Tesla Plans To Spend Up To $3 Billion A Year On Gigafactories Over Next 24 Months

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Published on November 8th, 2018 |

by Steve Hanley

Tesla Plans To Spend Up To $3 Billion A Year On Gigafactories Over Next 24 Months

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November 8th, 2018 by Steve Hanley

In its latest 10-Q filing with the SEC, Tesla says it is planning to spend big on upgrading Gigafactories 1, 2, and 3 — up to $3 billion a year over the next two years, in fact. It also says it expects to pay for most of that from current earnings. Here’s the relevant paragraph:

“Considering the pipeline of new products planned at this point, and consistent with our current strategy of using a partner to manufacture cells, as well as considering all other infrastructure growth and expansion of Gigafactories 1, 2 and 3, we currently estimate that capital expenditures will be between $2.5 to $3.0 billion annually for the next two fiscal years. Moreover, we expect that the cash we generate from our core operations will generally be sufficient to cover our future capital expenditures and to pay down our near-term debt obligations, although we may choose to seek alternative financing sources. For example, we expect that much of our investment in Gigafactory 3 will be funded through indebtedness arranged through local financial institutions in China. As always, we continually evaluate our capital expenditure needs and may decide it is best to raise additional capital to fund the rapid growth of our business.”

That part about Gigafactory 2 is interesting. GF2 is the factory near Buffalo, New York, where Tesla intends to produce its Solar Roof tiles. We haven’t heard much about that initiative in a while. Perhaps the company is finally ready to get serious about ramping up Solar Roof production? In the recent Tesla conference call, Elon Musk highlighted that it simply takes a long time to do appropriate testing for a roof product.

In addition to increased spending on its factories, Tesla also announced recently it intends to significantly expand its service network, particularly in places outside of major urban areas. That will take even more money. According to Electrive, the company says it is leveraging what it has learned about manufacturing to date to allow it to manage its money more wisely and efficiently. Here’s more from the 10-Q filing itself:

“In 2019, we expect to continue to increase the Model 3 production rate in our Fremont factory while needing only limited additional capital expenditures. As we continue to expand our existing manufacturing capacity, introduce new products, expand our retail stores, service centers, mobile repair services and Supercharging network, we will continue to utilize our increasing experience and learnings from past and current product ramps to do so at a level of capital efficiency per dollar of spend that we expect to be significantly greater than historical levels.”

Tesla is not resting on its Q3 laurels. Moving forward, the company is looking for ways to make every dollar available to it work as efficiently as possible to support its overall mission — driving the electric car revolution forward at the fastest possible pace. Tesla has a lot on its plate and still has plenty of detractors who think it is continuing to bite off more than it can chew.

New ideas always unsettle the status quo and invite negativity from those who wish things would just continue going along they way they always have. It’s human nature. One minute you’re Kodak or Polaroid or Xerox with a hammer lock on the market, the next minute you’re out in the cold looking in. It’s painful to fall from grace. But creative destruction is one of the bedrock principles of modern capitalism. And creative destruction is what Tesla does best.

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Steve Hanley Steve writes about the interface between technology and sustainability from his home in Rhode Island and anywhere else the Singularity may take him. His muse is Charles Kuralt — “I see the road ahead is turning. I wonder what's around the bend?”

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$47.7 Million — The Cash Norwegians Have Put Down For Electric Car Reservations

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Published on November 2nd, 2018 |

by Zachary Shahan

$47.7 Million — The Cash Norwegians Have Put Down For Electric Car Reservations

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November 2nd, 2018 by Zachary Shahan

There’s no secret about it in the electric car world — Norway is the world’s premier country for viewing the electric revolution. As I wrote recently, 60% of new car sales in the country are now plug-in car sales. The country has risen up the tech adoption S-curve and has a far higher number of EV drivers per capita than any other country on earth.

Norwegians are also eagerly waiting for all the hot new electric models, to the tune of 400 million Norwegian kroner (or $47.7 million).

Well, I presume that is a low estimate. I was told by someone at the Norwegian EV association () that no one outside of Tesla really knows how many Norwegian Model 3 reservations are sitting behind tesla.com/teslaaccount. The findings reported in a Norwegian paper put the Model 3 as second in line on the reservation list, behind the Audi e-tron quattro, and I have to say that’s hard to believe.

Other popular electric models Norwegians have put down money to reserve include the Porsche Taycan (formerly called the Mission E), which is a high-end car in the range of the Model S; the Kia Niro Electric, one of the first affordable electric CUVs on the market; the Mercedes-Benz EQC, a fully electric SUV entry from the well known German brand; the Jaguar I-PACE, a CUV/SUV that is helping to lead Jaguar into an electric future even thought it doesn’t quite stack up to the similarly priced Model X in several regards; and the BMW iX3, which is BMW’s coming attempt to finally get back into the electric game.

“Over 30,000 Norwegian kroner are in line to buy one of the new electric cars that are on the way to the market, as many buyers have paid to stand there,” a Google translation of the NRK article about the news states. [Update: That translation has been modified for accuracy. It initially said “Over 30,000 Norwegians are in line” but that was apparently an unfortunate auto translation.]

Again, Tesla’s numbers are an estimate rather than official figures from the automaker, and I have a hard time believing they aren’t much higher.

Learn more about Norway’s EV adoption background if you haven’t done so before.

