Industry News: Ford Executive Wants A Sequel To "Cash for Clunkers"

[William Maley]

The COVID-19 pandemic has basically brought most of the world to halt. Orders to stay at home, businesses either having workers to their work from home or closing down, and unemployment skyrocketing is causing the economy to crater. There are efforts to try and jump-start the economy such as $1,200 stimulus checks. But an executive at Ford wants to see a return of a "cash for clunkers" like program.

“We think some level of stimulus somewhere on the other side of this would help not only the auto industry and our dealers, which are a huge part of our overall economy, but will help the customers as well,” said Mark LaNeve, Ford’s vice president of U.S. marketing, sales and service to Bloomberg.

“Cash for clunkers was very effective at that time. It would be nice to think we could have something equally as effective for 2020 when we get out of this because it was a great program.”

According to LaNeve, internal discussions are taking place at Ford about doing a similar program and there are plans to bring the Government in to these talks.

When asked by Automotive News about this, Ford spokeswoman Rachel McCleery said, "The auto industry is America’s economic engine.We are encouraging Congress to look at a variety of ways to drive job creation, increase demand, support customers and provide long-term stability for the entire auto ecosystem."

A brief refresher on the Cash for Clunkers program. In 2009, the U.S. Government introduced a billion initiative called the Car Allowance Rebate System, which gave a voucher worth between $2,900 and $4,500 to anyone replacing a vehicle newer than 1984. Their old vehicle would be taken away and disposed of. The program was nicknamed Cash for Clunkers.

On the surface, the program was a success. Within first month, all of the funds were exhausted. This prompted the U.S. congress infuse an addition two billion into the program, which would be all gone within 17 days. But begin to look deeper and the results are mixed. In 2012, a study published in the Quarterly Journal of Economics described the program as being a bit of a wash,

"...the effect of the program on auto purchases is almost completely reversed by as early as March 2010 — only seven months after the program ended.”

Other studies have come to the same conclusion.

There's also the question of how many perfectly good used cars were taken off the road due to the program.

Source: Bloomberg via Automotive News (Subscription Required), The Drive, The Truth About Cars

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[daves87rs]

It will fail.

The big difference? There will be way, way more people out of work. At this stage, folks aren’t even sure that the world will end. Back during the Great Recession, you knew at least some point things would get better. And it did. But we’ve never seen damage done this bad. So even if the deals are good, people may still not jump on this....

Second- Automakers will adjust to demand this time around. They even have other things that they can build. For the first time- some profit (maybe) will not be from the cars. I would be surprised I’d sales of cars even touch 10 million this year. This all depends when people can get out again......

[oldshurst442]

58 minutes ago, daves87rs said:

But we’ve never seen damage done this bad

Yes we have. We've seen worse. A whole lot worse.  And there are people still alive and still remember those bad bad times...

We are a weak society as compared to prior generations...

The bombs were not dropped and exploded on North American turf, but the effects of the war on the economy side of things affected North Americans.

RATIONS

And Im not even talking about Europe and how Europe was devastated by bombs and lack of food and disease on the streets along with dead bodies from war and internal in fighting and sabotaging and back stabbing and soldiers murdering innocent civilians and the list goes on and on and on.  Not to mention self isolation when the bombs hit and Europeans prayed it was not their house exploding

Im talking about America.

The war effort in America had a severe economic impact.  Detroit produced war machines. Not cars for about 3 years. It wasnt the boys who made them. It was the girls. The boys were off to war.  The girls, the married ones, prayed that they didnt get a certain letter from Uncle Sam.....  Many boys came back home in body bags...

The only thing is, there was no self isolation in America during WW2 as there was in Japan, Europe and in today's situation. But there was no internet and no TV either back then...no video games.  Some places in America barely had electricity and lights...even in 1942...

Not everybody had a job prior to 1939  either(start of WW2 for everybody else other than the US) so buying consumer products was not a thing...like we do today....even in a Covid19 lockdown.  We could still go to Wallmart and buy a Playstation 4, or workout equipment  because our favorite gym is closed...  We could still order take-out.  That kind of consumerism was not even dreamt of back in 1939...    Hell...even after the war in 1945...that concept wasnt even conceived.   Drive thrus though in the 1950s? maybe?

