- If I asked you to close your eyes
and picture an electric car,
I'd be willing to bet that you're picturing a Tesla.
(electronic music)
Of course you are.
Tesla Motors is far and away
the top seller of electric vehicles globally.
And they have been for years.
When it comes to mass produced EVs,
Tesla faces no real competition.
So why are all the other car companies failing?
I'm a freaking collectable.
Check it out, these are the first official Donut figurines.
We've got James "Kentucky Cobra" Pumphrey over here
and me, Nolan "Be Kind" Sykes.
These limited edition figurines will be available
September 25th starting at nine a.m.
And once again, they are limited.
So once they're sold out
that's it, there's no more of them.
But for three of you lucky D-holes
we're gonna be giving away three signed figurines.
That's right, signed by James and I.
So to enter go to donutmedia.youtooz.com,
follow the steps like visiting their Youtooz Reddit
or their YouTube.
The more steps you do,
the more likely you are to win.
So get on it. (car horn honking)
The protective sleeve is off.
(Nolan tapping)
Hear that?
Oh, look at that.
I love you. - Aww.
And there it is.
There's James.
And even on the shirt you can see
that it does have the Donut logo,
oh, on the front and back.
There's nice little touches here.
I do like that James just looks so joyful.
Let's open up mine.
(upbeat music)
Be kind.
Perfect. Alright.
Got glasses, aye, that looks like me.
They've even got my mole.
How did I get to a point in my life
where there's a collectable of me?
In my car no less? (car horn honking)
Guys, I'm really excited for this.
When you get yours
please post some photos of them and tag me.
'Cause it's surreal that I have my own collectable figurine.
So see you on September 25th
and good luck to those who enter.
You know me,
I'm a red-blooded gasoline boy through and through.
But even I have to admit that the future is electric.
We even made a video on whether or not electric cars
are better for the environment than gas cars.
The answer may shock you.
It's actually one of my favorite videos we've ever done.
And if there's one thing I've learned
from all of automotive history,
it's that competition breeds the best cars for consumers.
Which brings me to electric vehicles.
Of the approximately 65 and a half million cars
sold around the world last year,
EVs made up a mere 2.5% of the global market
and just 1% in the US.
But within the market, Tesla,
specifically the Model 3, completely dominated.
In the United States last year
Tesla's made up 78% of all EV sales.
So far in 2020 they're outselling
the next three biggest EV manufacturers combined.
The Model 3 is
the world's best selling plugin electric vehicle
and it's not close.
It doesn't just leave other companies in the dust.
It's lapped them about 10 times over
and has taken off like a rocket
to Elon Musk's condo on Mars.
The lack of competition is frankly frustrating.
There have got to be plenty of companies
that have the resources
to provide an electric vehicle to the masses, right?
There should already be a people's electric car
comparable to a Tesla on the market.
But there just isn't.
And it's not for lack of trying.
There have been several swings and misses
made by the would be Tesla killers in the past decade or so.
For instance, despite Audi's popularity,
their e-tron never really took off.
Faraday Future's CEO went bankrupt
and literally fled his debtors
after the failure of the FF 91.
Even Dyson tried their hand at EV manufacturing
before pulling the plug on a project because it sucked.
We talked about the Dyson car more in depth a few weeks ago.
Go check out that episode if you haven't seen it yet.
The car doesn't really suck,
it was just really expensive.
So what is everyone doing so wrong
that Tesla is doing so right?
Well, I've done some research
and I've come up with three main areas
where Tesla is kicking everyone else's EV butt.
But the third one's got the most oomph.
It is definitely the nail in their collective coffin
leading directly to the answer
of why they have stayed miles ahead
of everyone else in the race.
How did they consistently blow away their competition?
First of all, in a nutshell,
Tesla's electric vehicles are just plain better to drive
than anything else on the EV market.
Tesla hits it out of the park
when it comes to the overall consumer experience.
I'm talking about how damn good
driving a Tesla really feels.
Take the Model 3,
Tesla's more accessibly priced family car
and their stab at creating a mass market EV.
This car is a dream to drive.
It handles well, drives smooth.
and is incredibly safe alongside all the standard EV perks
like the quietness and instant torque.
