One more aspect of the insurance. If a Tesla is involved in an accident, assuming it's not the driver's fault, there's essentially an irrefutable witness (the car) Tesla contacts "the other party" and says "we have the data, video, etc. If you dispute it, see you in court, but you'll lose" Minimal fuss, maximum profit.
I never liked the idea of those driver monitoring data collectors that insurance companies use. Most of them don't really track your driving. The only thing they monitor is how often and hard you apply the brakes. They are getting a risk assessment based on how many hazards you encounter and not how well you avoided them. Its good information for them, but not for you. If you are the best driver in an area full of lunatics, you will still be penalized. Bad drivers are usually bad drivers because they don't pay attention. Other people are constantly swerving to avoid them when they cross a double yellow line or get stuck behind them matching the speed of a semi truck on the interstate for 14 miles. No monitoring system will every fairly penalize them for being an a-hole to everyone around them.
@@michaellowe3665 I'm not talking about driver monitoring. In an accident the Tesla will have 360° video as a "witness". Added to the speed, acceleration, braking and all the other data, they can prove fault of the OTHER driver.
I think he is missing on his insurance point though. Or at least he didn't clearly/accurately communicate the time line. Currently Tesla has approval to sell auto insurance in Texas. Every state has its own giant bureaucracy in place for insurance sales. It will be 10+ years before Tesla has nationwide coverage for car insurance--longer for home policies.
@@lanzer22 Tbh, on paper it looks like you'll be able to buy a brand new Xpeng P5 with the same range as a Chevy Bolt and way, way better specs and tech. EDIT: Oops, forgot - for the same price or cheaper.
When you have a strong audience using Social Media, where fanboys, many with Stocks on the company, are pumping the hype through multiple YT channels, with similar head lines as "genius" and "game over"...you really don't need a strong Advertisement Department.
well, they do publish some videos of their cars that were obviously made by either a marketing team at tesla or a marketing company, but still, compared to the expenses that comparable companies have, it is insane how much brand recognition they have.
Elon has 61M followers on Twitter, any advert campaign for this many people would cost a million. Say what you want about Elon, but if he's a fraud or if his products are shit, good luck reaching this many followers. He's doing something right and too many people are happy to try to find faults, when there's so much more to learn.
Sandy, you have always been hard but fair with Tesla. I appreciate the fact that you also acknowledge where they are going and can see their vision. Thanks always for your honest assessments.
I've never studied at a university. Yet, to me, I feel that I'm attending the " Munro University " , every time that I watch and listen to you. Thank you Sandy Munro for what you do. I feel privileged to be your student.
Looks to me more like a Monroe church preaching the Tesla gospel. Overhere in Europe people are not so impressed by Tesla. Yes, we see a few on the roads overhere, but these cars a only for the happy (rich) few, but not for the ordinary citizen. We can not buy a car on monthly payments, like Americans, without paying at least 10 to 13 % interest rate, so people save up money for years to buy a car.
@@wimschoenmakers5463 I hate church, preachers & politicians, and I like facts & numbers. His business studies part 1 and 2 are excellent. But I do understand your point. And he does discuss/analyse the upcoming Chinese products too.
@@linnovate360 waiting for his video about those Chinese cars. Of what I here they build decent cars. Overhere we see mostly (Toyota) hybride's, and that will stay so for the next upcoming years. Also, we have no electric infrastructure for charging EV's, so those cars are not really a option today.
@@wimschoenmakers5463 People in Europe buy Mercedes….no? People in Europe pay for maintenance too…. and Tesla has virtually none. Tesla resale value is high, so that also reduce overall cost of ownership. I’ll save up my Starbucks money so that I can pay for a lower overall cost car that is also fun to drive. I think there are lots of people like myself in Europe who look at OVERALL value.
Nice quote, but is it accurate? What sort of 3 dimensional chess makes hyperloop and the boring company make sense? At this point I'd say musk is more of a self fulfilling prophecy machine.