We also have credit today...unless of course those of us who over consume and are maxed out from buying too many Starbucks coffees and useless contraptions...   But even then... the US household does have on average 3-4 TVs and at least 2 computers and 2 smart phones at their disposal during this crisis with unlimited internet...

We also have 2-3 cars in our Average Joe homes...  

Jobs?

Yeah...those will be coming back after all this.  

Businesses will re-open. Those that went away...will spawn new businesses.

After all...American consumerism is a way of life.  That wont go away...

And to those that will have a hard time getting back on their feet BECAUSE of overspending in the past...

HOPEFULLY THIS will RESET THEIR mindset and we could get back to a much more simpler time and material objects are not coveted as much as we coveted them prior to this pandemic.

Stay safe. Lets be careful on how we interact with our immediate environment and hopefully their is a solution around the corner soon. But we have faced much much tougher economic times than this.  

Human Mortality is always grim,  so I wont downplay anything regarding that. THAT would be inhumane. 

IN OTHER WORDS:

We also have 2-3 cars in our Average Joe homes...  

CASH FOR CLUNKERS IS NOT ALL THAT IMPORTANT RIGHT ABOUT NOW...

To get the industry rolling again?

In another thread...I was a major contributor in arguing for and against what constitutes a luxury vehicle...

Well...all that is NOT IMPORTANT...

ALL auto manufactures may now need to  go back into time and re-introduce back to basics automobiles... 

Honda CVCCs,  BMW ISETTAs,  Ford Model Ts...

Forget about Longhorn Laramies and AMG E Classes for the moment after this crisis is done with...and then maybe cash for clunkers could work out...

50 000 dollar pickup trucks with all the frills, bells and whistles is totally not what is important and needed.

All the ApplePlay connectivity to tell us where to spend our money is not what is important and needed.

The 20 inch rims and Brembo crossdrilled ceramic brakes are not what is important and needed...

For our transportational needs going forward after this Coronavirus COVID19 thing gets resolved....

 

 

 

  

 

Edited April 5, 2020 by oldshurst442

[riviera74]

That Ford executive wants Cash for Clunkers because he sees an opportunity for Ford to get more money from the government.  That is the real issue.  I do not believe that we need a Cash for Clunkers program this time.

As for back to basics automobiles, maybe that will happen but I doubt it.  Not only are current new vehicles too expensive, but used vehicles can be bought at semi-reasonable prices.  Unless the fight is over a brand new $10K Chevy Trax, I suspect that automakers will make do with a market that only sells 8-12 million new cars a year for the next several years.

[regfootball]

No, this is a stupid idea.  Really ashamed that someone from Ford would suggest this.

How about concentrating on how many more new 2020 Escapes you can sell instead of 70,000 dollar Aviators now?

Likewise, GM, maybe something like the Cruze is a valuable entry in the car lineup now?

Watch GM spin this into needing all sorts more money to dump into autonomous and electric black hole now.  I would be for the development budgets of electric being increased if the charging grid were part of that investment but I haven't seen jack squat of that to date.  And in the meantime, how about instead of cash for clunkers, get more hybrid powertrains into volume lines.  Like an Equinox hybrid.  Give credit for continuing hybrids in some of its product lines.  

Edited April 5, 2020 by regfootball

[smk4565]

Bad idea, waste of taxpayer money that can go to more important things.

Also if did it, they would require the new car to be an EV (which are mostly too expensive, especially for people that have economic hardship) or it would have to be on a car that gets 30 or 35 mpg combined or something fuel efficient and Ford quit making their cars and has nothing fuel efficient, outside of an Escape Hybrid.

We don't need more corporate welfare, auto companies were making billions in profits a couple years ago, I didn't see them giving it all away to charity or to the government to pay extra taxes. 

[daves87rs]

7 hours ago, oldshurst442 said:

Yes we have. We've seen worse. A whole lot worse.  And there are people still alive and still remember those bad bad times...

We are a weak society as compared to prior generations...

The bombs were not dropped and exploded on North American turf, but the effects of the war on the economy side of things affected North Americans.

