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Tesla’s $7,000 EV incentive is a nail in the coffin for ICE competitors

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The reintroduction of the electric vehicle tax incentive credit could be a nail in the coffin to Tesla’s competitors as if the company needed any more help to bury its competitors into the ground officially.

Earlier this week, it was reported that Tesla could be primed to receive the new EV incentives that would grant a $7,000 tax credit to the first 600,000 Tesla EVs sold in the United States. The new GREEN Act indicates that the number of applicable EVs per manufacturer would increase by 400,000 cars, from 200,000 to 600,000, making a considerable number of Tesla’s projected sales for 2021 reasonably less expensive for car buyers.

While Tesla didn’t give an exact estimation for how many cars it plans to build this year, several analysts have projected numbers between 800,000 and 950,000. However, Tesla’s Q4 Earnings Update Letter has a total output of 1,050,000 between its two active production facilities.

Tesla to gain access to 400k more $7k EV tax credits amid Biden’s sustainability push

The GREEN Act states:

“The bill also extends existing tax incentives available for the sale of electric vehicles. The bill increases the electric vehicle credit cap for manufacturers to 600,000 vehicles, but reduces the credit by $500 after the first 200,000 vehicles sold. This would replace the current phaseout period that begins with 200,000 vehicles sold, with a phaseout period that instead begins during the second calendar quarter after the 600,000-vehicle threshold is reached. 

“At the start of the new phaseout period created under the bill, the credit is reduced by 50 percent for one calendar quarter and subsequently ends. For manufacturers that already passed the 200,000 threshold before the enactment of the bill, the number of vehicles sold in between 200,000 and those sold on the date of enactment are excluded in determining when the 600,000 threshold is reached.”

Tesla is sitting pretty if this happens to go through. For several reasons, the reintroduction of the EV incentive to Tesla’s cars could effectively bury conventional automakers who have not put a more serious and specific focus on the development of electric powertrains.

It is no secret that the future of vehicles is electric. While classic muscle cars will likely always be in existence for decades to come, mass-market vehicles from other manufacturers, like Ford Escapes, Honda Civics, Toyota Camrys, and Chevy Malibus, will fade away. Let’s be honest with each other here: Nobody is collecting any of them; they just don’t have the “it” factor that a classic vehicle has.


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Even today’s Mustangs, Camaros, and Corvettes don’t hold the value, the sentimental meaning, or the history that early builds have. And even worse, they don’t have the performance, the speed, or the technology and efficiency that an electric car has. EVs are the best of both worlds, and when you buy a Tesla, there is no better car to display that in the most exaggerated manner.

Subtracting another $7,000 from the price of any of Tesla’s vehicles thanks to the GREEN Act would be game over. The Model 3 SR+ would be well below the average cost of a car in the United States today while offering environmentally-friendly transportation, acceleration that is well beyond the norm for a combustion engine car, and pricing that just cannot be matched by some of the “luxury, high-performance” vehicles that are offered in today’s market.

Comparative to the Tesla Model 3 SR+ is the 2021 Mercedes-Benz CLA-Class. Both start at price points slightly below $38,000, but the specs speak for themselves. The Model 3 has a significantly faster 0-60 time at 5.3 seconds, while the Benz sits at 6.2. The quarter-mile race wouldn’t be close either, with the CLA getting to the line in 13.8 seconds. The Model 3 would be finished in 13.1, according to Matthew Cjel, who did three 1/4-mile runs with his SR+ and got times of 13.185, 13.181, and 13.218.

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While competitive without the incentive, pricing wouldn’t be close if the $7,000 credit was applied. That would bring the Model 3 to just under $31,000. Additionally, the CLA only gets 25 MPG City and 35 MPG highway. With spiking gas prices, that would be a considerably frequent trip to the local Shell station. The Model 3 gets 263 miles per charge and can be charged from home or at a local Supercharger for a fraction of the price.

This is just one example of where the $7,000 credit would make EVs more appealing than gas cars to those who remain on the fence. Price parity is becoming an outdated argument, and with Tesla’s battery advancements and increased production rates, cars will only become less-expensive every year. Soon enough, Tesla’s $25k mass-market vehicle will hit the roads, and there will be an overwhelming sense of demand from new car buyers. The initial 600,000 EVs will likely disappear as fast as turkey on Thanksgiving, making the tax credit obsolete in virtually no time.

The only real concern that could arise from the new credit is it is likely to increase demand significantly, which could bring issues for Tesla’s projects that have been delayed due to battery constraints. I don’t know how more 3 and Y purchases, along with S and X, would affect Roadster, Semi, or Cybertruck production. However, Tesla is battery constrained, and available cells would likely be subjected to the S3XY lineup, which could further delay the other projects.

