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Model 3 is Out! What Does Bob Lutz Think of the Doomed Tesla Company Now?

Model 3 is Out! What Does Bob Lutz Think of the Doomed Tesla Company Now?

Nearly four months ago, Bob Lutz had this to say about Tesla (see link below). What sayeth ye now, after the release of Model 3 on-time?!? Please enlighten the masses, Bob. Eagerly awaiting his guest appearance on the news surely this week. The "snake oil salesman" is hailing the snake.

Bob Lutz four months ago:

https://m.youtube.com/watch?v=ie0XiOzs5Qc

PhillyGal | 31 juillet 2017

Sounds like Bob Lolz to me...

Okay, that was corny. But I love to see companies that refuse to adapt (or worse, fake adapt) eat a little crow.

lilbean | 31 juillet 2017

Reminds me of my mother's doctor who told her she had a year to live. That was twenty-five years ago. She's still alive and he died twenty years ago.

cessna182 | 31 juillet 2017

Bob's a little long in the tooth. He worked for a company formed in the early 1900's that went bankrupt in the early 2000's. He probably thinks the earth is flat, so why give him credibility?

cessna182 | 31 juillet 2017

Bob's a little long in the tooth. He worked for a company formed in the early 1900's that went bankrupt in the early 2000's. He probably thinks the earth is flat, so why give him credibility?

TeslaTap.com | 31 juillet 2017

I doubt they plan to eat crow - I expect them to just die. When they (other car manufacturers) are so far removed from reality, failure is expected. I'm sure a few smart ones will figure it out, but most seem to hope Tesla/EVs will go away and expect to just continue producing the same old gas guzzler pollution machines.

carlk | 31 juillet 2017

Bob Lutz is not even qualified to design the door pull for Model 3.

Tropopause | 31 juillet 2017

lilbean,

What a twist of fates! Very happy for your mom!

Model 3 was the culmination of Elon's Master Plan 1. Model 3 is just the beginning of Master Plan, Part Deux. I'd venture to say, Tesla is here to stay and growing quickly.

Coastal Cruiser. | 31 juillet 2017

Thanx for posting. There seem to be a few sides to Bob Lutz. He was the reported force that dragged GM -kicking and screaming- back into the electric car market. But he doesn't like Tesla's business model.

For some reason he thinks that Tesla is not making money on each car it sells. That's why he is chastising them. And he doesn't believe there is economies of scale at the gigafactory. A seemingly mistaken view. Not sure what Kool-aid he was drinking the day he did that CNBC interview. I'd like to think that he is enough his own man not to be outright shilling at this point....

lilbean | 31 juillet 2017

Thanks, Tropopause! You are right. Tesla is here to stay and growing quickly. I cannot think of any other car make that has the happiest owners. That Tesla grin is phenomenal!

Coastal Cruiser. | 31 juillet 2017

"I doubt they plan to eat crow - I expect them to just die. When they (other car manufacturers)..."

"Do you expect me to reform?"
"No Mr. (other car manufacturers). I expect you to die."

carlk | 31 juillet 2017

Those people are either lying or they are so dumb when they keep saying Tesla loses money on each car it sells. Chanos is the other one. I don't think they are so dumb they must be lying just to cover their asses.

hoffmannjames | 31 juillet 2017

Honestly, I don't expect the traditional auto makers to adapt quick enough. Heck, Chevy saw the Model S and saw the Model 3 reveal and they still put out the Bolt. I think they are stuck in the mindset that EVs cannot replace gas cars but are only good as a niche car for environmentally friendly people who want a small city car. The most innovation that Chevy could muster with the Bolt was to take their existing small city car and give it more range. Meanwhile, Tesla produces a 310 mile range car that drives great, has a classy interior and revolutionizes the tech inside.

Tropopause | 31 juillet 2017

"Meanwhile, Tesla produces a 310 mile range car that drives great, has a classy interior and revolutionizes the tech inside."

