Forbes article

Forbes article

Without being too (pro Tesla) biased, is this article (more or less) correct?

ChristianG | May 28, 2013

This article is more or less correct. However, even as I'm not really into the tesla numbers, I suspect that they took the number of money Tesla spent in that quarter and calculated that against the car. That's only partly fair as Tesla is still ramping up their Service centers and superchargers.

On the other hand it does show that Tesla operates on a tight budget and of corse we don't know if the sales of the cars alone would be enough to finance the whole infrastructure and still make a profit. But then they'll not have to yet.

Also it's true that you americans pay around 10k per car and of corse it's a bit contriversial that the poor tax payers pay for rich guys toys. But then it's not teslas fault that the their goverment chooses to push EVs in a general. If you don't want to give the money to rich guys don't give the credit if the guy earns too much or the car costs zu much. that's a politics problem.

lolachampcar | May 28, 2013

So that paying for rich guy's toys would apply double in Europe with all the EV tax incentives????? I was not aware that European tax men/women were so thoughtful when it comes to rich guys/gals :)

ChristianG | May 28, 2013

@Lola Unfortunately not the whole of europe. All I get is that I don't have to pay street taxes wich are around $80 ;) Also rumors has it that Incetives will not be continued next year in Norway. So it's at least they do talk about that.

When substitutin the EVs most people are ok with small everyday cars. Now that we buy a Model S or Roadster wich are too expensive for most people and the main feature other than driving electricity is tha acceleration so it also gets into the toy category.

And whenever the lower class pay for the upper class the system seems unfair.

Runar | May 28, 2013

@Christian, incentives in Norway will not change until the end of 2017. Dont know what rumors you talk about, but they are false. :-)

BrianMRolfe | May 28, 2013

The article is quite biased. The author refuses to distinguish between a tax rebate and a subsidy and then goes on to build his argument that Tesla is gouging tax-payers with each vehicle sold on this confusion. The argument concerning 'green credits' is also spurious. Tesla didn't invent the program, and any smart company will take advantage of a readily available income stream (and budget/spend accordingly). The selling of green credits may have helped Tesla succeed, but I doubt Tesla will die without them. Overall the article is bunk. (just my relatively uneducated opinion).

Winnie796 | May 28, 2013

BrianMRolfe +1

SCOOBY | May 28, 2013

All Tesla buyers receive a $7,500 reduction in their federal taxes. I thought Forbes believed in tax cuts. I also thought Forbes believed that tax cuts "pay for themselves". Apparently that doesn't apply if the tax credit is for a product Forbes doesn't like (electric vehicles) as opposed to one it does like (offshore drilling).

And nobody is forcing other car manufacturers to buy emission credits from Tesla. They buy these credits because they cost less than complying with federal and state emission regulations. It's a free market solution that reduces the cost of all cars, both those made by Tesla and those made by others. I thought Forbes supported free market solutions that reduce our dependence on foreign oil. Apparently that only applies if the answer is "drill, baby, drill"!

jat | May 28, 2013

Not to mention he ignores the massive subsidies in various forms for oil companies.

The one function that must be provided by the government is protection of resources subject to the tragedy of the commons, such as air quality. So I think it is *entirely* correct to require all taxpayers to subsidize things that reduce pollution simply because it is in no single entity's interest to do so otherwise, and that is exactly what the federal tax credits and CA ZEV credits are. Likewise for reducing dependence on foreign oil.

spip | May 28, 2013

1)The article has some valid points but they are valid for any EV car (volt, leaf, focus, prius plug-in, smartcar, etc.) Tesla is the currently sexy/splashy thing to write about so they are the easy target.
2)consider the source. The author is a director at the CATO institute.
3)The CATO institute is heavily influenced (argueably controled) by the Koch brothers who make their money from oil.

Healthy debate about the good and bad of government programs is always valid. However when the debate is originated by a puppet master it runs the risk of diminshing the message somewhat.

ChristianG | May 28, 2013

@Runar good to hear (even thou I'm jealous ;)) I red somewhere that it's important for you guys to get the car still in 2013 to still get the incentives and that's why everybody was so happy Elon said all europeans will get their cars in this year as it's not sure what will happen to the program.

Good to be proofen wrong thou :)

Kimscar | May 28, 2013

A very biased article.
1). The tax credit was created to spur the development of electric vehicles. The goverment understood that by providing the tax credit for the first 200,000 cars that would help while a company like Tesla gets the R& D done and can finally design a cheaper version.
2) By those who buy and have bought a Roadster, Model S, and Model X at the high cost,they are paying for the future so that the costs can drop for the general population thus helping all Americans. Elon has stated that his goal is a $30,000 car for the general population in 3 to 4 years. The author ignored that completely.
3) the entrenched car makers would stay with gas until we run out or the planet is damaged beyond repair.

I am pulling for a tesla. I bought stock on opening day and July 2014 I turn 59 1/2 and will get my model S.

Andre-nl | May 28, 2013

BrianMRolfe quoted from the article "The selling of green credits may have helped Tesla succeed, "

That was precisely the objective of the ZEV credits, to spur innovative and clean vehicles. Now the incentive has seemed to WORK, oops, that wasn't part of the plan.

Brian H | May 28, 2013

Elon has stated numerous times that neither in the past or future has the value of the credits been budgeted for or entered into planning decisions. Nor have they been necessary for past or future profitability. And the $7500 credit benefits the buyers, not Tesla except in making a very minor boost in saleability.

DonS | May 28, 2013

The government subsidies are there to try to start weaning the USA off of an oil economy, along with reducing the billions of dollars sent overseas to pay for the oil. Any car company could take advantage of these incentives if they are willing to risk it. Detractors are somehow offended that Tesla took the risk and is actually succeeding!

When oil gets more expensive or there are shortages, the same Tesla haters will rush to be the first to bash the government for not doing more to reduce our oil dependency.

Lush1 | May 28, 2013

I took delivery of my Model S in 2013 so I haven't realized the benefit of my federal tax credit yet. I paid the state of Pennsylvania about $6500 in taxes this year when I registered the car. I sure hope Uncle Sam and The Commonwealth of PA invest the money they hold and the money I paid respectively, perhaps by investing in a savvy, innovative, job creating, American company that is producing a product which is paving the way for oil free transportation, like say, Tesla. Somehow, the $1000 net gain I'll receive, (not adjusted for any interest in either direction), hardly feels like a windfall for me or a burden to taxpayers, myself included. But I do feel bad for companies like poor little Honda. It's a shame they don't have the resources of an entrenched giant like Tesla so they could figure out a way to make cars that earn them carbon credits and not be forced to buy them. The Forbes article is trying to sugar coat the problem so I'll come right out and say it; Tesla and its customers should be damned to eternal hellfire for taking advantage of the legal incentives the liberal government provides.

Model S 60 owner, formerly reservation holder 1712,

P.S. Please don't let me be misunderstood by a language barrier or something. My comments are sarcastic, but seriously, the article is B.S. Will the haters ever stop? They seem stuck and desperate, reaching for new ways to spin and recycle the same old arguments. The guy makes Broder seem rational.

Just my .02 worth