Never Stop Driving #96: Politics Is Everything
The Elon Musk Show is the gift that keeps on giving for pundits, including yours truly. This week, The Wall Street Journal posited that Musk’s political opinions are turning off Democrat buyers—one reason the company’s sales declined in the first quarter of this year.
Ahh. So now we buy cars based on political beliefs? That sounds nutty, but there’s some truth to it. Over my three decades testing new cars I came up with my own list of buyer priorities to help me predict a car’s sales success. Mind you, my formula is far from scientific; rather, it’s based on observations collected over a career rubbing shoulders with engineers, designers, product planners, and analysts across the global automotive industry.
I believe that the number one aspect, for most car buyers and not us nut job enthusiasts, is a car’s design. Then comes the infotainment system—particularly the ease of pairing cell phones—and then the brand and what it represents. Some will quibble that I’m missing rational considerations like number of seats, price, fuel economy, etcetera, and you’d be right. Hang with me though.
Our cars are like clothes: They say something about us, especially for those lucky enough to be able to afford more than a basic tool to get to work. The first mass-selling Toyota Prius, the egg-looking thing from the aughts, outsold every other hybrid largely because its distinctive (if unattractive) shape sent a clear message about the owner. The same goes for Subarus—I don’t know what the brand’s message is, exactly, but it sells a lot of cars.
We consumers are all susceptible to this image shaping, me included. I searched for and paid a premium for a silver 1990 Miata because I didn’t want to be the fifty-something dude pining for attention with a red sports car. Silly, right? Of course, if a car is junk, the right design won’t save it. People are rational but not perfectly so, which is what gave rise to behavioral economics. Humans are complicated.
Now back to Musk. Tesla cars hit three powerful points: They send the desired message, they’re generally good cars, and for a while they had the coveted shiny penny aspect. We love the new and the novel.
Musk may be turning off buyers with the provocative and controversial statements he makes on X (formerly known as Twitter) and in interviews, but the Tesla model lineup is also getting a little stale. The biggest sellers, the Model 3 and the Model Y, debuted in 2016 and 2019, respectively. Some car models, like the Toyota 4Runner, survive for years with minimal changes, but most require significant upgrades after the fourth or fifth year. Tesla is also facing more competition than it did three years ago, even while demand for EVs is cooling. And the company relinquished a competitive advantage when it recently began allowing EVs from other automakers to use Tesla’s proprietary charging network.
Musk’s politics surely have an effect, but I think those more conventional factors play a larger role. So, what’s his response? You should read the transcript of the Tesla earnings call from earlier this week. Musk and Tesla executives said that the company is accelerating the rollout of new models, including cheaper cars. They’ll arrive in about a year. The cars, Musk stressed, are the sideshow. “The way to think of Tesla,” he said, “is almost entirely in terms of solving autonomy…”
Musk said that AI engines are quickly learning from the Teslas already on our roads and operating with existing driver-aid systems. He mentioned the advantage Tesla had in its development of AI because the constraints of on-car computing meant that the Tesla software is uncommonly efficient. The company plans to show a robotaxi on August 8. Musk says that Tesla will operate a fleet of taxis and Tesla owners will be able to rent out their cars like many do with their homes on Airbnb. We’ve heard this before, and the promised delivery dates have come and gone. The difference—as it seems to this computer idiot—lies in how quickly the AI systems are learning and evolving the autonomous systems.
I’m in no position to judge the veracity of Musk’s claims. I think we’re all now used to technology hucksterism, a promised future state that’s good for the stock price but ultimately never arrives. Remember when they said the internet would allow people to share information and make us all closer? Right. Perhaps autonomy is a convenient redirect away from the aging hardware. That said, the Model 3, which has been thoughtfully updated, is now available with a $299 per month lease. While the car’s price cuts over time have certainly penalized the resale price of existing Model 3s, likely angering many existing owners and turning them off from buying another, the current Model 3 is a solid deal.
