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model 3 performance Archives - Evoto

Elon Musk

Elon Musk’s Secret Master Plan — Part 3 Predictions

By Clean Energy, Technology, Tesla

If we use the first 2 parts of the ‘Master Plan’ as an indication to our prediction, we have to start with the objective. Elon Musk had an elegant plan to reach his self confessed goal of accelerating the advent of sustainable transport. In a stroke of genius, he started with a sexy & pricey roadster to prove EV’s can look great. He knew that he had to create a network that boasts the possibility of driving from coast to coast in the US even though most people would rather fly than drive from LA to NYC.

  • He then launched the Model S & X for the luxury market so the wealthy early adaptors, rich and famous celebrities and personalities can adapt them while the rest of us can aspire to them
  • When he got the money from the above, he invested in the Gigafactories to pump out the Model 3 & Model Y to open his brand to the masses
  • He has already disclosed his lateral shift to offer other segments of the automobile market to offer Pick up trucks, Semi’s & buses
  • If we agree that cars solve terrestrial short haul travel, we can see that in parallel to the above, Elon Musk has also devised concepts for Tunnel Boring & Hyperloop to solve terrestrial medium and long haul travel. If that is not enough, he created SpaceX to use re-deployable rockets to solve space travel

 

Tesla Model Y Teaser

Tesla Model Y Teaser

This covers “Master Plan” Parts 1 & 2. Here are our predictions for Part 3:

  • Tesla will create buses for the roads, trains for the Hyperloops and pods for their underground tunnels
  • As battery advancement increases range, they will create (private &a commercial) electric planes
  • Tesla will also build luxury electric speed boats and larger electric yachts
  • Tesla will then offer an autonomous self driving taxi or Uber type service through their app
  • Finally, once their Supercharger Network is larger than all gas stations in the US, they will open it up for all other electric cars for charging at a fee and build / sell adaptors that those users can use to connect their electric non Tesla cars. By then, just like the gas car replaced the horse, the electric vehicle would have become mainstream and would have replaced the gas car.

In the end, most people consider Tesla a car manufacturer. If dropping the “motors” from their name was any indication, they will emerge to become a melange of the following:

  • A clean energy & power utility provider (solar power, batteries, roofs, superchargers)
  • A global & universal transportation carrier,
  • A road, tunnel & hyperloop construction company,
  • An insurance company,
  • A sensor company,
  • An AI company
  • As well as a car, truck and plane manufacturer.

In Lehman’s terms, they will be the equivalent of Shell, Exxon Mobile, Esso, Maersk, Boeing, AMTrack, Bechtel, Pratt & Whitney, GEICO, NASA, NVIDIA, Qualcomm and about 5 car & truck manufacturers combined

Nikola Tesla never received his share of stardom for inventing AC or alternating current or the electric motor among many other fascinating things. Now, at least the legacy of his name lives through Elon Musk’s company.

Watch out for the coming age of light & Tesla everything. You have been warned…

Tesla’s ‘Apple Effect’ and how similar both companies’ customers are

By Apple Effect, Tesla

Tesla’s Apple Moment, Apple Effect and the true difference

There have been many articles comparing Tesla to Apple and going far enough to claim that Tesla’s “Apple Moment” will be when they launch the Model 3. Different reporters have made the metaphor citing the long lineups for the Model 3 similar to those lineups for the iPhone. The reporters on CNBC’s Fast Money went as far as to say Tesla was a “hype stock” and that it would be wise “to at least take some money off the table” back when Tesla’s stock was at $229 US. You can watch the video here: http://video.cnbc.com/gallery/?video=3000505824

However, nothing could be further from the truth. Just because people line up for a product launch & there is great customer anticipation of these products doesn’t make the companies or their stock any similar. People lined up for Adidas’s Yeezy shoes, Snapchat’s Sunglasses, and yes even Supreme’s Brick yet these companies remain quite different

The truth is Tesla is similar to Apple but not due to its lineups and definitely not due to its stock movements. It is not merely a fleeting “Apple Moment” but rather, an eternal “Apple Effect”.

