Expensive business plans, Vectrix, Tesla, etc...

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reikiman's picture
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Expensive business plans, Vectrix, Tesla, etc...

I was reading the following article (via wwwatts) about a "philantropist" who got the 500th Tesla. The article also mentions Tesla's plans for more show-rooms in various cities.


The idea in my mind is the expensive business plan with dealerships around the world. Sounds like the issue being discussed in Suspension of Trading - What does it mean? .. just switch out the name Tesla for the name Vectrix and some of the same things are true, maybe. Maybe though Tesla's management is doing a better job. Such as getting Daimler to invest, that shows something maybe about the quality of the business.

The thing I'm taking from the Vectrix story is an expensive business plan with building a global sales and service organization, and the company failing.

It's not a given that an expensive business plan means failure. It simply requires enough ramp up of business to support the business plan. If Vectrix were getting enough income to pay for the business then we wouldn't be having that discussion about suspension of trading. But they didn't and therefore we are.

With an expensive business plan it requires more income to pay for the business .. obviously.

jdh2550_1's picture
Last seen: 11 years 3 months ago
Joined: Tuesday, July 17, 2007 - 09:35
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Re: Expensive business plans, Vectrix, Tesla, etc...

Yup, I agree with you. Here are some thoughts and observations:

- I agree that Tesla seems to have a similar approach to Vectrix and that seems to somewhat mimic the traditional vehicle manufacturing model.

- Even though Vectrix is struggling and Tesla might struggle they've been the most successful so far.

- The traditional model does in fact have many advantages and has been proven to work. However, it's capital intensive and there's not a lot of capital around at the moment.

- Although many folks think that the EV market is set to explode no one really seems to know when. So, one either needs a really patient investment strategy or take the gamble of getting the timing right or having "the" product that sets the market on fire.

- Of course we all like to think that we have that elusive "one" product that history shows was the tipping point. Vectrix kind of proved that they didn't - as I posted on the other thread I think they (and Tesla) are too expensive. That was certainly a big barrier to entry. Personally I think they were just a little short on range too.

- If Detroit Electric delivers on their promise of a $25K / 100 mph / 100 mile range 4 seater sedan then I think that they might have "the one". Of course, it's not JUST price - they will need reliability and quality and good support and good marketing and lots of other good stuff too.

- The whole EV sector will benefit from that "one" product.

- If you don't have "the product" that truly starts the revolution then you need deep pockets or low overhead. The Japanese capital system seems more inclined to have the patience and depth to support the deep pockets approach. We're trying the low overhead approach.

I love discussing this stuff - hopefully this becomes one of those really long threads!

John H. Founder of Current Motor Company - opinions on this site belong to me; not to my employer
Remember: " 'lectric for local. diesel for distance" - JTH, Amp Bros || "No Gas.

Last seen: 7 years 7 months ago
Joined: Monday, April 14, 2008 - 09:49
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Re: Expensive business plans, Vectrix, Tesla, etc...

Something to remember about Tesla: they felt they *had* to start with an expensive speedster, something with really phenomenal performance. They had to break the stereotype of electric vehicles generated by golf carts and neighborhood electric vehicles: slow. Painfully slow. Pathetically slow.

Now that the Tesla roadster is on the road, and people are amazed at it's speed and acceleration, it becomes possible to build a cheaper product for a larger market segment. People will start looking carefully at specs, and try to figure out what's fast enough for their needs, and how much range they actually need.

Of course, I'm afraid we're working with the same stereotype on the scooter/motorcycle side. Even the massive Vectrix is too slow for me to safely use on the nearest segment of Interstate highway, and the Vectrix kicks tush compared to the 2-4kW scooters that typified the market for the last couple of years.

I think some of the newest fast motorcycles, especially entries in the TTXGP race, will break that stereotype on the 2-wheel side. Once the idea of a fast electric motorcycle sinks in to the 'average' consumer, they should be able to look at a 50-60pmh bike like John's and say "that's good enough for my needs, and the price is reasonable".

Many of the mainstream car companies persued the same strategy: they'd build something really fast and flashy, like a Dodge Viper or Chevy Corvette, to get people into the showroom, and then sell them something more 'practical'.

Of course, this may mean that John needs to build a speed-demon scooter just to establish his company's credibility, even if it's too expensive to sell.

My electric vehicle: CuMoCo C130 scooter.

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