Posted on October 25, 2017 by Charles Morris
Few companies in history have inspired the extremes of love and hostility that Tesla has, and surely none have been written about in so many different branches of the media. Almost from its founding, Tesla was a darling of the tech press, thanks to Elon Musk’s high visibility among the Silicon Valley elite. And of course, the environmental media took an early, and favorable, interest. The outlook of most automotive mags was ridicule prior to the delivery of Model S, awe and admiration thereafter. Since Tesla’s 2010 IPO, the financial press has followed it closely. General-interest newspapers and news magazines frequently report on the company (although they seldom seem to understand what’s going on).
Above: Tesla logo artwork (Instagram: investorsniper)
By no means has all the attention been positive. Au contraire - there are whole web sites devoted to anti-Tesla bile, and some popular TV personalities spit out the names of Tesla and Elon Musk with the scorn usually reserved for a Hitler or a bin Laden.
Conventional wisdom is that companies should ignore negative press coverage, but Elon Musk has often chosen the opposite strategy, which has led to several highly entertaining incidents resulting in massive press coverage for Tesla, and embarrassment for the naysayers. In 2008, Tesla sued the English auto show Top Gear over a snarky review of the Roadster. Tesla ended up losing the lawsuit, but the years-long courtroom drama resulted in Tesla becoming a household name around the world. (Postscript: in 2015, caustic host Jeremy Clarkson was fired from the show, and a year later, his successor delivered a rave review of the new Model X.)
In 2012, the New York Times published an account of a road trip in which the reviewer claimed that his Model S had failed to deliver its advertised range, leaving him stranded in the snow. What he didn’t know was that Model S records everything in a log, like an airliner’s black box. Tesla released the data, which revealed that the reviewer had taken detours, failed to charge the car when he should have, and at one point driven around and around in circles in a parking lot. The resulting media wildfire spread to thousands of newspapers and magazines on every continent. Dozens of Tesla fans and media outlets recreated the Times’s midnight ride, and Tesla reaped an avalanche of positive publicity.
In April 2013, Tesla announced a profit, the stock soared 20% in one day, and many of the naysayers became cheerleaders overnight. From that point on, the general tone of Tesla coverage in the mainstream press shifted from skepticism and ridicule to respect, in some cases bordering on hero-worship. However, the doubters have not gone away. While there’s no denying Tesla’s past achievements, the future is an open book, and platoons of pundits continue to insist that the company’s wild ride will come to a horrible end soon. The stock web site Seeking Alpha, among others, provides a forum for endless anti-Tesla screeds (it also occasionally features pro-Tesla pieces). An endless procession of clever headlines predicts imminent collapse, and financial ruin for anyone foolish enough to invest in Elon’s house of cards (my favorite: “Winter is coming for Tesla”).
Above: A compilation of Tesla naysayers (Youtube:
Who are all these spoilsports and party-poopers, and what motivates them? There are several answers. Stock market short sellers (speculators who place bets that a company’s stock price will go down) have flocked to TSLA since the 2010 IPO, and have collectively lost millions of dollars. Some of the anti-Tesla screeds in the financial press are surely aimed at bolstering their bearish viewpoint. Some (but by no means all) conservative political writers detest everything to do with electric vehicles. Some readers believe that anti-EV writers are financed by Big Oil, the Koch brothers, Russia and other sinister puppet-masters, and there is probably a certain amount of that going on, especially when it comes to the ungrammatical, incoherent rants that clog up the comments sections of EV-related web sites.
However, the vast majority of anti-Tesla writers probably have the same end in mind as pro-Tesla writers do: writing is their business, and they try to write articles that will attract readers and earn them money. And contrarian articles sell, especially online. There has always been a huge audience for pieces that contradict whatever seems to be the current majority view on any subject. Such articles (among journalists, the technical term is “turd in the punchbowl stories”) are even more effective if introduced by a shocking, inflammatory headline. People who agree click and read because they want to have their beliefs reinforced, and people who disagree also click, because they just have to see what this crazy person is going on about.
Of course, the anti-Tesla stories cover the whole spectrum of respectability. Some are reasonable works of journalism, with logical arguments backed up by facts and figures. At the other end of the clickstream, some are rambling rants, replete with cherry-picked statistics, outdated and/or misleading information, and a large helping of outright lies. What are the main anti-Tesla arguments that the petulant pundits make, and do any of them have any merit?
