Desperate marketing

Updated 23 September 2017
0

Desperate marketing

After years without a single scrappage scheme to replace old polluting cars with new clean versions, almost all car companies are now offering these schemes in Europe with generous cashback offers.
These offers are not driven by an altruistic desire to clean up the environment, but rather by the sluggish sales figures in all segments. In Britain, figures show that new car sales to private buyers are down by a substantial 10 percent in August than a year ago. Diesel car sales were even worse — down by 21 percent.
During the recession of 2008, governments came to the rescue with scrappage schemes to encourage sales of new cars in a stagnant market.
This time, hopes of government interventions failed to materialize and companies took matters into their own hands.
The new scrappage scheme offered by car companies to replace old cars with cleaner ones is nothing but a cheap and desperate attempt to boost sales in environmentally wrapped packages.
While offering these schemes, car companies are still selling diesel cars.
Polluting cars taken in part exchange, some of which are in good running order, are not scrapped but rather sold in auctions and most of them are used again on the roads.
Buyers of new cars through these schemes are not doing it for the environment either.
They think they are getting a good deal selling their old cars worth no more than $700 for $2,000 in subsidy form to buy their new cars. What they do not realize is that they are going to lose more money than the incentive they got, in depreciation during the first three years of new car ownership.
These schemes have a whiff of dishonesty about them in the way they describe themselves and in how they are operated by the companies.
They have nothing to do with the environment and they aim at flogging more sales. Similar schemes in the past did not last long.
• Adel Murad is a senior motoring and business journalist, based in London.


Tesla production leader Doug Field exits company

Tesla produced 5,000 of its Model 3 cars, along with a combined total of 2,000 Model S and Model X vehicles. (AP)
Updated 03 July 2018
0

Tesla production leader Doug Field exits company

SAN FRANCISCO: Tesla on Monday confirmed that the head of Model 3 production, who went on leave after chief executive Elon Musk took over his duties, will not be returning.
The departure of engineering senior vice president Doug Field came as California-based Tesla appeared to have finally hit a self-imposed goal of cranking out 5,000 Model 3 electric cars in a week.
Tesla co-founder Musk fired off a Twitter post over the weekend saying “7,000 cars, 7 days.”
In a note to investors on Monday, Analyst Trip Chowdhry of Global Equities said that in the preceding week, Tesla produced 5,000 of its Model 3 cars, along with a combined total of 2,000 Model S and Model X vehicles.
Tesla has been under pressure to increase production to show it can operate profitably and at the kind of scale needed to be considered a major auto company.
Musk has been managing the Tesla production line, which has been rejiggered to pump out cars faster.
Field will not be returning to the company, according to Tesla.
“After almost five years at Tesla, Doug Field is moving on,” a company spokesman told AFP.
“We’d like to thank Doug for his hard work over the years and for everything he has done for Tesla.”
Tesla announced in June that it was cutting nine percent of its workforce to enhance profitability, but said the move would not affect an ambitious production ramp-up of its Model 3 sedan.
The job cuts are part of a company-wide restructuring to address excess staff in some areas due to the company’s speedy growth, Musk said in an email to employees.
The cuts concern salaried staff but not production workers and will not affect Model 3 output targets, said Musk, who characterized the downsizing as an acknowledgement of the need to focus more on costs.
“Given that Tesla has never made an annual profit in the almost 15 years since we have existed, profit is obviously not what motivates us,” Musk said in the message.
“What drives us is our mission to accelerate the world’s transition to sustainable, clean energy, but we will never achieve that mission unless we eventually demonstrate that we can be sustainably profitable.”
Shares of Tesla closed the formal trading day down 2.3 percent to $335.07 but regained some of that ground in after-market trades.