Published on August 28th, 2018 | by Kurt Lowder0
Potentially Positive Tesla Article On CNBC … Is Still Misleading
August 28th, 2018 by Kurt Lowder
Occasionally, CNBC allows something positive to be published about Tesla. Maybe just enough to pretend to be objective. However, most often, CNBC coverage ridicules Tesla about small, irrelevant issues. The lies have become less blatant and are increasingly more clever. I was momentarily surprised when CNBC actually covered Musk’s recent comment about a future compact Tesla which would cost $25,000 in as little as three years. The public does not understand how quickly electric cars are improving and falling in price, and this could have helped them to understand that.
The CNBC article correctly quoted Elon Musk multiple times, and sets up the article as if to highlight a key success of Tesla. Obviously, if Tesla can build a 200-mile range EV and sell it for just $25,000, then it can capture greater market share. Furthermore, even the target is a testament to Tesla’s continued success bringing down the price of its batteries and other drivetrain components.
Nevertheless, halfway through the article, CNBC reverts to its consistent behavior with a misleading statement about the cost of the Model 3:
“Currently one of the top trade-ins for a Tesla Model 3 is a Toyota Prius, according to statements Musk made during an August earnings call. The Prius, which starts at $23,475, is roughly half the cost of the $49,000 Model 3 starting price.” (this quote is from the article and not a direct quote of Elon Musk)
The sentence begins with “currently,” so it could be argued to be a technically true, but it is cleverly misleading. The article fails to mention that the base Model 3 should begin shipment in 5–7 months and will cost only $35,000. Tesla has publicly stated this planned price for several years.
The article also fails to mention that the Model 3 can receive incentives in 14 states within the USA as well as a $7,500 US federal tax credit (down to $3,750 in early 2019) and much more generous incentives in several other countries. The article does not even go into a brief analysis of total cost of ownership for electric cars. After reading this article, I contend that an uniformed reader considering purchasing a Tesla would decide to wait three years and save $24,000 on the future Tesla model. (Why consider a $49,000 Tesla when a $25,000 one should be available soon?)
Based upon CNBC’s track record, I’d say it is probable this is another example of harmfully misleading coverage. At the very least, it is incompetency. An uninformed reader is left with the impression that purchasing a Tesla is out of the reach of a middle class consumer.
A valid comparison would state the Tesla Model “fuel economy” of 130 MPGe compared to perhaps the Prius at 52 MPG. The base Model 3, meanwhile, goes 0 to 60 mph in a brisk 5.6 seconds, while the Toyota Prius lags behind at 10.5 seconds.
I own a Toyota Prius and the maintenance costs are more comparable to a BMW then they are to a Camry. I just hit 100,000 miles and have over $700 of scheduled maintenance. The Prius is an immensely complex vehicle, and there are so many things that can go wrong with it. According to Edmunds, over a five-year period, on average, a Toyota Prius will cost $4,977 to maintain and repair.
It will take some time to see what the total cost of ownership for a Tesla Model 3 ends up being. However, a precise comparison is not required to see that CNBC is terribly misleading its readers yet again, and CNBC has a strong motive to do so. The article states, “Musk boasted that Tesla shells out virtually nothing on advertising and endorsements, and relies heavily on word of mouth.”
On the other hand, in 2017, Toyota spent over $1.7 billion in advertising in the US alone. NBCUniversal has a clear track record of not harming its advertisers and assisting its advertisers with favorable coverage. Former MSNBC host, Cenk Uygur, has detailed how NBCUniversal muzzled him despite great ratings because Mr. Uygur went against “the establish.” They actually offered him more money to only do a weekend show. Imagine that — getting paid more to only work two days a week. Thankfully, Mr Uygur had some integrity and refused the bribe to be an unethical journalist.
This is how corporate media can be corrupt. There often is not a quid pro quo. They simply hire journalists that are going to toe the corporate line. Should journalists refuse to obfuscate the truth for corporate profits, then they are fired.
NBCUniversal also fired Ed Shultz on MSNBC 45 days after Shultz covered the 2016 announcement from Bernie Sanders that he was running for president. Shultz had flown all the way to Vermont to do a live interview. NBCUniversal President Phil Griffen called Shultz moments before and emphatically dictated that the Sanders announcement would not be covered.
If CNBC wanted to write a more competent article, it would have compared the base Model 3 to the Prius Prime. This plug-in hybrid electric vehicle starts at $27,300 and has an electric range of only 25 miles. After the battery is depleted, the Prius Prime runs on gasoline. A mindful driver without many long-distance driving needs could hope to drive 80% or more of their miles on electric power. The PHEV is a decent option for drivers who have anxiety range or frequently travel long distances. (Globally, subsidies for the Prius Prime vary, but they are generally less than for a pure EV.)
It is hard to quantify the value of a Tesla vehicle in regards to how sustainable it is. However, the air quality and climate benefits are quite significant. A further analysis as regards the environmental impact of Tesla versus Toyota is night and day. Tesla is light years ahead of Toyota in terms of sustainability. Of course, CNBC is a media network focused on business. Nonetheless, it can be argued that the company has a corporate responsibility to accurately report issues dealing with climate change.
Toyota is significantly fighting the transition to EVs, whereas Tesla builds only pure EVs. Though legal, Toyota’s fight against sensible environmental regulation of automobiles is highly unethical. Toyota has financially contributed to Alliance for Automobile Manufacturers in order to reduce fuel efficiency standards, and Toyota’s efforts towards sustainability are paltry considering the vast majority of its vehicles are pure gasoline vehicles — and all of them use gasoline.
Conversely, Tesla sells solar and battery products, offering a one-stop shop where customers can power their homes and vehicles with sustainable energy. Tesla’s manufacturing processes are increasingly becoming much more sustainable. Any journalist that does not allude to this reality is failing to see the big picture and broader costs. Without some environmental framing, it is just irresponsible journalism in my opinion.
To this point, Tesla has reinvested every dollar of revenue to create the innovation that is needed to prevent the end of human civilization. Not discussing this angle is like ignoring a herd of elephants in the living room. CNBC’s coverage of the EV revolution will historically be viewed as a crime against humanity and the environment. It is in the realm of cigarette companies that told us smoking was good for our health. Additionally, it is not preparing its audience of investors for the likelihood that several conventional automakers could suffer massive financial losses if they continue to procrastinate and delay the transition to sustainable transportation.
CNBC can hide behind the delusion of neutrality in business reporting, but in effect, it is misconstruing reality for profit at the expense of all of us.