BONUS PODCAST: Tesla CEO Promises To Double U.S. Production
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Tesla CEO Elon Musk just announced plans to double the company's U.S. vehicle production within the next two years. This was against a backdrop of the United States president publicly saying he would purchase a Tesla as a show of support for the EV manufacturer and its embattled CEO during a bizarre situation where the White House lawn was turned into a pop-up

impromptu Tesla showroom as the two men began to try and flog cars to the American public watching. And all of that also against the backdrop of new data coming out on the same day of Tesla's decline in sales, this time it's specific US data. While Musk explicitly framed this production expansion as a demonstration of support for Republican policies and confidence in America's economic future,

So can they do it? We'll look at some possible pathways on today. And welcome to a special bonus edition of EV News Daily. I'm Martin Lee, and let's get into it.

So Tesla currently maintains substantial manufacturing operations in the United States with a combined production capacity of about 1.1 million vehicles every single year. There is, of course, the Fremont factory in California, Tesla's OG, the original manufacturing base and continues to be a cornerstone of their production capabilities. According to Tesla's most recent financial reports.

Fremont has the capacity to make around 100,000 of the premium vehicles S and X every year and over 550,000 volume models which is split between three and Y annually so there we have 650,000 vehicle capacity in Texas of course Tesla's newer Gigafactory they can produce approximately 250,000 Model Ys every year and capacity installed of 125,000 Cybertrucks annually.

This facility represents Tesla's future manufacturing with more advanced production techniques and certainly a lot more room for expansion on its vast property outside Austin. Beyond vehicle assembly, Tesla also maintains specialized manufacturing at Nevada, which is more famous for making the cells, but where pilot production of the Tesla Semi is underway today.

So what did he say and what's the path to doubling production? Well, the Tesla CEO announced that they would double US production in two years, but did not include any details on how they plan to achieve this dramatic production increase. And of course, no one challenges him in that particular situation on how to do it. In fact, even on the earnings calls these days, those kind of

so-called analysts, the people who watch the city, I think they're very much in awe of him because no one ever, it's always softball questions whenever I listen to one. I don't listen to all of them. So there's no opportunity to interrogate the CEO of a company

on what he means by we will double US production. Now, one possible approach involves expansion of Tesla's Texas operations. As I mentioned, they currently have more room for growth than the space-constrained Fremont facility, which is a bit of a Frankenstein's monster of a facility, using every bit of land they possibly can. And during the Q3 earnings call last year in 2024, the Tesla CEO predicted that Tesla would reach volume production of the CyberCab facility,

Now, the cyber cab is their autonomous robo taxi. Volume production will be reached in 2026. So that's next year, obviously an ambitious target. They mentioned two million units a year of the cyber cab and potentially scaling to four million units ultimately, but no date on that.

So if the projected cyber cab production, as he says, volume production is two million units a year, is included in this doubling pledge he announced yesterday, that would single handedly fulfill the promise of doubling current production capacity.

At the other end of Tesla's vehicle lineup, the Tesla Semi program represents an avenue for growth. According to Dan Priestley, head of engineering for the Semi, Tesla plans mass production at the new Semi factory near Nevada with the capacity of 50,000 units annually. And you have noticed I've not mentioned the Cybertruck. We'll get to that in a moment.

Tesla's production expansion plans come during a period of market challenges for the company. The EV maker has experienced weakening sales figures globally, with particular difficulties in Europe and China. This sales decline has added to market devaluation, with Tesla's stock down 40% this year and 50% since the peak following the election.

Well, several factors have contributed to that. The company faces criticism for an aging product lineup, but I'm not sure I subscribe to that because the vehicles might look the same. They might look different with the case of the new Model Y. But under the skin, there have been significant changes. So, yes, they still only sell five vehicles or so, and some of those don't really sell very well.

