Tesla's $110,000 Model S is now Norway’s best-selling car

http://www.theglobeandmail.com/globe-drive/new-cars/auto-news/teslas-110000-model-s-is-now-norways-best-selling-car/article14739655/

by austenallred • 13 years ago

121 80 13 years ago

theglobeandmail.com

cstrat2• 13 years ago

I hope to see the Telsa become a big hit in Australia.

Right now I couldn't have one since my apartment complex wouldn't support charging - however if the government ran a subsidy program to retrofit complexes I would definitely look at buying one!

redact207• 13 years ago

Me too, though given the stance the government has taken on climate change and investment into the future, it's unlikely such subsidies will be significant or fast coming.

And retrofitting apartments would be great, but again given the track record with the NBN rollout, you really have to ask how committed they are to infrastructure projects. Also brown/black outs happen during summer as the grid struggles to keep up with the increased demand. Adding EC to that? Yeesh.

Tangent: I'm all for EVs, but paradoxically they are really quiet - as in silent if they're coming up behind you. If you've ever been on the footpath, turned casually to cross the road only for a cyclist to rush past you out of nowhere it's really frightening like someone jumping out and yelling "boo". Can only imagine once we transition away from fossil fuels.

oblio2• 13 years ago

Now imagine tens of thousands of mostly quiet, non-polluting cars on a very crowded high way. It would be amazing for the environment. And for the neighboring residential areas ;)

cynix• 13 years ago

Another issue is that the price here in Australia will likely be double the US price.

taralx• 13 years ago

Does anyone know what's behind this?

Is it that people don't buy a lot of cars in Norway? Average income is significantly higher? Different income profile of car buyers specifically? Some kind of social effect, like prestige?

cremnob• 13 years ago

High taxes on gas fueled cars make Tesla afordable.

cstrat2• 13 years ago

"because of the punitive taxes Norway’s government levies on cars with big, gas-guzzling engines"

I guess people wanting a fast modern car would have to pay out their nose for one if its fossil fuel powered.

glesica• 13 years ago

Yes, Norway is very, very wealthy. This is a fairly recent development... https://duckduckgo.com/?q=norway+wealthy

frewsxcv• 13 years ago

I don't think it's that recent, I feel like they've been pretty 'wealthy' for a while. Interestingly, NOK-EUR YTD hasn't been that great http://ur1.ca/fuyz4

dagw4• 13 years ago

Due to the tax structure on electric vs gas cars in Norway, a similar performing gasoline powered car would cost you at least twice and probably more. For comparison $110000 will just about get you a middle of the line BMW 5 series, and something like entry level BMW M3 coupe will easily set you back in excess of $200000.

And that's before you take into consideration the annual savings due to high gas prices in Norway and no road tax on electric cars.

greenyoda• 13 years ago

Many versions of this story have already been posted:

https://www.hnsearch.com/search#request/all&q=tesla+norway

jeddi• 13 years ago

I think Oslo consistently comes in each year as the most expensive city to live in -- so at $110,000 it may also be Norway's cheapest car.

sbrekken• 13 years ago

The article fails to mention a bunch of other benefits of owning an electric in Norway:

- No annual road tax and virtually no sales tax

- You're allowed to drive in the bus lane which is huge for suburb communters.

- Free communal parking

- Free passage through tolls and ferries

- Free charging at communal charging stations (they're everywhere in Oslo)

akavel• 13 years ago

Quoting a fragment:

"Electric cars have been especially popular in Norway because of generous subsidies, free parking, government-provided re-charging stations, the right to use express lanes on highways and exemptions from tolls."

or wasn't that fragment there earlier?

thomasfl• 13 years ago

Besides: - Norway has the highest taxes anywhere on buying and using gas cars. Horsepower and weight is taxed heavily. - Urban sprawl around the biggest cities has created some of Europe's worst traffic congestions. It's a huge benefit to be able to use the bus lane.

Teslas high market share in Norway is also a symptom of some of the challenges we face here in Norway.

vidarh5• 13 years ago

I find the idea of "urban sprawl" in Norway hilarious.... I'm from Oslo, but live in a London suburb that is larger than the "urban sprawl" around Oslo. Norwegians for the most part has no idea what proper congestion looks like.

jccooper• 13 years ago

Nice benefits. At what point in market share does that all get taken away? Surely the whole population cant go on the bus lanes.

capisce• 13 years ago

A big reason for the Tesla Model S being the best selling car last month is that a lot of people have been on waiting lists for months to buy one, and they only started selling them in August. Not to say that it won't keep selling well with all the benefits specific to electric vehicles in Norway.

matponta• 13 years ago

I was in Oslo last May, saw my first Tesla Roadster... They tell me it's actually a pretty cheap car - or rather, all other cars are crazy expansive - because of taxes on internal combustion cars...

