Much of the blame for the Tesla fiasco goes to government, which, in the name of green virtue, decided to subsidize the hobbies of millionaires to the tune of a $7,500 federal tax credit per car sold, along with additional state-based rebates. Would Tesla be a viable company without the subsidies? Doubtful. When Hong Kong got rid of subsidies last year, Tesla sales fell from 2,939 — to zero. It may be unfair to describe Tesla as Solyndra on wheels, but only slightly.
But the Tesla story isn’t just about the perils of misdirected government-led development and clever rent-seeking entrepreneurs. And it isn’t about the virtue signaling of those who like their environmentalist bona fides to come with vegan-friendly upholstery. It’s about hubris and credulity — the hubris of the few to pretend they know the future and the credulity of the many to follow them there.
Electric vehicles were supposed to be the car of the future because we were running out of oil — until we weren’t.