- Jan 31
- 4 min read

TESLA Will Launch Price War in US Says Michael Dunne

Tesla's Potential Price War and Dominance in the US Electric Vehicle Market: A Discussion with Michael Dunne and Hans C Nelson on the Impact of Tesla's Competitive Advantage and Charging Infrastructure Challenges for Other EV Manufacturers

Questions to inspire discussion:

🤨 Is it possible for Tesla to start a price war in the US in 2024?

According to Michael Dunne, he predicts that Tesla will start a price war in the US in 2024, similar to what it did in China last year. Whether this is possible remains to be seen, but Dunne's statement suggests that he believes it is within the realm of possibility.

💬 What impact does the wait for electric vehicle improvements have on Tesla?

The wait for electric vehicle improvements impacts Tesla by potentially allowing other players to catch up. It may also affect Tesla's market dominance and influence in the industry. The impact of the wait on Tesla's position should be considered in relation to the evolving landscape of electric vehicles.

🤨 How does Tesla's pricing power affect its competitors?

Tesla's pricing power puts pressure on its competitors, as it can kick off price wars and impact their margins. This was evident in China last year when Tesla's price war caused pain for all of its competitors. Non-Tesla automakers are feeling the effects of this in the United States as well.

❓ What challenges did Hertz face with Tesla as rental vehicles?

The challenge Hertz faced with Tesla as rental vehicles was around the reliability and repair costs. The vehicles themselves are very reliable for daily EV users, but when inexperienced drivers abuse the vehicles, it can lead to reliability issues and higher repair costs.

🚗 Why are Legacy car companies not likely to compete with the likes of Tesla and BYD?

Legacy car companies are not likely to compete with the likes of Tesla and BYD because they struggle to adapt to new paradigms and are unable to make the necessary price cuts to stay competitive.

🚘 What makes Toyota successful today and how does it relate to the competition with Tesla?

One of the things that makes Toyota successful today is their ability to sell Camry and Corollas, as well as entry-level new car vehicles that other companies have walked away from. This relates to the competition with Tesla because if Toyota were to go head-to-head with Tesla in these categories, it could potentially accelerate their demise, especially if Tesla's technology has the same impact on Toyota's vehicles as it did on the BMW 3 Series.

Key Highlights:

Tesla predicted to initiate a price war in the US, causing disruption in the electric vehicle market. Expert opinions and insights discussed.
Impact of Tesla's pricing power and charging network on the EV industry, with potential price war and margin implications.
Importance of KNX for long distance travel, challenges with Tesla reliability and repair costs for new EV users.
Legacy auto companies face challenges transitioning to EV manufacturing due to existing infrastructure and lack of expertise.
Tesla's entry into new vehicle categories will intensify competition and potentially disrupt the market, leading to a price war in the US.

Clips:

00:12 ⚡ Tesla predicted to initiate a price war in the US by 2024, causing concern for other EV makers. Charging infrastructure for non-Tesla EVs still a challenge.

Tesla predicted to start a price war in the US by 2024
Concern for other EV makers due to potential price war
Charging infrastructure for non-Tesla EVs still inadequate

03:57 ⚡ Tesla's competitive advantage in pricing and charging infrastructure will impact other EV manufacturers, causing a dilemma for Western automakers.

Tesla's pricing advantage and charging network impact other EV manufacturers
The dilemma facing Western automakers in transitioning to EVs
Potential impact of price cuts on Tesla's position in 2-3 years
Expectation of limited production growth for Tesla's current models
Value proposition of Tesla's models and charging infrastructure
Access to Tesla's charging network vs. waiting for other OEMs' chargers

08:13 ⚡ Challenges faced by traditional car manufacturers in transitioning to electric vehicles and Tesla's competitive advantage in pricing and profitability.

Challenges in repairability and access to service for EVs compared to traditional vehicles
Tesla's cost advantage and ability to maintain profitability
Difficulty for traditional car manufacturers to produce EVs profitably
Risk of failure for companies not adapting to new technology, illustrated by Kodak and GM
Struggle for legacy companies to profit from new technology

12:33 ⚡ Tesla's potential price war and dominance in the EV market, with legacy auto companies struggling to compete.

Legacy auto companies face challenges in competing with Tesla in the EV market.
Disruption works differently than assumed, as seen in Kodak's failure to compete with digital camera companies.
Tesla's potential to lead a price war in the US, impacting legacy auto companies.
Legacy auto companies have lower production volumes, impacting their cost of goods.
Tesla's ability to reduce prices and increase volume due to cash balance and gross profit margin.
Tesla's untapped market in vehicles below $30,000, giving them a competitive edge.