With Musk, we could be witnessing what’s often called the “Founders Curse,” where the vision and energy needed to launch a new company are not what’s needed to ensure its continued prosperity. There are ample examples to study including General Motors, which took off thanks to William Durant but then later thrived after his ouster. The New York Times recently ran this terrific summary. Food for thought.
Whatever you think of Musk, at least he’s not boring. He also sounded very excited about the humanoid robot, called Optimus, which the company plans to sell in the next 12 months. After reading the transcript my first thought was, “Maybe we should slow down a little here.” I do, however, have enormous respect for what Musk has accomplished. He is undeniably a brilliant guy.
The auto industry is never dull. Before I wish you a fantastic weekend, I highly encourage you to watch Jason Cammisa’s brilliant history of Bugatti’s short-lived return, back in the 1990s, with the EB110 supercar. This weekend, I’ll be at the Air|Water show in Los Angeles to commentate during the Broad Arrow Porsche auction. We’re broadcasting the action live on the Hagerty Samsung TV Plus network, channel 1194. If you don’t have a Samsung TV, you can watch for free here. And if you’d like to support all the free automotive content Hagerty provides, please join the Hagerty Drivers Club.
Get out and drive this weekend!
Larry
P.S.: Your feedback is very welcome. Comment below!
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Is Wussy a Chinese EV manufacturer? Never heard of them…..
I generally don’t pay too much attention to politics, but in this case I make an exception. Musk is a right wing nutjob, and the lies that he spreads on his social network actually cost people lives, not to mention help create larger and larger divisions. He single handedly, when he turned off spaceX internet service in parts of Ukraine, foiled Ukrainian attack plans, gave the Russians an edge and as a result got many Ukrainians killed. That’s not ok, and I can never be associated with Tesla, or any other company he’s running. I would wager a lot of lost sales are a direct result of him being a giant pile of rotting sheit. He already lost 2 within my household, and probably many more since I, and many moderates like me, steer thousands of people away from “his” cars.
‘I generally don’t pay too much attention to politics, but in this case I make an exception. Musk is a right wing nutjob…’
Perfectly stated.
Agreed, Musk is a brilliant humanoid-like unit; but Musk’s claim that he and his team are “solving” autonomy is like mathematicians saying they are solving Riemann Hypothesis. They may be working on it, but it will likely be decades – if ever – for a solution to be found.
Maybe the decrease in Tesla sales is just part of the overall downturn in EV sales as early adopters already have theirs and many other people realize EVs aren’t everything the propagandists claimed. And maybe since Tesla was the most high flying of those in the EV space they had farther to fall when people finally realize that the EV emperors have no clothes.
Remember they love you until they don’t…..I remember when Musk was the next Howard Hughes mixed with Tony Stark, a rock star that could do nothing wrong, if one of his cars caught fire, the press would congratulate Musk for providing his customers with warmth. If only St. Elon was in charge of everything we would be hyperlooping to Mars for a weekend get way and back on earth on Monday…..and they turned on him, he thought “why is certain speech being censored for political reasons on a platform that is supposed to promote the free ideas and thought” and that was it.
I’ve always thought of him as being part brilliant and part scam artists, for years he was allowed to get away with defects and issues that a company like GM for example would have been raked over the coals for. He engineers by press release and hyperbole. He runs his company like a 13 year old, just goofy stuff…..the model names spell out “sexy”, the Plaid models, because I know what my car needs are references to a 1987 Mel Brooks Star Wars spoof, that awful awful awful truck, etc etc.
The other part of it is that Teslas are no longer the exclusive status symbols they used to be, they’re just commonplace cars now available to anyone.
Paywall in NY Times link to article about GM; not expected. Great respect for your thoughtful and deep insights, but commercializing Everything is not a good look for Hagerty.
Signed,
A long term customer
The truth of Teslas auto pilot came out and it is not as advanced as claimed by a past employee.
People always think these genius movers are successful at everything. The truth is most are failures at 90% of what they do. Edison, Jobs and more. The key is they never give up and when they do succeed they really leave a mark.