Demand is never a bad thing, though. The higher sales of its mass-market vehicles would give Tesla even more capital to invest in battery manufacturing and tech. It would give them more money to source cells from third-party suppliers. It also would only help the company’s financials for many quarters to come. But battery shortages have halted the Semi and Roadster project several times, and the Cybertruck now seems like it could be subjected to the same issues. It seems like Musk could have been hinting toward that in the podcast with Rogan yesterday, where he said that they can “hopefully” begin volume production next year. During the Q4 EC, Musk also said:

“If we get lucky, we’ll be able to do a few deliveries toward the end of this year, but I expect volume production to be in 2022.”

Let’s hope things continue to expand in a timely fashion, I think the EV incentive and the long list of advantages that EVs have over their ICE competitors will be recognized by everyone who remains in limbo over which power source will “fuel” their next vehicle.

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I use this newsletter to share my thoughts on what is going on in the Tesla world. If you want to talk to me directly, you can email me or reach me on Twitter. I don’t bite, be sure to reach out!

Tesla’s $7,000 EV incentive is a nail in the coffin for ICE competitors

Source: https://www.teslarati.com/tesla-7k-incentive-nail-in-the-coffin-ice-competitors/

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Rivian adopts mobile service model for maximum convenience

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Rivian Service promises to provide a proactive and personal approach to mobile vehicle service. Rivian seems to have developed an intricate mobile service model to make vehicle care more convenient for R1T and R1S owners.

Over-the-air updates will support Rivian’s mobile service model to optimize a vehicle’s performance continuously. Most of the over-the-air updates will take place at night, making it more convenient for owners.

The company’s mobile service will also be backed by Rivian Remote Care, enabling the company to perform comprehensive diagnostics from afar. With Rivian Remote Care, technicians can proactively identify most vehicle problems even before the owner notices them.

Credit: Rivian

“We’re remotely diagnosing vehicles and pre-ordering parts if needed. By the time we arrive for your mobile service appointment, we’re ready to resolve your issue on the spots,” said Edwin, a Rivian Service technician.

Rivian will have a fleet of mobile service vans ready for deployment at any time. Rivian mobile technicians can attend to calls at an owner’s home, workplace, or anywhere service is needed within the United States and Canada. Rivian plans to expand its mobile services as it reaches other markets.

Rivian technicians will also bring vehicles that need extensive care to service centers and return them to owners afterward. The company will provide a loaner to owners while their cars are cared for at the service center. Rivian has not specified what vehicles will be used as loaners.

Rivian plans to open over 40 service centers in the United States and Canada soon. More service centers are planned for the future as Rivian grows. The company has also established a network of Rivian-owned and Rivian-certified collision centers for bodywork and exterior damages.

Rivian Service seems to go hand-in-hand with the company’s warranty coverage. Rivian’s warranty system is also quite intricate. It includes a Comprehensive Warranty, a Battery Warranty, a Drivetrain Warranty, and a Perforation Corrosion Warranty.

The Teslarati team would appreciate hearing from you. If you have any tips, email us at [email protected] or reach out to me at [email protected].

Rivian adopts mobile service model for maximum convenience

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Source: https://www.teslarati.com/rivian-mobile-service-details/

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Lucid Motors, Rivian sued by Illinois car dealers for direct sales

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Lucid Motors and Rivian were sued by the Illinois Automobile Dealers Association, the Chicago Automobile Trade Association, and some individual franchised auto dealerships in the state for selling vehicles directly to consumers.

The numerous plaintiffs are accusing both Rivian and Lucid of violating state laws that require new vehicles to be sold through franchised dealerships. The direct-to-consumer sales platform has become popular with electric car companies, especially Tesla who has never operated through dealerships. While each of the aforementioned automotive companies does have showrooms in operation to display their products, they do not have salespeople or sales managers who negotiate prices with customers. The costs are the same for everyone, a strategy that has alleviated a lot of stress from the car buying process.

In May 2019, the dealers, the Secretary of State, and Tesla entered an agreement that would consent to the automaker obtaining no more than 13 dealer licenses in Illinois. This allowed showrooms to sell vehicles to customers, but it only applies to Tesla and not to Lucid and Rivian.

The new lawsuit against Rivian and Lucid alleges the Secretary of State of “turning a blind eye to Rivian’s unlicensed sales operations,” according to the Chicago Tribune.

“We have no choice but to file this lawsuit, both to protect consumers as well as the hundreds of franchised dealers across the state who contribute to the local economy,” Pete Sander, the Illinois Automobile Dealers Association President, said. Sander represents more than 700 auto dealers that operate over 2,300 franchises across the state.

Credit: Lucid Motors

The Illinois Vehicle Code and the Illinois Motor Vehicle Franchise Act were cited in the lawsuit. These mandate that all vehicle sales to the public “must be made through licensed and independent franchised” dealers.

Lucid operates out of California and has its main production facility in Arizona. The company recently opened a sales studio in Oak Brook, a suburb of Chicago that is home to several large corporations like Ace Hardware and Blistex. However, Rivian is based in Normal, Illinois, and the lawsuit seems to affect it more than Lucid simply because of the company’s base location.

