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What occurs when the bright student in class refuses to share his notes?
He may experience bullying, gossip, or, if fortunate, become overlooked by envious classmates. More often than not, it results in nothing more than hurtful comments and social isolation for that diligent student. Life continues, and ideally, that student transforms into a great leader instead of a violent outlier.
In the business realm, where one company’s victory could equate to billions in losses for a rival’s products, numerous hired strategists are willing to manipulate facts to benefit their financial backers.
In this context, Edmunds has recently published a severely distorted critique that is perhaps the most absurd I have ever encountered. The report is available in PDF format. This study appears to be purposefully timed and aimed at undermining Tesla, aiming for a significant impact with a single statement found on page two.
“Without tax credits, this (EV) market is likely to crash.”
This statement refers to the $7,500 federal tax credit available to every manufacturer that sells electric vehicles. After Tesla sells its 200,000th vehicle, this subsidy will gradually diminish, placing Tesla at a $7,500 disadvantage compared to its competitors. In other terms, if Trump and the Republicans choose to abolish this tax break, Tesla’s sales, alongside those of other EVs, may significantly decline.
The report references the market in Georgia, my native state, which once provided a $5,000 state tax credit for electric vehicles until July 2015, as evidence of a potential future downturn. Following the elimination of this tax incentive, certain older models (such as the Nissan LEAF, Chevy Volt, and Mitsubishi I-MiEV) did see a market crash.
However, this collapse did not occur for Tesla at all.
The ‘study’ consciously places Tesla’s name on a graph on page three, which focuses on the decline of an entirely different model, the Nissan LEAF.
This exemplifies a classic bait-and-switch tactic. Rather than crashing, Tesla’s sales stabilized, and currently, it sells more electric vehicles in Georgia than any other brand. Beneath two alarming graphs and a series of exaggerated statements lies a nugget of truth:
Sales of the Tesla Model S declined after the tax credit was removed but returned to normal levels within a few months.
In other words, Tesla did not actually experience a crash. What about other electric vehicles from that period, such as the Ford Focus EV, Fiat 500E, Mitsubishi I-MiEV, Chevy Spark EV, or the lesser-known Smart Electric Drive?
Edmunds does not provide any data for these vehicles—none at all. The only model that appeared to suffer significantly based on this flawed study was the Nissan LEAF, which was already experiencing a national sales decline of over 50% prior to Georgia’s subsidy removal (thanks to goodcarbadcar.net). The LEAF was also set to be replaced by a new model later that year, a transition that typically results in temporary sales drops, yet Edmunds chose to overlook that as well.
Given that the data fails to support its conclusion, why did Edmunds publish this analysis?
I suspect it is due to the close financial ties Edmunds has with car dealerships. A visit to this page reveals the type of partnered content that reflects standard industry practice.
Visit Edmunds.com for a complete listing of local car dealerships in your area. Find the best deal on your next vehicle with online discount price quotes on car, truck, SUV, and minivan models. With the ability to compare prices on new and used vehicles by location,
Edmunds.com makes the car buying process convenient and cost-effective. Search for local car dealers by make or region with our comprehensive dealership network to avoid the common hassles associated with car shopping.
Edmunds has a flourishing partnership with new car dealers—but not with Tesla. Similar to Autotrader, Cars.com, and TrueCar, Edmunds collaborates with networks of new car dealers who employ lobbyists and special-interest groups to prevent Tesla from selling its cars directly to consumers.
Does Edmunds disclose these relationships in its study? Not at all. However, they cleverly timed and crafted the report so that this doubtful perspective could be exploited by those who have vested corporate interests.
Does Tesla have weaknesses in specific areas? Absolutely. I have pointed out several of those issues here, here, and here. While Edmunds could present solid arguments against Tesla, they need to base their claims on accurate data. Unfortunately, Edmunds opted for a shortcut, largely using the decline of one non-Tesla model, the Nissan LEAF, to create doubt about the upcoming Tesla Model 3. It is disappointing because the challenges and opportunities facing Tesla in the coming years will be far more intricate.
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