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Bloomberg article

Discussion in 'Tesla Motors' started by malcolm, Feb 14, 2008.

  1. malcolm

    malcolm Active Member

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    #1 malcolm, Feb 14, 2008
    Last edited: Feb 14, 2008
    Bloomberg.com: News

    Quote:

    ``We did have a burn rate that was out of control last year,'' said Musk, 36. ``The board and I have taken steps to make the appropriate changes in senior management to correct that situation.''

    Uh huh.

    And how much of the overspend was due to the need to employ four different outside companies to try to get the two-speed transmission working? ( http://www.teslamotorsclub.com/news-articles-events/776-my-town-hall-notes.html ) Presumably it was only when the fourth one failed that Elon realised that his insistence on a two-speed solution to achieve the necessary performance specs was unrealistic under the present time and financial constraints. At least Tesla seems to have gained some useful IP from the process.

    Given the wider redundancies it's ironic that it was TESLA'S OWN ENGINEERS who saved the situation by adapting technology intended for Whitestar, allowing for a single-speed solution that matches the original specs.

    And we've all learned that Elon is smart and quick-witted enough to capitalise and gain politically from situations caused by a conflict between Elon's ideas and Elon's money.

    I guess that's his definition of engineering.

    ______________________________________________________________________

    It is disingenuous of Elon to imply that last year's overspend was something that he was not aware of at the time or that he had not voted on. Key elements of the Tesla Plan would appear to have been devised with his explicit involvement and, as he likes to remind us, a significant amount of funding for Tesla continues to be from his own pocket.

    "The strategy of Tesla is to enter at the high end of the market, where customers are prepared to pay a premium, and then drive down market as fast as possible to higher unit volume and lower prices with each successive model."

    "In keeping with a fast growing technology company, all free cash flow is plowed back into R&D to drive down the costs and bring the follow on products to market as fast as possible."

    Tesla Motors - think

    To what extent has the work at Tesla during 2007 been driven by those four words: As Fast as Possible?

    Interestingly, things now seem more cautious: "Prior to beginning series production, our intent is to build
    production cars in limited quantity throughout the first half of 2008."

    Tesla Motors - think

    Looks like "as fast as possible" is out of favour.

    So thankyou Elon for "saving" Tesla from a reckless and headlong overspend caused by incautious management requiring/encouraging Tesla employees to work as fast as possible on a wide variety of disparate projects (Tesla Energy Group, Whitestar plant, Whitestar development, Tesla Stores, Left-field marketing such as Game tie-ins and cross-country trips, Roadster production) which threatened to derail the company.

    Thank heavens you uncovered this and took control in time. What a good job you stayed immune to all this frantic activity and took several months to appoint the new CEO.
     
  2. stopcrazypp

    stopcrazypp Well-Known Member

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    I was kind of riding on the edge of whether or not to post this article as I don't want to open old wounds.

    "Tesla cut its workforce by about 10 percent last month to pare costs as its supplier move spurred other technical changes.
    ``We did have a burn rate that was out of control last year,'' said Musk, 36. ``The board and I have taken steps to make the appropriate changes in senior management to correct that situation.'' "

    This part kind of pissed me off as I remember clearly that Tesla's official stance for firing the engineers were said to be not finance related. Now this article says it is, and seeing the cash problems they were having affirms that.

    But I want to see this company succeed regardless, so I don't really want to comment more on this point.
     
  3. W8MM

    W8MM R1.5 #325 + Mdl S #01380

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    This line of criticism is a little too much for my taste. Your take on this situation is thoroughly at odds with my experiences running "bleeding edge" consumer-market gizmo companies.

    It seems to me that Elon knew in his bones that a ~4 second 0-60 time was a non-negotiable requirement to get enough buzz to launch the car and keep growing it into the marketplace. If the main investor is going to risk scores of millions of dollars on a mere concept, that concept needs to have his complete confidence. That seems completely fair to me. This isn't a government project, after all.

    It's quite plain to me that given Tesla's quickest-time-to-market motor control (inverter) electronics concept (analog platform + IGBT of the day) that a 2-speed transmission was absolutely necessary to meet the performance goals. The best e-motor and inverter combination at that time couldn't get to 4 second 0-60 performance without changing gear ratios during the run. Anyone advocating a single-speed gear drive at that time was also advocating missing the performance target. How can one advocate blowing off a mission-critical performance target and expect to maintain the confidence of the investors?

    Now, one can argue that 6 seconds is plenty fast enough and that the Roadster never needed more than a one-speed gear box. It would have had a top speed just as high although it would feel only half as quick from rest. Those that argue that a reduced acceleration spec would have been preferable to a 2-speed of dubious development time have a meaningless point as far as I'm concerned. If one can so easily compromise the vision that generated the initial investment confidence, why should the investors have any reciprocal confidence in those that would compromise that vision?

