Latest / Elon Musk Podcast / Massive Tesla Sell-offs

Transcript

Massive Tesla Sell-offs · Elon Musk Podcast

• 0:03
  Why are so many people suddenly trying to get rid of their
• 0:06
  Teslas? After all, Tesla was once the
• 0:09
  gold standard in EVs, cutting edge designs, breakneck
• 0:14
  acceleration and the status symbol for the tech savvy elite.
• 0:18
  But now an uncomfortable question is echoing across used
• 0:22
  car marketplaces and dealerships.
• 0:24
  Why are so many Tesla owners suddenly trying to sell their
• 0:28
  cars? Numbers staggering.
• 0:30
  In March alone, over 13,000 used Teslas were listed for sale on
• 0:34
  Auto Trader, the most ever recorded.
• 0:38
  The spike wasn't just an outlier, it marked a 67%
• 0:41
  increase from the same time last year.
• 0:45
  And what's driving the shift? Some point to market
• 0:48
  saturations, others to brand fatigue.
• 0:51
  But underneath it all is a deeper discomfort with Elon Musk
• 0:55
  himself and his increasingly political persona as he stepped
• 0:59
  into a new role as the doge head and lie himself.
• 1:03
  With right wing politics, including close ties to the
• 1:05
  Trump administration, the Tesla brand appears to be losing its
• 1:10
  luster and faltering, especially among the progressive leaning
• 1:13
  buyers who once championed it. Question isn't just why people
• 1:17
  are selling, but what this sudden exodus says about the
• 1:20
  future of Tesla. Now used Tesla inventory in the
• 1:23
  US is ballooning at a pace that outstrips every other automaker.
• 1:27
  March didn't just break records, it absolutely shattered them
• 1:31
  with more than 13,000 used Teslas up for sale on Auto
• 1:35
  Trader during the final week of the month.
• 1:37
  And this was a flood of new cars coming in.
• 1:42
  The listing surged in tandem with hundreds of anti Tesla
• 1:45
  protests that swept across the country during the same week,
• 1:49
  some under the banner of the Tesla takedown movement.
• 1:53
  Now, whether a correlational or a causation, this timing was
• 1:58
  hard to ignore. And while Tesla remains smaller
• 2:01
  in size compared to Toyota and GM, increased in used listings
• 2:06
  about 5300 more than the same time last year was large even in
• 2:10
  absolute terms. And meanwhile, used inventory
• 2:13
  for rivals like Rivian and Lucid, which are also pure EV
• 2:18
  brands, either stayed flat or dropped off.
• 2:21
  Tesla is swimming against a current most of its competitors
• 2:25
  aren't feeling right now, and prices have followed the same
• 2:29
  downward trajectory. Data from Car Guru shows that
• 2:32
  the average price of a used Tesla in the US dropped by 7% in
• 2:37
  March compared to a year ago. In contrast, other E VS saw only
• 2:41
  1.5% dip. In the UK, the trend was even
• 2:45
  sharper, with used Tesla prices falling 15% versus the 10% drop
• 2:50
  across all E VS. The size and speed of these
• 2:53
  price reductions suggests more than just routine market
• 2:56
  adjustments. Now Cox Automotive, which is the
• 3:00
  parent company of Auto Trader, and I have to disclose this, I
• 3:03
  used to work at Cox Automotive. They attribute this glutton
• 3:07
  inventory to two core reasons. First, the company notes Tesla's
• 3:11
  extraordinary production growth between 2021 and 2023, and that
• 3:15
  surge of new vehicles hitting the road was bound to spill into
• 3:18
  the used market. And now it's starting to show.
• 3:21
  Second, Cox suggests that Elon Musk's political involvement,
• 3:25
  particularly his leadership in DOGE in his proximity to Donald
• 3:28
  Trump, has begun to affect consumer sentiment.
• 3:32
  Even some long term Tesla drivers are looking for the exit
• 3:36
  now. This isn't just about cars
• 3:37
  though. People identify with their
• 3:40
  vehicles, and Tesla's were never just transportational.
• 3:44
  For many, they symbolized a future forward lifestyle, clean
• 3:47
  energy innovation and independence from the large
• 3:51
  fossil fuel companies. But when the people behind the
• 3:54
  vision become closely associated with a political ideology many
• 3:58
  of his early adopters oppose, the product starts to feel
• 4:02
  different in your driveway. Data from you Gov in early March
• 4:07
  showed a noticeable drop in Tesla's popularity among
• 4:10
  American consumers reaching record lows.
