The other day, former Fisker CEO Tony Posawatz interviewed with the stock- and business-centered site Benzinga to outline his caution regarding the future viability of Tesla Motors.
Posawatz’s main concern lies with the company’s recent decision to announce the more expensive, “D”-badged Model S cars, saying that Tesla seems to be moving (for now) in the wrong direction. The $69,900 base price of the most basic Tesla Model S presents a hurdle to mass-volume sales, and as the former Fisker CEO notes, economies of scale matter.
“It’s not a business model I think that is sustainable. So I would have preferred – and perhaps [Wall] Street would have preferred – for Tesla to provide news not for a higher-priced car… but to show signs of driving costs out of the car,” said the former Fisker CEO. He goes on to provide an example: purchasing a million steering columns is much cheaper per unit than purchasing a thousand.
To this end, Posawatz expresses concern for the future viability of the company unless they can manage to deliver on a low-cost, high-volume car like the Model 3 – or perhaps, strike up more partnerships than the automaker’s current relations with Daimler and Toyota. That selling its California ZEV credits to other brands tends to be the company’s main source of income is worrisome, remarks the former Fisker CEO.
We think that Posawatz is right on the money, and most likely, Tesla CEO Elon Musk agrees; the Gigafactory in Reno (and a possible second location) have been announced for just this reason. They hold the promise of taking the crucial next-step in driving down manufacturing costs of the most integral component of Tesla’s electric cars – the batteries. But only if the factories can deliver.
Of course, if there is one magnate in the world who can set unthinkably high demands and meet them, it’s Elon Musk.
You can listen to the entire interview in a post at Autoblog.