The Ideaconomy
June 29, 2026
Alex KiersteinBuilding cars might be the hardest way to make money. Unless building cars isn’t really the point.
Rory and I were talking in Slack today about REO, a “startup” truck maker that seemingly thumbed through a lapsed trademark catalogue to conjure up a name.* I don’t doubt for one minute that the guy in charge, who had a nice and earnest conversation with our friend Jason Torchinsky over at The Autopian (which you should read), is an enthusiast who believes in the notion that people might want a low-cost, low-frills pickup with an engine that prioritizes balancing economy and reliability rather than being fully optimized for corporate fuel economy standards.
*I use startup for neo-REO in skeptical-quotes because it doesn’t take a whole hell of a lot to announce you’re going to do something. Doing it is the hard part. Call it a startup once it’s got a factory; until then, it’s an idea.
A simple truck is a thing enthusiasts want—we sweet summer children. I’m an enthusiast; I actually learned to drive in a ‘84 Toyota Truck, which was a single cab long bed with no A/C. It didn’t come with a passenger mirror or power steering. It was an auto, a nod to my mom needing to drive it. But I’d love something like that again. And that puts me in the same basic category as the car-collector-cum-prospective-car-manufacturer of REO. An enthusiast.
An enthusiast is a terrible thing to be if you want to build cars that will sell, because we make up such a small bit of the car market. Enthusiasts get way in front of their skis, full of passion to carve out a niche building something for them.
If you want to build cars, you should be an, I dunno, someone who built an empire of auto parts companies in China. Or maybe a corporate lobbyist specializing in tax breaks. Because you’ll do some of the work—the IP, engineering—but the work of lining up suppliers, a code stack, a workforce, a factory, this is Sisyphysian.
Tesla only just squeaked by its thinnest point, and I think that was on the strength of two things. One is some phenomenal engineering. Credit where credit is due: Tesla’s powertrain and battery advances were, until recently, unparalleled. The other is the shameless, awful showmanship of Elon Musk, an odious man whose absurd promises about product and features created an entire class of coattail clingers, hoping to ride the meme until payday. I don’t think anyone earnestly believed he was going to put rockets on the mythical Roadster, but more than a few were willing to make a buck off of the people who did.
All that aside, Tesla established a supply chain and manufacturing presence in China, and that was arguably the inflection point. It still might not save the company; Musk seems disinterested in future Tesla product, so it might wither while he pretends he’s going to do make other things.
Maybe I’m being too pessimistic, but I think a market in which Nissan and Mitsubishi are too small, and when well-funded newbies like Rivian and Lucid are a funding round away from oblivion, isn’t a great environment to launch what can only plausibly be a low-volume player. Where’s the secret cost advantage that makes that possible?
I wonder the same thing about Slate, but the difference there is a human with a country’s worth of personal wealth. That tap could turn off, either due to a missed benchmark or a whim, but there is the war chest of a robber baron looming behind it. Arch-capitalist versus scrappy enthusiast?
In this economy?
Unless, and I know this is an even more cynical take, the idea is simply to sell an idea. Ideate something cool, sell it to someone bigger who can bring it to fruition. I guess there’s nothing wrong with the notion of that, provided the motivations are right. But this exists within a corporate culture that venerates the next big thing. Venture capital, chasing shiny ideas, placing bets. Private equity vacuums up the failures, if they fail the right way.
Good luck to REO, is all I’m going to say. You’re going to need it.
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