Inflation is Coming to the Automotive Industry

With what’s going on in the automotive industry, namely the transition to electric vehicles, and the shortage of components, I think that it will result in inflation within the auto industry. Cars will simply become more expensive, not just new cars, but used cars too. Although Tesla may keep their prices down relatively, their waiting lists will increase as a result, and their used car prices will also rise. We are already seeing this happen.

I wanted to through what impact this would have on the industry and of course Tesla.

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This video is meant for entertainment purposes, not Tesla stock investment advice.

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  1. Also I'm an investor and not an owner. New cars are bad investment so i've never purchased one. Currently have 4 ICE vehicles but they're not worth much. Also, thinking gas will become much cheaper in the future. Still, I will probably buy a Tesla in the future due to operation costs and possibility it would achieve 500K miles +. The Cybertruck would check a lot of boxes for me.

  2. I would love to own a Model S, but I just can't justify spending $90,000 on ANY CAR. So I look to the Model 3 which is not near as good looking but is half the cost.
    But wait, the promise of a $25,000 Tesla some where in the future makes me wait even more. Yes, I'm a tight wad, a penny pincher. But in reality my wife and I use a car to go grocery shopping and for doctor appointments. Who am I wanting to impress by spending 90 Grand on a Model S??? Nobody!
    We just want a car to do its job and that is to haul us from point A to point B and back. And I want an EV. There is no other EV out there like a Tesla. So Tesla is what I want. But I don't care which model, I'm not trying to impress anyone. So I guess I'll have to wait for this upcoming $25,000 Tesla. It will do us just fine as long as I live long enough to see them available to the public and not just as a dream on you tube.

  3. I'd be curious to hear why you seem so certain that EV models from legacy automakers will be inferior to tesla in quality. As we're seeing Hyundai come out with a higher volt battery at the a lower price point (ioniq 5), have you revisited this assumption?

  4. Waiting lists for Tesla? You understand that Tesla cost minimum 50 000€…
    There are really nice ICE cars for less then 30 000 €, new.
    World that you describe is not the one we live in.

    And in America ICE cars are even cheaper then in Europe.

  5. Write you would but that e mustang? I saw it on road it looks like a big version of a Toyota Yaris. The e mustang is tall and not to my liking I would take a Tesla over that thing any day

  6. Curious which country you’re in that won’t get its first plaid until end of next year.

    We have a model 3P and LOVE it. More fun than our model X. It’s the perfect everyday car.

    It replaced an R500. I sure don’t miss buying gas!

  7. I think there may be something to the electric bike market point… small manufactures can easily enter that space, and in places where the weather is good all year long…

    Dammit, now you got me thinking of building a collapsing electric recumbent tricycle.

  8. Great analysis 👍.. i think the starting of volume production in tesla new giga factories will make a big blow in the automotive idustry in coming months .. greetings from egypt

  9. Well downunder new M3 had a massive price drop and Tesla is emailing interested buyers that cars are available for immediate delivery this has come just after BYD distributer Nexport, announced a 6model BEV range at incredible prices taking deposits late this year and deliverys in 2022

  10. Your episodes have gotten so good rnow I always hit the thumbs up button before they even begin. Keep up the great work and go get a Tesla yourself even though the E500 is an excellent car and I have one as well (AMG)

  11. Any US tax credits are unlikely to go to Tesla. Tesla doesn't need any help. Legacy auto needs a lot of help. No politician is going to ask taxpayers to subsidize high income people's Tesla purchase, or allow Tesla to raise prices by the amount of the subsidy. It's just not going to happen.

  12. Kind of interesting that you used your discretionary income toward investing in Tesla rather than buying one. Now you're in the queue for the Plaid. When will you pull the trigger on the Model 3?

  13. I just did the same thing – I was planning on buying a Model 3 SR+ next year, but after crunching the numbers, the cost/month of buying now is actually less than what I spend on my Hyundai Tucson plus fuel per month… so it was a no-brainer.