    I have many times been offered product content decisions in my own businesses that would be easier to deliver or less risky or quicker to develop, but would fall short in performance. I have found these situations to be like the Sirens calling Ulysses. They have a powerful pull, but they lead to lost market share and threaten long term viability. What real good is a slightly quicker but significantly weaker entry into the market? Rejecting the Sirens was my greatest challenge as well as a satisfying source of later triumph.

    To those that say the new shift-less gear drive is proof that single-speed was the correct decision from the get go, I say you're full of it. Just because Moore's-law-like advances expand into other areas of technology besides CPUs doesn't mean it's predictable ahead of time. One goes into production with the best production-ready technology available at the time the design is frozen. Super IGBT technology wasn't available when the 2-speed decision was made. One couldn't economically get enough current into the motor to eliminate shifting and still get to 4 second 0-60. Now, it's possible. It wasn't then. 20/20 hindsight isn't the same thing as clairvoyance.

    So, there are two choices:

    1) We could already be driving a less satisfying and appealing Roadster with greater long term risk for company survival. Who (which normal car person) wants a $100,000 sports car that gets embarrassed in a stoplight grands prix by most cars that cost half as much? The great visionaries remain employed, but later get laid off as sales falter after saturating the rich eco-nut market and being rejected by "sports car people".

    2) We wait an extra portion of a year and get a product even better than the original concept in performance that satisfies an even larger portion of the motoring public than originally planned. The waiting time causes financial strains that are corrected through painful staff reductions, but the company is positioned to take better care of the opportunity to succeed

    As far as I can see, Elon has done exactly what could be reasonably expected of him as the champion of bringing the Roadster convincingly to market while still financially surviving the experience. It's his money, not ours.

    Cheers,

    Mike
     
  4. TEG

    TEG TMC Moderator

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    #4 TEG, Feb 15, 2008
    Last edited: Feb 15, 2008
    Mike, I mostly agree with what you said, but this one part seemed a bit wrong:

    If Tesla had planned for one gear all along they probably could have gotten 0-60 in 4s even with older inverter technology. They would just have had to do things a little differently including:

    #1: Different gear ratio that sacrifices a bit more of the top speed.
    and/or
    #2: A bigger inverter and eMotor in the first place.
    and/or
    #3: Further vehicle weight reduction.

    The inverter improvements now seem to be "saving the day" so that they don't have to use a bigger eMotor or drop the top speed by a huge amount.

    (Not as direct proof of my point, but): The tZero and Wrightspeed X1 do 0-60 < 4s with only one gear. They both use older inverter technology, and have a less powerful eMotor but both have low(ish) top speeds, and have lighter weight. If Tesla had planned for more weight (due to more safety equipment and luxury features) and had planned for one gear they could have started out with a bigger inverter and eMotor.
     
  5. malcolm

    malcolm Active Member

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    #5 malcolm, Feb 16, 2008
    Last edited: Feb 16, 2008
    My apologies for getting too rant-y earlier.

    W8MM: I agree that Elon has been right in a lot of his calls regarding the Roadster styling and specs. It has to be a sports car; it's styling needs to be as different as it can be from existing Loti.

    I like the lower door sills. Tony Belding has illustrated the problem with the height of these on existing Lotus models: http://www.teslamotorsclub.com/3420-post3.html

    The hidden door handles are a cool touch. The headlights are an improvement. The 130 mph and 0 to 60 in 4 seconds were the right targets to set.

    Yes I did say that, Elon was right.

    However (and thanks to TEG for finding this) :-

    http://www.teslamotors.com/display_data/pressguild.swf

    Extraordinary to see that Tesla grew from 100 employees to 250 in just eight months (August 2006 to April 2007) as the scope and complexity of the work increased.

    In the space of a few short months Tesla went from being a single startup to a series of multiple and interconnected startups. Fun but messy.

    I know that hindsight is always 20/20 but my two cents (for what it's worth) is that the board wasn't proactive enough to support the management team through this transition. In particular, the delay in finding a replacement full-time CEO was, in my view, a crucial failure. I believe that both Martin and Michael Marks did their best to put the brakes on and re-focus work on the transmission but seasoned automan Ze'ev should have been in post a year earlier.

    It is most unfortunate that other employees of the company had to pay for this slip.

    Now I know Elon's a busy man. He has his own company to run.

    I just wish there was one interview where he says "Yes I can single-handedly finance the company, but you know what? There was this one time where I dropped the ball"

    He gets to drive P1 every day. I think it would help the people who made it for him.
     
  6. M09

    M09 New Member

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    I held off putting down my Tesla deposit until this year because I thought giving them another year to work on the transmission was worth the wait. I hate waiting for new toys, but I am willing to wait for my Tesla if waiting improves my chances for a car that goes 0-60 in under 4 seconds. I would even be happy to sacrifice top speed and range for better performance off the line. I think Elon is absolutely right about the importance of the 0-60 time. Under four seconds is very attractive, but anything much above it is definitely less appealing.
     