Disclaimer, I am not a Tesla fanboy of any kind. But this is very exciting progress. For someone that is a huge fan of technologies and innovation, I am so tired of stagnation and super small incremental updates that we get once in a while, be it software or hardware in personal electronics, cars or whatever. What Tesla is doing is leaps and bounds ahead of everyone. Just imagine where we would be if we started something like this 20 years ago! And it's not like technologies were not there. Most of the innovation gets stopped by interest groups and those who stand to lose if someone else comes up with a better product. Free market my ass! Anyway, have a good one everyone!
Yeah we could have had a steady growth in EV interest. The GM EV1 was loved by many people. Instead the brilliant minds at GM and other auto makers decided to terminate these interest and let them simmer and stew for years until they reach a boiling point. Tesla really have the other companies to thank. But then this is exactly the type of free market movement that many economists agree to. Companies with monopolies grow stagnant, setting up the stage for innovative and disruptive players. This cycle just keeps happening in all industries. Aerospace, banking, biotech, telecom, it's all happening this decade, which is kind of crazy.
All legacy automotive manufacturers had basically a gentleman's agreement to only improve by 5% every 5 years and they all built cars to purposely need fixing and replaced with the latest model.
@@lanzer22 You are correct. GM shot both its feet off by the way it handled the EV1. GM had made itself the EV industry leader in those few years, then crushed all the EV1's and walked away completely from the EV market instead of dominating it. Too many ICE engineers running the show at GM poisoned by gasoline fumes!
Having worked at Tesla, rented out my Model 3 through Turo, and driven for Uber in the 3, I recognize what a huge deal this is as well. Tesla gets to sell 100k cars at full price, exposure through advertising and huge celebrity endorsement without spending a dime, and a fleet of drivers to test fsd for future robo taxis. Hertz gets to be back in the spotlight with Tesla association and fleet of low maintenance cars. Uber gets more riders and drivers who wants to experience a Tesla, and drivers will be able to work more due to the fact that driving a Tesla is significantly less tiring than a gas car (one pedal driving, autopilot, comfortable interior to relax in during idle time).
One more thing the Hertz deal clearly demonstrates: The Tesla is no longer a fringe product, it is mainstream. You can be sure that the bean counters at Hertz crunched the numbers and found that Tesla vehicles are going to make them the most money. Hertz does not care one little bit about saving the environment. They care a whole lot about money. Think about that when you consider your next vehicle purchase.
Yes and renewables are now cheaper than coal and oil. The change will come not from protest, not from government decisions, but from economic expediency. I don't really care, as long as the change comes.
Hertz got an unmeasurable amount of free and positive publicity by buying 100,000 Teslas. That wasn't some token, half hearted attempt by Hertz to appeal to the Enviros. Hertz was going all-in with the Tesla deal and it has been a grand slam for them, even though they had to buy the Teslas at full retail price. Paying full price for the Teslas wasn't so bad after all when you consider all the free positive publicity it gave Hertz.
That’s what I love about buying a Tesla (or most EV’s) you seriously don’t have to be a tree hugger to buy them anymore. Electric vehicles have gotten to the point where they’re now competitive with legitimate ICE vehicles. No longer do you have to suffer in technology or performance just to get a more environmental, sustainable vehicle. Carwow just did a video this past week comparing the model 3 to a 3 series and a C-class and he ended up choosing the *model 3* as his best option. Whether or not people want to accept it, Tesla and EV’s are mainstream now and aren’t going away for a long *long* time
I can attest to the fact that the safety score makes drivers better. Ever since I have had that on my phone, I am conscience of my driving like I never was before. And I am slowly raising my rate from 83 to 91 in about 2 weeks. When I first heard of this I was little miffed about it but now, I am convinced this is the best thing that ever happened in the car industry for increasing safety.
Sandy, this was FANTASTIC! To quote the late James Brown; "Please, Please, Please, Please" don't ever take this series away. This is what we EVoholics need. Common sense analysis. Thank you Mr. Munro. You Da Man!
Same for me, I guess all the bolt fires burning down peoples homes has had an almost immediate effect on insurance. Now that you can have a Tesla roof,stationary storage battery and a couple of Tesla in your house a large expensive of what is insured is made by Tesla.
Don't forget the tunneling in Las Vegas. The cars used are Teslas. They can handle 57,000 passenger an HOUR. That is a lot of butts in seats. And the people in Vegas are from all around the world.
