Tagged: Elon Musk

Elon Musk says the Model 3 represents Tesla’s last ‘bet the company’ initiative

In a wide-ranging interview with Bloomberg, Tesla CEO Elon Musk explained that the Model 3 represents the last “bet-the-company” initiative we can expect to see from the automaker. Recall, everything Tesla has done up to this point has been to hasten the release of the Model 3, the mass market EV Elon Musk initially promised us more than a decade ago when he penned his now-famous “Secret Tesla Motors Master Plan” back in August of 2006.

Nearly 12 years ago, Musk outlined Tesla’s roadmap as follows:

Build sports car
Use that money to build an affordable car
Use that money to build an even more affordable car
While doing above, also provide zero emission electric power generation options.

Impressively, Tesla managed to follow Musk’s early roadmap to a tee, though there have been some well-publicized product delays along the way. Regardless, with the Model S and Model X now bonafide success stories, and with Model 3 production seemingly on the up and up, Musk explains that huge bets that put the entire company at risk may no longer be necessary.

There have been three situations where it was necessary to bet the company. Like it was unavoidable to bet the company. The creation of the Roadster. Obviously, we’re a brand-new company, it’s our only product. From the Model S, we went from like 600 cars a year to 20,000 cars a year and a much more sophisticated car. Obviously, that was a bet-the-company situation.

Model X was painful but not a bet-the-company situation. Model 3, we’re going from, you know—like the S or the X program is 1,000 cars a week. Model 3, even to basically be healthy for the Model 3 system, it’s 5,000 cars a week. So it’s a half order of magnitude increase relative to the S or the X. That is necessarily a bet-the-company decision. You cannot have that much of a step change for a manufacturing company without this being a bet-the-company decision.

Musk, per usual, isn’t one to mince words and the entire interview is well worth checking out. One point of interest worth mentioning is that the initiative Musk is currently most excited about is the Tesla Model Y, a crossover version of the Model 3 that might see production begin as soon as 2019. Incidentally, Musk says that the Model Y design is almost complete and that a prototype might make an appearance by March of next year.

Tesla commits to 500,000-car factory in China as tarrifs kick in

Tesla CEO and wannabe cave diver Elon Musk was in Shanghai on Tuesday to secure a deal with Chinese authorities to build an ambitious new car plant, Tesla’s first outside the US, and a sign that President Trump’s rapidly-escalating trade war might be having an unintended effect. The announcement came just as Tesla raised prices on its vehicles in China to offset the cost of tarrifs imposed by the Chinese government in retaliation for US tarrifs recently levied on Chinese goods.

The plant will start producing cars two or three years after construction begins, according to Reuters, with an eventual capacity of 500,000 cars per year. Tesla is currently in “production hell” trying to build its affordable Model 3 sedan at its existing factory in Fremont, California, although the company recently hit its internal goal of producing 5,000 Model 3s in a week.

Musk has been reported to be considering a Chinese factory for years, as China is widely seen as a potentially massive market for electric vehicles. The country has a stated goal of 100-percent electric vehicles by 2030, as part of its plan to tackle air pollution, so a Tesla plant in the country makes sense. The timeline may have been accelerated by recent tarrifs, however, as well as Tesla’s well-documented cash flow problems.  “The Shanghai municipal government will fully support the construction of the Tesla factory,” authorities said in a statement, which could help Tesla build the factory sooner rather than later. With new projects like the Tesla Semi and a Tesla pickup truck on the horizon, as well as a long-rumored European factory, any help Tesla can get with the capital costs of building new infrastructure will be welcome.