Happy Tuesday from, matt fans. I hope everyone had a wonderful weekend. I’m Andrew, and I’ve taken over from, matt for the day. So here we go. Welcome to the inaugural edition of: from, anj.
Let’s start with a quick story
I’m in the market for a new car.
The car I’ve REALLY wanted for the last year and a half is the Toyota RAV4 Prime: a plug in hybrid SUV that has an all-electric range of ~40 miles. So your short trips can be fully electric and on your longer trips you can use your gas tank and rest assured you won’t be stranded without a source of power.
So last weekend, I talked to a salesman at a Toyota dealership. He let me know that Toyota dealerships nationwide are only getting 1 or 2 of these RAV4 Primes per year.
Well, that sucks doesn’t it?
Why even offer a vehicle if production of it is so limited? Doesn’t make sense.
Anyway, instead of trying to sell me on another Toyota model (almost all of which are backed up by production issues along with a 6 month or longer waitlist), the salesman proceeded to give me some very unexpected and candid advice.
What he said was this: “I drive a Tesla. There’s about 5 of us at this Toyota dealership that drive Teslas. I won’t ever drive another car again. The one word I use to describe them is ‘magic’”. And so I began my journey down the rabbit hole of Tesla, EVs, and the state of the automotive market today.
Transition to informative article time.
The automotive market is being shaken up
It feels like just a few years ago that seeing a Tesla on the road would make you turn your head and point it out to others. Thanks to scaled manufacturing, improved driving range and charging infrastructure, and more affordable options, Teslas have gone from a rarity to a common sight on the roads.
And just a few weeks ago, Tesla slashed prices by almost 20% on their more affordable vehicles: the Model 3 (sedan) and Model Y (SUV). Along with that price drop, there is a federal EV tax credit worth up to $7500 that consumers can take advantage of for instant savings.
You literally get a check in the mail for $7500 a month or two after your purchase.
The increased adoption of EVs over the last decade has invited lots of competition to the market. Major automakers such as Ford, Chevy, Hyundai, and more have made the commitment to focus on EVs in the future. Because of the increased competition, there are now more and more EV options in the market appealing to different consumers’ tastes and budgets.
EVs are no longer focused just on the luxury segment, they’re now trending towards the economy segment too.
The competition in the EV space is making for a great story of innovation in such a short amount of time. We are on the frontier of the new wave of how the world will drive. Tesla has started the wave and continues to dominate it, but only time will tell if they will come out on top as the EV standard.
The buying experience
Aside from starting the EV wave, Tesla has also completely changed the car buying experience. Buying a Tesla is literally as simple as buying something on Amazon. Pick your model, pick your color, pick between a few additional features, and hit check out.
The checkout page gives you an expected delivery date and all you have to do is put down a $250 deposit on the checkout page – which you can do with Apple Pay. It’s literally that simple. And in a month or two someone just drives a new Tesla that you ordered to your door.
With most automakers, there is the base model, then any number of additional trims with any number of additional optional specs that can be added: interior features, infotainment system, premium speakers, sun roof, floor mats, blah, blah, blah. This can make it so confusing and difficult to get what you actually want. And it can also get SUPER expensive relative to the base price of the vehicle you were actually looking to purchase.
For instance, a base model 2023 Toyota Corolla starts at $21,550. With additional trims and premium features, the same Corolla can cost as much as $34,000.
Couple the million different options with a backlog of consumers all on waitlists to buy the same car and you have a disaster of a buying experience. And that is what’s happening at most car dealerships, no matter the manufacturer (except for Tesla).
And what makes the Tesla buying experience even better and more unique is that you don’t have to deal with pushy salespeople.
Tesla does not have any dealerships. The whole buying experience is direct to consumer. There are Tesla showrooms and service centers all around the country where you can go for more info and test drives on your prospective car. But the folks there are not even working on commissions – so they are’t pushing you to buy.
And additionally, there is no negotiation involved. The price you see is the price you get. No additional random additional fees or optional warranties are added to your purchase like they would be at a dealership.
The rest of the automotive industry has not reacted to Tesla’s simple buying experience yet. But I think that can change in the future. The ease with which you can buy a Tesla has got to be a a factor that’s driving their exponential growth. And other car manufacturers that use the dealership model of delivery will need to eventually react to stay afloat.
Speaking of buying cars, everyone knows that dropping something between the seat and the console sucks, especially if that something happens to be a french fries and you have a new car. The solution? Drop Stop . I’m sure you’ve all seen them on Shark Tank, but the Drop Stop truly is the only solution to dropping things between the seats, and the distracted driving that comes with it. No need to worry about cleaning under the seats ever again. Stop the drop with Drop Stop #ad
Alright man, wrap it up
So that’s my spiel on the state of the automotive industry today.
After long consideration (drum roll please), I’ve decided I will not be buying a car anytime soon.
The price of an EV is already almost equal to the price of a plug-in hybrid and is getting even closer to the price of a hybrid and a regular internal combustion engine (ICE) vehicle. I’m holding out for the next 2-3 years and waiting patiently for the EV auto market to continue to offer more exciting and affordable options to consumers.
And until then, I will continue to drive my 2007 Toyota Prius with a broken muffler that makes it sound like a NASCAR.
Oh, and I almost forget, while I’m just plain ole’ Anj to you guys, I’m Chuck Biagi to the rest of the world. Follow me on twitter @chuck_biagi. I’m active in the tech community there and will be sharing more info soon.