RATIONS

And Im not even talking about Europe and how Europe was devastated by bombs and lack of food and disease on the streets along with dead bodies from war and internal in fighting and sabotaging and back stabbing and soldiers murdering innocent civilians and the list goes on and on and on.  Not to mention self isolation when the bombs hit and Europeans prayed it was not their house exploding

Im talking about America.

The war effort in America had a severe economic impact.  Detroit produced war machines. Not cars for about 3 years. It wasnt the boys who made them. It was the girls. The boys were off to war.  The girls, the married ones, prayed that they didnt get a certain letter from Uncle Sam.....  Many boys came back home in body bags...

The only thing is, there was no self isolation in America during WW2 as there was in Japan, Europe and in today's situation. But there was no internet and no TV either back then...no video games.  Some places in America barely had electricity and lights...even in 1942...

Not everybody had a job prior to 1939  either(start of WW2 for everybody else other than the US) so buying consumer products was not a thing...like we do today....even in a Covid19 lockdown.  We could still go to Wallmart and buy a Playstation 4, or workout equipment  because our favorite gym is closed...  We could still order take-out.  That kind of consumerism was not even dreamt of back in 1939...    Hell...even after the war in 1945...that concept wasnt even conceived.   Drive thrus though in the 1950s? maybe?

We also have credit today...unless of course those of us who over consume and are maxed out from buying too many Starbucks coffees and useless contraptions...   But even then... the US household does have on average 3-4 TVs and at least 2 computers and 2 smart phones at their disposal during this crisis with unlimited internet...

We also have 2-3 cars in our Average Joe homes...  

Jobs?

Yeah...those will be coming back after all this.  

Businesses will re-open. Those that went away...will spawn new businesses.

After all...American consumerism is a way of life.  That wont go away...

And to those that will have a hard time getting back on their feet BECAUSE of overspending in the past...

HOPEFULLY THIS will RESET THEIR mindset and we could get back to a much more simpler time and material objects are not coveted as much as we coveted them prior to this pandemic.

Stay safe. Lets be careful on how we interact with our immediate environment and hopefully their is a solution around the corner soon. But we have faced much much tougher economic times than this.  

Human Mortality is always grim,  so I wont downplay anything regarding that. THAT would be inhumane. 

IN OTHER WORDS:

We also have 2-3 cars in our Average Joe homes...  

CASH FOR CLUNKERS IS NOT ALL THAT IMPORTANT RIGHT ABOUT NOW...

To get the industry rolling again?

In another thread...I was a major contributor in arguing for and against what constitutes a luxury vehicle...

Well...all that is NOT IMPORTANT...

ALL auto manufactures may now need to  go back into time and re-introduce back to basics automobiles... 

Honda CVCCs,  BMW ISETTAs,  Ford Model Ts...

Forget about Longhorn Laramies and AMG E Classes for the moment after this crisis is done with...and then maybe cash for clunkers could work out...

50 000 dollar pickup trucks with all the frills, bells and whistles is totally not what is important and needed.

All the ApplePlay connectivity to tell us where to spend our money is not what is important and needed.

The 20 inch rims and Brembo crossdrilled ceramic brakes are not what is important and needed...

For our transportational needs going forward after this Coronavirus COVID19 thing gets resolved....

 

 

 

  

 

Much of that depends. ( I am a history buff ? )

If this drags out too long, it might make the Great Depression look good. Much of this remains to be seen. I do agree with much you have said. I think from the ashes good will come- how quick will depend on the damage.....

[balthazar]

41 minutes ago, daves87rs said:

If this drags out too long, it might make the Great Depression look good.

I believe unemployment reached 25%. but I'll bet the real number was higher (pride).
Some of these steam tractors were 6 or 7 grand in 1930 :

[daves87rs]

1 hour ago, balthazar said:

I believe unemployment reached 25%. but I'll bet the real number was higher (pride).
Some of these steam tractors were 6 or 7 grand in 1930 :

I agree....

[balthazar]

China's car sales in Feb were down 79% vs a year ago.

[riviera74]

5 hours ago, balthazar said:

China's car sales in Feb were down 79% vs a year ago.

Wow.  Down 79% in one month?  I suspect that will probably happen here soon, if it hasn't already.

[balthazar]

This blurb is from insideevs.com RE sales reporting. GM got criticized for going to quarterly yet once again, look at how many other OEMs then began 'getting shifty' with reporting : 

[regfootball]

12 hours ago, balthazar said:

China's car sales in Feb were down 79% vs a year ago.

well, there goes Buick then!