The Illinois Attorney General’s office issued “an informal opinion” last summer that stated new automotive manufactures are not expressly required by law to establish franchised dealerships to sell their cars. This gives companies like Rivian and Lucid the opportunity to sell their products directly to customers unless the lawsuit filed by the numerous plaintiffs moves forward. A spokesperson for the Secretary of State’s office said they would review the complaint when it comes to their office.

Lucid Motors, Rivian sued by Illinois car dealers for direct sales

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Source: https://www.teslarati.com/lucid-rivian-lawsuit-direct-sales-ban-illinois/

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Elon Musk’s Starlink Beta meets opposition from India’s industry body

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It appears that Starlink is facing a challenge in India, a country expected to receive coverage from the satellite internet system sometime next year. 

The opposition against Starlink was initiated by the Broadband India Forum, which has written a request to the Telecom Regulatory Authority of India (TRAI) and the Indian Space Research Organization (ISRO). The forum asked the bodies to block SpaceX from pre-selling the beta version of the satellite internet service in the country. 

As noted in a report from The Economic Times, TV Ramachandran, the industry body president, argued that SpaceX does not have the necessary license or authorizations from the government to offer its beta services in India. 

The Broadband India Forum represents companies such as Amazon, Facebook, Google, Hughes, and Microsoft. In its request, the forum asked the bodies to “urgently intervene to protect fair competition and adherence to existing policy and regulatory norms.” It also noted that SpaceX seemed to be “non-compliant to existing guidelines” in India.  

Explaining further, the forum added that Starlink does not have its own ground stations in the country, nor does it have the satellite frequency authorization from the ISRO and the Department of Telecommunications (DoT). According to the forum, these are needed for a company to be allowed to offer beta services in India. 

SpaceX, for its part, has not issued a statement about the matter. In a statement to the Times, a senior TRAI official has stated that the issue brought up by the Broadband India Forum “would be examined.”

SpaceX is currently offering pre-orders for the beta version of Starlink in India for a fully refundable deposit of $99 (about Rs 7,000). The satellite internet service is poised to compete with other satellite communication services such as the Bharti Group and the UK government-owned OneWeb, which is also expected to launch its services sometime in 2022. Competition may also be coming in the form of Amazon’s Project Kuiper, which is yet to provide internet services, even in beta form. 

Don’t hesitate to contact us for news tips. Just send a message to [email protected] to give us a heads up.

Elon Musk’s Starlink Beta meets opposition from India’s industry body

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Source: https://www.teslarati.com/elon-musk-starlink-india-opposition/

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Elon Musk to become board member of Endeavor Group Holdings: SEC Filing

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Tesla CEO Elon Musk will join the Endeavor Group Holdings Board of Directors ahead of the group’s Initial Public Offering, a filing with the Securities and Exchange Commission says.

Musk, 49, currently spends his time with Tesla, SpaceX, Neuralink, and The Boring Company, but will join the Endeavor board in the coming months, the filing says. He is currently listed as a “Director Nominee.” However, the filing describes what Musk’s eventual position will be.

“Mr. Musk is currently a director nominee and will become a member of our board of directors at or prior to the pricing of this offering,” the filing says. “Mr. Musk was selected to serve on our board of directors because of his professional background and experience running a public company, his previously held senior executive-level positions, his service on other public company boards and his experience starting, growing and integrating businesses.”

Endeavor includes several well-known brands under its parent company, including talent agencies WME and IMG, and premier mixed martial arts promotion Ultimate Fighting Championship, most commonly referred to as the UFC. The UFC was purchased by Endeavor’s WME-IMG joint venture in July 2016 for $4.2 billion.

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Endeavor had attempted to launch an IPO in the past but pulled the plug on the effort at the last minute in the Fall of 2019 when market conditions were unfavorable. The company may have sensed it wouldn’t reach its fundraising goal, according to Deadline, and opted to wait for better economic circumstances.

It also skipped 2020 as a possible date for its IPO due to the Coronavirus pandemic. Despite pulling in less of a profit compared to 2019, CEO Ari Emanuel stated the company remained resilient despite the tough circumstances and is attempting to initiate an IPO in the coming months.

“As challenging a year as 2020 was, it underscored the strength, creativity, and resilience of our people who mobilized time and time again in the face of overwhelming odds,” Emanuel wrote in the S-1 filing. “We made difficult decisions but worked as a team to find creative solutions and best position the business for the future.” The company reported $3.5 billion in revenue last year, down $1.1 billion from 2019.

The filing for the possible Endeavor IPO indicates the company wants to raise $100 million, but this number could ultimately change.

As long as Endeavor can raise the correct capital and it avoids any other dicey economic uncertainties, it will trade under the “EDR” ticker symbol on the New York Stock Exchange.

Elon Musk to become board member of Endeavor Group Holdings: SEC Filing

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Source: https://www.teslarati.com/elon-musk-endeavor-group-holdings-boardmember/

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