And don't forget has Supercharging throughout USA, Europe, Asia, and elsewhere!

jordanrichard | 31 juillet 2017

If he does comment about the 3, he will no doubt focus on Tesla's ability to make as many of them as they hope. He will also undoubtedly comment about the price point of the first delivered cars.

hoffmannjames | 31 juillet 2017

@Tropopause yes, and autopilot too.

hoffmannjames | 31 juillet 2017

jordanrichard | July 31, 2017
If he does comment about the 3, he will no doubt focus on Tesla's ability to make as many of them as they hope. He will also undoubtedly comment about the price point of the first delivered cars.

----

I am sure of that. He will move the goal posts again. He'll say that the Model 3 is "nice" but Tesla will never be able to build them in large enough quantities to meet demand, unlike the established auto makers of course which can produce cars in large quantities. Thus, he'll argue that the Model 3 is irrelevant because it will never actually be sold in large enough quantities to threaten them. Of course, by the time, the Model 3 does sell enough, it will be too late for them.

Honestly, I think the traditional auto makers have had a monopoly on the auto industry for so long that they simply cannot imagine that anyone could realistically compete with them. In their minds, they are it, they are the companies that make all the cars that people want. They are their own little elite club that no one else is allowed to join. The idea that some start up could dethrone them is unthinkable.

The only auto makers that seem to be showing signs of adapting quick enough are the European companies which are shifting to EVs.

JAD | 31 juillet 2017

The old school manufacturers seem to be having major internal fighting. The Chevy Bolt is actually a pretty decent car, BUT and this is a big BUT, neither Chevy or the dealers want it to sell well, and they are creating a self fulfilling prophecy.

My friend just bought a Bolt, the dealer spent two detailing it while they did the paperwork, but didn't charge it, so it had about 20 miles of charge. Car also comes with no adapters, so they couldn't charge it at home other than at 110v. Being new to EV's, they made some mistakes, but ended up on a flatbed with no charge the next day. Dealer was unwilling to help and they had quite a bad experience. If ALL GM dealers installed 3-4 high speed chargers, it would be a pretty reasonable charging network, but they won't do that.

It is no model 3, but with just a little cooperation and planning, provide charging adapters, install chargers at dealers, deliver the cars charged, the Bolt could be a really good first attempt. Without the changes, it is doomed to fail and prove the ICE contingency within GM were right and they shouldn't build EV's

PhillyGal | 31 juillet 2017

Switching to "electrified" - meaning expect to see lots of PHEVs. Not a knock on PHEV, but it's not a full commitment from the automakers either.

PhillyGal | 31 juillet 2017

@JAD - I was surprised to see a billboard in a majorly congested area where I live (I-95, just north of downtown) saying to Bolt down to Barlow Chevrolet (somewhere in Jersey) where they had the largest area inventory of Bolts.

Shock | 31 juillet 2017

"Reminds me of my mother's doctor who told her she had a year to live. That was twenty-five years ago. She's still alive and he died twenty years ago."

LOL

To be fair Lutz hasn't yet been proven wrong. He thinks the company doesn't have a long term effective business model and at some point a company does need to make money, and consistently.

Twice I saw comments from him and the other guy, though about offsets. That is telling: they don't see EV as legitimate cars. They only see them as ways to get around bothersome federal regulations. Given this mindset it's not surprising their cars are particularly expensive for what they are, and they don't much care to make them profitable. If you're only creating a product because you need X amount of that product before you can see the real product you actually care about, Y, X is going to suffer.

hoffmannjames | 31 juillet 2017

JAD | July 31, 2017
The old school manufacturers seem to be having major internal fighting. The Chevy Bolt is actually a pretty decent car, BUT and this is a big BUT, neither Chevy or the dealers want it to sell well, and they are creating a self fulfilling prophecy.

----------

Great point. But the question becomes why does GM not want to sell the Bolt? I think it is because they don't believe that EVs are the future. They merely build EVs to meet CAFE standards and fill a niche. But gas cars are their bread and butter. So they don't have any real incentive to push EVs. But you are right that it is a self-fulfilling prophecy.

