An interesting (and well researched) post about Tesla Motors and how what they claim does not match up with what they do. Business practices, numbers and rebates from the California taxpayers.
Check out: Whopperpedia: the Ultimate Guide to Teslagate
WHOPPER #1: "WE'RE PRODUCTION-CONSTRAINED"
Tesla maintains that it makes as many cars as it can. Production-constrained, then, means that demand exceeds capacity (or production, or supply if you prefer to call it that). They have used this mantra from the moment the Model S started production (June 2012) to the latest earnings report, which covers January-March 2014.
How anybody with any business knowledge can believe this bullshit is beyond me.
a) If demand exceeds capacity then you simply increase capacity and/or price
Of course, in the real world demand usually outpaces capacity for a short period of time; in such case the company will be reluctant to raise prices for fear of killing momentum. This happens not so much because a product is popular (the iPhone doesn't sell out) as when it's more popular than expected, as happened to the Wii and PS4. Surprises do happen, and sometimes a product is in fact low on stock for a year or so (as with the aforementioned Wii). But to the best of my knowledge it's unprecedented for a product to remain supply-constrained for nearly three years.
Oh, and there may be occasional sell-outs later in a product's cycle. As in, the Wii sold out first at launch and three years later with New Super Mario Bros. Most of the time in the middle it wasn't sold out. The same has happened with the Galaxy S, Nespresso coffee machines or any other product you may think of: occasional sell-outs here and there, available 98% of the time at 98% of the stores.
A quick google search reveals how rare these "constraints" are: Tesla is virtually the only company using the production-constrained mantra, while supply-constrained is mostly used in economics, natural resources and occasionally by Tesla too.
Capacity rises to meet demand, whether it's in oil, diamonds or massages. Of course, some demand may simply be unprofitable; Sony may be reluctant to launch operations in Chad even if some people there want to buy a PS4. This is not a demand constraint but a logistics/operational one. In fact, it is an indication that there is not enough demand for the PS4 in Chad for Sony to bother, i.e. a sign of weakness rather than strength.
Of course, the use of this term in natural resources has an explanation: it may be difficult to increase production for physical reasons, and this situation can persist far longer than in manufacturing, food retail, etc; the oil run of 2004-2014 is a good example, as it took several years for producers to increase supply in response to high-and-growing prices. Looking at it the other way, if demand exceeds capacity and capacity is fixed for the time being, the price will rise.
So can't Tesla raise prices, just like the Saudis?
The author develops this WHOPPER #1 with five more chapters and then goes on with 19 more WHOPPERS
They conclude with a bunch of quotes from Elon Musk, misleading statements and numbers as well as potential frauds. A long and interesting read. I would love a reliable electric car but they are still waaay off in the future. We simply do not have the battery technology available.
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