The design of the interior is a minimalist's dream.
The aesthetics are sleek and modern.
The user interface is sophisticated yet kind of simple.
It's a little more on the sophisticated side.
I did not understand the Tesla hype until I drove one.
Say what you will about the build quality
and the gimmicky features
like having to use a touchscreen to open the glove box.
But after driving it I truly do not care.
Another huge factor is batteries
in that Tesla's batteries have longer range
than all their competitors.
In fact,
Tesla's cars hold the top four positions
on the list of EVs with he longest range.
Not only are their batteries the best,
but they're the only company to offer
different battery packages at different price points.
So although the base model of the high selling Chevy Volt
has comparable range to the base Model 3,
Tesla's higher specs smoke the Volt.
Plus it's faster and more fun to drive.
It's that variety that sets the Tesla apart
from other electric vehicles.
How the driver experiences
the automated capability and features.
But I'll get to the technology section
of my love letter to Tesla a little later.
I want to take a moment now to remind you
that Tesla isn't perfect.
They've seriously struggled
with poor build quality and paint quality many times over.
Remember back in 2018
when they were building cars in a literal tent
to meet their quarterly production goal?
That resulted in a harsh lack of quality control
and a high number of defects in their cars.
As a company they've faced harsh criticism
of the quality of their work.
Over time though
they've been steadily addressing these concerns.
Solving problems, introducing newer and better models.
Something that BMW hasn't been doing with the i3
which is arguably the most recognizable rival of Tesla.
This rivalry goes all the way back to 2013.
BMW started developing the i3
as Tesla was producing their flagship Model S.
But the truth is these two vehicles are nothing alike.
The model S is a luxury sedan.
It's reminiscent of the Mercedes Benz S Class
in its aesthetics and performance.
But the i3 almost looks like
a toy version of a futuristic car.
Its design makes it read
somewhat more like a novelty than a daily driver.
And though it's years on the market
have given it something of a reputation,
it's still BMW's only fully electric model.
Since the i3 launched Tesla has been hard at work
with that signature innovation and relentless development
to create newer, better models like the Model Y, Model X,
and everyone's favorite, of course the Model 3.
The second (clears throat).
The second point I'll make
as to why Teslas are so appealing to consumers
has very little to do with the actual machines themselves.
(upbeat synth music)
Teslas, much like yours truly,
have an undeniable cool factor.
(heavy metal music)
They have that je ne sais quoi,
an indisputable sense of joie de vivre,
and when you see one it coup de souffle.
That last one means to take your breath away.
I had to do that like five times.
I'm very bad at French.
If you'd like to hear more of me butchering pronunciations,
check out our podcast "Pass Gas".
Lots of names that I don't get right
and people send me helpful mail.
What I'm getting at here
is that Tesla has top-notch branding and marketing.
And they have a $0 advertising budget.
They literally don't do ads.
They don't have to.
They're in the zeitgeist.
And although they're a young company,
Tesla is a household name.
Not to mention the name itself is catchy and apropos.
Something that other companies have tried to copy.
I'm looking at you, Nikola.
Can't just piggyback off Tesla
and use the same guy's name.
Look I don't want to disparage your cars
or anything like that but that's, that's weird.
Of course a large part of its marketing success
is due to the eccentric personality
and celebrity of its CEO Elon Musk.
(jazzy music)
Elon basically doubles
as the marketing department of the whole company.
Everything he does is some kind of commercial for Tesla.
Whether he's sending a Roadster to Mars,
smoking a joint with Joe Rogan,
or tweeting away to his 38 million Twitter followers.
Elon stays in the headlines,
and therefore so does Tesla.
And look he's definitely not
everyone's cup of billionaire tea,
I
have my issues with him,
but the fact is whether or not you're a Muskhead or not
I'm willing to bet that most people in your life
know who he is.
Can you say the same for Mark Duesmann or Jim Hackett?
No.
You know Elon Musk's name.
Might not know his kid's name,
but honestly I don't think he does either.
- How's X AE A-12? - Sorry?
- How's X AE A-12? - Oh, oh you mean my kid.
(Elon laughing)
- But with this help Tesla has an ardent and loyal fan base
unlike that of any other car manufacturer.