TobbenTM• 13 years ago

That, and the USD is quite cheap.

zerr4• 13 years ago

Interesting. One fellow Norwegian client was assuring me - the country is rich, but people don't have money. I understood this as one of the perils of socialism.

marvin• 13 years ago

People do have money. The median salary is on the order of ~$75,000/year. But everyting is so expensive that you don't get the class division that can be observed in the UK and US. (It is also a part of our culture to not have distinct social classes).

dooptroop• 13 years ago

That's more the perils of being born with a golden spoon so far up your ass you start complaining because the back of your mouth tastes like poo.

kristofferR2• 13 years ago

Norway is not a socalistic country, that's just absurd (unless you are on the right wing of US politics - where everything left of for-profit healthcare is socialism/marxism/communism).

Our cost of living is often absurdly high though, and the increased wages can't completely make up the difference (it's AWESOME for travel though). Therefore we can't afford as much "stuff" as Americans can, but I think it's worth it due to increased quality of life the Norwegian system brings.

davidw• 13 years ago

I think it's worth it due to increased quality of life the Norwegian system brings.

I visited Oslo a few years back, very briefly, and indeed it did seem like a very nice and well run place.

But no amount of nice social systems will buy you sunshine, so I'm still here in Italy.

JoeAltmaier• 13 years ago

Ok its a "parliamentary representative democratic constitutional monarchy" according to Wikipedia. Doesn't change the fact that socialist systems operate inside Norway. Including heavy centralized govt control of goods and services e.g. taxing cars to force people's choices.

lumberjack• 13 years ago

I was under a similiar impression but even with high taxes and cost of living Norwegians have an estimated individual net worth $350K, third in the world, on par with Australia and about $150K less than the Swiss.[1]

It still seems bizarre to me that somebody would buy a car that is a third or even a fifth of their net worth, though.

But Norway also has almost 55K millionaires (net worth).[2]

1. http://www.businessnewsnorway.com/2011/10/norwegians-are-the...

2. http://www.theguardian.com/money/2007/jul/13/business.intern...

vidarh5• 13 years ago

The taxes are not particularly high outside of very specific things. If you spend most of your wealth on large gas-guzzling cars and alcohol, your overall tax rate will be high. Other than that, people tend to overestimate how high Norwegian tax rates are. I'm Norwegian, lives in the UK, and at one point worked for a US startup and we looked at moving me over to California. As a result I compared my specific situation, with an income at the time of several times the UK national average, and a slightly lower multiple of the Norwegian average. That put me well into the top tax brackets in the UK and Norway.

Yet my "fully loaded" tax bill in the UK and Norway came out at ~37% and 38% respectively, and at ~35% in California. This is everything paid by me: VAT/sales tax (at 25% in Norway, but since most people don't spend a huge proportion of their income on stuff where VAT applies, it doesn't contribute that much to overall tax paid), local government taxes/property taxes, wealth taxes, income taxes, as well as national insurance (compulsory part of healthcare/pensions etc.) and equivalents. When factoring in the need for private health insurance in California to cover things that are free at point of service in Norway and the UK, I'd break pretty much even on that respect. If you include payroll taxes etc. paid by employer, as some people like to do when they want to complain about tax levels, it might shift a bit bit further towards the US (but the UK and most European countries are at Norwegian levels there).

Some other US states would have left me a bit better off tax wise, though less than one might expect (but that's moot if I can't make the same salary or even find a job there). Then again, by that argument I could've substantially reduced my tax bill in Norway too by moving to the northernmost regions which have special tax breaks (or no income tax at all on Svalbard, but then I don't think there's many tech companies up there...).

The real outcome regarding tax level is "it depends" whether or not you can or want to live in the lowest tax areas and whether or not you can take maximum advantage of tax breaks (e.g. one thing that can drive Norwegian taxes down is that there's a number of things, including most loan interest, that can be deducted from gross income to arrive at taxable income, and this can make the tax rate paid by two people with the same salary vastly different; compared to the UK at least, the potential for deductions is far higher) and/or spend your money on things that are taxed at special rates.

