Electric vehicles: the future is there
I am a big fan of Elon Musk and reading his biography written by Ashlee Vance provided me with a great introduction regarding the history and future of Tesla Motors. Yes, I am one of those guys believing electric vehicles will take over the world, mostly because if there is one industry, which needs a shake-up, it’s the car industry. Over the last decades, we all have seen cool developments, nicer designs and some advances regarding efficiency and climate-friendly techniques in cars. However, nothing changed the industry. And there was Tesla, the first American automaker to go public since Ford in 1956 and I believe we already passed the discussion whether electric vehicles do have a future or not.
What I find inspiring is that Musk and his team built a new, disrupting car company in Silicon Valley, not a typical area to start working on a new car. However, Tesla managed to extract the best out of the Valley by working according to the structure, pace and principles of a start-up environment to rapidly deliver the Tesla Roadster, the first sign to the public that Tesla meant serious business. Tesla attracts the best people, from software developers to designers and engine specialists, all bound by the feeling that their company is actually ‘changing’ an industry. Traditional automakers such as Audi, BMW, Toyota and Ford did not have any clue (and actually still don’t do compared to Tesla) how to deal with the rising popularity and success of Tesla and their hierarchical structures did not help in pushing similar innovations in existing processes and products.
Musk and his team are constantly envisioning the future and taking huge steps to overcome obstacles such as driving range, fluctuations in demand and supply, competition and safety. But lets go a few years back; launching an electric vehicle of more than 100,000$ equivalent to a 25,000$ gas car wouldn’t work back in 2005. Therefore, the guys at Tesla motors came up with a business plan allowing quick revenues and exponential innovation. This strategy proved to be a winner solving EV shortcomings at an amazingly rapid pace and creating an aura of ‘sexiness’ around the Tesla cars.
Step 1: High-priced, low-volume car for the super rich. Come out with an expensive first product, but make the car so fancy that it’s worth that price. Tesla’s result: The Roadster.
Step 2: Mid-priced, mid-volume car for the pretty rich. Use the profits from Step 1 to develop the Step 2 car. This is still an expensive car, focused on the luxury segment and similar to a $75,000 Mercedes or BMW competitor instead of Ferrari. Hence, the Model S was the result.
Step 3: Low-priced, high-volume car for the masses. Use the profits from Step 2 to develop an affordable car for the middle class. To drive your road by 2017, the Model 3:
And this is just the beginning… To support demand, Tesla is building a Gigafactory to produce enough lithium to supply the enormous demand of more than 500.000 cars per year, an incredible development for a very young car company boosting the American economy and changing the car industry at the same time. Smart innovations such as the Powerwall, a small solution for storing energy at homes allowing home owners to save money by charging during periods of low electricity demand, and expending during times of high demand (Investopedia), are small complement products further expanding the Tesla empire. You also must have read regarding the fast developments at Tesla for a (semi) self-driving car, rolled out at a much faster pace compared to other (tech) firms. Electric vehicles are no longer a novelty. It is too soon to say that in 5 years electric vehicles (and Tesla) have taken over the world, there still exists a huge infrastructure for gas vehicles and profits are still made. However, mark my words, by 2030 you and me are driving an electric car (and hopefully a high-end Tesla) for sure.
Do you believe traditional car companies will prove to be serious competition for Tesla?
What do you envision to be the next step for Tesla after launching the Model 3 in 2017?
Which technologies can boost or slow down the development of electric vehicles?