Top image via Elbilfestival i Geiranger and Norsk Elbilforening (some rights reserved), second image via NRK

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Zachary Shahan Zach is tryin' to help society help itself (and other species). He spends most of his time here on CleanTechnica as its director and chief editor. He's also the president of Important Media and the director/founder of EV Obsession and Solar Love. Zach is recognized globally as an electric vehicle, solar energy, and energy storage expert. He has presented about cleantech at conferences in India, the UAE, Ukraine, Poland, Germany, the Netherlands, the USA, and Canada.

Zach has long-term investments in TSLA, FSLR, SPWR, SEDG, & ABB — after years of covering solar and EVs, he simply has a lot of faith in these particular companies and feels like they are good cleantech companies to invest in. But he offers no professional investment advice and would rather not be responsible for you losing money, so don't jump to conclusions.

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Tesla Autopilot Lawsuit May Affect Autonomous Driving Rules

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Published on November 1st, 2018 |

by Steve Hanley

Tesla Autopilot Lawsuit May Affect Autonomous Driving Rules

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November 1st, 2018 by Steve Hanley

Let’s say you are driving down the highway at 80 mph when a stopped vehicle suddenly appears in your lane. What do you do?

A. Swerve?

B. Brake hard?

C. Crash into it and blame the autonomous driving software in your vehicle for the collision?

If you are Shawn Hudson, the correct answer is C. Hudson was driving along a Florida highway in his Tesla Model S in early October, with Autopilot engaged and his speed set to 80 mph, when his car crashed into the rear of a Ford Fiesta that had stalled in his lane. Hudson’s car was heavily damaged as a result, although he escaped with no injuries.

Release The Hounds!
Unimpressed that his Tesla did a fine job of protecting him thanks to its superior crash worthiness, Hudson hired a lawyer and sued Tesla, claiming its Autopilot system failed to perform as advertised. “Through a pervasive national marketing campaign and a purposefully manipulative sales pitch, Tesla has duped consumers” into believing that Autopilot can “transport passengers at highway speeds with minimal input and oversight,” the lawsuit says, according to a report in ArsTechnica. Where have we hard this tale before?

Contacted about the suit, Tesla emailed this comment to ArsTechnica (we didn’t bother to reach out as well since Tesla always provides the same statements to all outlets in controversial cases such as this):

“We don’t like hearing about any accidents in our cars, and we are hopeful that those involved in this incident are recovering. In this case, the car was incapable of transmitting log data to our servers, which has prevented us from reviewing the vehicle’s data from the accident. However, we have no reason to believe that Autopilot malfunctioned or operated other than as designed.

“When using Autopilot, it is the driver’s responsibility to remain attentive to their surroundings and in control of the vehicle at all times. Tesla has always been clear that Autopilot doesn’t make the car impervious to all accidents, and Tesla goes to great lengths to provide clear instructions about what Autopilot is and is not, including by offering driver instructions when owners test drive and take delivery of their car, before drivers enable Autopilot and every single time they use Autopilot, as well as through the Owner’s Manual and Release Notes for software updates.”

Word Of Mouth vs. Reading The Manual & Paying Attention To The Prompts
Stuff and nonsense, says Hudson in his suit. He claims he heard about the wonders of Autopilot and went to a Tesla store to find out more. “Tesla’s sales representative reassured Hudson that all he needed to do as the driver of the vehicle is to occasionally place his hand on the steering wheel and that the vehicle would ‘do everything else,'” the lawsuit claims. Hudson says he was “relaxing” during his morning commute at the time of the crash.

His lawyer, Mike Morgan, stated during a press conference announcing the legal action, “If this had been something more substantial than a Ford Fiesta, he wouldn’t be here. Hudson became the guinea pig for Tesla to experiment their fully autonomous vehicle.” He says the car’s owners manual states, “you can engage it over 50 miles an hour, but if you engage it over 50 miles an hour, it’s got trouble finding stationary objects and stopped cars. To me, that’s a big problem. To me, that means you’re selling nothing.”

“The Law Is A Ass”
No less a personage than Charles Dickens weighed in on the majesty of the legal system some years ago in Oliver Twist. In one passage, Mr. Bumble, a character in the novel, says, “If the law supposes that, the law is a ass — a idiot.” The redoubtable Mr. Bumble may have been right.

The history of liability law in the United States relates back to the famous case — beloved by law students everywhere — of McPherson vs. Buick Motor Company, in which future Supreme Court justice Benjamin Cardozo ruled customers could sue manufacturers directly for injuries related to the use of their products. Prior to that case, decided just over 100 years ago, manufacturers were insulated from liability because they had no direct dealings with the consumer, what the law liked to call at the time “privity of contract.”

They made stuff — like automobiles — which they sold to dealers. The dealers in turn sold them to the end user. Since there was no contractual relationship between the manufacturers and the consumer, how could they be held responsible if their products caused harm? It didn’t take Cardozo long to figure out the answer to that question and then make it the law in New York state. The entire field of American tort law grew out of the McPherson case, which opened the floodgates to the tsunami of tort law litigation that bedevils us today.

The False-Positive Dilemma
Tesla is not alone in struggling to design autonomous driving systems that can navigate on their own. The problem is designing them so they are not constantly applying the brakes whenever something unexpected happens. Today’s systems have difficulty discriminating between a piece of paper on the roadway or a plastic bag being blown across a travel lane and an actual car or — God forbid — a pedestrian. To get around that issue, most emergency braking and self-driving systems today are simply instructed to ignore those inputs — which are known as false positives — and continue on without pausing.

