Musk drama means Tesla's cars need to be better than ever
Often this context is outwardly dull and you can largely ignore it. Sometimes it's unbelievably interesting and you need to remind yourself to focus on the car.
I'm thinking about the product-business-politics ecosystem now because in a couple of weeks we're giving the new Tesla Model Y the full Autocar Road Test, in what should be the popular Long Range Rear-Wheel Drive form. As ever, it will be fascinating to see exactly what Tesla – in many ways an era-defining success story that has always talked a big game about its technology leadership – can deliver. Efficiency and performance for years constituted a twin-pronged attack that few else could match as the brand dominated the sales charts. The cars' uniquely lounge-like atmosphere was also a much-loved Tesla hallmark.
These days things are different. Tesla still sells strongly in its key markets but those sales are dipping and the company's public image has been in the wars. There's a growing body of direct competition that simply didn't exist three or four years ago (and much of it has adopted Tesla's minimalistic cabin layout, how very dare they.) Moreover, US legislation looks likely to kneecap a crucial revenue stream, as president Trump's 'Big Beautiful Bill' seeks to curtail emission-offsetting regulatory credits. Last year, Tesla made almost $3 billion from the sale of these credits; it's not chicken feed.
It means the current product really has to stand up – right now, while it's still passably fresh and capable of swelling the coffers. In two years, Tesla's current line-up won't just feel a bit long in the tooth but outright elderly. Then you're probably into a downward cycle. Can't sell, can't invest, and all the while your regulatory-credit side-hustle has run out of road.
We know that many people will never again grace a Tesla showroom or the company's website. Musk's political leanings and his role in the USAID shutdown, the humanitarian fallout from which will only be revealed in years to come, aren't with commercial consequence. Those potential customers are lost to Audi, BYD and whoever else. But there are plenty more who will still buy a Tesla if it happens to be the car that best meets their needs and aspirations at the right price.
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