[balthazar]

37 minutes ago, regfootball said:

well, there goes Buick then!

Buick outsold Tesla in China 21:1 in 2019.

[riviera74]

14 hours ago, balthazar said:

Buick outsold Tesla in China 21:1 in 2019.

Tesla does not matter in China.  I am not sure if China matters to Elon Musk.

[balthazar]

^ He's supposed to build a FACTORY there. I think it matters.

[riviera74]

1 hour ago, balthazar said:

^ He's supposed to build a FACTORY there. I think it matters.

Thanks,  apparently China does matter to Elon Musk.  The question is whether Tesla SALES will actually rise anytime soon.

[balthazar]

With the price of gas cheap and the price of Teslas high, it may take a few years to get back on track of 2019 levels.
Much like the Model X hasn't assumed it's sales leadership over the Model S, I wonder if the Model Y will also falter hard against the Model 3 and NOT provide the volume boost Musk is hoping for.

[G. David Felt]

6 hours ago, riviera74 said:

Tesla does not matter in China.  I am not sure if China matters to Elon Musk.

China Matters to Tesla, major investor and they have already expanded to cover auto production with expansion to now also cover power train and now we have the latest news that Tesla is expanding again to cover in house parts production to reduce turn around time.

https://www.reuters.com/article/us-tesla-china-idUSKBN20X0HN

[USA-1]

Absolutely horrible idea. Not surprised coming from Ford who needs gov't bailout money, but want to cover up the facts again. 

We lost 10's of thousands of classic cars in this country last time (some still in decent shape) from greedy, clueless people dumping them off for a new model and they had to be destroyed as part of the failed C4C gov't program. It was a total disaster last time and it would be just as bad if not worse this time.

[ccap41]

I'm fine with trashing garbage vehicles. 

[Robert Hall]

11 hours ago, USA-1 said:

Absolutely horrible idea. Not surprised coming from Ford who needs gov't bailout money, but want to cover up the facts again. 

We lost 10's of thousands of classic cars in this country last time (some still in decent shape) from greedy, clueless people dumping them off for a new model and they had to be destroyed as part of the failed C4C gov't program.  

Most were just high mileage 90s-00s FWD generics and trucks and SUVs, though..I remember in Phoenix at the time a lot of dealers were taking in worn out Explorers, Expeditions, minivans, etc..

Edited April 8, 2020 by Robert Hall

[USA-1]

2 hours ago, Robert Hall said:

Most were just high mileage 90s-00s FWD generics and trucks and SUVs, though..I remember in Phoenix at the time a lot of dealers were taking in worn out Explorers, Expeditions, minivans, etc..

For sure, but many classics went that Grandparents gave to or were inherited by grand kids who had no clue what the cars were. I have buddies who deal with cars who were shocked.

[riviera74]

2 hours ago, USA-1 said:

For sure, but many classics went that Grandparents gave to or were inherited by grand kids who had no clue what the cars were. I have buddies who deal with cars who were shocked.

Mistakes are always made, especially when the recipient does not know a thing about the car in question.  C4C was probably not a good idea, especially given that the financial system was the source and cause of the last recession.  Shuttering bad banks would have corrected more issues with less harm to the larger economy.

[balthazar]

Only thing of remote interest I saw at my dealer was a circa ‘80 Riviera. The rest was a couple decent trucks and modern junk.

[regfootball]

On 4/7/2020 at 1:26 PM, riviera74 said:

Thanks,  apparently China does matter to Elon Musk.  The question is whether Tesla SALES will actually rise anytime soon.

NOw that i think about it, this song by California gal Marnie Ann must have been an early love song for Elon Musk,

 

but I digress, Carry on,.....

[A Horse With No Name]

I am to the point where I am tired of the government bailing out everything and everyone. Stop all government bailouts, period. 

[G. David Felt]

1 hour ago, A Horse With No Name said:

I am to the point where I am tired of the government bailing out everything and everyone. Stop all government bailouts, period. 

While I have no problem with the government spending tax dollars on new tech to get things moving forward as to why I support the EV rebates for now, eventually they have to go away. 