Bluesday Afternoon | 31 juillet 2017

One of the bigger prizes Tesla still seeks is competing with Ford's F-150. Ford is already developing an electric F-150. The question is will Ford release it in mass before Tesla starts taking reservations?

https://electrek.co/2017/05/17/ford-all-electric-f-150-pickup/

hoffmannjames | 31 juillet 2017

Shock | July 31, 2017
"To be fair Lutz hasn't yet been proven wrong. He thinks the company doesn't have a long term effective business model and at some point a company does need to make money, and consistently."

Bob's comment still puzzles me. Sure, if Tesla is unable to mass produce the Model 3 in a timely manner, they could lose so much money that they risk going under. But Musk's overall business model seems sound to me: raise capital, build the expensive Model S and X in small quantities enough to fund the next step, use the money to mass produce the Model 3 in large enough quantities that you make a profit and become self-sustaining. The model makes sense. Of course, like with any business, the key is in the execution of the plan. But so far, it has worked

Bluesday Afternoon | 31 juillet 2017

@hoffmannjames

I don't see Tesla making a profit, sustained or otherwise, for years. With their building plans (3-5 more gigafactories plus) and future products they leave little time to take a break to have a profit. How long Tesla can maintain this break neck speed is a major question. The current company stock price is betting on a long run but world events and a changing economy can quickly lay waste to those plans. We'll see.

hoffmannjames | 31 juillet 2017

But as Model 3 sales ramp up, that will bring in extra profit to sustain the growth. At least, that's the plan.

Tropopause | 31 juillet 2017

Simply Red,

Maybe Ford is preparing an F-150 BEV just in case Tesla makes it that far in Elon's Master Plan. If so, Ford will have some ability to protect their bread-n-butter F150; in not, Ford will never need to produce the BEV F150.

Tropopause | 31 juillet 2017

"But as Model 3 sales ramp up, that will bring in extra profit to sustain the growth. At least, that's the plan."

Yes! I also believe this is why Tesla chose the first production Model 3 to be $49,000; to recoup some cash before moving into the other variants of Model 3. Nothing wrong with that! The $35,000 Model 3 will begin production in October so waiting two months is fair in my eyes.

jordanrichard | 31 juillet 2017

I am surprised by people's puzzlement about why GM or any other company doesn't make an EV and the associated experience better.

FOLLOW THE MONEY. GM's customers are the dealers. Dealers will sell anything GM produces, as long as they can make money on it. Where dealers make a vast majority of their money from is parts and service. EVs require next to nothing in way of routine service. So, dealers (GM's customers) have no interest in buying them to resell.

PhillyGal | 31 juillet 2017

@jordanrichard - great reminder that drivers are not GM's customers, dealers are!

hoffmannjames | 31 juillet 2017

@jordanrichard very insightful. It might also explain why auto makers appear to be so afraid of change, basically pumping out the same cars every year. Consumers tend to very conservative in terms of the type of car that they want so dealerships want to play it safe and keep doing what has proven to make them money. Cars that are too radical run the risk of not selling.

ReD eXiLe ms us | 31 juillet 2017

Coastal_Cruiser: For some reason, whenever I think of that exchange, I always have a flash of 'Dr. No' even though it was from 'Goldfinger'. If I ever build a James Bond Evil Bad Guy Pad, I'll make sure not to put explosives in all the walls and floors though... It is in some ways even worse than how every starship bridge on Star Trek has explosives in all the consoles. You'd think someone would notice that as a design flaw and stuff.

hoffmannjames: Yes. Indications of 'moving the goalposts' are already readily apparent with the Model S. It has been shown to outsell each of its direct competitors individually, but some claim they are not impressed because Model S does not outsell them... collectively. The Mercedes-Benz S-Class was the perennial leader among flagship vehicles for some time, but I doubt anyone ever expected it to outsell all comers combined.

Why should the Model S be so burdened? Just so someone can point out that more ICE vehicles are sold than fully electric? That is a definite red herring. And I expect the same one to be trotted out against Model 3, as someone notices that "Sure the Model 3 sells the most units, but the market is obviously larger for ICE at that price range..."