The similarity lies in the customer experience and how the two companies treat their customers. Furthermore, their customers are very similar:

  • Both companies manage and control the whole customer experience throughout the sales cycle. They both don’t rely on dealers or franchises but open their own stores in each territory
  • Both companies enjoy enormous brand equity where the perception of the brand is matched or surpassed by the reality. They both charge a premium for their brands
  • Both companies built a closed ecosystem of products & services which lures customers into it with one gateway product; (the iPhone or the Tesla car)
  • The sales cycle from their websites to their stores are top notch. Their after sale experience is second to none with Apple’s Genius Bar & Tesla’s Service Centres. This is enforced throughout the corporate culture engrained into each company
  • Both companies listen, and quickly adapt to their customers. Elon Muskreplies and actions Tweet suggestions while Tim Cook replies and considers customer emails
  • Most importantly, customers of both these companies do something, few other companies have ever experienced: When there is a defect or default in their products, customers do not complain, bitch or moan. They merely mention the issue with a smile on their face and are happy to get it fixed. They almost feel like its a privilege to have such products, and feel bad for those that haven’t experienced it
  • This makes these customers die hard fans or fanatics just like when a person is a lifetime fan of a sports team, they never bad mouth their home team or switch sides to support another. They stick with them through the thick and thin, making all Apple / Tesla owners a tribe, a community that feel a strong sense of belonging and are the greatest mouth piece any advertiser can ever buy.

This is not to say that Tesla will also have its “Apple Moment”. If you define Apple’s “Apple Moment” as the time it went from a niche to the mainstream, I would argue the real moment was not when the iPhone was released but rather when Steve Jobs launched iTunes on Windows. This allowed the iPod to be accessible to everyone, not just Mac users. This “Moment” for Tesla will not be when the Model 3 comes out, but rather when (if) Elon Musk opens up the Supercharger Network to all electric car users and sell adaptors that go the other way: From Tesla connectors to those used by the Leaf, Prius, Bolt and all other EVs.

Tesla is ‘actively talking to other automakers’ about opening up its Supercharger network, says CTO JB Straubel

This will partially help in making Tesla the world’s most valuable company. You can read more on this in my other article: “How Tesla will become the world’s most valuable company”

While the “Apple Moment” is a turning point in history, the “Apple Effect” is an end result defined by the relentless struggle to master the perfect customer experience.

Tesla Evoto

How Tesla will become the world’s next most valuable company

By Clean Energy, Technology, Tesla

It is said that most people who fight change & disruption are always the “experts” in their fields. Disruptions happen really fast & those ‘experts’ almost always never see it coming. Disruption can be defined as a convergence of technologies that make it possible for companies to put together products & services that create new markets & radically transform, weaken or destroy existing industries.

A few examples are how cars replaced horses in 13 years in NYC. One of the leading consulting firms was off by a factor of 120x when they were hired by AT&T in 1985 to predict the market size or customer adoption of the then newly invented mobile phone within 15 years. Kodak was bankrupt within 12 years when they didn’t anticipate the disruption of the digital camera.

One thing we know, is that technology disrupts everything. This is due to Moore’s law and how compute power decreases in cost every 18 months. Sensors, AI, AR, VR, IOT, machine learning, robotics, energy storage, 3D printing, big data & nano satellite technologies will become the prime reason industries such as healthcare, transportation, travel and many others will be disrupted within the next 20 years. Business model innovation is also as disruptive as technology innovation when we think of Uber, Airbnb, Instacart, Amazon, Deliveroo and all the new apps that are joining the sharing economy.

Tesla is constantly mistaken as a car manufacturer when its much more than that. Tesla is closed ecosystem of many products & services. Tesla as a company is best positioned on the cusp of big disruptions coming to several industries. They are involved in disruptive energy & transportation. This includes batteries, solar, rockets, hyperloops, tunnels and electric vehicles, and we haven’t even discussed autonomous driving.