Things that need to go away are pork like the $50 billion given to the oil industry for exploratory drilling. WHY, Exxon Mobile made over $100 Billion in pure profit last year, I doubt they need tax dollars for finding new oil well's especially when they make that much money.

Another PORK that needs to go away is the billions spent on maintaining the worlds biggest Tank fleet parked in the high Dessert in California when the military says they do not want or need tanks in this modern world as they are not useful in the modern warfare world.

Just a couple of examples where we need to cut fat, live within our budget and focus like we did in the 90's paying down national debt.

[A Horse With No Name]

23 minutes ago, dfelt said:

While I have no problem with the government spending tax dollars on new tech to get things moving forward as to why I support the EV rebates for now, eventually they have to go away. 

Things that need to go away are pork like the $50 billion given to the oil industry for exploratory drilling. WHY, Exxon Mobile made over $100 Billion in pure profit last year, I doubt they need tax dollars for finding new oil well's especially when they make that much money.

Another PORK that needs to go away is the billions spent on maintaining the worlds biggest Tank fleet parked in the high Dessert in California when the military says they do not want or need tanks in this modern world as they are not useful in the modern warfare world.

Just a couple of examples where we need to cut fat, live within our budget and focus like we did in the 90's paying down national debt.

Exactly. My point is that if you make it convenient for government to send money to businesses that lobby them, they flat out will. 

[riviera74]

I always wonder why governments subsidize businesses in any way.  The corporate tax code is notorious for business subsidies that are tax expenditures when the corporate tax code is supposed to fill the Treasury's coffers.  THOSE are the worst.

The current PPP program is not working as intended mostly because the biggest banks are administering it to their biggest clients FIRST.  This is bad.  I would rather have that money go to individuals rather than businesses because it is a LOT harder to distort incentives when people (not large businesses) are getting the money to do what they need to do, whether it is paying for essentials or debt service. 

I am all for cutting the fat and ditching the pork.  The biggest hogs are in the corporate tax code, excessive military spending, and basically all subsidies to big business.  Where should we start cutting?

[oldshurst442]

Government subsidies.

A necessary evil on many levels.

In a perfect world, government subsidies should not be. But as we all no, there is no such thing as a perfect anything.

For starters, in a global economy to which many American companies compete in, is most of these global countries, many governments subsidize their national industries and subsidies their national manufacturing.

For starters, Japan subsidizes their automotive industry to levels that seem insane to American minds. The Chinese even worse. GM, Ford, NEED American taxpayer money JUST for those two reasons alone... 

Secondly, even if you dont think  American taxpayer money should go to GM/Ford, American taxpayer money goes to foreign automobile manufacturers let alone GM and Ford.

All those Honda, Toyota, Nissan, Subaru, Mazda, Mercedes, BMW,  Volkswagen (Porsche and everything thing else VW...), Hyundai/KIA manufacturing plants...IN THE USofA...ALL GOT some sort of American governmental level of tax breaks, grants, loans on guaranteed low low low interest rates and the like...

You think that is fair for GM and Ford NOT to get taxpayer money when American taxpayer money goes to everybody else?

OK...we eliminate ALL taxpayer money of all sorts to ALL companies...

THAT only solves what happens on your land...THAT does NOT solve what GM and Ford face in the global market when all other nations subsidize their industries...

Example with the aircraft industry because it happens in the automotive industry too:

Boeing gets taxpayer money in very loopholey ways. Fine! 

Boeing complains that Bombardier Aerospace is subsidized by the Canadian government!  Fine! 

Boeing's subsidies stop. OK...

Canada WILL NOT stop subsidizing Bombardier Aerospace.   (OK...maybe they will now even before this COVID19 thing happened.) 

Problem is...Brazil will NOT stop subsidizing Embraer. 

Bigger problem than Embraer and Bombardier Aerospace is that Airbus will continue to get government support by not 1 country. Not 2 countries. But 3 countries...(Germany, Spain and France)

How can Boeing compete with that?   

Boeing NEEDS the American government and the loopholey ways of subsidies...that is how.  (I dont like the lies that Boeing done to try to undermine the CS100/Airbus220, but that is for another time) 

There are things that need to be more in check. I agree.

