President Biden is willing to “say Tesla” on the condition Tesla helps solve the semiconductor supply chain crisis. Specifically, President Biden wants to know how Tesla has done so well while so-called electric vehicle leaders and other automakers and manufacturers are struggling. It sounds like one of those fake “I’ll only be your friends if you give me candy” kids used to tell me when I was in elementary school.
The Biden administration is ready to consult with Tesla and Elon Musk to help solve the semiconductor shortage. Commerce Secretary Gina Raimondo said CNBC that she was willing to consult with Elon Musk on how to improve the semiconductor supply chain shortage that is having such a negative effect on the auto industry (hat point Tesmanian and Bloomberg). Despite this, the language of the President of the United States still seems to be held hostage by the United Auto Workers (UAW), since the government has still not publicly acknowledged Tesla’s leadership in electric vehicle markets.
In the interview with CNBC, Raimondo shared his thoughts on the Biden and Tesla administration as well as his reason for not acknowledging Tesla’s leadership. “None of this is personal. These issues are way too big for anyone to have, you know, hurt feelings. Like – just let’s do the job. And like I said, anyone who has any good ideas or is willing to help us, we absolutely want help.
She added that Tesla has handled the chip shortage better than traditional Detroit automakers who are “still learning quickly.” She pointed out that Tesla is also a tech company and then tried to downplay President Biden snubbing Tesla, saying she was not aware of any administrative policies that would not allow her to seek advice from Tesla. .
Tesla has already shared how it is surviving the chip shortage
The idea that the chip shortage doesn’t affect Tesla at all isn’t accurate. During Tesla’s last earnings call (and before), Elon Musk shared how Tesla was able to weather the worst. During Tesla’s first quarter 2021 earnings call, Elon Musk said:
“So Q1 was — had some of the toughest supply chain challenges we’ve ever had in the life of Tesla and some struggles with the supply chain, with parts — across the whole parts line. obviously people have heard about the shortage of chips. This is a huge problem. But on top of that, for example, we’ve had a lot of difficulty scaling up our production in China, because we’re not able to to send critical engineers there due to COVID quarantine restrictions. So that meant that Tesla around the world depended on drive units that were made at our Nevada factory, Giga Nevada. So that was a very difficult situation.
“The team has really done an incredible job of dealing with some very serious supply chain shortages.”
He further added:
“As we continue to work through the instability of the global supply chain, particularly around semiconductors and port capabilities, while the Tesla team, in partnership with our suppliers, has done a tremendous job. to keep our factories running, we experienced high ramp-up costs in the quarter, and they were also higher than they were in [Q3], with some minor production disruptions during the quarter. We believe that this landscape is improving, but it remains difficult and it is an evolving situation.
Although that last paragraph was more about goals and financials, he pointed out that Tesla was able to solve the instability of the problem while partnering with suppliers. Despite these challenges, Tesla did exceptionally well for the first quarter – and now we know it wasn’t just the first quarter. Last year was a phenomenal year for Tesla.
At Tesla letter to shareholders for the first quarter 2021 earnings call, Tesla wrote:
“In the first quarter, we were able to navigate through global chip supply shortage issues in part by moving extremely quickly to new microcontrollers, while simultaneously developing firmware for new chips made by new vendors.”
Last month, Automotive News published an article titled “How Tesla Overcame Global Supply Chain Issues That Toppled Rivals.”
The article explained how Tesla was able to survive the shortage as other automakers struggled. These included:
- Allow customers to take delivery of vehicles with missing parts such as Bluetooth chips and USB ports.
- Radar and lumbar support removed from front passenger seats.
- Raise vehicle prices to meet higher costs.
- These included “acceleration costs” for parts.
- Replacement of alternative chips for some that were in short supply.
The article also noted that Tesla designs more hardware and writes more software than other automakers, and reminded readers of Elon Musk’s description of Tesla as “absurdly vertically integrated compared to other automakers”.
A Tesla insider said Automotive News“We design the PCBs ourselves, which allows us to quickly modify their design to accommodate alternative chips like powerchips.”
How the answer should be
Despite Tesla’s leadership, the Biden administration still refuses to admit that it is wrong for GM to do the hard work that Tesla employees actually did. It may not seem like much or mean-spirited, but it’s a matter of honesty and integrity.
If I can’t trust the president’s word when he says GM leads the EV markets, I can’t trust him for anything else. Seriously, y’all, these are cars we’re talking about. Not war, intelligence, weapons or elections. If the President of the United States tells lies about cars, then he will lie about everything else.
That said, here’s what I think Tesla and Elon Musk should do. I think Tesla should only officially help when President Biden apologizes for not being honest about Tesla’s role in electric vehicle markets. As for Elon, well, he’s already shared how Tesla survived. Perhaps a simple reminder in a tweet or a thoughtful comment could help ease some of the tension — tension that President Biden sparked by allowing the UAW to take charge.
Neither Elon Musk nor You’re here owe this administration anything, but helping would show a sense of patriotic duty. Although Elon and Tesla have shown how much they really care about America, many refuse to see that and I think Elon has a chance to shine a light on his love for America by navigating this situation with grace and kindness.