Though Tesla’s mission is to advance the advent of sustainable transport, I believe its much deeper than that. I believe they want to advance sustainable energy which they need to power their cars. But this will grow into powering homes, cars, planes, rockets and even cities. This is what everyone is missing. Tesla is not just the world’s first sustainable car or transportation company. It is the world’s first vertically integrated sustainable energy company

Solar creates energy, power wall batteries store energy, Superchargers distribute this energy and their cars use the energy. They have reinvented the manufacturing process by redesigning the traditional factory and re-engineering the “machines that build the machines”

Elon Musk hasn’t even started to work on maximizing efficiency of their global supply chain which he said he would do.

Energy storage disruption will come about as the cost of lithium ion batteries go down, the cost of solar power + batteries will go down to an expected 1$ per day for residential users by 2025. As prices go down, every house, warehouse, building, factory, mall & office building will switch to electric power when its cheaper than the grid. The problem with the traditional grid that created energy from burning fossil fuels was during peak times. Battery storage disrupted this concept with solar roofs + batteries. Users are already selling back their excess power back to the utility companies in European countries. Even if individual customers don’t consider “Rooftop Solar” which will be cheaper than the cost of transmission of regular electricity, companies & governments will consider “Distributed Solar” & “Utility Scale Solar” when its cheaper than the cost of electricity from the grid because it makes selfish economic sense.

 

Solar Power Costs — Courtesy of Deutsche Bank & Tony Seba

Tesla has already proven it plans to operate in all these solar markets with their home solar panels, their government battery farms in Hawaii and California as well as the possible projects in China & Australia.

This focus on residential & commercial solar will be the catalyst that pushes Tesla to become the largest utility energy company in the world. It was always about energy. The cars are just the means that will create the demand for the energy. This way Tesla will create and fulfil its own supply & demand in a better way than the status quo, the open up their products & services to the masses.

 

Tesla’s cars will also come down in price. When they can provide Porsche performance at lower prices with long ranges, regular gas car manufacturers will not be able to compete. After launching a semi, a truck, a mid-priced sedan (Model 3) and a cross over (Model Y), Tesla will probably launch a low-priced compact hatch back to become a full spectrum car manufacturer and take the top spot ahead of Toyota (Tesla is already the 4th largest car maker after Toyota, Daimler & VW based on market cap)

Their supercharger network will soon become greater than the number of all gas stations combined in the US.

Just this year, they plan to double the estimated 5,000 of them they already have on major highways and will soon have them inside major cities. Not to mention, they will speed up the charge speed which is already pretty fast. This does not include the current 10,000 “destination” chargers that are also planned to be increased to 15,000 as well.

Whether the US and Donald Trump come back to the Paris Climate Accord or not, the cat is out of the bag. People want a cleaner, eco-friendly and sustainable future. Those that don’t care for the environment, will also come on board for the shear economics of costs and efficiency. Regardless of the cost of gas, fuel, coal or oil, all the large car manufacturers, oil companies, old energy / utility companies from the past will be dethroned and they will be left sitting on products & services no one wants due to a better, cleaner and cheaper alternatives that make selfish economic sense

Thus, Tesla in not only disrupting the automobile industry, rather they are disrupting energy, and that, will be the biggest gold mine of all time. Tesla will emerge as the leader in the car, trucking, utility, energy, power and travel industries among many others. This will make it the most valuable company in the world.

In the end, most people consider Tesla a car manufacturer. The biggest clue is the man the company is named after; Nikola Tesla (who invented A.C current), was all about energy. If dropping the “motors” from their name was any indication, they will emerge to become a melange of the following:

  • A clean energy & power utility provider (solar panels, batteries, roofs, superchargers)
  • A private, public & universal transportation carrier (trucks, trains, buses, rockets & possibly planes)
  • A road & tunnelling construction company (Hyperloop, Boring company)
  • An insurance company (Tesla already started insuring its own cars)
  • A sensor company (best in class sensors for their Autopilot driving)
  • An AI company (Neuralink & autonomous driving)
  • A global telecommunications company & ISP (low orbit satellite internet)
  • As well as a car, truck and plane manufacturer.

Watch out for the coming age of light & Tesla everything. You have been warned. . .