Example:  Bombardier, JUST before the CS100 (now Airbus 220) was being certified by the FAA and the TCCA(Canadian equivalent), Bombardier needed billions of dollars of loans from the Canadian Government for reasons. There was an uproar by Canadians. From Quebec and the rest of the country.  Canada gave some interest free loans and the Quebec government said they will give money, but they need to partner up wioth the Quebec government. Bombardier agreed to those terms.   ONE YEAR LATER...Bombardier LAYS OFF people saying they are bleeding money.   What about those billions of dollars they got a year earlier?     WELL...the family that owns  Bombardier (like Ford) have a controlling interest in the company...and they got a very very healthy end of year raise in CEO salary and bonuses...

Let me tell you, they had to answer to the Quebec folk as there was an uproar.

The link below...the green sign reads... "steal from the poor to give to the rich"

The red sign reads "Bombardier and others, old or new aristocrats, same insensibilities, same arrogance, same justifiactions"    

https://business.financialpost.com/transportation/bombardier-inc-executives-defer-half-of-their-32-6-million-compensation-after-uproar-over-pay-hike

https://www.cbc.ca/news/canada/montreal/bombardier-defends-pay-structure-after-public-outcry-over-executive-pay-increases-1.4051413

So yeah...while government subsidies should not be, they also should be. 

 

Edited May 7, 2020 by oldshurst442

[balthazar]

8 hours ago, dfelt said:

WHY, Exxon Mobile made over $100 Billion in pure profit last year

It was $14B in profit, not $100B.

[A Horse With No Name]

9 hours ago, balthazar said:

It was $14B in profit, not $100B.

Which, considering the service provided and risks taken is actually fairly moderate. 

[67impss]

Back to c4c it decimated the used car stock. I live in Dayton Ohio and was out of work from 2009- 2013, sure my age and highish past pay rate added to my woes but that was a painful time. In looking through car adds afterwards the used cars were more than triple and  my wages were 1/3 of what I previously was making. My point is that the folks at the bottom can't afford new and get a Gov check. The used car market hasn't recovered here yet, my 2000 Dakota Sport 3.9l 5spd man. with 300k mi would still pull in maybe 1k-1.2k$ and that's absurd. I know pricing inflates but this insane and I was just reading last week that the used market was reeling from all the lease turn ins and rentals. I was hopeful that  I might be able to afford something newer, after I get back to work.

[G. David Felt]

12 hours ago, balthazar said:

It was $14B in profit, not $100B.

Yes, I was off by a few years thinking of when they had multiple years of $100 billion plus gross profit, but the end point is that the oil industry DOES NOT need billions from the tax revenue of the government.

https://www.macrotrends.net/stocks/charts/XOM/exxon/gross-profit

[balthazar]

If there's no new cars, imagine what the used market would turn into. Cuba 2.0.

I thought the C4C program was kinda crazy, but who am I to turn down $4600 for a $500 truck??

[G. David Felt]

1 minute ago, balthazar said:

If there's no new cars, imagine what the used market would turn into. Cuba 2.0.

I thought the C4C program was kinda crazy, but who am I to turn down $4600 for a $500 truck??

Imagine your B59 could end up having a Marine 4 banger Diesel in it if we became like Cuba.

[balthazar]

Diesel IS about to slip below $2/gal here.
Hmmm, I wonder what Cam 2 is going for???

Nah- I have most of my 455 parts on hand, plus a back-up block if I split the lifter galley.

[G. David Felt]

Current average prices for fuel here in western washington is as follows:

• Regular = $2.29
• Mid Grad = $2.53
• Premium = $2.68
• Diesel = $2.75

 

[balthazar]

30 minutes ago, dfelt said:

Yes, I was off by a few years thinking of when they had multiple years of $100 billion plus gross profit,

That's gross profit. Net profit is substantially lower.
Net for 2019 was $14B, a decline of 31% vs. 2018.
Q1 2020 saw a 125% decline, to a loss of $600M.

- - - - -
Electric vehicles use numerous petroleum-based materials in their production, from tires, bearing lubricants, paint additives, varnishes, coatings, distribution, plant machinery, etc.
Just because EVs don't go to the gas station doesn't mean they're not firmly part of the petroleum spectrum.
Tesla NEEDS Exxon.