Such statements will be true, until they aren't, and then the goalposts will be moved again. Probably to the, "Well, sedans are just not as popular as SUVs these days, and ICE sales of passenger cars and SUVs still dwarf those from Tesla in class..." or whatever. Like, how some here have pointed out the outstanding sales of the BMW Group in the U.S., while ignoring the falling sales of 3-Series and 4-Series over the past two years. So far this year, BMW has shown improved sales for X1, X3, and X5 SUVs, but only the i3 and Z4 have improved numbers YTD among their passenger cars. 3-Series is at -13.7% compared to 2016.

JAD: As far as I can tell, the 'independent franchised dealerships' are absolutely not in favor of cooperation with traditional automobile manufacturers. They have a confrontational relationship that does not foster trust. Very similar to what happens in 'negotiations' between automakers and the UAW.

Shock: Yes. To the traditional automobile manufacturers, electric vehicles, high fuel economy vehicles, 'clean' vehicles of any sort, are and have been stated to be 'too expensive' to build or buy for decades. Self-fulfilling prophecies allow them to continue that narrative. They consider them to be an unecessary 'burden' or 'distraction' from their primary business model. Which they see as building what their Customers 'really want' -- gas guzzling trucks and SUVs.

Simply Red: Until the overwhelming response to the Model ☰ Unveil, I figure Tesla intended to take their foot off the accelerator and just cruise to 2020 or so... Since then, they've realized the course is clear before them. So they can 'floor it' through 2025 at this point, without 'letting up' at all. Not just to stay ahead of potential competitors, or expand their manufacturing capacity, but to literally accelerate the transition to renewable energy in transportation. That is much more important to me than becoming a company with a mountain of cash they don't know what to do with... If someone were to give Tesla $50,000,000,000 in cash, they would find a way to spend it.

dd.micsol | 31 juillet 2017

GS announced they are short 14 million shares at 260. They will need to pay 840 million tomorrow night.

Sleepydoc1 | 31 juillet 2017

If his competitor truly lost significant money on every car it sold, why not encourage more sales to accelerate the demise?

hoffmannjames | 31 juillet 2017

In any case, I doubt Elon Musk cares about what Bob Lutz thinks. He is too busy pushing ahead! :)

joemar10 | 31 juillet 2017

Regretfully, we are a disposable society. Traditional car manufacturers and dealerships love selling the same people the same car, with a few upgrades, for increasingly more money, every four or five years.

Earl and Nagin ... | 31 juillet 2017

I'm going to come to Lutz's partial defense. In the early 2000's he was busy crushing EV1s and I sent him an email asking how a good Marine could crush a car that could allow America to be strong and independent from oil.
A few years later, he's driving the development of the Chevy Volt inside GM.
He was then fired by the establishment for this politically incorrect move.
He then went out and tried to help Via motors get into the EV truck market - one he understands well. He was using GM donors - still even loyal to GM and trying to show them the way.
I can understand why he might be confused. Sure, he has spouted his mouth off a few times about the wrong things but his actions since the early 2000's actually haven't actually been too bad.

JayInJapan | 31 juillet 2017

If Bob Lutz were good good at what he does, he would have had a steady job all these years and products to show for it. Instead, he's reduced to playing armchair quarterback, commenting, mostly incorrectly, about others' work. Fail...

Coastal Cruiser. | 31 juillet 2017

jordanrichard: "FOLLOW THE MONEY. GM's customers are the dealers. Dealers will sell anything GM produces, as long as they can make money on it. Where dealers make a vast majority of their money from is parts and service. EVs require next to nothing in way of routine service. So, dealers (GM's customers) have no interest in buying them to resell."

Indeed. When I researched the piece I published on the Bolt one of the dealers I interviewed (Paso Robles Chevy) was selling the Bolt... to people who wanted to order one... but was not inventorying a demo model. Instead they had spent about the same amount of money on specialized TOOLS to repair the Bolt (35K). It included special machines to service the AC, and so and and so forth.

Coastal Cruiser. | 1 août 2017

Oh. Red, your response. LOL.

(and I'm glad you mentioned the Goldfinger reference. Wasn't sure if it had come through).

