Elon Musk Says It's Tough Making Money Selling Cars, Anand Mahindra Agrees

Elon Musk last night shared his pain of running an automobile manufacturing company with the world on Twitter and Indian automotive industrialist Anand Mahindra responded by relating to the same feeling in a reply.

Reuters

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Musk was talking about how difficult it can be for carmakers to balance production while ensuring a positive cash flow to make ends meet, stating, ¡°Production is hard. Production with positive cash flow is extremely hard.¡±

Musk, hinting towards massive car makers around the world, revealed how these companies sell their cars on minimum to zero margins and end up making most of their profits and revenues by selling replacement parts for their vehicles, where nearly 70 to 80 percent of them are no longer covered under the company¡¯s warranty, ¡°Large incumbent carmakers sell their cars at low to zero true margins. Most of their profit is selling replacement parts to their fleet, of which 70% to 80% are past warranty.¡°

Large incumbent carmakers sell their cars at low to zero true margin. Most of their profit is selling replacement parts to their fleet, of which 70% to 80% are past warranty.

Like razors & blades.

New car companies lack this advantage. Also lack sales & service infrastructure.

¡ª Elon Musk (@elonmusk) September 6, 2021

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Musk added stating that this concept was similar to that of razors and blades, and sadly this advantage that these massive carmakers possess is something that¡¯s not possible for new car companies, while also lacking sales and service infrastructure.

Reuters

Apparently, the pain being experienced by Elon Musk resonated with Anand Mahindra, who replied to the tweet stating, ¡°You said it, @elonmusk and we¡¯ve been doing that for decades now. Still sweating & slaving away at it. It¡¯s our way of life¡­¡±

You said it, @elonmusk And we¡¯ve been doing that for decades now. Still sweating & slaving away at it. It¡¯s our way of life¡­ https://t.co/EGpcyKrRhF

¡ª anand mahindra (@anandmahindra) September 7, 2021

This conversation comes at a time when Tesla is trying hard to launch its series of electric vehicles in India, but is facing exorbitant import duties.

Also Read: Elon Musk Says Very High Import Duty Delaying Tesla India Launch

Meanwhile Indian carmaker Tata is starting the EV revolution in India with its line of electric vehicles, with Nexon EV, Tigor EV and is soon expected to unveil Tiago EV which could be its most affordable electric offering.

Do you think Tesla will be able to make its mark in India? Tell us in the comments below. For more tech and trending news, keep visiting Indiatimes.com.