Tesla has been more aggressive about marketing its Autopilot than most, as have Tesla owners. As of this moment, Tesla has a video on the Autopilot page of its website that shows a person driving without a hand on the steering wheel. There are no disclaimers in the video advising viewers that they must remain attentive at all times. Elon Musk has gotten very upset with people who dared question the capabilities of Autopilot, arguing that such carping will result in more highway deaths if people get spooked by the negativity and decide to not engage Autopilot whenever they can.

The Beta Tester Conundrum
Attorney Mike Morgan, despite his grandstanding, has a point. While Tesla owners may arguably consent to being voluntary beta testers for the company (and even pay a premium for it), drivers of the other cars on the road — such as the owner of the Fiesta that Hudson’s Model S collided with — clearly are not part of the Faustian arrangement Tesla and its customers have entered into.

Now, here’s a fine legal point you aspiring attorneys out there can wrestle with. Can a Tesla employee expand the representations made by the company orally? Let’s take an example. A roofing company sends a representative to a home. The salesman presents the homeowner with a brochure promising a 10 year warranty on all new roofs installed by the company. During the sales presentation, the salesman says, “All our roofs come with a lifetime guarantee.”

When the roof starts leaking 10 years and one month after it is installed, is the homeowner covered by a warranty or not?

Courts have wrestled with issues like this for generations and there is no generally recognized answer nationwide. Will the state court in Florida rule the Mr. Hudson could rely on the statements supposedly made by the Tesla salesman even if they go further than the company’s written materials? We simply don’t know.

Volkswagen Proposes An Alliance Of Manufacturers
When an Uber test vehicle ran over and killed a pedestrian in Tempe, Arizona, earlier this year, it set off alarm bells throughout the automotive industry. According to a report by Automotive News, Volkswagen is quietly engaging in conversations with up to 15 other automakers about standardizing autonomous driving protocols. The purpose of the talks is to insulate the companies as much as possible from liability claims.

An unidentified VW executive told Automotive News, “When you are involved in an accident, you have a better chance in court when you can prove that your car adheres to the latest technical standard. How do you create an industry standard? Ideally by getting others to use the same sensor kit and software, so for that reason an overarching cooperation between automakers is one of the options we are examining. The question is: How do we bring products to market that guarantee we made ourselves as small a target for damage claims as possible? Law firms are already in the starting blocks,” the executive said.

When asked if such an alliance would be similar to the Ionity consortium that is bringing high-speed charging stations for electric vehicles to Europe, the executive said autonomy is “another level of complexity entirely.” Ionity is a partnership between Volkswagen, Mercedes, BMW, Ford, and Shell and is basically just about getting high-speed charging stations installed across Europe.

“The gates of history turn on tiny hinges,” my high school history teacher told her students constantly. In 1916, Mr. McPherson drove his Buick into a phone pole. The collision broke the steering wheel, which then proceeded to pierce his chest. The result of that small incident changed American liability law forever.

In 2018, Shawn Hudson’s Tesla Model S drove into the back of a Ford Fiesta on a Florida highway while its Autopilot system was engaged. Could that incident have a similar impact on self-driving technology both in the US and in other countries? “We’ll see,” said the Zen master.

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Steve Hanley Steve writes about the interface between technology and sustainability from his home in Rhode Island and anywhere else th..

Alta Motors Fails: A Tale Of Electric Motorcycles, Disruption, & Startups

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Published on October 24th, 2018 |

by Michael Barnard

Alta Motors Fails: A Tale Of Electric Motorcycles, Disruption, & Startups

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October 24th, 2018 by Michael Barnard

Alta Motors has ceased operations after a decade of innovation, work, and some success. But is the apparent failure of this electric motorcycle company just the story of another startup that couldn’t cross the chasm, or is there something more going on?

Alta has been around at least as a glimmer in its designers’ eyes since 2007. Derek Dorresteyn and Jeff Sand loved the smooth torque curve of electric motors, and with their combined decades of engineering, fabrication, and design experience, decided to take on dirt bikes at their own game.

And in 2017, they reached their pinnacle, it seems, with their bike reaching victory in the Geneva Supercross. An almost stock Alta Redshift winning an international supercross race made it seem as if victory was within reach.

But as has been reported many times before, the motorcycle market has radically shifted over the past decade. It fell off a cliff in North America and Europe due to the 2008 recession, and has never recovered. Part of that is that the Baby Boomer generation embraced huge motorcycles in a quest for bragging rights about having the biggest… engine. Ludicrous displacements of up to 2,294 cc were found on two-wheelers. When motorcycles regularly had larger engines than many family cars, it was obvious that something odd was happening.

Harley-Davidson is the most obvious victim of expanding girth. As its North American sales fall, it’s chastised from the biggest bully pulpit in the world for shifting production to markets where it actually has hopes to expand and it tries to shift to electric drive trains, something it has only a faint hope of succeeding at.

And Harley-Davidson’s electrification plans play into the story of Alta Motors. In hindsight, it’s obvious that when Alta Motors’ funding hope was Harley-Davidson, there was a problem at Alta. The two brands are far, far apart. Alta is a San Francisco startup, a maker of silent race machines and looking forward to an electric future. Harley-Davidson is a lethargic, backward-looking dinosaur of a company, trying to survive while nimble mammals eat its eggs. They were always a poor fit, and HD funding Alta was at best odd. And it didn’t last.