Good show! - I like this type of show !!! - why? cuz it's not some anonymous dude I've never seen before with no credentials and only an opinion of his own rather than an industry Icon like Sandy has become. I take nothing from these podcasters (some of which I watch everyday as they have a good show) but there is a huge difference in caliber and quality between some self-made podcaster with an interest and someone like Sandy who's opinion is sought and bought buy the biggest players in Industry, World-wide. I like that Sandy has an ordinary man type of aura and speaks simply and with no condescension about matters that literally are changing the world around us; but let's be serious now. Sandy (and his team, of course) are the Engineering Authorities when it comes to making money with your process and/or product, period. So, hell YES! I want to see what Sandy has to say about whatever is on his mind. I am an (small) investor and I base my stock picks on real value rather than hyperbole sold by some pumper. This is something that Sandy has already helped me with through his critiques of what usually seems to be an obvious problem, grown large. Or the opposite, when he sees a solid and inspired design that literally moves something from the ordinary to the truly extraordinary - things that can change an Industry and even the World itself around us. I've come to expect such from watching Sandy so please continue the show.
Soo glad you tackled Tesla insurance. I've been astonished what most are saying: that insurance won't help Tesla much! I figured immediately that it would be HUGE. Insightful
I remember the CEO of Kodak (Fisher) saying they "need to get back to their core competencies," when digital cameras were starting to eat into Kodak's cash cow. As a result, Kodak started selling off everything that wasn't involved with film. I remember thinking that was insane, everybody knew that film was on its way out (...well, apparently not everybody). Today everything he sold still exists (Eastman Chemical, Clinical Diagnostics, etc.) and all of those core competencies are gone. He got paid millions to destroy that company.
Legacy auto's core competency is making ICE vehicles. Back in the early 1900's there were companies whose core competency was making horse drawn vehicles. And then technological advance eliminated the horse. If you have ever owned and taken care of a horse; you know what a huge positive change that was.
I remember when KODAK unveiled its Commerical/Prosumer digital camera - the Clunky one , I thought what was KODAK thinking ?............LOL. Meanwhile , CASIO made a Shirt pocket one with a Rotating lens..........lol. I remember selling these back in the 1990's .
Same thing happened with Blockbuster. Their board member suggested shifting to mail order system and later internet. But blockbuster denied saying delivery cannot replace the experience of their stores. The board member left the company to start another. 10 years later, blockbuster went bankrupt and the other one became the king of ott platforms.
Fleet leasing is HUGE for the pick-up truck market. Watch for Hertz and other leasing companies to do the same play with electric pick-ups as Hertz has done with EV Sedans.
The best corporate sales trainer I ever had drilled in, "Perception is reality". 17 years later and I still carry that in my business life. Sandy nails it...AGAIN.
GM, under Chairman Bob Stempel, an engineer, was highly proactive when he forced GM to make the EV1 in 1996. The GM EV1 was highly advanced and at least 20 years ahead of its time, and because it was so advanced it was Elon Musk's inspiration for starting Tesla. (EV1 was based on the GM Impact whose motor controller was built by Cal Tech's Alan Cocconi who founded AC Propulsion, whose drivetrain Tesla used in its original Roadster. AC Propulsion also promoted the Lithium Ion battery in EVs, and that is one of many aspects of Alan's work that remains in Teslas and other EVs today.) So what did GM do with this 20+ year lead in EVs (and this was before Toyota hybrids)? They took all the EV1s back and crushed them, under orders of the accountants who took over GM after Stempel was ousted. Had GM continued to develop EVs after the EV1, they would have owned the EV market for decades and probably prevented the hybrid market that Toyota developed.
@@markplott4820 The Gen I GM EV1 had Lead Acid batteries, first gy GM Remy Delco, then by Panasonic. The Gen II GM EV1 had Panasonic Ovonics Nickel Metal Hydride batteries. The former had a range of about 70 miles and the latter had a range of about 130 miles. Ovonics sold their NiMH patents to oil company Chevron, who then suppressed their availability for EVs.
@@thomas735 False. Most drivers in the U.S. and EU drive fewer than 40 miles a day, and most driving is local, within 20 miles of home. Any EV can do that.