• 4:14
  And Musk's increasingly visible alignment with far right
• 4:17
  politics appears to alienated a core segment of its original
• 4:21
  buyer base. Now the effects of tangible of
• 4:24
  these tangible sell offs that go beyond social media and
• 4:27
  political debate. Though Edmunds has tracked a
• 4:30
  sharp increase in post 2017 Tesla's being traded in, by mid
• 4:35
  March they accounted for 1.4% of all vehicle trade insurance, up
• 4:40
  from just .4 in the same period last year.
• 4:43
  This tripled in trade. Trade insurance suggests a
• 4:46
  growing urgency among owners to move on.
• 4:49
  They just want to get rid of these things.
• 4:51
  Car Guru's market analysis believe there's another
• 4:54
  technical factor at play, an influx of former fleet cars
• 4:58
  hitting the market. These are vehicles leased by
• 5:01
  companies or rented out through services and now returning to
• 5:04
  dealerships in bulk. That volume can crash prices,
• 5:08
  particularly if not balanced by equal consumer demand, and the
• 5:13
  result is a swelling inventory and declining resale value.
• 5:17
  Now over in the UK, Auto Traders commercial director attributes
• 5:20
  the price drop to a wave of Tesla purchased on financing
• 5:24
  that are now maturing. In March alone, there were 5400
• 5:28
  used Teslas listed on Auto Traders UK platform, nearly
• 5:32
  double the 2900 from a year earlier.
• 5:34
  Interestingly, UK buyers still seem more receptive as those
• 5:39
  used Teslas are selling quicker than the average EV, 23 days
• 5:43
  versus 29. But volume like this can only be
• 5:46
  absorbed so fast before the market stress sets in.
• 5:51
  Now, despite all the chaos in the resale markets, Tesla is
• 5:54
  attempting to pivot forward. The company has confirmed two
• 5:57
  major upcoming releases, a more affordable Tesla model, the
• 6:00
  $25,000 model that we've all heard about, and it's set to
• 6:04
  enter production before the middle of this year.
• 6:07
  And a robo taxi, of course, will launch in Austin in June.
• 6:11
  They're designed to revitalize consumer interest in Tesla, but
• 6:14
  they arrive at a moment when brand trust is the most fragile
• 6:17
  it has ever been. Now, Tesla's global performance
• 6:22
  has been hit hard too. The first quarter of this year
• 6:24
  was the company's weakest since 2022, with only 336,681 vehicles
• 6:29
  delivered worldwide, far short of 390,000 analysts hit
• 6:34
  forecasted. And that 13% drop year over year
• 6:38
  has unnerved investors. Now, according to JP Morgan,
• 6:43
  even low end expectations weren't pessimistic enough.
• 6:47
  The sharp drop in deliveries confirm the kind of brand
• 6:50
  erosion that only months ago would have seemed improbable.
• 6:55
  Now, the pressure isn't just about production delays.
• 7:00
  Tesla's best selling vehicle, the Model Y, is aging.
• 7:03
  They're releasing a new refresh of that, and people are taking
• 7:06
  to that pretty well. Analysts believe some potential
• 7:09
  buyers are delaying purchases until they can get their hands
• 7:12
  on a new Model Y as well. And increasing competition is
• 7:15
  also mounting. Tesla now finds itself battling
• 7:19
  EV manufacturers from China, like BYD and other Asian
• 7:22
  markets, who are releasing more advanced, lower cost models.
• 7:25
  One glaring example came in March when BYD revealed a fast
• 7:29
  charging platform capable of refueling an EV in about 5
• 7:34
  minutes usually trickles in on a supercharger for about 20
• 7:39
  minutes. You can go get yourself a cup of
• 7:41
  coffee, grab a burger, whatever you want to do.
• 7:44
  The 20 minutes. That was Tesla's strategy all
• 7:47
  along, because they couldn't get their Superchargers to go faster
• 7:50
  than about 20 to 30 minutes, depending on how much charge you
• 7:53
  needed. Sometimes it would take longer
• 7:55
  than that, too. So what are you going to do on a
• 7:57
  long road trip when you already took a break and you have to
• 8:00
  wait 30 more minutes just because your car has to charge?
