Lately I’ve been thinking that the Koch brothers ought to come out big for wind and solar power, just to watch lefty heads explode. Better still, they could take a substantial position in publicly-traded Tesla, though the stock is likely overvalued (down over 10 percent in recent weeks I think). Still, it would almost be worth it for the heartburn it would cause the anointed. (For one thing, we could float the rumor that the Koch move is just step one in a conspiracy to kill off electric cars. Begin mustache twirling in three, two . . .)
I think Tesla’s technology is cool, and hope they make it. To make electric cars truly competitive requires a Henry Ford-level breakthrough akin to how the assembly line cut the cost of Model Ts by 40 percent. At the moment electric cars are still a boutique product mostly for the very rich. And just where do the electrons come from for its batteries? If you drive a Tesla in Ohio, Indiana, etc., you’re driving a coal-powered car. Heh.
But above all, Tesla requires huge subsidies to make it work at all. From today’s Wall Street Journal:
New registrations of company’s vehicles dropped to zero from 2,939
By Tim Higgins and Charles Rollet
Tesla Inc.’s sales in Hong Kong came to a standstill after authorities slashed a tax break for electric vehicles on April 1, demonstrating how sensitive the company’s performance can be to government incentive programs.
Not a single newly purchased Tesla model was registered in Hong Kong in April, according to official data from the city’s Transportation Department analyzed by The Wall Street Journal.
Nor is this unique:
Drop in sales suggests market isn’t yet competitive
By Peter Levring
The electric car has dropped out of favor in the country that pioneered renewable energy.
Sales in Denmark of Electrically Chargeable Vehicles (ECV), which include plug-in hybrids, plunged 60.5 percent in the first quarter of the year, compared with the first three months of 2016, according to latest data from the European Automobile Manufacturers Association (ACEA). That contrasts with an increase of nearly 80 percent in neighboring Sweden and an average rise of 30 percent in the European Union.
Of course, those other countries still have huge subsidies and tax breaks in place for electric cars.
In the fall of 2015, the Liberal-led government of Prime Minister Lars Lokke Rasmussen announced the progressive phasing out of tax breaks on electric cars, citing budget constraints and the desire to level the playing field.
Tesla, whose sales were skyrocketing at the time, lobbied against the move, with Chief Executive Officer Elon Musk warning during a visit to Copenhagen that sales would be hit.
The new tax regime “completely killed the market,” Laerke Flader, head of the Danish Electric Car Alliance, said in a recent interview. “Price really matters.”
Price matters! Who knew? And pro tip: If sales depend on subsidies, it isn’t a “market.”