@@LoanwordEggcorn where do you charge though? What if you don’t have a garage? It’s also an issue if you live in a cold climate or your on a budget. They cheapest model y is over 50k and that is smaller than a Toyota Highlander.
I think you missed one big plus for Tesla. Rental vehicles are probably driven a lot more than owned vehicles. Tesla is going to get terrabytes of data to train its self driving programs using real data in real situations.
When the company that makes the product ensures the product. That is a win-win. Tesla has skin in the game. Make a safer car. Have less insurance claims. Perfect marriage.
I'm thinking of the impact of this vs. the laughable legislated Auto Insurance "reform" that happened recently in my state... One of these would lower my premiums.
And if they get only the good drivers to sign up for the program, they will have to pay out significantly less, and make much more per insurance customer.
@@Psi-Storm I snicker every time I hear, "Why would I want the insurance company to monitor my driving?" Legacy insurance will get to keep all of these customers and their aggregate rates will soar.
@@briansilver3412 I doubt that Tesla has better tariffs than established insurance companies for me personally. I have 20 years of accident free driving, and get a 60% discount on the base rate. But for younger drivers that are driving safe, it might get cheaper. Other companies don't mind that they get worse Tesla drivers, they just make that specific car more expensive to insure. And Tesla's are already pretty expensive because the repair costs for big accidents are higher.
Great show Sandy. The next generation needs to understand these transformational trends happening right in front of our eyes. We need to wake up or get passed by
I think this is as great of value as the tear downs. Sandy’s insight to the car industry gives credence to the necessary business shift, in conjunction with the focus on quality with cost containment- it is a must watch series!
Miles driven by either Hertz or Uber customers will all feed into the Tesla machine, advancing and improving their drive to AI capability. This is a huge bonus to Tesla and at FULL PRICE PER VEHICLE, not a legacy OEM discounted price. Money in the bank and free data. Win, win win.
None of the Hertz cars will have FSD or Navigate on Autopilot, at least until Level 4 is reached. I think Tesla will still be getting driving information back from the Hertz fleet in shadow mode.
The Hertz-Tesla deal is a win-win-win-win deal for Tesla, Hertz, Uber and Carvana. Absolutely impressed by how Fields at Hertz came up with this deal. Uber will pay Hertz a monthly fee that makes Hertz a guaranteed profit of at least $25mm/mo based on the terms. Hertz will issue bonds in order to pay Tesla for the cars. Uber will effectively pay Hertz’s bond interest payments. Then, in the back end, Carvana will sell Hertz’s cars at a market clearing price. Each player in this deal gains a profit and market advantages…just amazing.
Fields is brilliant. Ford should have listened to him. Environment wins. Customer safety wins. Tesla wins because people are introduced to Tesla possibities. ICE loses - majority do not want those cars for everyday driving, along with service contracts, OIL loses because majority wants clean. Traditional insurance loses because they refused safer EV Tesla and lower maintenance costs. They must not like to save money. They will inherit the left behind riskier cars and drivers. MORAL: Stubbornly doing the same thing over and over just because and not considering the new and improved is akin to drinking the original Coca-Cola containing cocaine or stubbornly cooking with lead or storing in BPA containers. Insanity. 🥊 the FUD...
Hello Sandy, Your totally right about now i can or will be soon able to rent a Tesla from Hertz to just see how great a Tesla is. Keep well, keep safe and enjoy life.
Love the Cancer support! My sister was recently diagnosed with breast cancer and going through surgeries and treatments. I hope no one ever has to deal with.
Are you sure Tesla could satisfy such a big order from Hertz? A company that was struggling financially recently? Also some point out this operation is a form to Hertz receive big incentives to electrification from the Government.
Sandy is out here telling everyone who can't figure it out how AWESOME TESLA IS as their stock price did a jig to all time highs AGAIN. Boy, I love this company. If you don't think Tesla is going to clean up as Sandy will no doubt explain, then remember this is a company that is already in the lead, has also changed the game, and is headed by a guy who has done that in 3 industries; vehicles, green energy; and rockets. DON'T BET AGAINST ELON it won't be a treat! Happy Halloween!
