- If I asked you to close your eyes and picture an electric car, I'd be willing to bet that
you're picturing a Tesla. (electronic music) Of course you are. Tesla Motors is far and away the top seller of electric
vehicles globally. And they have been for years. When it comes to mass produced EVs, Tesla faces no real competition. So why are all the other
car companies failing? I'm a freaking collectable. Check it out, these are the
first official Donut figurines. We've got James "Kentucky
Cobra" Pumphrey over here and me, Nolan "Be Kind" Sykes. These limited edition
figurines will be available September 25th starting at nine a.m. And once again, they are limited. So once they're sold out that's it, there's no more of them. But for three of you lucky D-holes we're gonna be giving away
three signed figurines. That's right, signed by James and I. So to enter go to donutmedia.youtooz.com, follow the steps like
visiting their Youtooz Reddit or their YouTube. The more steps you do, the more likely you are to win. So get on it.
(car horn honking) The protective sleeve is off. (Nolan tapping) Hear that? Oh, look at that. I love you.
- Aww. And there it is. There's James. And even on the shirt you can see that it does have the Donut logo, oh, on the front and back. There's nice little touches here. I do like that James just looks so joyful. Let's open up mine. (upbeat music) Be kind. Perfect. Alright. Got glasses, aye, that looks like me. They've even got my mole. How did I get to a point in my life where there's a collectable of me? In my car no less?
(car horn honking) Guys, I'm really excited for this. When you get yours please post some photos
of them and tag me. 'Cause it's surreal that I have
my own collectable figurine. So see you on September 25th and good luck to those who enter. You know me, I'm a red-blooded gasoline
boy through and through. But even I have to admit
that the future is electric. We even made a video on
whether or not electric cars are better for the
environment than gas cars. The answer may shock you. It's actually one of my
favorite videos we've ever done. And if there's one thing I've learned from all of automotive history, it's that competition breeds
the best cars for consumers. Which brings me to electric vehicles. Of the approximately 65
and a half million cars sold around the world last year, EVs made up a mere 2.5%
of the global market and just 1% in the US. But within the market, Tesla, specifically the Model
3, completely dominated. In the United States last year Tesla's made up 78% of all EV sales. So far in 2020 they're outselling the next three biggest EV
manufacturers combined. The Model 3 is the world's best selling
plugin electric vehicle and it's not close. It doesn't just leave other
companies in the dust. It's lapped them about 10 times over and has taken off like a rocket to Elon Musk's condo on Mars. The lack of competition
is frankly frustrating. There have got to be plenty of companies that have the resources to provide an electric
vehicle to the masses, right? There should already be
a people's electric car comparable to a Tesla on the market. But there just isn't. And it's not for lack of trying. There have been several swings and misses made by the would be Tesla
killers in the past decade or so. For instance, despite Audi's popularity, their e-tron never really took off. Faraday Future's CEO went bankrupt and literally fled his debtors after the failure of the FF 91. Even Dyson tried their
hand at EV manufacturing before pulling the plug on
a project because it sucked. We talked about the Dyson car
more in depth a few weeks ago. Go check out that episode
if you haven't seen it yet. The car doesn't really suck, it was just really expensive. So what is everyone doing so wrong that Tesla is doing so right? Well, I've done some research and I've come up with three main areas where Tesla is kicking
everyone else's EV butt. But the third one's got the most oomph. It is definitely the nail
in their collective coffin leading directly to the answer of why they have stayed miles ahead of everyone else in the race. How did they consistently
blow away their competition? First of all, in a nutshell, Tesla's electric vehicles are
just plain better to drive than anything else on the EV market. Tesla hits it out of the park when it comes to the
overall consumer experience. I'm talking about how damn good driving a Tesla really feels. Take the Model 3, Tesla's more accessibly priced family car and their stab at
creating a mass market EV. This car is a dream to drive. It handles well, drives smooth. and is incredibly safe alongside
