Elon Musk’s Conference Call And The Dumb Media Reaction To It

I really wanted to talk today about the improving sales of hybrids and how that’s a good thing for the world and, yeah, I’ll get there. I’ll also use this Morning Dump to talk about the escalating UAW strike. But first, I’m going to do what I really don’t want to do and defend Tesla CEO Elon Musk against weaponized bad faith. This might be a theme today.

This is a car website and I like to avoid politics when I can because my faith in this world relies, in small part, on the hope that there are enough things that bind us to one another (church, sports, and especially automobiles) to keep us from entirely spinning apart. Some days clinging to that hope is like holding onto an oily drain plug.

Politics always find you and, while talking about Elon Musk isn’t explicitly a political act, it does attract love and hate, in equal measure, from people on the capital “I” Internet. So let’s do it because there’s some real dumb dumb nonsense out there I’m just not gonna abide any longer. Also, welcome to Bizarro Day, where David Tracy is an EV soyboy (more on that later) and I’m defending Elon Musk.

Elon Musk Didn’t Cry On His Call

The Internet as we know it is a machine that is fed by outrage, and there are websites that exist to churn that outrage into clicks, which makes them money, which makes them create more outrage. That’s fine. People have to make a living. When Elon Musk does something wrong we, here, are also not above calling him out on it. But there’s a deep hypocrisy and lack of insight out there I feel I have to address.

Brands are not your friends, though it’s fine to make ethical choices about your investments in brands, even if they won’t always work out. When you outsource your financial and emotional stability to the same thing you will very likely reap what you sow, eventually, and it won’t be pretty. Just look at all those people on the Internet who got big mad about losing their apes.

It’s in this environment that Tesla decided to cut prices in an effort to maintain some of its shrinking market share and take advantage of its lower production costs to maintain revenue as it tries to expand. Tesla has been one of the most valuable stocks to own for a long time, and an entire cottage industry has popped up on the web of people who think they’re smart because they bought Tesla at some price and they are extremely invested, both literally and emotionally, in the stock price of Tesla.

Some of these people are, seemingly, exuberant and somewhat earnest investors. Other people seem merely like showman who make some money off the stock and more money off of people reacting to the stock. When faced with a version of Elon Musk who is not a superhuman genius but rather an actual human being, it gets messy.

As I reported last week, Elon Musk was quite forthright on his Q3 investor call about the challenges of the future. He talks about interest rates and vehicle affordability. He talks about how hard it is to build the Cybertruck. You can listen to the call in the YouTube link above. Does he sound a little emotional? Sure, he’s an emotional person. Without psychoanalyzing Musk too much, the whole notion of him being an unfeeling android always struck me as based on what we think Musk should be like. The reality is far messier and he’s always seemed to me like a smart kid with a mean father who took all the wrong lessons from his various persecutions, real or perceived. I don’t hear him cry on this call. About an hour into the call he laughs about the cost of stickers, though.

The Internet, in addition to containing annoying Tesla Finance Guys/Stans, also contains a good chunk of the media that wants to always report on the worst in Elon Musk. As someone who was there during the creation of Musk as an internet persona and has had a few brief interactions with him, I’m sympathetic to the temptation. He’s wrong. Often (and of course, he’s often right, too). He exaggerates. He’s not particularly friendly to the media, and bought Twitter — which the media loved — and has basically ruined it.

What has happened this week appears to be the unholy alliance of Tesla Finance Guys/Stans and the Anti-Musk Media, and it’s deeply hypocritical because the same media that has pretty consistently lambasted Musk for his exaggerations about self-driving and the Cybertruck are now essentially criticizing Musk for being more honest than usual about issues with building the Cybertruck and for, uhhh… arguing that vehicles are too expensive?

And where do the headlines about Elon Musk “crying” come from? A Tesla Finance Guy/Stan named Kevin Paffrath whose whole job is to bring attention to himself by constantly talking about Tesla on YouTube. The kind of guy that the Anti Musk Media dislikes. If you don’t know Paffrath, who goes by Meet Kevin, he’s a “financial analyst” whose whole schtick is like If Jim Cramer existed in the “Idiocracy” universe, complete with a Walmart Great Value Brand faux CNBC set.

He went on Yahoo Finance (a thing that still exists) and said this:

Kevin Paffrath, the YouTuber behind “Meet Kevin,” a financial analyst, and Tesla investor, had harsh words for the EV maker’s CEO Elon Musk. Paffrath called the company’s earnings call “terrible,” saying Musk has a lot going on, but “it doesn’t justify acting like Trump on Twitter, stonewalling the SEC or the European Union, and quite frankly, turning into a little baby on the earnings call. I mean, he was almost in tears. It showed a complete lack of leadership. Tesla is a leadership-less company right now.” Paffrath says Musk’s performance was a “slap in the face to everyone,” including shareholders and Tesla employees.