Furthermore, because of their success,
all other EVs and their commercials
kind of serve as free advertising for Tesla.
When new EVs come out
analysts often labeled them as Tesla killers.
That's free advertising.
Some companies like Volvo openly challenged Tesla
when they launch a new EV.
Volvo claimed the Polestar 2 was their Tesla 3 competitor.
It's free advertising.
Then there's companies like Ford
who spend hundreds of millions of-dollars
on advertising every year
and base the whole marketing campaign of the Mach-E,
an electric vehicle,
on the Mustang,
arguably one of the most iconic gas fueled cars ever.
Why are they lumping these two ideas together?
It pisses off some Mustang fan boys
and is a complete missed opportunity to center Ford
as a force in creating new, fresh,
alternative energy vehicles.
It's not that innovative.
Tesla though sells innovation.
They sell progress.
They sell a vision of the future
where technology is utilized to improve our lives
and the planet.
It's marketing, baby!
Speaking of technology,
it is the third component of my breakdown
of Tesla's superiority over other electric vehicles.
And it's the big one.
(synth music)
Teslas are software defined vehicles.
What that means is that all the functions
and features of a Tesla are primarily enabled and operated
by software as opposed to hardware.
This is what people are talking about when they say
that a Tesla is basically a computer on wheels.
They're right.
Software defined vehicles are different
from the analog vehicles of yore
because they offer an ever changing and evolving platform
to suit customers' needs.
Tesla owners can reap the benefits
of software updates, bug fixes, and feature upgrades
without a single trip to the dealership.
And I'm not talking about a new navigation system
or stereo settings.
These updates are like getting a whole new tune on your car.
The most recent update for instance
includes lower charge times, increased cruising speeds,
updated driving visualization
which further inches them closer to full self-driving.
It even adjusts your suspension
to support aerodynamics and ride comfort.
It's awesome.
And while I love me and analog dash
with a loud internal combustion engine,
I can't deny that cars are headed for a digital future.
Tesla is leading that charge,
and boy, do they have a huge headstart.
Their tech is what makes them untouchable
even to good-looking competitors.
Take Volkswagen for example.
When they announced their ID.3
they called it their electric offensive
and it would dictate tens of billions of euros
in the next eight years to launch up to 70 new EVs.
The ID.3, meant to compete with the fierce Model 3,
looked like it might give Tesla a run for their money.
At first.
It's an everyday EV with great maneuverability
and with pretty good range.
The rub was, predictably, the technology.
After hitting the market it soon became clear
that the software in the ID.3 was too hastily developed.
In fact, the ID.3,
the company's first mass market EV's launch,
was delayed due to the software issues.
And the first versions of the car will be equipped
with incomplete software architecture.
(sad trombone playing)
VW just didn't have the people or the expertise
to compete with Tesla's computers.
Tesla has those things in spades.
On top of being software defined,
Tesla is the unrivaled leader in self-driving technology.
They've been working on it longer and harder
than any other company.
There's no fully self-driving vehicle yet
but Tesla is getting close.
It's got sentry mode
which continuously monitors the surroundings of the vehicle,
adding protection,
and laying the framework for a self-driving future.
Tesla's integrated central control unit,
also known as full self-driving computer, AKA Hardware 3,
quote, "claims a computer performance
"of 144 trillion operations per second."
Do you know how many a trillion is?
It's a million millions.
Now imagine 144 of those.
I can't wait to see the animation of this.
(ominous strings playing)
Now I don't know too much about computers
but that sounds like a pretty damn smart one to me.
This FSD computer has capabilities
that competitors can only dream of.
It's Tesla's ace in the hole
and their biggest advantage over their competition.
In Japan, Nikkei Business Publications
did a tear-down of a Tesla Model 3
to try and figure it out.
What they discovered upon inspecting the FSD
is that Tesla's technology
is about half a decade ahead of the competition.
So even for competing EVs,
like the beautiful Jaguar I-Pace
whose infotainment system might actually have
a slight edge over its Tesla counterpart, the Model X,
the self-driving tech is completely unrivaled.
Tesla tech is king.
Consumer experience, branding and marketing, technology.
Tesla trumps all around.
But now that we've looked at specifics,
let's back up and think about the big picture,
the giant question we're trying to answer with this video.
