What Tesla’s Troubles and Musk’s Missteps Mean For You
The true cost of EVs
Ric Edelman: It's Monday, May 1, and Tesla has cut prices for the sixth time this year: starting price of the Model S, down five percent; the Model X, down nine percent. When you cut the price of the new cars, you cut the value of the used ones. The value of used Teslas has collapsed in the past six months, according to sales data. A new Model 3 is projected to fall by nearly fifty percent by the end of the year, and that's not the only problem with Teslas right now. The National Highway Transportation Safety Administration (NHTSA) says that steering wheels are falling off the Tesla Y. Hundreds of thousands of Teslas have been recalled because of issues in their autopilot system. Their full self-driving system has been linked to fatal accidents, and did you know that Teslas have internal cameras that record what's going on inside the car? These videos get uploaded to Tesla, and over the past four years, Tesla employees, according to news reports, have been sharing these videos among themselves: videos of drivers and passengers in embarrassing and compromising situations, all that according to Reuters. It says former employees have reported that they could see inside people's garages and their private property. Did you know that your Tesla is snooping on you and uploading the data to employees who see what you're doing in your car when you think you're alone?
And let me ask you this: are you sure you want an electric vehicle as opposed to an internal combustion engine? Look, I get it. Electric vehicles are cutting edge technology, they're quiet and really fast, and they don't directly pollute the air. But are they truly economically superior?
Electric vehicle sales are going to rise twenty five percent this year; one in 12 cars sold in the U.S. will be electric vehicles. But compared to an internal combustion engine, an electric vehicle will take five to 10 years to pay off. Are you gonna own the car that long? That all depends on whether you get the state or federal tax credit, you know, the rebate for buying an electric vehicle. The average electric vehicle costs $60,000; that's $10,000 more than the average internal combustion engine vehicle. The cost of charging an electric vehicle at home is equivalent spending a dollar a gallon for gas – that’s a bargain, right – compared to the real price of gas. At 15,000 miles a year, you'll spend about $3,700 versus about $10,000 on gasoline. It sure makes it look like the electric vehicle is cheaper, but the insurance cost is up to fifteen percent more for an electric vehicle compared to an internal combustion engine, and not every state offers those rebates for buying an electric vehicle.
So, my point is simply this: you need to recognize this is new technology. You need to realize that there are some kinks that need to be worked out – that Tesla for the last decade hasn't been a choice – it’s been a lack of options. Now as virtually every car maker is offering electric vehicles, you need to recognize you're not stuck with a Tesla-or-nothing; you can now choose from a wide variety of vehicles, and you need to truly evaluate, is it more economical for you to own than an internal combustion engine? Figure it out because you're going to own this vehicle for a long time.
I'm Ric Edelman. There's a big buzz going on about crypto. What you need to realize is that there's more buzz than there has been in years, and this isn't going away. That's why you need to learn what all this is all about. And I want to help you. We've just created a new track in our Certificate program for Blockchain and Digital Assets. We have a track specifically for investors, consumers, and students. That's in addition to a separate track for financial advisors, a track for financial professionals working in the back office, and a fourth track for crypto professionals. Now you, as an investor and consumer and student, can get the education you need, so you can cut through the nonsense and understand what everybody's actually talking about. You can learn about this new Certificate in Blockchain and Digital Assets from my sister company, DACFP, the Digital Assets Council of Financial Professionals at DACFP.com. The link is in the show notes. I'll see you tomorrow.