Photo Credit: 12 News
Economic predictors come in all shapes and sizes. The price of a Big Mac is considered a viable inflation indicator, and tipping amounts and men’s underwear sales are considered indications of a recession. But a recent observation of a car lot in Scottsdale may tell us a few things about the economy as well as the state of one of the biggest car producers in the world.
People have started noticing the number of Teslas piling up in a parking lot right next to a boarded-up movie theater near Northsight Boulevard and Arriba Drive in north Scottsdale. A check of the Google Street View perspective over the years has shown that the number of cars in the lot has increased steadily since 2021.
So what does that say about the economy? One could surmise a few different things from this observation. As nearly everyone knows, Tesla is more on the luxury end of the pricing spectrum and could well be considered an indicator of an economic slowdown. Luxury items are often the first things to be impacted by a slowing economy as people hold onto their existing cars later or consider cheaper options.
Additionally, we all know of the pervasive inflation issues that have hit our country (and most of the world) in the wake of the pandemic. As everyday items cost more across the board, many people look to cut costs elsewhere. With less expendable income, a luxury item such as a Tesla becomes less viable. While inflation has gone down materially, high interest rates also make financing a luxury car even more expensive, compounding the affordability issues.
However, another aspect that is not economic by nature may be playing a significant role: Tesla’s extremely controversial leader, Elon Musk. Electric vehicles have long been largely the domain of politically left-leaning buyers, as the car fit in nicely with their desire to reduce carbon emissions. Tesla was long the preferred brand until Musk bought Twitter (now X) and gained a lot of infamy for espousing views and amplifying content that was often in opposition to the views of those same left-leaning buyers. Alienation from the brand has been profound as many Democrats are now looking elsewhere so as to not financially support someone they deem problematic.
So perhaps it’s a signal about buyers being financially squeezed, as they have been for several years now. But in all likelihood, the growing lot of new Teslas is a result of many factors, including the company’s head and his inability to keep his mouth shut and just stick to his job.