Connect with us

Hi, what are you looking for?

CleanTechnica

Batteries

Tesla’s Spending On R&D Is Higher Than Legacy Auto’s — Per Car Sold

Tesla has been spending $2,984 on R&D per car sold. Its competitors? Not even half as much.

I saw an interesting comparison between Tesla’s spending on research and development (R&D) and that of its competitors — namely Chrysler, GM, Toyota, and Ford. Visual Capitalist shared the comparison and noted that Tesla has spent $0 on advertising but almost $3,000 on R&D per car sold. Here’s the comparison breakdown:

R&D spent per car sold:

  • Tesla: $2,984
  • Ford: $1,186
  • Toyota: $1,063
  • General Motors: $878
  • Chrysler: $784

There’s also a comparison between the five companies on how much they spend on advertising per car sold and R&D per dollar of advertising. Since Tesla doesn’t pay anything for advertising, that number in the last category is $0. Advertising spending per car sold/R&D dollars per dollar of advertising:

  • Tesla $0; $0
  • Ford: $468; $2.53
  • Toyota: $454; $2.34
  • General Motors: $394; $2.22
  • Chrysler: $664; $1.18

Courtesy of Visual Capitalist

Looking at these numbers, we can see that Chrysler pays the most in advertising and the least in R&D per car.

The article noted that all of its data comes from the 10-K filings of each company and that it covers the numbers for 2020. It also added that due to increasing investments in the EV space, EVs are poised to be a trillion-dollar market by 2028.

As a reminder, Chrysler is part of the Fiat-Chrysler Automobiles (FCA) family that includes a range of brands, including Jeep, Ram, Fiat, Dodge, Maserati, and Chrysler. Keeping that in mind, a quick look at FCA’s 2020 U.S. sales show that it sold 1,820,636 vehicles in 2020. That may sound like a lot (it is), but that number was down 8% due to the pandemic. In comparison, Tesla sold 500,000 vehicles in 2020, and that was the highest Tesla had ever sold (it has now sold more in 2021).

JB Straubel’s Thoughts Echo The Above Data

This data echoes a recent chat between Jason Calacanis and former Tesla CTO and co-founder JB Straubel. The latter shared his thoughts about the EV revolution and the focus of OEMs on battery electric EVs. The two chatted on Calacanis’ YouTube show “This Week In Startups,” where Straubel spoke of Tesla’s early days, battery recycling, and OEMs lack of planning on its so-called dedication to EVs.

In the interview, Straubel said:

“The Model S was such a different car. The Roadster was a technology validation. We proved that batteries could work, they could go on a car, they could be safe, they could do the range and acceleration. The S was a whole different thing. It was so good. We put so much effort into that. Elon was hell-bent on making it the best car on the road. And I think we really delivered on that at the time. It was phenomenal.

“I’m still amazed at the skepticism there was. Even after delivering those, we kinda imagined, I imagined, that people would see this and go ‘Clearly this is the future. This is all gonna work. All the car companies are gonna copy this immediately, and we’ll have to go really fast to figure out how we can carve out a niche.’ And it just didn’t happen. Customers loved it. It was a runaway hit with reviewers and magazines and customers, but the copying and market change didn’t happen.”

Despite the rave reviews and the success of the Model S, legacy automakers didn’t take EVs seriously. That wouldn’t happen until the Tesla Model 3 became a global bestseller years later, and this happened after the company’s 2018 battle to bring them into production. Tesla has since focused more and more on scaling up via gigafactories.

Tesla’s success has transformed the automotive industry to the level that OEMs have begun to take EVs seriously. They want to go all-in, but Straubel pointed out that these announcements may not be so realistic. And the above data reflects this. They are spending more on advertising than R&D per car sold, and all this does is just make noise.

The noise is good for Tesla, which doesn’t spend anything on advertising. But it’s not good for the industry if it really, really, really wants to go all-in on EVs.

“So many different OEMs, countries, factories, customers are leaping into EVs. You know, making these huge announcements, you know, saying that they’ll be fully electric this decade or the next. They haven’t — I don’t think they’ve done the math fully [on] what that entails on the supply chain and tracing it all the way back, literally all the way back to the mines. You need to do that, or else, you know, you haven’t really solved it. It has the feeling to me of kind of like a giant overbooked flight.

“All these people like, ‘Oh, this is great. We’re all gonna go to that new place. We all wanna go there. It looks great. Sweet. Let’s all go on the plane and go.’ So everybody’s saying that we all wanna go there at the same time. Meanwhile, we have to sort of build the planes to get there; we have to figure out how to sequence everyone. The figurative runway is like the time to do all this, and it could all get sorted out over time. But obviously, we’re trying to do this fast as a society and as a species.”

If legacy auto is serious about EVs, it would spend more on R&D. It would also secure more battery and mineral supplies. It would tone down the chatter and focus more on the products.

 
 
 
Don't want to miss a cleantech story? Sign up for daily news updates from CleanTechnica on email. Or follow us on Google News!
 

Have a tip for CleanTechnica, want to advertise, or want to suggest a guest for our CleanTech Talk podcast? Contact us here.
Advertisement
 
Written By

Johnna owns less than one share of $TSLA currently and supports Tesla's mission. She also gardens, collects interesting minerals and can be found on TikTok

Comments

You May Also Like

Cars

With EV charging standardization still up in the air, Tesla CEO Elon Musk goes to Washington.

Cars

Peugeot e-208 is the 2022 best seller in France!

Cars

Following what many considered a rough 2022 for Tesla, investors are warming up to the idea of a big 2023 for the automaker, especially...

Cars

Tesla’s stock has remained a polarizing topic, especially as the company’s stock price dropped immensely throughout the last year. Bears and bulls are trying...

Copyright © 2023 CleanTechnica. The content produced by this site is for entertainment purposes only. Opinions and comments published on this site may not be sanctioned by and do not necessarily represent the views of CleanTechnica, its owners, sponsors, affiliates, or subsidiaries.