Connect with us

Plato Vertical Search

Cleantech

Tesla’s Spending On R&D Is Higher Than Legacy Auto’s — Per Car Sold

I saw an interesting comparison between Tesla’s spending on research and development (R&D) and that of its competitors — namely Chrysler, GM, Toyota, and Ford. Visual Capitalist shared the comparison and noted that Tesla has spent $0 on advertising but almost $3,000 on R&D per car sold. Here’s the comparison breakdown:

R&D spent per car sold:

  • Tesla: $2,984
  • Ford: $1,186
  • Toyota: $1,063
  • General Motors: $878
  • Chrysler: $784

There’s also a comparison between the five companies on how much they spend on advertising per car sold and R&D per dollar of advertising. Since Tesla doesn’t pay anything for advertising, that number in the last category is $0. Advertising spending per car sold/R&D dollars per dollar of advertising:

  • Tesla $0; $0
  • Ford: $468; $2.53
  • Toyota: $454; $2.34
  • General Motors: $394; $2.22
  • Chrysler: $664; $1.18

Looking at these numbers, we can see that Chrysler pays the most in advertising and the least in R&D per car.

The article noted that all of its data comes from the 10-K filings of each company and that it covers the numbers for 2020. It also added that due to increasing investments in the EV space, EVs are poised to be a trillion-dollar market by 2028.

As a reminder, Chrysler is part of the Fiat-Chrysler Automobiles (FCA) family that includes a range of brands, including Jeep, Ram, Fiat, Dodge, Maserati, and Chrysler. Keeping that in mind, a quick look at FCA’s 2020 U.S. sales show that it sold 1,820,636 vehicles in 2020. That may sound like a lot (it is), but that number was down 8% due to the pandemic. In comparison, Tesla sold 500,000 vehicles in 2020, and that was the highest Tesla had ever sold (it has now sold more in 2021).

JB Straubel’s Thoughts Echo The Above Data

This data echoes a recent chat between Jason Calacanis and former Tesla CTO and co-founder JB Straubel. The latter shared his thoughts about the EV revolution and the focus of OEMs on battery electric EVs. The two chatted on Calacanis’ YouTube show “This Week In Startups,” where Straubel spoke of Tesla’s early days, battery recycling, and OEMs lack of planning on its so-called dedication to EVs.

In the interview, Straubel said:

“The Model S was such a different car. The Roadster was a technology validation. We proved that batteries could work, they could go on a car, they could be safe, they could do the range and acceleration. The S was a whole different thing. It was so good. We put so much effort into that. Elon was hell-bent on making it the best car on the road. And I think we really delivered on that at the time. It was phenomenal.

“I’m still amazed at the skepticism there was. Even after delivering those, we kinda imagined, I imagined, that people would see this and go ‘Clearly this is the future. This is all gonna work. All the car companies are gonna copy this immediately, and we’ll have to go really fast to figure out how we can carve out a niche.’ And it just didn’t happen. Customers loved it. It was a runaway hit with reviewers and magazines and customers, but the copying and market change didn’t happen.”

Despite the rave reviews and the success of the Model S, legacy automakers didn’t take EVs seriously. That wouldn’t happen until the Tesla Model 3 became a global bestseller years later, and this happened after the company’s 2018 battle to bring them into production. Tesla has since focused more and more on scaling up via gigafactories.

Tesla’s success has transformed the automotive industry to the level that OEMs have begun to take EVs seriously. They want to go all-in, but Straubel pointed out that these announcements may not be so realistic. And the above data reflects this. They are spending more on advertising than R&D per car sold, and all this does is just make noise.

The noise is good for Tesla, which doesn’t spend anything on advertising. But it’s not good for the industry if it really, really, really wants to go all-in on EVs.

“So many different OEMs, countries, factories, customers are leaping into EVs. You know, making these huge announcements, you know, saying that they’ll be fully electric this decade or the next. They haven’t — I don’t think they’ve done the math fully [on] what that entails on the supply chain and tracing it all the way back, literally all the way back to the mines. You need to do that, or else, you know, you haven’t really solved it. It has the feeling to me of kind of like a giant overbooked flight.

“All these people like, ‘Oh, this is great. We’re all gonna go to that new place. We all wanna go there. It looks great. Sweet. Let’s all go on the plane and go.’ So everybody’s saying that we all wanna go there at the same time. Meanwhile, we have to sort of build the planes to get there; we have to figure out how to sequence everyone. The figurative runway is like the time to do all this, and it could all get sorted out over time. But obviously, we’re trying to do this fast as a society and as a species.”

If legacy auto is serious about EVs, it would spend more on R&D. It would also secure more battery and mineral supplies. It would tone down the chatter and focus more on the products.

 

Appreciate CleanTechnica’s originality? Consider becoming a CleanTechnica Member, Supporter, Technician, or Ambassador — or a patron on Patreon.

 

Tesla’s Spending On R&D Is Higher Than Legacy Auto’s — Per Car Sold

 


Advertisement


 


Tesla’s Spending On R&D Is Higher Than Legacy Auto’s — Per Car Sold

Have a tip for CleanTechnica, want to advertise, or want to suggest a guest for our CleanTech Talk podcast? Contact us here.

PlatoAi. Web3 Reimagined. Data Intelligence Amplified.
Click here to access.

Source: https://cleantechnica.com/2021/10/12/teslas-spending-on-rd-is-higher-than-legacy-autos-per-car-sold/

Related Streams

Blockchain

The price of bitcoin tapped a new low this year hitting $34K per unit at just after 5 a.m. (EST) on Saturday morning. Bitcoin...

Blockchain

The price of bitcoin tapped a new low this year hitting $34K per unit at just after 5 a.m. (EST) on Saturday morning. Bitcoin...

Blockchain

BTC Price Continues Bearish Run as It May Revisit $30k – January 21, 2022 On January 20, buyers failed to keep the BTC price...

Blockchain

Jim Cramer, the host of CNBC’s Mad Money took to Twitter for a rather controversial stance. He stated, “Please be careful with Dogecoin…It is...