It's all the man has left. Once he can't earn a dollar this way what has he got left? Zero credibility, his career as a financial advisor is now over. So working the local drive through is all he can look forward to, so while they're still willing to pay him he'll keep it up right to the bitter end no matter how stupid he looks.
Sandy great insights as usual. Thank you for raising the funds for the ACS! I was diagnosed in September with Cancer of the bladder. so while I practice pissing in a plastic bag.. I want to thank again for supporting the American Cancer Society!
13:20 couldn’t agree more with you teacher Munro, this is what happened back in 2010- with Toyota Prius but without any deals, just a natural way, since then Prius went loved drive train and helped Toyota sales and the integration of their hybrid tech into other models. 👌✅
Had the 2010 Prius plug-in then the 2016 Prius plug-in. Now 2020 Model Y, with FSD and online updates, May have it forever. And yes for Elon Musk, man of the century.
There are so many aspects to this paradigm shift that even Sandy is getting slightly tongue-tied at moments. One thing though - he's 100% right, it is indeed the biggest shift in industry, transport and consumerism, since the Industrial Revolution. The change and disruption that is really starting to happen now and the tidal wave that is coming is staggering, when I think properly about it. So many variables, yet the momentum is building, driven by key factors like solving Climate Change and making a sustainable future. The very things that the original Industrial Revolution put in danger.
Tesla is leading the world into a new era. Some are coming peacefully and some are kicking and screaming. But they are coming as is this new word. Every thing is open to being disrupted. So settle down folks new things are coming fast.
About one or two years ago I read an article that said that Tesla didn't have a future. This would be because the OEM's have much bigger production facilities, which would just crush Tesla. I still blame myself for believing this BS. I did not realize back then, that production facilities alone are worthless without a vision.
Right, Let's not forget that vehicle production facilities that are only building products people don't want are not a profit center. Who cares about the new 640+ hp Corvette ZO6 when you can have a 1000hp Tesla Plaid leave it in the dust.
People also have the simple notion that a factory and workforce built around one kind of tech and product can switch to something entirely new easily and cheaply.
Great video, Sandy. I learn so much every time I watch your show. I hope you live forever; especially to see the changes you've predicted come true. Stay healthy.
Dear Sandy and Cory, I would really love you to do an episode on your take on GM's plan to replace the battery Modules in the Chevy Bolts versus GM simply manufacturing a new Battery Pack in the factory and shipping it out to Dealers to be "Bolted" into the Chevy Bolts. I see GM's current plan to replace the Modules as a Logistical Nightmare especially when you consider it takes 30 hours to properly charge and balance the new modules once they are installed into the pack. People are going to need to leave their cars at the Dealers for two weeks to get the work done. If GM switched to a "Pack Swap" program (with new factory made packs) people could get their cars back in only one or two days. Personally, I think GM is going to have such a mess that they may never see the end of the Module Swap program (the word Cluster... comes to mind).
It think channels like Wendover which focus on logistical issues is great for these type of topics. There's nothing innovative and cutting edge about handling a recall, and Sandy's interest is probably on something that's more exciting.
@@lanzer22 I am not looking for a logistical discussion, I would like to hear Sandy's opinion of GM's plan to replace the modules versus replacing the pack.
I think they'll scrap the buy back bolts, new battery + labor to sell used & compete with a new bolts. This disturbs me because I want a used bolt in future.
There are 2 more aspects to Tesla's competency. One is that their full self driving software can be licensed to other companies that can potentially boost their revenue tremendously, and when other cars are running Tesla's AI, Tesla can then sell them Tesla Insurance. Tesla wouldn't need to build a single car to have all this extra revenue.
The real motivation for Elon and Tesla is that all cars will be much safer. Profit is not # 1 for Elon and Tesla, it is a result of making the safest and most sustainable cars. Big difference in motivation.
@@terrysullivan1992 growing up I found it odd that companies like Honda has a luxury brand where people with more money can have better safety while people with less are gonna be on the side of statistics with higher death rates. I'm glad that finally there is one company that doesn't compromise on safety, period.
Hi Sandy, I always enjoy your engineering expertise and honesty. And I live less than 2 miles from Lelli's in Auburn Hills! I've been eating there for over 50 years!
