[salimmadjd]

I admire Musk and tesla. However, I see two paths for them and none are good.

A - fully-electric cars are still too early and will get crushed by hybrids or more efficient diesel/fossil fuel cars. Tesla becomes irrelevent.

B - fully-electric is all the rage, and every brand will have one. Tesla will become the victims of their own success.

I'm going to assume many of you are going to disagree with me. Mainly because we come from a world with a much different customer acquisition models.

For most people, if they had a choice they would buy a trusted car brand. Would you buy an Honda/Acura, Toyota/Lexus, Mercedes, etc with dealership in every corner or an unknown car called tesla? Also, unlike niche companies like Ferrari/Lamborghini that have brand and performance appeal, tesla doesn't provide anything unique. For the same price point, there are far better cars, than the original lotus-based Tesla. To that point, what's their beachhead?

[ChuckMcM]

What are your thoughts on:

C - full-electric is the rage, every brand has one and Tesla remains the 'premium' brand ?

My thinking is that the new vehicle market is quite large, and Tesla, as an early mover, has a great advantage relative to the other manufacturers. Their disadvantage is that they aren't as well capitalized. Their lack of working capital will kill them if they have to pivot very far from their current path, but otherwise it won't be an issue as long as they can scale production with demand.

Currently, you can't buy anything like a Model S from any of the other brands. Further if they start today it will be 24 months before they can launch something. So Tesla has a couple of years of runway, nearly all to themselves, in this space. (Note if you don't think they bring anything unique, I suggest you get a test drive of a model S and then go to Nissan and drive a Leaf) Tesla sells a 'no compromises' electric car, no compromise on range, no compromise on performance, no compromise on comfort, no compromise on quality. And significantly cheaper to fuel up. So that will sell them a lot of cars to people who are attracted to that stance, and those people's followers will get cars because they are followers.

Now it is an open question as to how many total cars that first batch is. Is it 100k, 250k? 1M? That depends on a lot of things. But if electric cars do take off as mainstream, I expect Tesla will be the 'best' one for a while yet.

[salimmadjd]

I think that's what Tesla is hoping for. However, I don't see it happening.

Tesla wisely is going after premium buyers, that market is niche by definition. They've done that because car is a major purchase unless if you a lot of money and you are more willing to take a chance on a new car company.

But beyond that, it doesn't matter if Tesla is building a better car, it matters if consumers think Tesla is building a better car. And tesla doesn't have the same brand loyalty in a very competitive market.

Secondly, if you're buying an electric car for environmental or gas price reasons, there are other options. I can lease a Nissan Leaf now for $199/month. The amount of money I save on daily gas cost driving my Honda will almost come to $199! It means I can have a car for 3 years for free (minus the $2000 singing fee). Tesla just can't compete with that!

[ChuckMcM]

Ok, I see where you are coming from. But aren't you getting ahead of yourself? The luxury car market is what, 1 million cars annually [1]? So these 'niche' cars which have good margins give Tesla the capital to do the next step which is bring the costs down.

I think folks who drive a model S will pretty quickly understand that Tesla is building a better car, so if someone was in the market, and open to an electric, Tesla is a contender.

I expect the majority of Tesla's sales to be 'status symbol' sales initially (just like Hummer's sales) and later a more durable market will develop. And I think it will benefit from being considered the 'best' you can get, Elon is a pretty compelling figure as well so very trendy.

Where we differ I expect is that I expect they can translate that early success into a broader class of car.

[1] rummaging around in http://online.wsj.com/mdc/public/page/2_3022-autosales.html isn't particularly helpful.

[majorlazer]

I think Tesla is going after the premium buyers at the moment, but that can change very quickly if the Model S lives up to it's hype and they actually start turning a profit.

There are no cars on the market that even come close to the Model S, the Nissan Leaf has a pathetic 73 mile range. The Tesla is 10x the car the leaf is, performance and luxury-wise, and it get's almost 4 times the range on a single charge. The Model S Signature (equipped with an 85kWh battery for a 300 mile range) MSRPs at $87,900; a Nissan Leaf MSRPs at $37,250. Sure, that's a pretty significant jump in price, but when you consider the fact that the Model S competes with a BMW M5 performance-wise, you see it isn't all that crazy.

Even if you take the 40kWh Model S that will MSRP for $49,900 you can see that it's a way better deal than the Leaf. Sure, the Models is $12,650 more than the Leaf, but you actually get a reasonable range (160 miles) and the luxury and performance that the Leaf just cannot compete with.

[howeyc]

> Further if they start today it will be 24 months before they can launch something.

You are assuming other companies have not yet started building electric cars. This is extremely false. I was at the Detroit Auto Show in Jan 2011 and saw Ford driving a fully-electric Fusion around the showroom floor.

Tesla certainly appears to be ahead publicly, but I'm not so sure that's the case.

[ChuckMcM]

Actually I was looking at the auto show data. One of the fastest 'show to road' cars was the Toyota Land Rover at 18 months but the electrics have taken longer (at least the Volt and Leaf did). The steps I saw at the San Jose show were tentative at best.

[CamperBob2]

I'm going to assume many of you are going to disagree with me. Mainly because we come from a world with a much different customer acquisition models.

I don't disagree with path A, but the fact is, path B (and Musk's prediction that half of all cars sold will be full electric by 2032) can't possibly happen with our current power distribution system in place.

The only conceivable way that electric cars are going to take over will be if the government steps in and mandates universal form factors for swappable batteries that can be charged at advantageous times and locations and made available to drivers when and where they're needed. Any other approach to electric cars is simply stupid, and I can't begin to imagine why someone like Musk doesn't grasp that.

I speak as someone in the market for a new moderately-high-end car who would love to support Tesla... if only the whole idea wasn't so hopelessly wrong from an engineering standpoint.