all the standard EV perks like the quietness and instant torque. The design of the interior
is a minimalist's dream. The aesthetics are sleek and modern. The user interface is
sophisticated yet kind of simple. It's a little more on
the sophisticated side. I did not understand the
Tesla hype until I drove one. Say what you will about the build quality and the gimmicky features like having to use a touchscreen
to open the glove box. But after driving it I truly do not care. Another huge factor is batteries in that Tesla's batteries
have longer range than all their competitors. In fact, Tesla's cars hold the top four positions on the list of EVs with he longest range. Not only are their batteries the best, but they're the only company to offer different battery packages
at different price points. So although the base model of
the high selling Chevy Volt has comparable range to the base Model 3, Tesla's higher specs smoke the Volt. Plus it's faster and more fun to drive. It's that variety that
sets the Tesla apart from other electric vehicles. How the driver experiences the automated capability and features. But I'll get to the technology section of my love letter to Tesla a little later. I want to take a moment now to remind you that Tesla isn't perfect. They've seriously struggled with poor build quality and
paint quality many times over. Remember back in 2018 when they were building
cars in a literal tent to meet their quarterly production goal? That resulted in a harsh
lack of quality control and a high number of
defects in their cars. As a company they've faced harsh criticism of the quality of their work. Over time though they've been steadily
addressing these concerns. Solving problems, introducing
newer and better models. Something that BMW hasn't
been doing with the i3 which is arguably the most
recognizable rival of Tesla. This rivalry goes all
the way back to 2013. BMW started developing the i3 as Tesla was producing
their flagship Model S. But the truth is these two
vehicles are nothing alike. The model S is a luxury sedan. It's reminiscent of the
Mercedes Benz S Class in its aesthetics and performance. But the i3 almost looks like a toy version of a futuristic car. Its design makes it read somewhat more like a
novelty than a daily driver. And though it's years on the market have given it something of a reputation, it's still BMW's only
fully electric model. Since the i3 launched
Tesla has been hard at work with that signature innovation
and relentless development to create newer, better models
like the Model Y, Model X, and everyone's favorite,
of course the Model 3. The second (clears throat). The second point I'll make as to why Teslas are so
appealing to consumers has very little to do with the
actual machines themselves. (upbeat synth music) Teslas, much like yours truly, have an undeniable cool factor. (heavy metal music) They have that je ne sais quoi, an indisputable sense of joie de vivre, and when you see one it coup de souffle. That last one means to
take your breath away. I had to do that like five times. I'm very bad at French. If you'd like to hear more of
me butchering pronunciations, check out our podcast "Pass Gas". Lots of names that I don't get right and people send me helpful mail. What I'm getting at here is that Tesla has top-notch
branding and marketing. And they have a $0 advertising budget. They literally don't do ads. They don't have to. They're in the zeitgeist. And although they're a young company, Tesla is a household name. Not to mention the name
itself is catchy and apropos. Something that other
companies have tried to copy. I'm looking at you, Nikola. Can't just piggyback off Tesla and use the same guy's name. Look I don't want to disparage your cars or anything like that
but that's, that's weird. Of course a large part
of its marketing success is due to the eccentric personality and celebrity of its CEO Elon Musk. (jazzy music) Elon basically doubles as the marketing department
of the whole company. Everything he does is some
kind of commercial for Tesla. Whether he's sending a Roadster to Mars, smoking a joint with Joe Rogan, or tweeting away to his 38
million Twitter followers. Elon stays in the headlines, and therefore so does Tesla. And look he's definitely not everyone's cup of billionaire tea, I have my issues with him, but the fact is whether or
not you're a Muskhead or not I'm willing to bet that
most people in your life know who he is. Can you say the same for
Mark Duesmann or Jim Hackett? No. You know Elon Musk's name. Might not know his kid's name, but honestly I don't think he does either. - How's X AE A-12?
- Sorry? - How's X AE A-12?