• 8:04
  Takes a while. Are you going to go stop at the
• 8:06
  convenience store or if it's at a parking lot, say at a hotel
• 8:10
  chain, what do you do then? You just sit in your car and
• 8:13
  hang out and take a breather. Guess that's one way to look at
• 8:16
  it. But this also means that BYD
• 8:19
  stocks surged to record highs, while Tesla's dropped more than
• 8:23
  40% for the year. Also, Tesla stock was very
• 8:27
  inflated and it's on a decline now.
• 8:31
  It's going to level out. I think it was once they start
• 8:35
  moving more into robotics, this the Tesla stock is going to go
• 8:38
  way up in my opinion. And I'm not a financial advisor,
• 8:41
  so don't take my word as any financial advice.
• 8:45
  I have to do a disclaimer there so nobody gets in trouble.
• 8:49
  There's also been the enthusiasm drop towards EVs, and Gallup had
• 8:56
  a poll that said that EV interest is softening,
• 8:59
  particularly among groups previously most likely to adopt
• 9:03
  them. The data doesn't specify Tesla's
• 9:06
  role in this trend, but it raises the possibility that
• 9:08
  negative perceptions of the brand may be bleeding into views
• 9:11
  of EVs as a whole. And for Tesla owners, the
• 9:14
  consequences are immediate. A vehicle that might have held
• 9:18
  its value better than any other EV on the market just a few
• 9:22
  years ago now sits in a resale market where it earns thousands
• 9:26
  less than competing models. The average used Tesla sells for
• 9:30
  about $10,000 less than any other vehicle.
• 9:34
  It's a pretty steep loss. It's also changed how
• 9:37
  perspective or prospective buyers are thinking.
• 9:40
  What's the status symbol? A used Tesla now comes with
• 9:42
  cultural baggage for a growing number of consumers.
• 9:45
  It's not just a car anymore. It's a statement about who you
• 9:49
  are. Shift is especially important in
• 9:52
  a country where buying decisions are deeply intertwined with your
• 9:55
  identity and your politics. Now, as the second hand market
• 10:00
  fills to the brim with Teslas and buyers become more cautious,
• 10:04
  the company's next moves will have to be more than technical
• 10:07
  upgrades or new product announcements.
• 10:09
  Tesla needs to solve one problem that software could never fix,
• 10:16
  the perception from the public. Also, right now it's a really
• 10:21
  great time to buy a Tesla. So if you could find a good used
• 10:24
  Tesla, go check them out. You can check them on any online
• 10:29
  auto retailer. Also on Tesla's website itself.
• 10:32
  You can also just get them delivered to your house through
• 10:35
  Carvana. You can get a car dropped off of
• 10:38
  your house. You could trade in your car at
• 10:39
  Carvana and also have that car dropped off of your house.
• 10:42
  The new Tesla I'm they're not a sponsor, but that's why I buy my
• 10:45
  cars. It's so easy now.
• 10:49
  Thing is, Tesla's losing resale value, market share, and
• 10:52
  consumer loyalty at the same time.
• 10:55
  That's a triple threat. And the root of the issue
• 10:58
  appears to be a complex competition of overproducing,
• 11:02
  increased competition, and of course people starting to not
• 11:06
  like Elon as much as they used to.
• 11:08
  He used to be a fun, happy, goofy tech bro.
• 11:11
  They had future plans to send people to Mars and seem like a
• 11:16
  nice guy. And then, of course, the whole
• 11:19
  Trump thing happened and people soured on him.
• 11:22
  So take that for what you will. But let me know if there's
• 11:26
  comments on your podcast platform, if you're in the
• 11:28
  market for a Tesla, because if you are, might be a good time to
• 11:33
  take a look. It's a lot of them on the market
• 11:35
  and the prices dropped severely. All right, thank you so much for
• 11:40
  listening today. On my way out of here, I want to
• 11:42
  ask you for one second of your time.
• 11:44
  I'm going to give you 10 years of mine.
• 11:48
  I just going to ask you for a quick sub or a follow on your
• 11:52
  podcast platform. That's it.
• 11:53
  And I'm going to give you 10 more years of my time doing this
• 11:57
  show. I've been doing it for about 5
• 11:59
  years now. Not going to quit.
• 12:01
  There's never anything behind a pay wall.
• 12:04
  And all I ask from you is a quick subscription or a follow
• 12:07
  on whatever podcast platform you're on right now.
• 12:10
  That's it for me today. Everybody.
• 12:11
  Thank you so much for taking the time out of your day to spend it
• 12:14
  here with me. Take care of yourselves and each
• 12:16
  other and I will see you in the next one.