So is that it? Was Alta just too early in its quest to succeed? Is it just another failed startup that couldn’t get funding for the next round of growth?

Probably not.

Chart by author

Let’s start by looking at use cases for motorized two-wheelers across multiple types of bikes. Alta Motors was making a pure dirt bike. While it could be converted in many places to a street legal bike by the addition of various bits, they didn’t sell it that way. The included chart reflects their purity or narrowness of purpose, depending on how you look at it. Like straight dirt bikes, they are optimized for offroad fun. Dual-sport bikes score highest in this ranking simply because they support the most use cases, even though they don’t support many of them as well as more specialized offerings.

So far, so reductive. You don’t buy a dirt bike to do extended road touring, and you don’t buy a Honda Goldwing if you want to spend time in the dirt. But what about the electric mountain bike category? It has a lot more utility in different areas, is almost as fun in the dirt as a straight dirt bike, and is a lot cheaper. And it’s street legal out of the box without add-ons.

Why is this important? Alta Motors wasn’t competing with mountain biking, after all. It was building pure offroad racing machines.

It’s simple. In order for Alta Motors to scale, it had to sell a lot of bikes. It had to sell motorcycles to weekend riders. It had to sell motorcycles to casual riders. There just aren’t that many motorcycle racers in the world.

Diagram by author

But as soon as it steps outside of racing, it’s competing with broader competition. More casual offroad riders are going to value bang for the buck, and both gas dirtbikes and electric mountain bikes offer that. Alta Motors made headlines when its prices made it down to $12,000 USD for its cheapest bike. The other two can be had for under $5K for the most part, although there are more expensive options as well.

If your differentiator is electrons or silence, electric mountain bikes offer those as well. And the 800-lb gorilla in the electric motorcycle market, Zero, sells its fun FX and FXS dirt bikes in street legal form out of the box at around the same price point as the Alta Motors bikes.

In the USA alone, there were about 40 million people who mountain biked in the mid-2000s. Mountain bikes sell by the millions annually in America, while dirt bikes might hit 100,000 units. Which is the more attractive market for an innovative product? Extending the utility and fun of something which is sold by the millions for a bit of extra money, or trying to displace the best product of tiny market?

When framed like that, it’s clear that Alta Motors faced an uphill battle. Its reported 300 back-ordered units is pretty good for the market they were going after, but terrible from the perspective of investors.

Market disruption per Christensen and Raynor’s The Innovator’s Dilemma

Electric bicycles are disrupting the bottom end of the motorcycle marketplace. They have much lower barriers to entry for most people, have higher utility for our increasingly urban lifestyles and increasingly offer equivalent amounts of fun at a fraction of the price. We can see what will happen to much of the rest of the market when we look at other innovation spaces that have been addressed in other areas. Christensen and Raynor’s Innovator’s Dilemma demonstrates with case study after case study the impact on market leaders when entrants come into established markets with simpler products which offer different utility at a lower price point.

Alta Motors is a victim of focusing too narrowly for effective entrepreneurialism. Its vision is to be admired. Its aspiration to compete directly with specialized gas offroad bikes was fulfilled. But unlike Tesla, it wasn’t going after a big enough market for investors to care. And the market is radically altering under its feet.

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Michael Barnard is a C-level technology and strategy consultant who works with startups, existing businesses and investors to identify opportunities for significant bottom line growth in the transforming low-carbon economy. He is editor of The Future is Electric, a Medium publication. He regularly publishes analyses of low-carbon technology and policy in sites including Newsweek, Slate, Forbes, Huffington Post, Quartz, CleanTechnica and RenewEconomy, with some of his work included in textbooks. Third-party articles on his analyses and interviews have been published in dozens of news sites globally and have reached #1 on Reddit Science. Much of his work originates on Quora.com, where Mike has been a Top Writer annually since 2012. He's available for consulting engagements, speaking engagements and Board positions.

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BASF And Norilsk Nickel Partner On New Battery Production In Finland

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Published on October 23rd, 2018 |

by Kyle Field

BASF And Norilsk Nickel Partner On New Battery Production In Finland

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October 23rd, 2018 by Kyle Field

Germany chemical giant BASF and Russian mining conglomerate Norilsk Nickel (Nornickel) have inked a new deal for nickel and cobalt supply.

The deal will see BASF build a new factory to produce battery cathode materials in Harjavalta, Finland, adjacent to a Nornickel cobalt and nickel refinery. The deal seeks to capitalize on the potential transition of the German auto industry to electric vehicles, which will require an immense new supply of lithium batteries to power them.

“With the investment in Harjavalta, BASF will be present in all major regions with local production and increased customer proximity, further supporting the rapidly growing electric vehicle market,” president of BASF’s Catalysts division Kenneth Lane said.

To date, most of these batteries are sourced overseas from Chinese and Korean suppliers, leaving local companies out of the mix. The new partnership leverages proximity to turn raw materials from the mine straight into usable battery cathode materials that can be funneled directly to a local battery cell manufacturer at a lower cost than they might be sourced from remote suppliers.

Locally sourcing the very raw materials that are used in batteries was one of the key reasons Tesla built its Gigafactory 1 in Nevada, where there are plentiful lithium reserves.

“The agreement is an important element of Nornickel’s broader strategy to expand its presence in the global battery materials market and establish long-term cooperation with leading producers of cathode active materials,” said Sergey Batekhin, senior vice president at Nornickel.