  7. vfx

    vfx Well-Known Member

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  8. tennis_trs

    tennis_trs 2010 2.0 Roadster Sport

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    Range anxiety mentioned in that article:

    Before driving the Mini ES, drivers told BMW the 150 range would be problematic. But the range turned out to be a problem for very few customers. The article notes that BMW concluded that, "electric cars are suitable for most people and that range anxiety fades as drivers get used to them."
     
  9. raymond

    raymond Member

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    But then again what intel is more valuable: 7 million miles with a battery pack that lasts, or 50 million miles to prove it does not? [if we are to take Elon's word on air-cooled battery packs]
     
  10. stopcrazypp

    stopcrazypp Well-Known Member

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    #10 stopcrazypp, Oct 20, 2010
    Last edited: Oct 20, 2010
    Goes to show range anxiety is mostly FUD, esp with aids like the radius map on the Nissan Leaf.

    I imagine automakers likely found the same thing with EV drivers during the EV1 era, but didn't report it since they needed a reason to end the program. "Range Anxiety" is mostly a pre-usage worry that fades quickly with experience.
     
  11. PopSmith

    PopSmith Saving for a Model 3

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    Even in America it's probably a safe bet that ~90% of people drive no more than 50 miles a day. As for an EVs range, in my personal opinion the "sweet spot" is 200 miles. This gives you plenty of range even if heater use in the winter cuts the driving range in half.
     
  12. kgb

    kgb Member

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    Me too. That was the range that leaves me with no anxiety. That's also why I would not buy a Leaf or any of the other cars on the market.
     
  13. vfx

    vfx Well-Known Member

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    Someone once wrote that it's when the miles to go dips below 100 is when you start to pay attention to it more often.

    200 to 250 gives you lots of daily driving before you are psychologically empty.
     
  14. richkae

    richkae VIN587

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    Its important I think to remember some time / distance relationships.
    If city driving averages 25mph ( max speed limits 35-40mph plus lights and congestion - no highways ).

    A 100 city mile range car gives you 4 hours of driving around time - if you spend an entire 9-5 day shuttling around in 15 minute chunks with equal 15 minute stops you have enough range to do so.
    If you have a 200 ( city ) mile range car, that gives you about 8 hours of driving around without any of the stops.
    I think 100 makes it unlikely that most people would run out of range driving around town, and 200 makes it just about impossible.

    Of course if you add highway driving into the mix then the equation is drastically different.
     
  15. kgb

    kgb Member

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    You are assuming an east coast type city, which is denser. Most cities in the USA have significant sprawl. Plus you need to factor in that most people do not want to pull into their home on E. When you drive an ICE around on E, it is a lot less scary, because there is a gas station on every corner.

    When you consider that the Roadster has 240 miles, that is in "Range" mode. It is just under 200 miles in "Standard" mode. I want to pull into my home with around 50 miles in the battery, leaving less than 150 for driving. Then factor a mid-western city (or in my case Houston) with a significant mix of highway miles. At an average of 35 mph, we are talking 4 hours drive time... and that is for a car with well over 200 mile range. For a car with 100 miles range, using my assumptions, you get an hour and a half, maybe two for driving.
     
  16. richkae

    richkae VIN587

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    To clarify:
    The average 12000 mlie per year driver averages less than 40 miles per day. A 100+ mile day is extraordinary.
    I'm talking about these worst case days, not the average case.

    If you drive around all day, city driving ( no highways ), don't charge anywhere, and use up all your range, you will have driven for about 8 hours in a 200 mile range EV, and 4 hours in a 100 mile range EV.
    If your driving is mostly city with a little highway and averages 33mph you get 6 hours in the 200 mile range EV and 3 hours in the 100 mile range EV.
    If you plan ahead and charge range mode in your Roadster, you get 10 hours at 25mph average and 7.5 hours at 33mph average.

    With a 200+ mile range EV you are very likely to run out of time in the day before you use up your range - unless your stops take close to zero time.
     
  17. TEG

    TEG TMC Moderator

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    Recall that better place showcased their pack swap technology first on a taxi fleet.
    There is a vehicle usage scenario that has someone driving all day long, nearly non-stop...
     
  18. richkae

    richkae VIN587

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    My post above was meant to apply to typical consumers that do not have driving as a core part of their job.
    Clearly there are several heavy usage scenarios that would strain the convenience of an electric car.
    However those scenarios also have the most to gain from fuel savings.

    I did some research into the electric taxi a while ago.
    In NYC, the average taxi drives 180 miles over a 12 hour shift. That must include a few hours of sitting around waiting.
    Some combination of central fleet management, battery swapping, and charging at taxi stands I think would make an EV perform well in that scenario ( because some days will be significantly above the 180 mile average ). The dispatcher could direct cars to the taxi stands with charging available when needed and the cars that have sufficient charge to pick up passengers.
     

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