But wealth is far more distributed in Norway as well (though that didn't apply in a like for like comparison of salary lie mine) so while we have fewer extremely rich people, unless you earn substantially above average elsewhere chances are you'd get a higher salary in Norway. This is a huge part of the reason Norway is so expensive: salary for low level staff in e.g. retail positions is far closer to the median in Norway than most places, and so contributes disproportionately to the cost of goods and services compared to elsewhere. For a majority of the population, this is sufficient to more than make up for tax and cost of living differences and leave them better off in Norway than most other places.

maggit• 13 years ago

"Social democracy" (http://en.wikipedia.org/wiki/Social_democracy) is a more correct term, though on Wikipedia there seems to be an even more specific article on the "Nordic model" (http://en.wikipedia.org/wiki/Nordic_model)

"Socialism" (http://en.wikipedia.org/wiki/Socialism) isn't really applicable.

zerr4• 13 years ago

Right. I didn't mean "Socialism" in a strict/formal sense. I always thought of Nordic countries as "kind of socialism". Apparently, there exist more correct and exact terms, as you pointed out.

dragonwriter• 13 years ago

The Nordic model is a form of social democracy which is a form of socialism; if the first is applicable, the second is as well, and if the second is applicable, the third is as well.

hanspeide• 13 years ago

I believe this article is inaccurate. A lot of people preordered the Model S, and a lot of those were delivered and paid for (upfront payment excluded) in September, which caused the Model S to be positioned in the top of the chart.

kayoone• 13 years ago

This is the direct result of what happens when similar specced petrol cars are just way more expensive (taxes) than electric cars.

So if any government wants to embrace the use of ecars, this is one way to do it! Governments of countries with a healthy car industry would be hesitant to do this though.

antr2• 13 years ago

All EU countries provide tax incentives to buyers of EVs.

dagw4• 13 years ago

But non provide the same level of tax disincentive to buy a large IC engine cars that Norway does. You really need both the carrot and the stick if you want to see significant change.

m_mueller• 13 years ago

As a fan of Tesla I'm still skeptical whether tax incentives are the way to go - the reason is that I'm not yet convinced that battery powered cars are a sustainable way to replace all the petrol powered ones.

In general it seems to me that internalizing all costs of transport is the way to go. This would mean higher fuel costs, possibly slightly higher cost of electric vehicles and also higher cost of public transport. There should be a clear incentive for people to move as close as possible to where they work, or to work from home. Some incentives to steer the economy in that direction could be helpful at first, for example subsidizing company housing or directly subsidizing people to move close to their job (the higher amount, the closer the family moves), offsetting high rent in places with lots of work.

Shivetya• 13 years ago

My issue with tax incentives is that they are given without regard to income level of the buyers. I do not believe tax incentives should be given to the companies that produce the cars, only to the public who buys them and then only weighed against income level.

Get the middle class into these electrics, if the rich want them there is no reason the middle class should subsidize their purchase

SuperChihuahua• 13 years ago

Electric cars in Norway:

- Three percent of all cars sold in Norway are electric, the same number in US is 0.1 percent.

- The number of electric cars on the Norwegian roads today is 7 000, and the total amount of cars is 2.4 million. The neighboring country Sweden has 4.4 million cars, but only 600 of those are electric.

- About 40 percent of those who own an electric car also own a gasoline car.

- The goal of the Norwegian Electric Vehicle Association is to have 100 000 electric cars in Norway within year 2020.

- The Norwegians have earlier tried to produce electric cars through the company Think Global. For the fourth time in twenty years, the company filed for bankruptcy in 2011.

svantana• 13 years ago

- Three percent of all cars sold in Norway are electric

Even better, that number is already outdated - the article states that the Model S has a 5.1% market share already.

It should be noted though that the Norwegians can afford to be environmental - they make ridiculous amounts of money from their offshore oil fields. Also, they have plenty of cheap electricity from hydro.

hrkristian• 13 years ago

That is a misnomer. Oil accounts for about 22% of our GDP. Fact is, GDP per capita is only so much higher than that of the US, about 10% I'd say.

We can "afford to be environmental" the same way any country would be able to afford to be. The real difference is our wealth distribution which is leaps and bounds ahead of most of the world, here in Norway a higher percentage of the population are simply able to afford the car and that is what we're seeing in Tesla's market share.

sspiff4• 13 years ago

Having access to your own oil is probably not going to boost electric car popularity in general (quite the contrary). I think "they have oil, so they are rich, so they can buy expensive electrical cars" is a bit of a shortcut.

axx• 13 years ago

My assumption is, that Tesla gets a lot of "free" marketing because they're the only "real" electric car company for now.

I'm really happy for them, but i believe that as soon as Mercedes Benz, BMW, Audi etc. can affort to make "cheap" but great electirc cars, nobody will talk about Tesla anymore.

In germany, for example, it's really expensive to own a car (insurance etc.) but it's even more expensive to drive one. You need to pay between 1,36 and 1,85 Euro per Liter (Cars have between 40-70 Liter tanks) and people _still_ don't buy electric cars.