Thank you Mr. Munro. I'm an old I.T. guy and during my education days we were always reminded of the RC (Resistance to Change) factor most employees experience and the example was the Jacquard loom sandal where the machines could produce textile patterns based on punch card technology, circa 1810. The looms were destroyed and burned initially by the in house labor force. Something else I would like to add is upper management is usually the executive who is trying to get to retirement within a couple of years. Their management style is "Don't bring me anything new". The legacy automakers would do themselves a great service to fully pay and retire their current executive and put entrepreneurs in play.
It will be interesting to see how many Uber drivers will be willing to pay ~$1400 a month to rent one of them through the Hertz/Uber agreement. Edit. I was just informed many cab drivers pay ~ 100 bucks a day to lease a cab (includes their insurance) so $1400 for a Model 3 sounds pretty good.
As someone who works for a Japanese automaker in Tennessee I am afraid that in five years my job will be gone. I hope when you guys do your rundown of who will survive and who will go belly up you include more than just the Detroit automakers. I wish my management team had the good sense to call Munro!
Accepting a paradigm shift is always hard regardless of who you are, and committees are the hardest to shift . You hit it right on the head about the traditional car companies committee paradigm shift paralysis, not just about sales of EVs but how autos are manufactured. What a radical idea, auto insurance based on your actual day by day driving record, which is only made possible by Tesla cars being connected. The established auto insurers are going to be left face down in the dust since they don't have connectivity with non-Tesla cars. Two hundred thousand Teslas for Hertz. Possible the most important auto sales made since Henry Ford sold his first Model T. Expect Tesla to break ground for a couple of more gigafactories next year.
Sandy, I don't think the chess or checkers analogy is accurate. Both games destroys the board of pieces. I think what is more accurate is that Elon Musk is playing "Go". Where he covering the entire board with either white or black pieces. He did this, just this year buying all microchips Tesla was only one that had microchips and other car companies were blocked from making cars.
@@RolandVazquez777Like the Hyperloop, Neuralink, Tesla Bot, or an Economical viable colony on Mars, using chemical rockets? Try to be less than a fanboy. Elon is more to an Investor, than a Inventor. Check the amount of patents he has.
@@RogerM88 to make a sound argument you state your case then the reason why you think that way. You named a couple of projects then proceed to call someone names. Not the best way to show others what you know, or rather, not know.
After two years I had to pay ~$270 maintenance on my two year old Models S. It was because I needed a new tire due to getting a nail in the sidewall. New tire ~$270, Installation and balancing by Tesla - $0.00. Oh... I guess that means maintenance is $0.00 after two years. I guess I'm $500 ahead of the average?
Great point about Rentals lead to car sales, 7 years ago, I was supplied a Volvo XC40 for driving around the tight roads of the Amalfi coast with 4 people. Loved it so much came home and bought/ leased one for 4 years.
Excellent video Sandy. The market exposure of this deal and all the ads Hertz will run cannot be overstated. The best advertising is free advertising. Genius move by Tesla!
The legacy automakers have two huge challenges facing them: 1 - their inability to think and operate like a startup. 2 - their archaic dealership network.
Awesome video Sandy! Really cool idea to also shine a light on the business side of things sometimes. When is the plaid teardown coming? I'm so excited for it ;)
Mark Fields was former president and CEO of Ford and is now interim CEO at Hertz. Ford used to own Hertz. Read into this what you will but rather than buy the Ford Mustang MachE he chose instead to buy 100,000 Tesla model 3s. News of this $4.2 billion order boosted Tesla’s share price by more the total market cap of Ford. Hertz really did their home work and Tesla model 3s offer little or no depreciation, low running costs, low energy costs and it differentiates them significantly from all the other car hire companies. By the time Tesla fulfils this order it will represent less than one months manufacture.
Many Tesla haters seem to forget that the public at large considers a Tesla to be a prestige or aspirational brand of car. A Mach-E Mustang is just another Ford to the public, albeit an electric one.
Very insightful as usual Sandy. The industry is at the crossroads of Disruption Junction Blvd and Head In The Sand Terrace(HIST)! Those choosing to take the wrong way will be footnotes in HISTory.