Why does everyone else keep failing?
This is not a simple answer,
but as far as I can tell based on my research,
legacy car manufacturers are failing to compete with Tesla
for a couple of reasons.
Firstly, many of them just plain underestimated Tesla
when they were first starting out.
Tesla's aspirations were lofty
and car companies like BMW and Mercedes Benz
didn't think Tesla could execute on their vision.
This was especially true in the case of the Model 3.
Tesla had a plan to deliver an affordable option
to reach a wider market.
And they did have problems and setbacks
in the early stages of creating and manufacturing.
But they figured their (bleep) eventually.
And this year so far they've shipped about 400,000 Model 3s.
Nobody thought they could do it.
Egg on all the haters' faces
and you know what, egg is unpleasant.
But hindsight 20/20,
which just also this year.
Did you know that?
The big wigs of our beloved big car companies
can't erase their past mistakes.
But what is so frustrating about the situation
is that they're also still reluctant to change.
Every single big car manufacturer
is dependent on the automotive industry's
parts supply chain.
Their business model depends on it.
The parts supply chain is a layered system
that includes dealerships, manufacturers,
and three tiers of part suppliers.
Car buyers go to dealerships
who place orders with manufacturers
who then use the dealers data to design new models
and collect components from the first tier of suppliers
who source parts from tier two suppliers.
Tier three sells raw materials to everyone.
It's complicated.
This system has been ingrained in companies for decades.
Of course it's facilitated growth
but it also effectively kept big car companies
from rolling with the technological punches.
Tesla, on the other hand,
doesn't rely on a parts supply chain
and instead manufacturers
almost 100% of their vehicles in-house.
There are no dealerships,
no ordering parts from some other factory,
and thus, no middle man.
Like we talked about earlier,
Teslas are software defined.
Tesla never made an ICE vehicle
that would benefit from a parts supply chain.
And the fact that the FSD computer
replaces so many hardware components of an ICE vehicle
is what makes the in-house manufacturing possible.
The AI chips that are the beating heart
of every Tesla machine are made, inserted,
and sold by Tesla.
It's a consumer's dream,
a no hassle one stop shop
for all your car-puter buying needs.
If other car companies want to compete with Tesla
they have to compete with their business model.
Tesla is essentially rendering supply chains obsolete,
forcing car companies to follow suit
and completely uproot
their entire manufacturing and business models.
That's a big ask,
that's a big ass (giggling).
That's a big ask.
If I was Mark Duesmann I'd be reluctant too.
Especially since Tesla only takes up
1% of the market in the US.
And they haven't made a profit yet.
I know I've been saying their highest praises so far,
but Tesla isn't a perfect company.
It has its problems too okay.
For one, since it was founded in 2003,
Tesla motors as never reported an annual profit.
And for all its innovation,
uncharted technological territory
is a breeding ground for risk.
So there is a chance for the car makers we know and love
to stand up against the auto tech giant.
It's just gonna take some risky moves
and a couple profound changes.
It's hard to imagine but car companies kind of have to adopt
an in-house manufacturing model for their EVs.
It's the key to Tesla's success.
And although it seems impossible,
it's the only clear way out of inevitable obsolescence.
Secondly, Tesla isn't the only company in the world
making AI chips.
Legacy car companies need to partner with AI platforms
if they want to stand a chance against Tesla.
Mercedes is already on this train
and recently announced a partnership with Nvidia
to build their own software defined vehicles
in what could be the first real competition
Tesla has ever faced.
And you know what, I'm here for it.
I'm always rooting for the underdogs
like Mercedes Benz and Nvidia.
You know, those little upstarts taking it to the man, dude.
And for how much I appreciate what Tesla makes,
I also know that it is intrinsically different
from what we know a car to be.
It's complicated and the future is uncertain.
What is certain though is that the presence of EVs
will only increase from here on out.
And let's hope that there are plenty to choose from.
If you'd like to see more videos from us
subscribe to Donut Media.
We put out a video almost every day.
Follow us on social media @donutmedia.
We post behind the scenes pictures and talk to you guys.
Follow me @nolanjsykes.
I fancy myself an amateur photographer.
Be kind, see you next time.