- Oh, oh you mean my kid. (Elon laughing) - But with this help Tesla has
an ardent and loyal fan base unlike that of any other car manufacturer. Furthermore, because of their success, all other EVs and their commercials kind of serve as free
advertising for Tesla. When new EVs come out analysts often labeled
them as Tesla killers. That's free advertising. Some companies like Volvo
openly challenged Tesla when they launch a new EV. Volvo claimed the Polestar 2
was their Tesla 3 competitor. It's free advertising. Then there's companies like Ford who spend hundreds of millions of-dollars on advertising every year and base the whole marketing
campaign of the Mach-E, an electric vehicle, on the Mustang, arguably one of the most
iconic gas fueled cars ever. Why are they lumping
these two ideas together? It pisses off some Mustang fan boys and is a complete missed
opportunity to center Ford as a force in creating new, fresh, alternative energy vehicles. It's not that innovative. Tesla though sells innovation. They sell progress. They sell a vision of the future where technology is utilized
to improve our lives and the planet. It's marketing, baby! Speaking of technology, it is the third component of my breakdown of Tesla's superiority over
other electric vehicles. And it's the big one. (synth music) Teslas are software defined vehicles. What that means is that all the functions and features of a Tesla are
primarily enabled and operated by software as opposed to hardware. This is what people are
talking about when they say that a Tesla is basically
a computer on wheels. They're right. Software defined vehicles are different from the analog vehicles of yore because they offer an ever
changing and evolving platform to suit customers' needs. Tesla owners can reap the benefits of software updates, bug
fixes, and feature upgrades without a single trip to the dealership. And I'm not talking about
a new navigation system or stereo settings. These updates are like getting
a whole new tune on your car. The most recent update for instance includes lower charge times,
increased cruising speeds, updated driving visualization which further inches them
closer to full self-driving. It even adjusts your suspension to support aerodynamics and ride comfort. It's awesome. And while I love me and analog dash with a loud internal combustion engine, I can't deny that cars are
headed for a digital future. Tesla is leading that charge, and boy, do they have a huge headstart. Their tech is what makes them untouchable even to good-looking competitors. Take Volkswagen for example. When they announced their ID.3 they called it their electric offensive and it would dictate
tens of billions of euros in the next eight years to
launch up to 70 new EVs. The ID.3, meant to compete
with the fierce Model 3, looked like it might give
Tesla a run for their money. At first. It's an everyday EV with
great maneuverability and with pretty good range. The rub was, predictably, the technology. After hitting the market
it soon became clear that the software in the ID.3
was too hastily developed. In fact, the ID.3, the company's first
mass market EV's launch, was delayed due to the software issues. And the first versions of
the car will be equipped with incomplete software architecture. (sad trombone playing) VW just didn't have the
people or the expertise to compete with Tesla's computers. Tesla has those things in spades. On top of being software defined, Tesla is the unrivaled leader
in self-driving technology. They've been working
on it longer and harder than any other company. There's no fully self-driving vehicle yet but Tesla is getting close. It's got sentry mode which continuously monitors the
surroundings of the vehicle, adding protection, and laying the framework
for a self-driving future. Tesla's integrated central control unit, also known as full self-driving
computer, AKA Hardware 3, quote, "claims a computer performance "of 144 trillion operations per second." Do you know how many a trillion is? It's a million millions. Now imagine 144 of those. I can't wait to see the animation of this. (ominous strings playing) Now I don't know too much about computers but that sounds like a
pretty damn smart one to me. This FSD computer has capabilities that competitors can only dream of. It's Tesla's ace in the hole and their biggest advantage
over their competition. In Japan, Nikkei Business Publications did a tear-down of a Tesla Model 3 to try and figure it out. What they discovered
upon inspecting the FSD is that Tesla's technology is about half a decade
ahead of the competition. So even for competing EVs, like the beautiful Jaguar I-Pace whose infotainment system
might actually have a slight edge over its Tesla
counterpart, the Model X, the self-driving tech
is completely unrivaled. Tesla tech is king. Consumer experience, branding