When it starts production in 2020, the new BASF factory is expected to churn out enough cathodes to supply some 300,000 electric vehicles per year, which, at 60kWh per vehicle, translates to enough cathodes for 18 gigawatt-hours of battery cells per year.

Impressively, BASF said that the new Harjavalta factory will “utilise locally-generated renewable energy resources including hydro, wind and biomass.” As companies around the world ramp up global battery production in support of the electric vehicle transition, it is an opportunity for us to build smarter, more efficient factories.

That happens both by utilizing low-carbon renewables to power them and by building them in intelligent locations. Building factories in close proximity to either raw materials or customers reduces the amount of transportation required and, thus, shrinks the carbon footprint of the manufacturing process. Manufacturing EVs is one of the areas where, according to analysis by the Union of Concerned Scientists, electric vehicles have higher emissions than gas and diesel vehicles due to lower volumes and what have historically been inefficient manufacturing processes for batteries.

The new cathode factory is but a single cog in a greater machine spooling up at BASF that will see some €400 million ($462 million) being invested into building cathode materials for Europe.

From a pricing standpoint, the cathode is one of the more expensive parts of electric vehicle batteries, thanks to the concentration of cobalt in lithium-ion chemistries. As the sharp uptick in demand for cobalt has driven prices of cobalt up to new heights in recent years, battery cell manufacturers and electric vehicle builders are aggressively looking for ways to trim down the cobalt used in their batteries.

Tesla has committed to decrease its cobalt usage from 3% of the battery in June of this year down to 0% over the next 2–3 years, demonstrating that where there is a will, there is a way.

Source: Reuters

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Kyle Field I'm a tech geek passionately in search of actionable ways to reduce the negative impact my life has on the planet, save money and reduce stress. Live intentionally, make conscious decisions, love more, act responsibly, play. The more you know, the less you need. TSLA investor. Tesla referral code: http://ts.la/kyle623

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Another Tesla Model 3 Teardown Highlights Strengths & Opportunities For Tesla

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Published on October 23rd, 2018 |

by Kyle Field

Another Tesla Model 3 Teardown Highlights Strengths & Opportunities For Tesla

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October 23rd, 2018 by Kyle Field

Sandy Munro and his team at Munro and Associates have been tearing cars down for decades. As legacy gas and diesel powertrains are being replaced by electrified versions and new electric car companies continue to sprout (seemingly every other day), Munro and Associates are putting their experience to work tearing down the latest and greatest electric cars.

A new video, which you’ll have to click over to YouTube to view, details some of the key things Munro and Associates recently learned in tearing down a second Model 3. In their coverage of their first teardown of the Model 3 back in July, they confirmed a bottom-up cost to build the Model 3 is probably under $30,000, supporting Tesla’s estimate that it could achieve nearly a 30% margin on the car. They also noted that the electronics in the Model 3 were “like a symphony of engineering,” which, if I’m being honest, is just fun to say.

Tearing down their second Model 3 resulted in another glowing conclusion from the narrator — “Tesla are ahead of the game in all areas but one.” They went on to note that the battery module is a “brilliant piece of engineering.” After the brief intro, the video dives into a section that highlights the one shortcoming identified with the model — the car’s body.

“The car’s body is too complex, expensive, heavy and difficult to build,” according to the narrator, summing up the findings from Sandy Munro and his team. Munro went on to specify the shortcomings of the Model 3 body in what feels like a healthy dose of industry expertise being applied to a car company that he believes still has a lot to learn.

“This is the reason I feel that Tesla has problems. The body and weight and the closures that go along with it are not designed for manufacturability,” Munro said. “They don’t do a good job at part count. The weights are too high. The body is much too stiff.” (One has to wonder, though, how much of this is due to Tesla’s focus on safety and the Model 3’s unprecedented NHTSA safety score — something that just built on Tesla’s previous industry leadership. Indeed, see Elon Musk’s tweet below for confirmation of at least part of this theory.)

Munro’s feedback on the body of the car is surprising given how much effort Tesla has put into optimizing the Model 3 for manufacturability, but it serves to put some substance behind the critiques of Tesla’s informal approach to manufacturing. There is always room for improvement, even after disrupting the entire automotive industry three different times with three different vehicles.

Munro notes that in his analysis that the body shop should be more efficient. Interestingly, Munro believes the body of the car would be more efficient to build if it were done at a traditional automotive factory. “This thing would have been a brilliant design,” Munro said. Tesla, on the other hand, builds the Model 3 exclusively at the former GM–Toyota NUUMI factory in Fremont, which has been retrofitted with a combination of automation and manual labor that lives in a constant state of flux.

The critique from Munro and his team feel very balanced, but the sensationalist, clickbait headlines from Bloomberg and the fact that the video leads with the one thing about the car that’s not amazing is disingenuous. Having said that, the video does highlight a few of the amazing things about the car, after the deep dive into the body of the car.

Munro said that, if the Model 3 were built at a traditional factory, “[Tesla] could have clobbered everybody. Nobody would have been able to catch up.” Whether that is true or not, we will never know, but Model 3 sales tell a very compelling story in favor of Tesla, while sales of the Chevrolet Bolt, which is built in a traditional automotive factory, struggles to gain a significant foothold.