One way to always associate the line to the movie Goldfinger is to watch a lot of episodes of Jay Leno's Garage... because Jay uses any excuse to break out his "Good day Mr. Bond" line. It's a different line, but it's said in the same menacing Goldfinger voice. ha ha.

Good day Mr. eXiLe

Nexxus | 1 août 2017

@Coastal Cruiser,

Nice 007 reference above. I was thinking the same thing when TT made that statement.

Bond: You expect me to talk Goldfinger?

Goldfinger: No. I expect you to die, Mr Bond.

Nexxus | 1 août 2017

I see ReD beat me to it.....darn.

Ross1 | 1 août 2017

GM actually make a pretty good product in the Volt, according to what I read. Why do you all knock it?

Elon probably cares more about what Mary Barra thinks (GM CEO), as he needs a good CEO.

OK, I forgot, I am not going to post any more :)

ReD eXiLe ms us | 23 août 2017

Ross1: I knock the VOLT because...

1) I believe GM recycled a tag line from an old PRIUS advertisement "An Electric Car That Runs on Gasoline" -- and it was just as inaccurate for the VOLT...

2) Yeah, I still am rather PEEVED that GM refused to SELL the EV1 at all, even though they provided a ~$35,000 price point for insurance purposes, then went on to recall them ALL from leases, then crushed and shredded them...

3) I am utterly perplexed that GM could have made the VOLT an obvious direct competitor to the PRIUS and sold similar quantities of the vehicle, but instead of releasing it WIDE throughout the U.S. from the outset, they initially concentrated on only CARB States so that they could rack up the ZEV Credits, which they used in turn to artificially lower their Corporate Average Fuel Economy (CAFE) numbers, so they could sell more gas guzzling SUVs and Pickup Trucks instead of actually improving the fuel economy of their fleet as a whole while making the VOLT the industry success it deserved to be...

4) The Second Generation VOLT arrived with some improvements, such as finally allowing barely enough room for five occupants instead of the prior 2+2 arrangement... But still refused to go after the now uglier-than-ever-before PRIUS in terms of overall range and observable fuel economy... Instead, they installed an EVEN SMALLER fuel tank in the car and didn't improve the fully electric range enough to even match the Ford Focus Electric... Worst of all the VOLT had an overall range that was lower than both the CRUZE and MALIBU...

5) Even with an 'electrified' power train, GM made sure that wimpified performance was in place to prevent the VOLT from becoming particularly popular with anyone other than commuters who wanted to 'save money on gas'... Thereby insuring the VOLT did not come close to challenging even the PRIUS in sales, let alone the CRUZE and MALIBU...

I'm sure there are other reasons, but that'll do for now.

carlk | 23 août 2017

Just count number of commercials you can figure out what vehicles GM is interested in selling. Pickups and SUVs.

Coastal Cruiser. | 23 août 2017

Nexxus "Nice 007 reference above. I was thinking the same thing when TT made that statement."

Great minds think alike. But, like Dr. Strangelove in the wheelchair when he couldn't control his arm, I cannot resist correcting the below quote. I'm fiiiiiiiggghhtting theee uuuurge, but it's too strongggg...

Bond: You expect me to talk Goldfinger?
Goldfinger: No. I expect you to die, Mr Bond.

I think if you check, Goldfinger's retort is "No Mr Bond. I expect you to die". The 'cadence' is completely different, eh?

youtube com/watch?v=U1TmeBd9338

TeslaTap.com | 23 août 2017

Not to derail shift gears, but the last couple of Jay Leno's Garage episodes, you can catch Jay's blue Tesla in the background in a number of shots. It is parked close to the garage door opening. Makes me smile every time I see it :)

Tropopause | 23 août 2017

TeslaTap,

I agree. Jay seems to be very proud of his Tesla.

Tropopause | 23 août 2017

Here's Jay addressing why he felt like an "idiot buying his Tesla."

https://www.youtube.com/watch?v=pNcCvmHtUnU

noleaf4me | 23 août 2017

Maybe Tesla will eventually buy-out GM for their manufacturing footprint so they can build their millions of EVs per year in a few years.

jordanrichard | 23 août 2017

Ross1, who is knocking the Volt? We are knocking GM.

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