Someone buys a $45,000 electric car. Thousands of people helped make it. Where does all that money go, and who's missing?
Tesla designs its cars and builds them in its own factories, but it buys thousands of parts from other companies: battery cells, computer chips, glass, seats, tires. The battery is the most expensive part of an electric car. So when you buy one, a big share of your money goes to companies you've never heard of.
The split is an illustration of how a car's price is usually shared, not Tesla's real numbers. The fact it shows is real: a car company keeps only a small slice as profit.
Most car brands sell through dealerships: separate businesses that buy cars from the carmaker and sell them to you, keeping a slice. Tesla mostly sells directly, online and in its own stores. Flip between the two to see what changes.
Fact: Tesla sells most of its cars directly, and some US states limit direct sales. The dealer slice shown is an illustration.
A toy model. Real car companies sell hundreds of thousands to millions of cars a year.
Some governments require carmakers to sell a certain number of clean cars, or pay a penalty. Companies that sell lots of electric cars earn credits they don't need, and they can sell those credits to companies that fall short. Tesla has earned billions of dollars over the years this way: money from rival car companies, for cars Tesla already sold.
Next time you see a car on the street, try to name three companies that got paid when it was sold: the battery or engine maker, the company that built it, and the one that sold it.
The biggest price tag doesn't always mean the biggest profit. Always ask how big the slice is, and how many slices there are.
— Mom