because they are not.

            These sorts of problems are because of maladministration at the Federal and State level, are near universal in the US, and are not necessarily to be laid at the feet of Tesla. These are the exact sorts of problems one sees when Republicans – who hate social programs and paying taxes – are in charge.

            Well, guess who has been in charge?

          • jimbills Says:

            More justification. It is a widespread problem, it’s not just Tesla’s fault, but still, Tesla is taking advantage of the system to the detriment of the poorer residents of that locality.

            My response to rhymes was just that I can understand the reasons why Austin would be hesitant to offer tax breaks as well. I’m not sure they need to do it to get Tesla there, I don’t think Tesla really needs them, and it’s pretty certain that the tax breaks would have several negative effects for the community.

          • Gingerbaker Says:

            Austin already has huge growth and industry – they may not need to offer tax abatements, as you say. I’ve visited Austin. It’s already a s**tshow as far as land use, urban development, sprawl, public transit. Texas is heartless when it comes to safety net issues. It’s also hotter than the hinges of Hades there.

            No idea why anyone would want to put their factory there in the first place.

          • jimbills Says:

            “No idea why anyone would want to put their factory there in the first place.”

            A large reason is exactly because of what you mentioned – Texas is heartless towards the majority and almost always tends to favor big businesses and the wealthy. It’s why Musk put Tesla in the desert in Nevada and is now looking at Texas instead of somewhere more pleasant to live like New England. Corporations seek every advantage they can – it’s their nature – but as long as localities prostrate themselves towards them, it will only get worse, no matter the product.

            Texas already doesn’t have a corporate income tax, and the Republicans in charge regularly lower business taxes and regulations further. Does Austin itself have to offer a deal to deprive itself of local taxes while adding to its sprawl from Tesla moving there? Is it fair to already existing businesses without such deals?

            Can’t argue with it being hot – ha ha. Austin itself, though, has a large pool of tech employees to draw from, and has a ton of benefits from UT being there.

          • Gingerbaker Says:

            Musk just spent a day in Tulsa at the proposed site chatting with officials, so he is definitely playing for concessions.

            I’m starting to agree with you about abatements. It’s tilting the field for the powerful at the expense of the poor. It would all be a lot cleaner if there were none given.

            That said, perhaps there is an argument to be made for abatements for renewable energy companies?

          • jimbills Says:

            Reply below.

  3. jimbills Says:

    ‘That said, perhaps there is an argument to be made for abatements for renewable energy companies?’

    One main problem with abatements themselves is that they are given on a case-by-case basis, and those that get them are either politically connected or are already a huge company.

    Let’s just Take Tesla and renewables. Tesla gets a 10-20 abatement. But, a startup with a great idea for solar doesn’t. The startup is too small, and it doesn’t have an inside connection with the local officials. Tesla just adds to their profits, and the startup struggles.

    That’s a hypothetical, but the reality of the situation plays out in multiple different businesses every day all across the country. The fact that one company is big and the other isn’t shouldn’t matter – they are both contributing their share to the local economy. One company may be huge, but take all the little guys who don’t get the same treatment and put them together, and they’ll be far larger than that corporation.

    The big get bigger. I don’t have a problem with Tesla getting bigger, but for EVs to really replace ICE vehicles, as with battery tech and solar, we need as much competition to Tesla on an even playing field as possible.

    There ‘should’ be some set of rules governing tax abatements on a federal level – but we don’t, and I doubt we will any time soon. I’m, of course, in favor of any legislation that makes renewables easier to create and FF more difficult, if it was applied fairly across the board – but again, I doubt we’ll see that any time soon, either.

    (I looked at some of the Tulsa and Musk articles. Those were the exact same guys in Tulsa defending Trump’s recent rally. Musk is playing Tulsa and Austin off each other. That’s a smart business decision – doesn’t make it right, though.)


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