Another key focus of the analysis has been the motors that propel the vehicles. Munro’s analysis estimated that Tesla’s motor for the Model 3 costs an estimated $754, which is significantly cheaper than the motors used in the Chevrolet Bolt ($836) and BMW i3 ($841). The pricing advantage reveals yet another of the paradigm shifts EVs are bringing about, as the cost of the motors in vehicles is now much lower than the cost of engines found in gas and diesel vehicles.

On the back end of the video, Munro opened up about how much fun the Tesla Model 3 was to drive. “This is wicked fast,” he said of the car. That instant torque has even longtime car industry experts smiling from ear to ear.

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Kyle Field I'm a tech geek passionately in search of actionable ways to reduce the negative impact my life has on the planet, save money and reduce stress. Live intentionally, make conscious decisions, love more, act responsibly, play. The more you know, the less you need. TSLA investor. Tesla referral code: http://ts.la/kyle623

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Hundreds Speak Against Rollback Of Clean Car Standards At Public Hearings

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Published on October 17th, 2018 |

by Guest Contributor

Hundreds Speak Against Rollback Of Clean Car Standards At Public Hearings

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October 17th, 2018 by Guest Contributor

Originally published on EVANNEX.
By Charles Morris

The US DOT and EPA recently held three days of hearings in Fresno, Dearborn, and Pittsburgh on the Trump administration’s proposal to reverse existing federal fuel efficiency and emissions standards, and members of the public had a chance to comment.

The hazardous effects of tailpipe emissions are concerning (Image: Charged)

Hundreds of people, including physicians and health advocates, former EPA officials and technology entrepreneurs, environmental advocates and local officials, testified against the plan, vastly outnumbering the handful that came out in support. Even representatives of automakers and the aluminum industry opposed the effort to water down the standards.

A former EPA analyst who spent years working on emissions policy testified that the technical analysis for this proposal was the “most biased and dishonest” he had witnessed in his 40-year career at the agency.

The DOT’s own Draft Environmental Impact Statement (DEIS) concluded: “The Proposed Action [the Trump administration’s rollback proposal] and alternatives are projected to result in an increase in energy consumption, an increase in most criteria pollutant emissions…Overall US health impacts associated with air quality (mortality, asthma, bronchitis, emergency room visits, and work-loss days) are anticipated to increase across the Proposed Action.”

The Natural Resources Defense Council’s David Pettit pointed out several shortcomings of the DOT’s DEIS at the Fresno hearing. “The alternatives analysis looks only at reductions in the CAFE standards, not increases,” he said. “None of these alternatives increases fuel economy with respect to the no action alternative, none conserves energy, and none represents maximum feasible CAFE standards. These are fundamental errors. The DEIS is fundamentally flawed and needs to be withdrawn.”

Rolling back clean car and fuel economy standards means more gasoline fill-ups for ICE vehicle owners (Image: Natural Resources Defense Council)

According to the NRDC’s Luke Tonachel, who testified in Dearborn this week, adopting the proposal would mean fewer innovative jobs, more smog, soot and carbon pollution, and higher costs for drivers filling up at the pump. The agencies’ own analysis shows that halting progress on emissions will mean 60,000 fewer jobs, an outcome that would be especially bad for Michigan, which is home to 69,593 jobs in 224 facilities that make materials or components for more fuel-efficient cars.

The agencies also admit that the plan will mean more carbon pollution. If the plan is adopted, an additional 73 billion gallons of gasoline will be consumed by the vehicles directly regulated under the proposal – an additional cost of $170 billion dollars for American drivers.

The administration’s argument that halting the pollution and mileage standards would save lives by reducing highway deaths was undercut by the EPA’s own analysts, who showed the flaws in its assumptions.

A spokesman for an aluminum industry trade group testified that the administration’s claim that automotive lightweighting would lead to more highway fatalities is false. “Numerous flawed assumptions in the draft rule are misleading and overstate potential unfavorable impacts on safety,” said Mario Greco, Chairman of the the Aluminum Transportation Group. “Automakers are not reducing the weight of small cars, but instead are prioritizing weight reductions where it offers the most promise to boost fuel economy and reduce emissions – their larger, heavier cars and trucks.”

Sources: Natural Resources Defense Council, Aluminum Transportation Group

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Tesla Pushes To Improve Service Center Coverage Density As Model 3 Deliveries Climb #ElonTweets

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Published on October 17th, 2018 |

by Kyle Field

Tesla Pushes To Improve Service Center Coverage Density As Model 3 Deliveries Climb #ElonTweets

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October 17th, 2018 by Kyle Field

Tesla CEO @ElonMusk took to Twitter to admit that Tesla had found some gaps in its global service center coverage and is now hard at work to improve its coverage over the next 3–6 months.

Specifically, Elon shared that Tesla would push to ensure full coverage of North America with its service centers over the next 3–6 months. Looking ahead, he shared that Tesla would be working to ensure similar levels of coverage in all countries where Tesla has operations by the end of 2019.

The news comes on the heels of Tesla’s successful ramp up of production and deliveries of the Model 3 which saw tens of thousands of Teslas sent out into geographies that hadn’t seen much action in the past. The latest wave of woes for Tesla started when its Model 3 went into production in June of 2017 and was followed by a full year of production hell.

Tesla and Elon pulled out all the stops to reach the target production rate of 5,000 Model 3s per week — and they did. The herculean effort required flying in new production lines from Germany, building a new general assembly line in a “tent” in the back lot of Tesla’s Fremont factory, and calling all hands on deck to put the hurt on the production lines and force them to comply with the will of Elon.

