Photo: Collage of Tesla Motors official image and wikimedia photo of Dr. Zetsche
Traditional car manufacturers are living in denial. Until now, their excuse for not including more electric models in their range - or for not prioritizing the development of EVs - was that the public wasn't interested.
Tesla in general and the Model 3 in particular just proved them wrong. It's not that we, the people, don't want electric cars, we just don't want the crappy ones they keep churning out, pricing them accordingly because this is “fringe technology” and you have to pay extra for that. Well, it's only “fringe” for those who are stuck in the past.
The truth is that the big names in the auto industry were caught on the wrong foot. The whole electric vehicle idea broke out and exploded in just a few years. Companies such as Volkswagen, BMW or Mercedes-Benz had a lot of money invested in the development of better diesel engines (ahem! except for Volkswagen), fifty-speed dual-clutch transmissions and downsizing and turbocharging the gasoline engine. They couldn't just give up on all that and start anew with electric motors and battery packs. Such radical decisions are hard to make even for individuals, not to mention multi-national companies.
But sticking to the old principles could cost them dear. Frankly, the saving grace for these dinosaurs right now is that Tesla doesn't have the production capacity to meet its demand. The recently launched Model 3 registered 300,000 reservations in just one week. Needless to say, no other car has ever managed that, and bear in mind that there are still 18 months to go until the first deliveries will be made. It's true that the small deposit sum - and the fact that it's fully refundable - meant that the risk was minimal, but even so - would you bother blocking $1,000 for a downpayment on a car you wouldn't be interested one bit in buying?
But they have to live in denial. At least, that's what they need to show the rest of the world, while in the backstage they should be hard at work catching up with Tesla. What are they doing instead? Releasing an electric car every five years or so, and even those that do come out are questionable at best. You feel like they're there just because it's cool to have an EV in your range, but not because somebody in that company actually believes in those cars. BMW did a bit more with the “i” range than Mercedes-Benz, but even though the i3 is neat and fast, it's got a laughable range.
Mercedes-Benz, on the other hand, only has a refurbished B-Class and the small smart fortwo electric drive. They've got plans to bring the total number of plug-in hybrids in their range to 10 by 2017, but even though this should be obvious to anybody, we're gonna say it once again: hybrids are not electric cars. But wait, according to Daimler CEO Dr. Dieter Zetsche, there is an EV planned as well and it'll have an approximately 300 mile range (about 500 kilometers). The only downside is that at least three years will pass until its launch. And it will probably cost a kidney and an ounce of liver. Not to mention that by that time, Tesla will have sorted out its production issues and it would be selling the Model 3s and Ys like crazy.
These were the three main problems raised by the Daimler shareholders at a meeting held on Wednesday in Berlin, as reported by the Financial Times:
[A shareholder] warned the automobile industry faced “a radical upheaval, driven by attacks from Silicon Valley.” Among other products, Alphabet is developing a self-driving car.
Another Daimler shareholder complained to management: “We don’t really have a product for this competition from Tesla. In the long term we have some great vehicles … but they are virtual at this point.”
A third shareholder said there was no adequate European competitor to Tesla’s latest model. He asked management: “What is the reason for that?”
Whether legacy car manufacturers wake up and realize their world is changing - they are “under attack,” as the first shareholder so very well noted - because the things that used to be important in a car - the ones they excel at - are being substituted for stuff outside their traditional field of expertise, can make the difference between survival and extinction. They are the dinosaurs, and companies such as Tesla are the small mammals that, deprived of competition, will grow and one day rule the Earth.
The truth is that the big names in the auto industry were caught on the wrong foot. The whole electric vehicle idea broke out and exploded in just a few years. Companies such as Volkswagen, BMW or Mercedes-Benz had a lot of money invested in the development of better diesel engines (ahem! except for Volkswagen), fifty-speed dual-clutch transmissions and downsizing and turbocharging the gasoline engine. They couldn't just give up on all that and start anew with electric motors and battery packs. Such radical decisions are hard to make even for individuals, not to mention multi-national companies.
But sticking to the old principles could cost them dear. Frankly, the saving grace for these dinosaurs right now is that Tesla doesn't have the production capacity to meet its demand. The recently launched Model 3 registered 300,000 reservations in just one week. Needless to say, no other car has ever managed that, and bear in mind that there are still 18 months to go until the first deliveries will be made. It's true that the small deposit sum - and the fact that it's fully refundable - meant that the risk was minimal, but even so - would you bother blocking $1,000 for a downpayment on a car you wouldn't be interested one bit in buying?
But they have to live in denial. At least, that's what they need to show the rest of the world, while in the backstage they should be hard at work catching up with Tesla. What are they doing instead? Releasing an electric car every five years or so, and even those that do come out are questionable at best. You feel like they're there just because it's cool to have an EV in your range, but not because somebody in that company actually believes in those cars. BMW did a bit more with the “i” range than Mercedes-Benz, but even though the i3 is neat and fast, it's got a laughable range.
Mercedes-Benz, on the other hand, only has a refurbished B-Class and the small smart fortwo electric drive. They've got plans to bring the total number of plug-in hybrids in their range to 10 by 2017, but even though this should be obvious to anybody, we're gonna say it once again: hybrids are not electric cars. But wait, according to Daimler CEO Dr. Dieter Zetsche, there is an EV planned as well and it'll have an approximately 300 mile range (about 500 kilometers). The only downside is that at least three years will pass until its launch. And it will probably cost a kidney and an ounce of liver. Not to mention that by that time, Tesla will have sorted out its production issues and it would be selling the Model 3s and Ys like crazy.
These were the three main problems raised by the Daimler shareholders at a meeting held on Wednesday in Berlin, as reported by the Financial Times:
[A shareholder] warned the automobile industry faced “a radical upheaval, driven by attacks from Silicon Valley.” Among other products, Alphabet is developing a self-driving car.
Another Daimler shareholder complained to management: “We don’t really have a product for this competition from Tesla. In the long term we have some great vehicles … but they are virtual at this point.”
A third shareholder said there was no adequate European competitor to Tesla’s latest model. He asked management: “What is the reason for that?”
Whether legacy car manufacturers wake up and realize their world is changing - they are “under attack,” as the first shareholder so very well noted - because the things that used to be important in a car - the ones they excel at - are being substituted for stuff outside their traditional field of expertise, can make the difference between survival and extinction. They are the dinosaurs, and companies such as Tesla are the small mammals that, deprived of competition, will grow and one day rule the Earth.
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