One perennial mainstay of the anti-EV crowd is that EVs will never catch on because of high prices, limited range and long charging times. This argument rests on a logical fallacy called static thinking. It assumes that technology is going to stand still, despite daily evidence to the contrary. Naysayers made the same argument in the early days of the internet, especially with regard to online audio and video. It would never work, they told us, because download speeds were too slow. Even at that time however, anyone who read the tech news would have been aware that telecom companies were investing massive amounts in a race to increase bandwidth and eliminate that bottleneck, just as thousands of researchers around the world are now working on bringing down battery prices and developing ever-faster charging technology.
Above: Higher volumes and improved energy density are causing battery costs to plummet (Source: The Economist)
Another bugaboo that just won’t go away is the myth of the “long tailpipe.” According to this argument, because some of the electricity that charges an EV comes from dirty coal, the EV is actually responsible for more greenhouse gas emissions than a legacy vehicle. While this may sound like a valid concern, it was definitively debunked in 2012 by a detailed study from the Union of Concerned Scientists (UCS), which found that even if it were charged 100% from coal, an EV would still be cleaner than the average ICE vehicle, because of the electric motor’s far greater efficiency. A later UCS study examined the entire life cycle of an EV from manufacturing to disposal, and found that battery electric cars generate half the emissions of the average comparable gasoline car. Study after study after study after study after study has reached similar conclusions (and writer David Herron has published a digestible summary of the issue).
There’s an enormous irony at the heart of the long tailpipe canard: those who argue for it are invariably also deniers of climate change. Major environmental organizations such as the UCS and the Sierra Club are staunch supporters of EVs. Venerable curmudgeon George Will invoked the long tailpipe in a recent EV-bashing editorial in the Washington Post (which, ironically, published another article a few days later heralding the imminent triumph of EVs). Where’s the logic here, Uncle George? If there’s no climate change, then there’s no reason not to burn coal, so a coal-powered EV should be a good thing, right? In fact, one West Virginia utility used to proudly advertise its American-coal-powered EVs.
Many Tesla-bashers, especially in the political press, insist that the company, and EVs in general, are dependent on government subsidies. There’s a grain of truth, and a barrel full of irony, in this. The truth is that the federal CAFE standards and California’s zero-emission vehicle mandate (which is also followed by 9 other states), have greatly advanced the development of EVs, by forcing the legacy automakers to build them. Public charging infrastructure (with the exception of Tesla’s) has also benefitted from the support of governments around the world. The irony is that Tesla, which was founded for the sole purpose of building EVs, is the only company that would be building EVs even if those regulations didn’t exist. Subsidies? The only direct federal aid Tesla has ever received was a $465 million federal loan which it repaid in full nine years early, delivering a profit to taxpayers (by the way, Ford received $5.9 billion, and Nissan scored $1.45 billion, under the same program).
Above: Tesla's loan was paid back nine years early with interest and was far smaller than loans received by Ford and Nissan (Source: U.S. Department of Energy)
The financial press is obsessed with Tesla’s ongoing multi-million-dollar losses (since the company posted its game-changing profit in 2013, it has not seen fit to repeat the performance, preferring to plow its earnings back into new projects). Today’s stock analysts are focused on quarterly profits, and it drives them mad that investors continue to reward a company that doesn’t deliver any. They seem to have forgotten about the stock market stars of the internet era, which posted years of losses while building their brands - some of whom went on to become superpowers (okay, some others went bust).
Probably the most common argument for Tesla’s imminent demise is the difficulty of ramping up Model 3 production to a mass-market level. Anyone who’s familiar with the auto industry, including Elon Musk himself, will admit that this is a valid concern. Producing automobiles on a mass scale is one of the most complex tasks ever undertaken by humans (or robots), and for a young company building a totally new kind of car to pull it off will be an incredible feat. The things that could go wrong... let’s just say that there’s a chance Tesla could fail.
The only answer to this is a now-familiar question: Do you want to bet against a man who redefined the automobile, landed rockets on a barge, and powered a whole island with solar power?
For those who share the Tesla vision, all the arguments of the pundits and the fulminations of the trolls are as raindrops, rolling off a Model X windshield. And, doubtless, vice versa. A hundred years hence, when the Tesla Model AA is cruising around the utopian urban environment of Mars, naysaying nabobs will still be nattering that it’s all bound to come to a bad end someday.