My guess is, that many people trust those big companies and don't want to buy a expensive car from a company they never heard of. As soon as all those german companies have a good mass-product solution for electric motors, they can scale them from an Audi A1 to an Audi A7 and people will buy them instantly.

jgreen10• 13 years ago

Tesla's technology is so far ahead of other manufacturers that people will probably have heard of Tesla long before BMW et al. catch up.

hef19898• 13 years ago

That's the point I'm not sure. COnsidering the fact that the biggest innovation the big german manufacturers had in last couple of years were new assisstant systems, I highly doubt they are in any position to actually built usable electric cars. The notable exception being BMW. And even they are far behind Tesla for now and had to fight considerable internal resistance to get the i3 project running.

I highly assume they are ready for some tough times if they don't prepare for a changed market. Exports to the US and Asia won't save them forever. And once the infrastructure for EVs is in place it will become practical to drive EVs. I only hope for the German economy that car manufacturers learned the lessons from former German camera and TV set manufacturers.

blktiger• 13 years ago

I wonder how much company size impacts the ability for auto manufacturers to innovate. Seems like (in general) the larger a company is, the more slowly they innovate. Tesla has ~3,000 employees while BMW has ~100,000 according to wikipedia. Perhaps that means that Tesla can move much faster and will be able to out-pace the larger auto manufacturers?

njharman• 13 years ago

I'm old enough I remember how crappy American cars were (due to non-innovation/cheap gas) and how Asian manufactures ate them alive with cheap, efficient (for the time), dependable cars. Detroit is now bankrupt and it took 20years (70's to 90's) for the American manufactures to recover.

Many similarities today. Incumbent manufactures mostly ignored (or produced paltry efforts) electric. Only now after the threat is getting established are they responding.

All cars will be electric someday and all manufactures will have electric cars (or be out of business). But until then, there is room for a new player to emerge. Honda, Toyota, Nissan weren't known before the last automotive disruption either.

r00fus2• 13 years ago

I'm really happy for them, but i believe that as soon as Mercedes Benz, BMW, Audi etc. can affort to make "cheap" but great electirc cars, nobody will talk about Tesla anymore.

People said the same thing about Google providing the first usable web search, and their dominance (and the Microsoft would eat their lunch when Redmond finally got around to it).

I feel the same way about Tesla - the Model S is merely a product that embodies the company's vision and skilled workforce. Tesla may not yet have a patent thicket, but they probably have key battery-specific patents as well.

They are busy disrupting the way cars are sold as well (mainly because, in order to succeed, they have to)… an area that sorely needs disruption.

All of this means that by the time the other manufacturers get around to building a Model S equivalent, Tesla will have both moved on to better product as well as entrenched their brand as the leader in the space (not to mention whatever lock-in that Supercharger stations produce).

Perhaps this will be diminished in Germany which prides itself on it's car manufacturers, but even Japan gave into the iPhone eventually.

Gravityloss2• 13 years ago

It may not be that Tesla is extremely good, but that the others are inconceivably fumbling in creating decent premium electric cars. And may do that for many years to come.

Just look at non-apple laptops' trackpads...

chollida12• 13 years ago

One of those secondhand buyers, 27-years-old financial consultant Anders Langset, said a regular car with similar performance and engine size could have cost him up to 2 million crowns ($330,000) because of the punitive taxes Norway’s government levies on cars with big, gas-guzzling engines.

Wow, if that's correct, then good on both the government and people for trying to move in the direction of gasoline independence.

I guess in Canada and the US we are too intertwined with the car industry to do something similar.

timc3• 13 years ago

Gasoline independence? You realise that they have large amounts of oil?

fulafel• 13 years ago

They're pretty big on planning for the depletion of the reserves.

icefox2• 13 years ago

And they sell that gas to _other_ countries for an nice profit.

chollida12• 13 years ago

Yes I do. If you have a point you should make it:)

frogpelt• 13 years ago

Keywords: Punitive taxes.

alephnil• 13 years ago

One of the main reasons is that ordinary cars are heavily taxed, while electric cars are not taxed at all. This makes a Model S cheaper than most BMW or Mercedeses for example.

Add to this that electricity is cheap, while fuel is expensive. Also, Norway's wealth is relatively evenly distributed while at the same time the GDP is high. All these reasons makes it affordable for a lot of people to Buy a Tesla Model S.

While I have seen a few Model S on the road, I can't commute to job without passing a quite a few Nissan Leaf. Those have been sold in large numbers here (3% of all cars sold first half of 2013).

Gravityloss2• 13 years ago

Take this with a grain of salt as I read it as a blog comment, but it's been argued that this is only a temporary thing, because of a pile up of orders for a long time and now a sudden delivery.

Tesla's $110,000 Model S is now Norway’s best-selling car

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