Emerging from the darkness, Tesla’s production troubles quickly morphed into birthing pains as Tesla’s delivery teams across the US choked on the 3× increase in deliveries. Deliveries of the Model 3 are spread across a distributed network of stores spanning the United States, making it difficult to quickly deploy improvements and standards.

Just the same, Tesla calmed the storm over the course of a couple of weeks as minor production issues and the overblown panel gap issues were tuned out on the production lines. In parallel, delivery teams improved their pre-delivery check processes and squeezed out most of the delivery issues.

The look at service centers is a look at the inevitable flow of Tesla’s vehicles that will either be forced in for service after an accident or require service for something that’s just not quite right in the car. That can be something as small as replacing a door handle all the way on up to the replacement of a full drive unit.

The flow of Model 3s out into the wild will result in a similar spike in requests for service at Tesla’s service centers, though the tail of requests will lag behind deliveries, as accidents and some other service requests don’t happen on a schedule.

Elon Musk and the team at Tesla started working on service center service times a few weeks back, as soon as Model 3 customers started voicing complaints of lengthy service times, with waits of several months for repairs being the norm. As part of the push, Tesla brought body shop work in-house at a few key locations in an attempt to streamline the repair process for its vehicles.

Early reports on the new service were positive, with some customers getting their repaired vehicles back in just a few hours. Same day turnaround is still far from the norm, but it showed that Tesla was working towards solutions and had some results to show for its early efforts.

Today’s tweets from Elon confirm that there is still work to do just to achieve the critical mass of service centers that would be required to get Tesla’s cars serviced. Beyond the base coverage, there is still work to do to ensure that all of its service center personnel are sufficiently trained and that the centers have the parts needed to get its vehicles repaired in a reasonable amount of time.

Tesla has pushed the envelope in just about every piece of its business, and service is no exception, as it has historically utilized its service teams to come pick up vehicles for service, leaving a loaner vehicle with the owner. Doing this drastically reduces the amount of effort required from the owner and from personal experience, it makes service all but a non-issue.

That wasn’t good enough so Tesla kept on innovating, deploying a roaming network of repair personnel, which it calls Rangers, that were trained and equipped to fix just about any issue on a Tesla that didn’t require a lift. That was estimated to be around 80% of all repairs and Tesla delivered in spades.

I utilized Tesla’s Ranger service to have the door handles on our Model S replaced. The service went off without a hitch and was actually a great experience. Tesla had already committed to doubling its mobile service fleet by the end of this year and the renewed focus on service center coverage is surely a part of its efforts to ensure timely and efficient service for all of its customers.

With every new day, there comes a new challenge. Today, it’s service center coverage; tomorrow, the moon!! Okay, so maybe Mars is the target, but the moon sounded better.

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Kyle Field I'm a tech geek passionately in search of actionable ways to reduce the negative impact my life has on the planet, save money and reduce stress. Live intentionally, make conscious decisions, love more, act responsibly, play. The more you know, the less you need. TSLA investor.

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Breaking News — Tesla Seals The Deal For Gigafactory 3 In China

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Published on October 17th, 2018 |

by Steve Hanley

Breaking News — Tesla Seals The Deal For Gigafactory 3 In China

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October 17th, 2018 by Steve Hanley

It’s official. Tesla has acquired just under 1300 acres of land in the Shanghai Lingang Equipment Industrial Zone for its Gigafactory 3. The factory is expected to cover about 1200 of those acres. The official signing ceremony for the transfer of land to Tesla took place in China on October 17, today.

Tesla is pushing hard to get the Gigafactory 3 project moving forward. Thanks to the tit for tat trade war initiated by the current US president and his crack team of economic advisers, Tesla cars manufactured in America now must pay an import tariff of 40%, making it hard for them to compete against locally produced automobiles. Cars built in the new factory outside Shanghai will be exempt from that tariff.

Tesla plans to be a major force in the Chinese new car market, especially as China institutes its latest EV policy starting January 1, 2019. After that date, every manufacturer building cars in the country will be required to produce a certain percentage of electric cars, known locally as new energy vehicles. Battery electric cars will get the most credits under the system. Plug-in hybrids will get a smaller credits.

Companies who wish to continue building cars with gasoline or diesel engines will be required to buy credits in order to do so. That will raise the selling price of those cars, making new energy vehicles more competitive in the marketplace.

Last month, Tesla began advertising numerous jobs for construction workers to help build the new factory, which is expected to have a capacity of 500,000 vehicles a year. Tesla expects the factory to begin producing cars in fewer than 2 years time — an incredibly short ramp up from breaking ground on the factory to getting cars rolling off the assembly line and into the hands of customers. But when have short timelines ever been a problem for Tesla?

It reportedly has increased the funding committed to the Gigafactory 3 project to $681 million. And as Vincent indicates on Twitter, local banks in the Shanghai area are actively engaged in lining up the additional funding needed to build GF3.

With the biggest new car market in the world, China is an important market for Tesla. Just how important is indicated by the fact that it is moving forward aggressively with plans for a Chinese factory before committing to a factory in Europe. Check out this video from the World Economic Forum on the rosy prospects for electric cars in China:

Check out more Tesla China news if this isn’t enough for you.