and marketing, technology. Tesla trumps all around. But now that we've looked at specifics, let's back up and think
about the big picture, the giant question we're trying
to answer with this video. Why does everyone else keep failing? This is not a simple answer, but as far as I can tell
based on my research, legacy car manufacturers are
failing to compete with Tesla for a couple of reasons. Firstly, many of them just
plain underestimated Tesla when they were first starting out. Tesla's aspirations were lofty and car companies like
BMW and Mercedes Benz didn't think Tesla could
execute on their vision. This was especially true
in the case of the Model 3. Tesla had a plan to deliver
an affordable option to reach a wider market. And they did have problems and setbacks in the early stages of
creating and manufacturing. But they figured their (bleep) eventually. And this year so far they've
shipped about 400,000 Model 3s. Nobody thought they could do it. Egg on all the haters' faces and you know what, egg is unpleasant. But hindsight 20/20, which just also this year. Did you know that? The big wigs of our
beloved big car companies can't erase their past mistakes. But what is so frustrating
about the situation is that they're also
still reluctant to change. Every single big car manufacturer is dependent on the automotive industry's parts supply chain. Their business model depends on it. The parts supply chain is a layered system that includes dealerships, manufacturers, and three tiers of part suppliers. Car buyers go to dealerships who place orders with manufacturers who then use the dealers
data to design new models and collect components from
the first tier of suppliers who source parts from tier two suppliers. Tier three sells raw
materials to everyone. It's complicated. This system has been ingrained
in companies for decades. Of course it's facilitated growth but it also effectively
kept big car companies from rolling with the
technological punches. Tesla, on the other hand, doesn't rely on a parts supply chain and instead manufacturers almost 100% of their vehicles in-house. There are no dealerships, no ordering parts from some other factory, and thus, no middle man. Like we talked about earlier, Teslas are software defined. Tesla never made an ICE vehicle that would benefit from
a parts supply chain. And the fact that the FSD computer replaces so many hardware
components of an ICE vehicle is what makes the in-house
manufacturing possible. The AI chips that are the beating heart of every Tesla machine are made, inserted, and sold by Tesla. It's a consumer's dream, a no hassle one stop shop for all your car-puter buying needs. If other car companies
want to compete with Tesla they have to compete with
their business model. Tesla is essentially rendering
supply chains obsolete, forcing car companies to follow suit and completely uproot their entire manufacturing
and business models. That's a big ask, that's a big ass (giggling). That's a big ask. If I was Mark Duesmann
I'd be reluctant too. Especially since Tesla only takes up 1% of the market in the US. And they haven't made a profit yet. I know I've been saying
their highest praises so far, but Tesla isn't a perfect company. It has its problems too okay. For one, since it was founded in 2003, Tesla motors as never
reported an annual profit. And for all its innovation, uncharted technological territory is a breeding ground for risk. So there is a chance for the
car makers we know and love to stand up against the auto tech giant. It's just gonna take some risky moves and a couple profound changes. It's hard to imagine but car
companies kind of have to adopt an in-house manufacturing
model for their EVs. It's the key to Tesla's success. And although it seems impossible, it's the only clear way out
of inevitable obsolescence. Secondly, Tesla isn't the
only company in the world making AI chips. Legacy car companies need
to partner with AI platforms if they want to stand
a chance against Tesla. Mercedes is already on this train and recently announced a
partnership with Nvidia to build their own
software defined vehicles in what could be the
first real competition Tesla has ever faced. And you know what, I'm here for it. I'm always rooting for the underdogs like Mercedes Benz and Nvidia. You know, those little upstarts
taking it to the man, dude. And for how much I
appreciate what Tesla makes, I also know that it is
intrinsically different from what we know a car to be. It's complicated and
the future is uncertain. What is certain though is
that the presence of EVs will only increase from here on out. And let's hope that there
are plenty to choose from. If you'd like to see more videos from us subscribe to Donut Media. We put out a video almost every day. Follow us on social media @donutmedia. We post behind the scenes
pictures and talk to you guys. Follow me @nolanjsykes. I fancy myself an amateur photographer. Be kind, see you next time.
