Elon Musk: Teslas Just Too Expensive For People … But We’re Fine Losing The $7,500 Tax Credit – CleanTechnica

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Craig Trudell at Bloomberg has pointed out something quite notable. Over the past few years, in order to explain why Tesla vehicles were not selling as much as desired (and as much as Tesla could produce them), Tesla CEO Elon Musk has noted on several occasions that they’re still just too expensive for many people. There are just only so many people who can afford a new $40,000 car, even if that car is highly desirable and better than other $40,000 cars. However …

Musk is also now saying that Tesla will be fine losing the $7,500 tax credit that effectively makes Tesla’s vehicles $7,500 cheaper. That’s quite at odds with Tesla’s hardcore efforts to cut pennies out of the production costs and make Tesla vehicle more affordable for more people. Clearly, Musk and the Tesla team saw it as very important that Tesla vehicles become more affordable, not more expensive.

Which Musk is right?

Need some receipts? Here are several statements Musk has made in the past two years, courtesy of Bloomberg:

January 25, 2023	4Q 2022 earnings	“It’s always been our goal at Tesla to make cars that are affordable to as many people as possible.”
March 1, 2023	Investor day	“Demand is very much a function of affordability, not desire. Very important.”
April 19,2023	1Q 2023 earnings	“We really don’t think about competitors that much. We just look at do people like our cars, how can we make the product better, can they afford our cars?”
May 16, 2023	2023 annual meeting	“The vast majority of people buy cars based on the monthly payment. So, it’s like, how much is the monthly payment? And it’s not a question of value for money. It’s just, do they actually have enough money, can they afford it?”
October 18, 2023	3Q 2023 earnings	“There’s something to be gained on the advertising front. I don’t think it’s nothing. But informing people of a car that is great, but they cannot afford doesn’t really help. So that is really the thing that must be solved, is to make the car affordable.”
January 24, 2024	4Q 2023 earnings	“We have lots of people who want to buy our car, but simply cannot afford it.”
June 13, 2024	2024 annual meeting	“For most people, it is really not a question of whether they want a Tesla. They do want a Tesla. They simply do not have enough money to afford one. So, we have to make it affordable.”

That’s quite a series of statements. How does that reconcile with the claim that it’s fine that Tesla buyers will lose the $7,500 discount?

Regarding the reference to cutting pennies out of production costs, Musk said last month, “It’s like Game of Thrones, but pennies.” But he also made that point several years ago, which even led to us creating this graphic:

While Tesla was striving to cut seconds off of acceleration times, it was also striving to cut the cost of its cars by pennies. Last I checked, $7,500 is a lot of pennies.

Tesla can’t just lower the prices of its cars by $7,500 itself, or it will be losing money on its cars. There are not going to magically be more people who can afford electric cars — Tesla’s or other companies’ — when they cost thousands of dollars more.

Now, in theory, Musk’s dream is that all subsidies would be removed. But there is 100% not a chance in Hell subsidies for oil and gas are going to be cut. That’s not even a question or discussion. No one with a functioning brain could think Republicans are going to cut the enormous subsidies oil and gas benefit from.

It really doesn’t make sense. It’s like there are two Musks with very different opinions on one of the most important matters to the future of Tesla — the affordability of its cars. Make it make sense.