Years ago a writer in C&D iirc, wrote a piece on Tesla that the car company was just a sideshow to play stock hype with and that the real endgame was the charging network. That has stuck in my mind for the 5? or so years ago I read it. The recent spread of the proprietary network to all is not a defeat, it is further realization of that goal (the writer spoke of). VHS defeats Beta all over again.
Cars used to be marketed like fashion –that why so many of the 50s-60s car ads are fun to look back on. I think many companies have been very bad at that aspect for some time (or just lazy). Dealerships wanting the “safe” product to sell creates this bad loop in North America where same-spec vehicles in black, grey, and white are 80-90% of the offerings.
I drove by the local Nissan dealership the other day, maybe 100 vehicles on the lot and all of them were black, dark grey or white. Not even the usual token red or blue one. All monotone. Terrible.
Actually cars represented the owners. What you drove told people your status and success in life. .
Some people played the image game on their cars often driving cars that cost more than their home.
Today it is more about affordability and utility. People want vehicles they can afford that will last. They also want vehicles that they can use to haul things old sedans used to haul. My old Ford could swollow a ten speed in the trunk but my Malibu not so much but my truck or SUv will.
“Actually cars represented the owners. What you drove told people your status and success in life. .”
You’ve said what I meant better than I worded it.
——
There is also an affordability disconnect that spurs apathy. If the bottom 25% of vehicles offered are the most boring/bland/ugly/anemic performers it is not a good gateway to enthusiasm. There is a generation of Malibu for example that I find to be an abomination of design, there is no excuse in my view to not at least make the body lines and grill work.
Base model 55 Chev was still a great looking car, 57 I prefer the base model trim (blasphemy I know). I get the script shifted, but even late 60s you had Tempest (then T-37) that still had most of the look of a GTO and the basis you could upgrade bits over your ownership if more performance mattered that much to you.
One of the only modern things you can kind of do that with is Mustang, but I am not sure that is that affordable to most first-time car buyers in the 18-26 year old range. I know I wasn’t buying a new Mustang at 26 years old on my new contract salary (so I had job security unlike most of my peers).
Here is the trouble. The 5t was designed to 1955 standards.
No crash rules, no CAFE, to roll over regs, and plenty of sheet metal express your design.
The same applies to the 60’s as no real rules till you get to 1973 and that begins the decline.
Also most kids today grew up in mini vans and Honda cars. None were that exciting or stylistic. They have little value in most cars outside Grand Theft Auto.
You go to Target and the average Hot Wheel buyer is over 40 years old.
When I grew up I was one of the car guys. Today most schools have no car kids. Some parents may buy a BMW for their daughter only to satisfy their own ego.
My son really did not care what he bought for a new car. He finds driving noting and cars as nothing special. Now video games, computers, head phones and phones are all the status you need.
Not much is affordable. For young buyers. Most kids don’t have the money. Those with collage often have major debts. Few have skills that pay.
My son is rare. He has a degree. Paid his school as he went while working. He has a degree and good job now where if he wanted could buy a Vette.
We went car shopping and ended up with a Blazer RS. Why? AWD, decent mpg, good price and it looks futuristic. He has to go to meetings and lunch with customers and he needed something that could haul 4 adults winter and summer where the rear seat people were not hitting their head on the rear window.
That is the state of the market. No few kids can afford or even handle a Mustang as that is why so few sell anymore. The Pony car died when the cheap RWD econo car died.
As for the Mustang it is getting long in the tooth the retro thing needs to go away.
Even the Corvette is evolving. Not all may be happy but they sell all they can build.
Larry,
Are we not missing the point with all EV’s? We no the infrastructure does not exist for a nation of EV’s. But let us put it so the masses can understand. I live on a street that has a five-inch water main. There are 25 other houses that are my street. Everything is fine until the ABC water plant goes in at the end of the street. Get it? Same thing with the power to my house. Service is fine for me today. Service is fine if I add a charging unit. Service is sketch if everyone on my street adds one. Build as many of these cars as you want. They won’t sell in the USA as we are not ready. OBTW. I agree that style is very important when it comes to a new car purchase, right up there with price.