Chris Collins explains why Tesla's growth is squeezing legacy automakers. As Tesla approaches 2 million cars, GM, Ford, and Chrysler face volume declines without proportional cost cuts. Service departments running at 20% margins and UAW labor agreements make it harder for traditional OEMs to adapt.
2 million cars.
About 20% net to gross.
20% (sales drop 20%).
Okay, so 45 years ago, I was saying.
That it isn't.
The decline of sales, it's going to get gm, Ford and Chrysler, it's the market share that Tesla is. When Tesla is making 2 million cars, their market share shrinkage will go into their profitability. Oh, yeah, right. So just, just think like if, if a service department is 20% net to gross and your sales drop 20%, your overhead isn't going to drop 20%. So their deals with UA, you know, the UAW, that, like, their costs in a lot of situations have gone up, not down, but their volume is going to go down, they're losing market share, and it would, it would appear that they're misstepping. And in what they think consumers want. Agreed.