So a dude with Airpods and an NYSE vest apparently gets mad because Musk is going to do what he’s legally obligated to do and talk frankly about the company’s prospects for once (although Tesla came pretty close to analyst expectations). Paffrath is exaggerating for attention, which is a thing the Anti Musk Media does not like about Elon Musk. So what does some of the Anti Musk Media do? Make Elon Musk look like a baby, literally, in an article where the author pretty much admits he didn’t even listen to the actual call.

Sounds like things are going great over at Tesla. Investors have long worried that Musk’s other ventures would get in the way of running a car company, and it seems their fears may be coming true — rather than planning paths to prosperity for Tesla, Musk seems content to whine on Twitter. And, apparently, on live calls with investors.

First, just listen to the call. It’s like one damn hour. Second, you’re going to deputize this guy into your argument? This is the guy you’re going to give airtime to.

I don’t like to use this space, or this place, to critique other media (especially the old site), but it’s nonsense like this that makes it harder to have a real conversation about what’s arguably the most important automaker in the world.

GM Walks Back Profit Guidance, Expects To Lose $200 Million A Week Due To Strike

Speaking of quarterly announcements, GM just released its third-quarter results and the big news is that the company claims to have lost about $800 million to the strike thus far and will continue to lose about $200 million per week as the strike rolls on.

Per Reuters:

The UAW walkouts cost the company $200 million during the third quarter and $600 million so far in the fourth quarter, GM Chief Financial Officer Paul Jacobson said in a briefing with reporters.

Strike costs are now running at $200 million a week, Jacobson said. He would not discuss the potential impact should UAW President Shawn Fain order new walkouts at GM’s most profitable North American factories such as the Arlington, Texas, plant that builds Cadillac Escalades and Chevrolet Suburbans, or the Flint, Michigan, heavy duty pickup assembly plant.

Because of the uncertainty over the strike, the company also withdrew its 2023 full-year guidance until there’s a deal and the company can account for costs in its balance sheets, at which time it’ll reissue new guidance.

Stellantis Is ‘Outraged’ At Latest UAW Strike

Right before the TMD filing deadline yesterday, the United Auto Workers called a strike at the Stellantis plant in Sterling Heights that’s responsible for making the Ram 1500. It’s the company’s biggest plant. According to the UAW, the Stellantis proposal is the “worst on the table” concerning economic issues.

How did Stellantis respond? Here’s the company, via Automotive News this morning:

“We are outraged that the UAW has chosen to expand its strike action against Stellantis … The UAW’s continued disturbing strategy of ‘wounding’ all the Detroit 3 will have long-lasting consequences,” the company said. “With every decision to strike, the UAW sacrifices domestic market share to non-union competition. These actions not only decrease our market share, but also impact our profitability and therefore, our ability to compete, invest and preserve the record profit sharing payments our employees have enjoyed over the past two years.”

Not great, Bob!

Hybrid Share Growing In The United States

Here’s what I really wanted to talk about today. Hybrids! Hybrids are good. They use small battery packs and small motors and, for some, offer the benefits of both electric cars and gas-powered cars.

Consumers agree, according to S&P Global, which put out this report on hybrid share and registrations:

In August, full hybrid and plug-in hybrid electric vehicles (PHEVs) accounted for 9.7% of total registrations in the US market — nearly triple its pre-pandemic share and continuing a steady rise in consumer interest in hybrid vehicles over the past three years. Counting just retail registrations, hybrids have accounted for more than 10% of the market in two of the past three months.

This surge may be attributed to the slower-than-expected adoption of electric vehicles – at least those that aren’t Teslas – as hybrids are seen by consumers as a pragmatic half-step toward a more fuel-efficient vehicle without committing entirely to battery electric propulsion and charging.

Yes! I don’t have access to charging where I park, but I want my next new vehicle to have an electric motor. I will probably get a hybrid.

While Toyota has been slow to adopt electrification, it has 40% of the total hybrid fleet lineup with 277,017 registrations so far this year. Honda is solidly in second with 180,208 registrations. Hyundai, Kia, Ford and Jeep are all bunched together in the 3rd-6th spots with sales between 53,000 and 59,900.

The Big Question

Here’s the order of hybrid (personal) registrations so far this year, which excludes fleets. In Q3 2024, what’s the order?