Elon Musk’s ambitious extend well beyond Tesla. The Californian entrepreneur has set his sights on building up an integrated energy company where consumers will be able to buy everything from electric cars to electric trucks and even solar facilities with storage batteries. John Dyer reports from Boston.
Tesla founder and CEO wants to transform Tesla into an all-in-one renewable energy company. (Image credit: James Duncan Davidson, flickr/Creative Commons)
American celebrity tech entrepreneur Elon Musk has unveiled a new master plan for Tesla. Posted in his blog last week, the new master plan is a follow-up to the first 10-year plan Musk posted in 2006 when he said Tesla would produce increasingly less expensive electric cars and solar power.
Tesla isn’t making much money, but the California firm is now selling three types of cars, each less expensive than the last. It’s also building a so-called gigafactory in the Nevada desert to boost production while reducing costs.
Merger with SolarCity
Musk is now in negotiations to purchase SolarCity, the biggest solar power panel company in the US. Many were surprised by Tesla’s announcement of the acquisition last month, but on Wednesday the chief executive said he’d always intended for Tesla to become a renewable energy company in the broad sense.
“No kidding, this has literally been on our website for 10 years,” wrote Musk. “The point of all this was, and remains, accelerating the advent of sustainable energy, so that we can imagine far into the future and life is still good. That’s what ‘sustainable’ means. It’s not some silly, hippy thing — it matters for everyone.”
New goals
Musk’s master plan contained a few new goals.
First, the company would perfect a “solar-roof-with-battery product” that would empower “the individual as their own utility”, representing a whole new business and revolution for consumers. He foresaw Tesla selling, installing, maintaining and using an app to service homeowners who use their roof’s solar panels to power their cars and lights indoors.
“We can’t do this well if Tesla and SolarCity are different companies, which is why we need to combine and break down the barriers inherent to being separate companies,” he wrote.
Second, Tesla would expand to make electric-powered trucks. “We believe the Tesla Semi will deliver a substantial reduction in the cost of cargo transport, while increasing safety and making it really fun to operate,” he wrote.
And in a third goal, Musk said Tesla would continue to research autonomous driving and would expect big improvements. Autopilot was still arguably safer than driving, he added.
Others would strongly disagree, with Tesla currently facing a controversy stemming from one of its cars crashing and killing the driver while on autopilot. American transportation regulators are now investigating the accident.
Autopilot vision
But Musk isn’t dissuaded by this.
“The most important reason is that, when used correctly, it is already significantly safer than a person driving by themselves and it would therefore be morally reprehensible to delay release simply for fear of bad press or some mercantile calculation of legal liability,” he wrote.
He added that people could eventually leave their car at home and call it to come pick them up when they wanted to go home for the night. On its way, the car could pick up and drop off passengers going in the same direction in an Uber-like manner, generating revenue for the car owner.
“When true self-driving is approved by regulators, it will mean that you will be able to summon your Tesla from pretty much anywhere,” Musk wrote. “Once it picks you up, you will be able to sleep, read or do anything else en route to your destination.”
Analysts are sceptical
Some analysts expressed scepticism.
“As is typical, Elon Musk has laid out a grandiose plan for the future with no timeframes and few specifics, and no mention of how and when Tesla will be profitable,” said Autotrader Senior Analyst Michelle Krebs.
Others said Musk should think less about the next ten years and more about the next ten months.
In addition to the autonomous car accident embarrassment, Tesla is falling behind on its goal of selling 500,000 annually in the next few years, with only 50,000 electric cars sold last year. It now has a long backlog of cars it owes customers who have placed deposits in expectation of the owning the Model 3, the company’s least expensive car.
“The plan sounds overly ambitious for now, especially considering that there are already doubts about whether Tesla can meet its goals for the next two years,” said Edmunds.com Analyst Jessica Caldwell.
Ambition is necessary
But Musk appears to have anticipated those critic’s thoughts in his blog. He had to be ambitious, he said.
“By definition, we must at some point achieve a sustainable energy economy or we will run out of fossil fuels to burn and civilisation will collapse,” he wrote.
“Given that we must get off fossil fuels anyway and that virtually all scientists agree that dramatically increasing atmospheric and oceanic carbon levels is insane, the faster we achieve sustainability, the better.”
