Comment by ClarityJones 3 days ago
The author said he saw Tesla prove that EVs were profitable, but it was profitable when taxpayers gave it $7,500 per vehicle sold... That's the whole profit margin on higher-end cars, and more profit than most mass-market makers get. EVs were never profitable.
If you want to deduct tax rebates, then what about the other side?
- New cars are subject to sales tax
- In some states (e.g., California), there are additional fees buried in DMV registration costs. California's Vehicle License Fee (VLF) is based on the depreciated value of the car. So newer and more expensive cars pay more to use the roads than do older cars. So the VLF is effectively another tax on new cars.
Even when excluding regulatory credits and consumer tax incentives, Tesla’s automotive business remains profitable.
Cost of Goods Sold (COGS): As of late 2024 and early 2025, Tesla’s average cost to produce a vehicle dropped to an all-time low of under $35,000.
Gross Margin: Tesla’s automotive gross margin (excluding regulatory credits) has typically hovered between 15% and 18% recently. This means they earn several thousand dollars more per car than it costs them to build.
That was a very long time ago and many billions ago and it was a loan that was repaid with interest in two years.
Tesla don’t only sell in the US - when you say “per vehicle sold” - are you saying that the American taxpayers were subsidising the global sales? Or are you saying they were not profitable only in America?