[001sky]

swappable batteries

-- What is the weight, though? @450 pounds?[1]

___________

[1] edit: source of estimate - Honda s2000 with A123 li-ion was discussed in thread below, estimated battery pack weight was approx 460-500lbs. Car had more hp, though.

http://news.ycombinator.com/item?id=4536452

[CamperBob2]

Batteries are heavy no matter how you slice 'em. They will always (AFAIK) offer terrible joule/kg performance compared to a tank of gasoline.

I don't think replaceable modular batteries would be that much heavier than whatever's being done now. But yes, there would be some additional overhead, given that even the smallest cars would probably take more than one battery module.

[001sky]

The UPS and the Airplane luggage guys though will only 30 kilos (65lbs), though because of insurance/workplace comp. They wont let them lug more. at 200 kilos (440lba) you are talking splitting the pack up into 6 or 7 parts (and still be laboriously removed) or having a somewhat major operation on your car (ie, you need an Engine Hoist for the thing in one part) to change the battery. Then a forklift or something to put them on a "rack". Seems logistically like a nightmare.

That being said, the actual cells themselves are only a couple of pounds each. Would be interesting if this could be engineered to just take out something like the 100 micro-cells (at 4 lbs each), and toss em in a shopping cart. Maybe have a robot then sort and charge them in a special room full of charging racks. (like automated library book retrieval). But they would need to be built up in a certain way, and put in a housing, etc to go back in the car OK.

[salimmadjd]

swappable battery is important for those who need to drive beyond the battery range or don't have a good option to easily charge their cars overnight. This could be for people who live in big cities like San Francisco (although you can imaging a plug every parking spot 20 years from now) or for people who maybe going on a road trip. Which would make you wonder if people would not have two cars. One for daily commute the other for extended activity that might be fueled by some form of biodiesel. Hydrogen might also be another good solution at some point. This is something I proposed a long ago as part of my high school science fair. Basically using electricity for electrolysis of water to get hydrogen. You can the use the hydrogen as fuel cell or in combustion form for these long-range road trips instead of swapping batteries.

[jacques_chester]

The engineering practicalities around the storage and transmission of hydrogen mean that it's a bust.

You weren't the first to think it. When I was a kid in the 90s I read books, written in the 70s, about "the hydrogen economy" that would be everywhere by ... the 90s.

[wmf]

Every brand may have electric cars using licensed Tesla technology.

[cryptoz]

Isn't that already the case? http://gigaom.com/cleantech/tesla-to-supply-powertrains-for-...

[salimmadjd]

Actually, their deal with Toyota is a better example and ultimately might be the future of tesla

[nandemo]

Given that Tesla is a startup, it's a fair bet to say that "huge success" or "bust" are the most likely outcomes.

But regarding point B: many makers already have an electric model: Toyota, Honda, Nissan, Ford. I think Tesla is a cool company, but they didn't invent the concept of the electric car and they don't have a monopoly over it.

I think it's likely that electric cars will gain a bigger share of the market relatively soon (in auto industry terms), even if Tesla doesn't succeed.

[marshallp]

Tesla are the Apple of cars. Elon Musk is the new Steve Jobs. The other car companies will have non-tech retards as ceo's and will always be playing catch-up. Tesla only has to fear techie's like google or apple itself entering the space.

[cryptoz]

I don't think Google will enter the space of actually building cars - but they most definitely will partner closely with some of these companies for their self-driving cars.

[sbierwagen]

Well, they'll "partner" with them in the sense of buying the bare car from car manufacturers, but they'll probably be Google Robot Cars.

[salimmadjd]

Althiugh agree with the visionary status of Musk. But, your comment speaks to my point directly regarding the differing customer acquisition models. Apple's growth comes from entering an emerging market. Very different than the car industry. The emerging market of the car industry started with another visionary, Henry Ford.

[wmf]

Ah yes. "If smartphones turn out to be the future, people will probably just buy them from existing phone brands that they trust, like Nokia or Motorola." — a lot of people in 2007

[qu4z-2]

For what it's worth, I have a Motorola smartphone, and I certainly wouldn't trade it in for an iPhone.

The point I'm trying to make is that that the prediction is correct assuming "people" refers mostly to the people making the predictions. Or... people tend to project their ways of thinking, and likes and dislikes, onto other people.

[salimmadjd]

Again what I said about different customer acquisition models. 1 - Smart phones have 2-4 years life at about $200 or so price point. They are not $60,000 cars that force buyers to buy a $600/year service contract from Tesla.

2 - Apple had the entire MP3 market with their ipods not to mention an army of long-time fanboys. Translate to a strong consumer brand loyalty. Tesla doesn't have any of these.

[marshallp]

Apple didn't actually create completely new products, just polished versions, same as Tesla. The same with market share, they only want a small segment (the only exception to this rule are ipads).

[lumberjack]

>The other car companies will have non-tech retards as ceo's and will always be playing catch-up.

This is false. Most car companies have been researching electric vehicles since the 60's or 70's when the first oil crises happened. And as for technology, Tesla is not actually ahead, in neither range nor charge up speed.

As an example, this is also a "Startup" thing. An electric bus, that gets better range (everything considered) and faster recharge times:

http://www.jaylenosgarage.com/video/proterra-ecoliner-electr...

[grecy]

> Most car companies have been researching electric vehicles since the 60's or 70's when the first oil crises happened

Exactly. They've spent all those years and dollars, and they still have nothing compared to the Model S.

[marshallp]

It's not simply the battery tech. It's all the extra interior stuff like display etc. It's the total package, like apple does. Plus, just like with apple and jobs, or virgin with branson, there's an extra brand factor developing with musk.