The Tesla Model S as we know it today is quite an impressive car. Whilst it’s not exactly within the everyman’s price range yet (getting one landed in Australia likely won’t see much change from $100K) it’s gone a long way to making a high performing electric vehicle available to the masses, especially considering Tesla stance on their patents. Before that electric cars were more of a niche product for the ultra environmentally conscious, combining tiny engines with small frames that would have just enough power to get you to work and back. Now they’re far more easily compared to high end luxury cars and with the new things that Elon announced last week electric cars are heading into a class all of their own.
Elon teased last week that he was going to unveil the D soon (and seemingly forgot how much of a dirty mind the entire Internet has) and “something else”. The D was for their new drive train system that incorporates 2 motors, making the Tesla Model S one of the few fully electric all wheel drive cars. The something else turned out to be the debut of their autopilot system, a sort of cut down version of the Google self-driving car. Whilst the D version of the Model S won’t be available for another couple months (although you can order one today) all Model S cars built within the last couple weeks shipped with the autopilot hardware. Suffice to say both these announcements are pretty exciting although the latter probably more so.
The dual motors is an interesting upgrade for the Model S as it’s a pretty common feature among higher end luxury cars, something which it has been lacking. Of particular note is how the dual motor upgrade affects the various aspects of the car, like slashing 0.8 seconds off the 0-100 time (3.2 seconds) and increasing range by about 3.5%, all whilst granting the benefits that all wheel drive provides. Typically you’d be taking a decent hit to range and efficiency due to the increased weight and power requirements but the Model S has managed to come out on top in all respects. Should those figures hold up in real world testing then it’ll speak volumes to the engineering team that Tesla has managed to cultivate.
However the most interesting part for me was the debut of Tesla’s autopilot system. Elon Musk had always been of the mind that a self driving car didn’t need to be an all encompassing thing, instead they should aim to do the majority of tasks first before looking to take the next leap into full automation. Tesla’s autopilot system is the embodiment of that philosophy, taking some of the technology that’s currently available (emergency braking, lane keeping, collision avoidance) and combining it into one seamless package. It won’t get you from point A to point B without human intervention but it’ll happy take over on the highway, park itself in the garage and even meet you at a certain location. It might not be as comprehensive at what Google is looking to create but it’s available today and does almost everything you’d need it to.
I really shouldn’t be surprised that a Musk created company is managing to innovate so quickly in an industry that has long been one of the slowest movers but honestly these two announcements blew me away. The dual motors might not exactly be a revolutionary piece of technology but the way Telsa has done it speaks volumes to the calibre of people that they have working there. The introduction of autopilot in just over a year since they first talked about it really is quite amazing and whilst it might not be the all encompassing system that Google is seeking it will likely be the standard for many years to come. I can’t wait to see what Tesla has in store for us next as they don’t seem to have any intentions of stopping their brisk innovating pace any time soon.
Elon Musk is quite the business magnate. Long time readers will know that he’s the CEO of SpaceX the current darling of the private space industry which has done as much innovation in a decade as others have done in half a century. However that’s not Musk’s only endeavor having started out by working in the payments industry, famously being PayPal’s largest stock holder when it was eventually acquired by eBay for $1.5 billion. That allowed him to create 2 companies of his own: SpaceX and Tesla Motors whilst being heavily involved in a third, SolarCity. The success of all these companies can’t be denied but it wasn’t always all roses for all these companies, especially Tesla, and indeed Musk himself.
Building a car manufacturer, especially one that eschews the traditional internal combustion engine for full electric, is fraught with risk and requires massive amounts of capital to pull off. Whilst Tesla’s end goal has been affordable electric cars for everyone it didn’t start off trying to service this market, instead focusing on building a high performance electric roadster that had a very limited production run. Of course this also drew skepticism from potential investors as they couldn’t be sure that Tesla would be anything more than a niche sports car producer and so many steered clear. However Musk was undeterred and in 2008 announced the Model S and hinted towards further models that would use the same power train, effectively creating a platform for the rest of Tesla’s fleet.
To say that the rest of the world was skeptical that they could pull this off would be putting it lightly. Indeed even though they managed to secure a $451.8 million dollar loan from the Department of Energy to help set them up investors still continued to short their stock heavily, to the point where it was one of the most shorted stocks on the NASDAQ. Some went as far as to say that Tesla was only profitable due to the American tax payers, words which would soon be served right back to them with a serve of humble pie when Tesla paid the loan back in full at the start of this year, 9 years before it was due. Since then Tesla’s stocks have continued to climb and it’s not just because people are looking for a pump ‘n’ dump.
The Tesla Model S won car of the year from Motor Trends and Automobile Magazine last year rocketing it from being a toy for the technical/green crowd to being a well known brand. Whilst it’s still not in the realm of the everyman with the base model still being some $65,000 it has still proved to be quite a popular car snagging 8% of the luxury car market in the USA. To put that into perspective that means the Model S has beaten the sales of both the BMW 7 series and the Audi A8, cars which have a pretty loyal following and have been around for decades. They’re only just beginning to ramp up production as well with the current 400 or so produced per week expected to double by years end making them one of the largest producers of purely electric vehicles.
Tesla has not only shown that fully electrical vehicles are possible today they’re also, in fact, great business too. Whilst the investors might be skeptical other car companies aren’t with the number of EVs available exploding as each manufacturer tries to carve out their own section of this market. Most of them are focusing on the low end now however and it’s highly likely that Tesla will eat their lunch when the eventual $30,000 model debuts sometime in the future. Still the more competition in this space the better as it means the products we get as consumers get that much better and, of course, cheaper.
Now all we have to do is hope that the Australia Tax doesn’t hit the Model S as that’d put the kibosh on my enthusiasm a little bit.