but they have improved them over the years, and they don't generate the same level of excitement they used to do. I've been doing this since 2018, and I can certainly, from my own perspective, make a comment that I see a lot less excitement, both on social media, both in the way the general media report Tesla these days compared to when I started doing this podcast, and that

initial excitement propelled Tesla to its leadership position, but I don't see much excitement around the company apart from outside the hardcore Tesla fans. Of course, competitive pressures are mounting. Chinese automakers like BYD surpassing Tesla as the world's biggest EV maker in sales volume. The shift in market leadership highlights competitive landscapes are changing around the world. Now, Tesla's political realignment, let's say that,

has alienated portions of Tesla's traditional customer base, particularly in regions in Europe where we don't appreciate Tesla's new stance on politics. Of course, they have a German factory and the company's reputation scores across Europe, the latest data I've reported on this podcast,

is declining significantly. Today, the brand has become poisonous among Democrats, according to one piece of data this week, raising questions about whether the popularity with Republicans is enough to offset, if you are going to make this political, Democrats not buying as many Teslas. Are there as many willing buyers in the Republican states to justify buying

doubling production capacity. The political dimension creates opportunities and risks, you would probably say. The company's increased polarized brand image may constrain the addressable market, particularly as Tesla attempts to broaden its appeal beyond early adopters. Just as they're hitting the mainstream or early mainstream adoption curve, they've taken this particularly polarized position.

Financial analysts have expressed varying degrees of concern about this. J.P. Morgan analyst Ryan Brinkman recently noted, "...we struggle to think of anything analogous in the history of the automotive industry, in which a brand has lost so much value so quickly."

This sentiment reflects broader market concerns about Tesla's ability to maintain its position, certainly in the premium segment, and increasing pressures from the other car makers. Now, to stimulate sales, Tesla's offered incentives, 0% financing, although that is with large down payments, and also things like bringing back free unlimited supercharging for life.

On the Cybertruck, with existing production capacity of 1.1 million vehicles in the United States, they need to hit 2.2 million by this time in 2027. Technically, it's feasible, but given the product introductions and facility expansions, the goal would be very, very challenging.

And that leads me on to the second point we'll talk about today, which is some new data coming out of S&P Global Mobility looking at registration data. Now, this is January. It's a little bit delayed, but it is United States specific, which is what I've been waiting for. And the EV market is showing significant growth in the US, which is great news. But Tesla's position within it seriously eroded.

Tesla's US registrations fell by 11% in January compared to the same month last year, with only 43,411 vehicles registered in the US in January. The decline is concerning as it occurs within, as I say, the context of a growth in the EV market.

A rising tide should be floating all boats, but the rising tide seems to be sinking just one of them, and that's Tesla capsizing. Tesla is losing ground rather than simply experiencing the same growth that the market has had. The company maintains its position as top. Don't get me wrong. They are still well and truly number one with the Model Y and the Model 3. They've got a 42.5% market share on January registration data in the US, but that's 12 points down from

on the same month last year. And that's a continuing trend, but not an isolated incident pointing to a structural issue. The sales decline is pronounced in California, you won't be surprised to hear, which serves as the most important EV market in the US. In a critical region, Tesla was down 11.6% in deliveries in 2024 as a whole.

that's 27,000 fewer EVs delivered in the year of 2024 compared to 2023. Tesla's performance declined, but the overall Californian market was up in 2024. If Tesla was excluded from the Californian market for last year, 2024, it would have been a market share increase of 20%, but you can't really do that or fudge the numbers like that. So the sales decline has not affected all models equally.

The Model Y, which was the best-selling EV in the United States and the best-selling vehicle globally in 2024, was down 26% on January registration data at 23,898. And I would think that's probably because people are delaying purchases because of Juniper incoming. I think it's still pretty good to still sell, you know, 23,000, 24,000 Model Ys, given that many people knew there was a brand new version incoming. It's a pretty good result.

The luxury lines, Model S and Model X, were particularly affected, though. Really, no one's buying those. They were down 45% on the X and 38% on the S. And the much-discussed Cybertruck, we'll come to that now. When we talked about that first story about...

growth, doubling it from 1.1 to 2.2 million. That would be installed production capacity. That's not how many vehicles they make in the US. That surely comes into it because the Cybertruck had one, two million people that were queuing up for it. Well, we'll discuss that next. I'll take a quick break. And when we come back, we'll talk about that and a bizarre incident in front of the White House where the president and the CEO of Tesla kind of became sort of

car salesman for the day. It was all a little bit weird, actually. Stick around. I'll tell you more next. And now, a next-level moment from AT&T business. Say you've sent out a gigantic shipment of pillows, and they need to be there in time for International Sleep Day. You've got AT&T 5G, so you're fully confident, but the vendor isn't responding, and International Sleep Day is tomorrow. Luckily, AT&T 5G lets you deal with any issues with ease, so the pillows will get delivered and everyone can sleep soundly. It's

especially you. AT&T 5G requires a compatible plan and device. Coverage not available everywhere. Learn more at att.com slash 5G network.