  14. Car Inflation has already been going on for years. Just read an article in Holland that compared the prices of the Golf VII in 2016 to a Golf VIII today: plus €5000, which is 20% more.

  15. The car under the rap on battery day might just be a platform for a suv a hatchback or a small compact.I feel the platform is the great idea.You then can be very versatile as what you put on the platform because the interior change would be minimal

  16. Tesla Economist…Your perspective and insight are unique…I have tried to compare your evaluations to all the Tesla channels i have visited. Elon Musk started an electric car company.. when the car industry was almost exclusively, Ice vehicles You started a YouTube channel when a lot of Tesla related channels were established… You now have approximately 25 Thousand subscribers…
    You have the individuality and a perspective that is incomparable For anyone who has an open mind in regard to Tesla. Your content is really thought provoking… Your channel will fly…. Please Keep your individuality.., Thank you for your videos. Would love you to have a live stream with Warren or perhaps some of the other prominent Tesla channels? But maybe that is not your preferred course of potential progress of action? I think you could bat with anyone and the content would be of compelling interest?

  17. I have heard many, many people say that the long range is worth the extra money because the range really makes the difference.

  18. Wow another Tesla will rule the world video lol , when is Tesla (cyberdine) systems 101 going into production. Get a life people if you really think the likes of VW , Ford , GM , Honda and the list goes on will fold your not of this world.

  19. I wondered why both Gali and Rob sold tesla stock to buy their first teslas, rather than buy on credit. Your approach makes more sense.

  20. I cant wait to hear about your experience as an owner!!!! I have a model Y, but when they were first coming out in the US, I put the $75,000 into STOCK when it crashed in the pandemic…… then it .. you know… went UP, and I sold just enough stock to pay off the car with cash and kep t the rest of the stock (about 66% of my investment ha ha ha)

  21. How can this guy call himself an economist if he thinks an EV tax credit reduces the price of a car? Tax credits are for the car company, not the individual. Car companies will simply increase the price of the car to consume the rebate for themselves.

  22. Always good to hear your take on things. FYI regarding electric bikes, they are like hens teeth to get especially for certain high end ones like the Brompton that has a waiting list. Bromptons now sell even higher used since people want them so much. That is the news out of Singapore and electric bikes have developed a waiting list when lockdown happened and people wanted something to do. We are already a year since then and the lists have gotten longer.

    Now as I have mentioned before, the legacy makers of ICE did not think we would still be this unstable for as long, but the pressure is building and only getting worse. While demand for Tesla's increase, the other guys are closing plants and pulling out of countries. Ford just announced that they were decreasing heavily in India (know anyone trying to get into that market?) after they made a $2BILLION loss. Ford has also pulled out of Brazil.

    Now why the analysts aren't looking at this and their huge debt load and worried about their immediate future I can't tell, but I am looking to see when the smart shorts start shorting legacy ICE.

    I'm going on two years with only one vehicle and I won't settle for anything else but a Tesla. We have one on order and are fine with the wait. We are not in a rush but you will see others making poor decisions and paying more for ICE instead on waiting so they will get a double hit.

    Demand for EV's are a growing problem so the faster Tesla gets the 4680 sorted the better and it helps that they have increased their orders with EVERYONE who is making a battery to sell to them.
    I wouldn't want to need anything for my EV if Tesla is in front of me in that line.

  23. Ah, the latest FOMO dilemma for TSLA owners… new Plaid or more stock… will the enjoyment of driving a Tesla Plaid now outweigh the disappointment of missing out on a possible “free” Roadster later…
    Happy to see you’ve made your decision!

  24. I’m on the same boat. Going to sell my Camarillo SS and finally order a teal since I’m basically getting it for free. Not selling any shares of Tesla of course. I’m using the banks money.

  25. This is my argument with friends. Everyone who owns a car is throwing money out the window. The gas and maintenance costs savings on your car will go a long way towards a Tesla monthly payment. And the kicker is, what will your Tesla be worth 3-5 years from now. Probably close to what you paid for it! Result- free Tesla

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