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Fixing Salvaged Teslas, The Ingineer Way

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Published on October 16th, 2018 |

by Guest Contributor

Fixing Salvaged Teslas, The Ingineer Way

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October 16th, 2018 by Guest Contributor

Originally published on EVANNEX.
By Charles Morris

All automobiles are supported by an ecosystem of services, which traditionally includes dealerships, repair shops, and fueling stations. One of the ways Tesla has redefined the auto industry is by vertically integrating these services. You can buy a vehicle directly from Tesla, have it serviced at a Tesla service center, and charge it at a Tesla Supercharger. On the whole, most customers seem to be happy with this arrangement, but some believe that there is an unmet need for independent repair shops, and a community of DIY Tesla repair techs has developed. Because Tesla doesn’t support their activities, there’s an underground, hacker vibe to the scene.

A totaled Tesla Model 3 that Phil Sadow plans to repair (Image: InsideEVs via Ingineerix)

A recent Motherboard documentary told the story of Rich Benoit, aka the Dr. Frankenstein of Teslas, who salvages Tesla parts and uses them to repair cars damaged in crashes, fires, and floods.

Another guerrilla repairman is Phil Sadow, aka Ingineer, an electrical engineer who has been rebuilding and selling salvaged Teslas for three years. A recent article in Fast Company tells us how Sadow also teaches fellow enthusiasts to develop their repair skills. The intrepid Ingineer says he’s participated in almost 400 Tesla refurbishment projects.

According to Sadow, Tesla really doesn’t want cars that have been in serious accidents back on the road, and the company has taken steps to make it almost impossible to repair them. “When a car is totaled,” he says, “they deny parts, [and] they don’t in any way give service information, the service tools like all the electronics and computer stuff needed to work on the cars … except where they’re required to by law. And even then they don’t do that.”

Sadow understands the reason for this policy: given the media hunger for anti-Tesla articles, any incident involving a repaired Tesla would surely be blown out of proportion by the press. “Tesla’s trying to protect their stock price and their mission by eliminating some of this,” he says. “If I buy a salvage car and fix it improperly and it kills someone or burns a house down … it’s not going to be ‘Man fixes Tesla improperly and hurts someone.’ It’s going to be ‘Tesla kills someone.’”

A look at the Tesla Model 3 drive unit (YouTube: Ingineerix)

Sadow is obviously a big fan of Tesla’s mission, but he fears that making it difficult to repair damaged vehicles is a short-sighted policy, because the lack of a market for salvaged Teslas will eventually lead to expensive insurance premiums.

Normally, when a vehicle is totaled, it’s sold at an insurance auction to a shop that either repairs it and puts it back on the road, or sells it for parts. This healthy secondary market allows insurance companies to recoup a substantial part of what they have to pay to replace a “totaled” vehicle. However, because of Tesla’s policies, Sadow says, the market for salvaged vehicles is thin, so auto insurers tend to lose a lot of money on totaled Teslas. “The insurance underwriters figured it out,” he says. “‘Oh, it’s a Tesla, we’re going to eat our lunch on these.’ So they start raising premiums. A lot of insurers consider the Model S and the Model X exotics, like a Ferrari. For that reason, they’re losing their shirt on even relatively minor accidents.”

In the US, only Massachusetts has a “right to repair” law, which requires auto dealerships to make parts and service manuals available to independent repair shops. According to Sadow, even in Massachusetts, Tesla has so far refused to release service information for Model 3. (Tesla told Fast Company the same thing they told Motherboard: owners are free to do whatever they want to their cars, and the company will inspect salvaged vehicles for a fee to assess what repairs are needed.)

A look at the Tesla Model 3 battery pack (YouTube: Ingineerix)

Sadow’s EV-recycling career began in 2015 when he bought a Model S that had been through the Houston flood. He and his girlfriend took the car apart, repaired the damaged electronics, gave it a thorough cleaning and got it back on the road. Soon he partnered with a body shop owner in Minneapolis and the two began regularly buying, repairing, and reselling salvaged Teslas.

Nowadays, Sadow spends more time teaching others to resurrect Teslas than fixing them himself. As more Model 3s hit the roads, more damaged vehicles will be showing up at insurance auctions. “There will be people that want to know how to work on them,” he says, “and that’s basically my full-time job now — helping other people work on these cars.”

Sadow has created his own answer to Tesla’s mobile app, which offers his car-fixing customers access to information such as battery voltages and diagnostic codes. Getting into Tesla’s software required gaining root access — something like jailbreaking a phone. It took Sadow about four months to figure out how to reverse-engineer Model S’s systems, but it took him only three weeks to get the same access to Model 3, as many of the new car’s systems were based on the older model. Tesla hasn’t tried to stop him, but it does employ some software counter-measures to limit what owners of damaged cars can do. When Tesla becomes aware that a particular vehicle has been in a catastrophic accident, it “blacklists” it, meaning that it will refuse to sell the owner any parts.

A look at the Tesla Model 3 cooling system (YouTube: Ingineerix)

That’s not a problem for Sadow and his fellow renegade rebuilders, because salvaged parts are plentiful and cheap. Sadow is proud of the fact that his revenant Teslas have been problem-free, and hopes that, as long as that remains the case, the company will leave him alone and let him get on with his business. “As long as it keeps them out of the news,” he says, “and as long as they don’t see one of the cars I helped repair burn down or burn down someone’s house or neighborhood, then they’re completely don’t ask, don’t tell.”

Sources: Fast Company, Ingineerix

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