All right, welcome back to the podcast. So let's talk Cybertruck then. That has seen price reductions, new leasing options, 1.99 or 0.9 finance, I think at some point. And like I say, unlimited free supercharging. That's recorded 2,807 registrations in the United States in January. Now they do sell in Canada, but I don't imagine they're selling many there. What with picking a fight with Canada and Mexico as well, they're on sale. But I would

probably say that of that 2807 in January, most of those were the, obviously, nearly all were the US, that was far below an already low average. Now, the average last year was 3,300 units per month.

That vehicle should be scaling exponentially, to steal a phrase, orders of magnitude bigger, you would think, as it grows month on month. But it's down by 500 on average to 2,807. Were the Cybertruck's January registrations be annualized, I know you can't necessarily do that because it's one month out of 12. We've got a lot of the year left. But if you were, that would be 33,700 vehicles in 2025. And...

And that's before we have cheaper versions arriving and things like that. So you can't really do that. But if we did, that would be a massive difference to Elon Musk saying that he predicts 250,000 Cybertrucks could be sold every year. So how does Tesla fill that massive hole of 216,000 difference between what the CEO has predicted, 250,000...

and what would be 33, 34,000 annualized if you took the January number. How can Tesla make up that in the remaining months of the year? Well, so far, we're lacking specific guidance on that.

While Tesla experiences declining sales, let's look at the competition, the rivals. They're enjoying substantial growth, and that's great news for the US EV industry. Non-Tesla EVs were about 59,000 new registrations in January. Many competitors, double-digit, triple-digit growth for various reasons, I'll tell you that. Overall, BEV registrations were up 14%.

in January, which pushed EVs to 8.3% of the overall light vehicle market. So comparing year on year, January last year was 7.6% BEVs. This year, January US data is 8.3% BEVs. So they're up and by a good amount as well. The difference between

Between Tesla's performance and the other cars in the EV market highlights the challenges that Tesla is facing. Well, Ford has emerged as the number two EV brand in the U S in January up 54% GM Chevrolet brand followed in third place with 6,000 vehicles registered a 36% increase on the same month. The previous year, most remarkable was Volkswagen, but remember the ID four had a bumpy year last year, but even though it was doing okay in January, um,

They were in the next place with 163% rise on the same month last year. But again, coming from a low base, so you can always make percentages do different things. But still, that's great for Volkswagen, selling almost 5,000 vehicles registered in January at PureBevs. These figures demonstrate that traditional automakers are transitioning their product lines rapidly.

And the White House Tesla showcase is perhaps the weirdest thing we'll talk about today. Presidential promotion is something that I didn't think I would see of cars, but that's what happened. The U.S. president transformed the south lawn of the White House into a pop-up Tesla showroom on March the 11th, two days ago.

in an unprecedented display of product endorsement that has ignited controversy, as you can imagine, in debate about the ethical boundaries of government. The event featured five Tesla vehicles, including the company's Model S, which the president said he would buy, and the Cybertruck, with the CEO, Elon Musk, standing alongside as he showed the president the vehicles...

And this extraordinary use of White House presidential grounds for what people described as a commercial event has raised serious questions about where the line is between government authority and private business, particularly given...

Musk spending, some would say, 250 to 300 million on buying the election for the Republicans. Well, the Tesla showcase was live streamed by the White House deputy chief of staff, Dan Scavano, on ex-formally Twitter. And obviously ensuring maximum publicity, the White House press secretary, Caroline Leavitt, admitted,

assured reporters president that the united states would be paying full market price for the vehicle they will buy for the president to use during the showcase the current president emphasized his support for the company saying and i quote tesla's a great company they are american cars it is american made he employs thousands of people he has the most modern plants in the world end quote doesn't speak in long sentences does he

The president also specifically praised the Cybertruck's design, and he said, and I quote, "...in terms of imagination, and I think I have a pretty great imagination, who else but this guy would design this? And everybody on the road is looking at it. As soon as I saw it, I said, that's the coolest design. You've got to give him credit."