Edited May 8, 2020 by balthazar

[67impss]

I did buy gas for .039$ / gal after Kroger fuel pt.s a couple weeks ago previous low was .119 / gal circa 1976 during  gas wars. Never thought I'd see that day, took pictures of the pump.

[riviera74]

1 hour ago, balthazar said:

That's gross profit. Net profit is substantially lower.
Net for 2019 was $14B, a decline of 31% vs. 2018.
Q1 2020 saw a 125% decline, to a loss of $600M.

- - - - -
Electric vehicles use numerous petroleum-based materials in their production, from tires, bearing lubricants, paint additives, varnishes, coatings, distribution, plant machinery, etc.
Just because EVs don't go to the gas station doesn't mean they're not firmly part of the petroleum spectrum.
Tesla NEEDS Exxon.

That does not mean that EVs need as much petroleum distillates as a typical ICE car.  At the same time, less oil used here means more exporting of gasoline and diesel overseas perhaps.

[G. David Felt]

3 hours ago, balthazar said:

That's gross profit. Net profit is substantially lower.
Net for 2019 was $14B, a decline of 31% vs. 2018.
Q1 2020 saw a 125% decline, to a loss of $600M.

- - - - -
Electric vehicles use numerous petroleum-based materials in their production, from tires, bearing lubricants, paint additives, varnishes, coatings, distribution, plant machinery, etc.
Just because EVs don't go to the gas station doesn't mean they're not firmly part of the petroleum spectrum.
Tesla NEEDS Exxon.

True, petroleum products are used in all forms of auto's.

While Net Profit is lower than gross profit, also the accounting as the link I posted with the gross profit shows the rest of the accounting picture and they truly manipulate the system to avoid paying taxes on the profit with all kinds of crazy expenses and manipulation. 

Too bad the CEO is not paid on Net Profit as they clean house on the gross profit bonus payments.

Oil if far more profitable than their net profit shows and I still do not believe they deserve or really need the billions in dollars the government gives them.

After all you and I as small business owners do not get the supplement payouts that many especially big oil gets from the gov.

[ocnblu]

Oil lubricates the whole entire world.  It's not going away.

[G. David Felt]

37 minutes ago, ocnblu said:

Oil lubricates the whole entire world.  It's not going away.

True, but we do not have to drill baby drill and destroy the planet we live on as is happening in so many places.

[ocnblu]

54 minutes ago, dfelt said:

True, but we do not have to drill baby drill and destroy the planet we live on as is happening in so many places.

I'd rather have a tiny hole in the ground than vast areas dug out so deep for rare metals mining.

[G. David Felt]

7 minutes ago, ocnblu said:

I'd rather have a tiny hole in the ground than vast areas dug out so deep for rare metals mining.

Ya just summed up coal mining and so many other things on top of rare metals which latest versions of batteries no longer need or leave toxic messes under ground where people live or on top of the ground as the latest rig explosions in Oklahoma and North Dakota has done.

Lucky for us with advances in EVs we can leave behind eventually the ICE age of old auto's and move forward with the 21st century.,

[balthazar]

'latest version' - unfortunately, trillions of batteries still use the much more common rare metals. That'll change about as fast as moving from IC to E has gone.

But with the world addicted to plastics like it is (especially -but far from exclusively- the auto industry), oil is correctly defined as a 'vital commodity'.

I'm not sure what the 'wind turbine huggers' think they're double mocha lattes are going to be served to them in. Every present & past container material involves petroleum in numerous ways. Automobiles are a tiny sliver of 'a tiny hole in the ground'.

Edited May 9, 2020 by balthazar

[riviera74]

6 hours ago, turnback said:

stocks is rising though 

 

How are the sales numbers? Is Tesla taking market share from other automakers?  Stock prices can be based on hype.  Actual sales numbers (especially car registrations) are NOT.

[frogger]

1 hour ago, riviera74 said:

How are the sales numbers? Is Tesla taking market share from other automakers?  Stock prices can be based on hype.  Actual sales numbers (especially car registrations) are NOT.

Well as the Model 3 came to market both the 3 series and C Class sales shrunk by 50% or so in the US (you could also partially blame that on the CUV craze), but the Model 3 is not a CUV and it outsells the 3 and C Class combined by a fair margin.