Bob Lutz Says Tesla Should Build a Volt

Bob Lutz, former CEO of a bunch of companies and often referred to as “the father of the Volt,” penned a piece for Road and Track regarding Tesla Motors. The title says it all, Bob Lutz thinks that Tesla is doomed.

We don’t necessarily think that Lutz is wrong in his assessment that Tesla is in financial trouble and that the Model X crossover is not going to pull it out. His reasons for Tesla being in that position are not seriously flawed. We are, after all, talking about a car company that doesn’t actually make money on the product it sells once you figure in the costs of doing business. Tesla’s heavy investment outside of its carmaking, including the initiial and continued costs of the supercharger network, the Gigafactory, and, as Lutz points out, the cost of having your own storefronts.. These are all worrisome.

What’s strikingly stupid, however, is Lutz’ way out for Tesla. He basically wants them to build a cheaper version of the Chevy Volt. He compares this literal destruction of the Tesla brand to Porsche building a front-engined car. You can take that ludicrous mode comparison for what it is. Don’t get us started on how Lutz’ own Via Motors fares..

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Aaron Turpen

An automotive enthusiast for most of his adult life, Aaron has worked in and around the industry in many ways. He is an accredited member of the Rocky Mountain Automotive Press (RMAP), the Midwest Automotive Media Association (MAMA), the Texas Auto Writers Association (TAWA), and freelances as a writer and journalist around the Web and in print. You can find his portfolio at AaronOnAutos.com.

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Adam says:

October 26, 2015 at 6:47 pm

GM went bankrupt, under Lutz’s watch. Tesla hasn’t.

Nicolas Zart says:

October 27, 2015 at 11:24 pm

Or Lutz’s tenure at the helm of GM?

Lutz is a colorful guy and nothing he says should surprise anyone too much. He’s a car guy. A gasoline car guy and is not from this weird new world of EV startups. This is too foreign to him.

Tesla’s financial choice is a high stake bet. Musk is not stupid and has poured enough of his money into Tesla to calm down skittish Wall Street investors. Why can we call them “betters”, as in people who bet?

In the meantime, this is like looking at the top of the iceberg, good and bad. Yes, Tesla is about to embark on its toughest journey while it can produce and sell the Model III. Musk has his fingers in other more fruitful ventures and this is what scares traditional carmakers whose eggs are in one basket and highly depend on the price of petroleum. Musk can pull a lot of money from non-automotive traditional financial venues.

The name of the game going forward is to diversify, something traditional carmakers haven’t done because their business structure doesn’t allow for that yet.

Now here’s a good question for Lutz. Since the country had to bail out GM (partly his responsibility also) your and my tax-paying money, why not bail out Tesla whose valuation is way above GM? Yes, valuation means nothing, but Wall Street is ripe of valuation theories with little substance behind.

I promise I will ask him that question next time I see him 🙂