Well, Garrett Nelson, a senior equity analyst at CFRA Research, told Business Insider that investors had legitimate concerns that this focus on politics is spreading the CEO too thin, dedicating more time than actually running the car company. On the evening before the event, there was a post on Truth Social where the president denounced those saying they would no longer buy a Tesla and

And he said, and I quote, it's an illegal and collusive effort. No, it's just people saying I don't fancy buying one of those products.

He wrote, and I quote, "...but the left lunatics, as they always do, are trying to illegally and collusively boycott buying Teslas, one of the world's great automobile companies and America's number one producer of electric vehicles, in order to attack and harm Elon and everything he stands for."

Well, this relationship has created what critics described as an unprecedented level of private business entanglement with the United States government authority. The White House Tesla showcase generated criticism from ethical experts and lawmakers who view it as inappropriate. William F. Hall is an adjunct professor of political science at Webster University, and he previously served in the Justice Department, expressing concern that it's, and I quote,

could be reasonably assumed by some that the White House and the president's endorsement is now up for sale, end quote. Hall noted that while it's not uncommon for presidents to lend support to American companies, they're made outside the White House grounds at locations such as the factories or office spaces. Senator Chris Murphy was particularly scathing, posting on X, just because the corruption plays out in public doesn't mean it's not corruption.

He then took to the Senate floor. In his speech, Murphy elaborated, saying, This is how democracies die. Democracies die when the very powerful people steal from us so regularly, so openly, so unapologetically that we come to think it's normal, end quote.

He also rejected the notion that these types of conflicts of interest has always existed, but is now happening in public. The unusual nature of the event was underscored by ethics experts who noted that presidents typically avoid promoting consumer products to prevent the appearance of being conflicted. Back in 2017, I remember the former White House advisor turned media figure these days, Kellyanne Conway,

encouraged people to buy products from Ivanka Trump's clothing line, and was seriously reprimanded, resulting in a formal warning from the government ethics office back in the day how things have changed. Well, during the campaign in 2024, the president was highly critical of Tesla. In September 2023, he characterized them as the idea of the radical left fascists, Marxists, and communists.

During his inaugural address in January, he vowed to revoke the EV mandate to save the American auto industry, though of course the United States has never had and implemented an EV mandate. These past statements are obviously in stark contrast to the sudden enthusiastic endorsement of Tesla. Yeah.

It's amazing what a couple of hundred million can buy you, isn't it? And the transformation of the White House lawn into a Tesla showroom represents a blurring of the lines for many people. Now, while the immediate impact people are pointing towards the share price was up 3.8%, well, they say it worked wonderfully.

The longer term implications for both governmental standards and Tesla, I wonder, because having said all of that, I wonder if the best thing for Tesla right now might not be just to maybe remove itself from politics, stop being such a polarizing brand, and just get back to making great electric vehicles and being a little bit

neutral, agnostic, if you like. I wonder if showcasing and staging a contrived event where the president, who is a popular president, won the popular vote, of course, but with people who traditionally buy those vehicles is quite disliked. If you look at the reaction to the polls in the first five weeks, the approval ratings are quite bad in a historical context for a new US president.

I wonder if this stunt could backfire, whether all this simply does, if somebody was maybe wavering or on the line and they perhaps aren't a fan or didn't vote that way, whether this would make up their mind, whether the fact that these are now just Trump mobiles.

are there enough of his fans of those Republicans to be like, hey, I love an EV now? He has always been very anti-Tesla until he wasn't. So that's a very interesting thing to think about. I'd love to get your thoughts. Now, the best way to do that is probably as a comment on the Patreon page. You haven't got to be a paid up member. Just sign up for free and you can join the discussion, leave a comment. I'd love to know what you think. Maybe this stunt

actually, in the long term, probably did more harm than good, according to some people. I wonder. Well, that's your podcast. That's your bonus podcast for today. Thank you so much for listening. Always appreciate your feedback on these issues. Lovely to read the temperature of the room and get your emails to hello at...

at evnewsdaily.com. If you'd like to leave a private comment just for me and don't want to leave it in a public place, you can always email me personally. I'd love to know what's on your mind. Thanks for listening. See you again soon. And remember, there's no such thing as a self-charging hybrid.