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Hypothetical - What if tesla gets out of the car business and only does battery?

Discussion in 'Tesla Motors' started by No2DinosaurFuel, Aug 25, 2015.

  1. No2DinosaurFuel

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    This is a hypothetical question and I am interested in what the response will be from current owners have if this was to happen.

    We all know tesla is building the massive gigafactory which is burning a lot of tesla's cash. We all know building a car is expensive and servicing and maintaining them is difficult. i.e. providing warranty and logistics and such. So it's logical battery, once the factory is up and running, will be a much easier and lucrative business compared to car manufacturing, especially when all the car companies will be releasing much better EV by the time the Model 3 comes out.

    I am not forecasting any downside for tesla, but I think there is a real chance Tesla might get out of the car business down the road and just focus on battery similar to coda, but a much grander scale.

    So what are your takes current tesla owners if one and only one of the following 3 situations happens:

    1) Tesla shuts down their car business and just focus on making and selling batteries to other car manufacture and electric power company.

    2) Tesla sells their car division to Audi, BMW, Mercedes, or some other car manufacture and let them run the show from there.

    3) Tesla sells their car division to Google, Apple, Uber, etc and let them run the show from there.


    Here is my take on this:
    1) Owners will be in a similar situation as Fisker and other defunct cars. They will hope their tesla have no major problems and probably will baby the car until it dies. This is probably the worst case. Supercharging station will be sold to other competitors or shutdown all together. So the cars are really worthless because of the lack of support similar to android cellphone/tablet with out of business parent companies.

    2) The new owners will implement many changes but will probably still provide support for the current owners. Some obvious changes would be charging money for supercharging and probably implement dealership sales and servicing... Maybe... Or they can just take the tech and reimplement it in their own cars and shut down tesla's version.

    3) Google or Apple will probably just shutdown the car business slowly and think about how to redesign tesla to fit their needs which is probably driverless cars. They would use tesla's technology so they don't have to reengineer the drive train, battery, electronics, and such. They might keep some of the current perks for model S owners but support will probably go away over time.


    Sorry for all the doom and gloom, but sometime it's fun to think of the worst case and predict what the outcome will be. That being said, I am very hopeful tesla will continue to build great products down the road... provided they do it sustainably.
     
  2. eye.surgeon

    eye.surgeon Member

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    #1 won't happen.
    #2 or #3 could happen.
     
  3. apacheguy

    apacheguy Sig 255, VIN 320

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    It would be a HUGE mistake for Tesla or any other potential buyer to mess with/shutdown the SpC network. Elon has said he won't stop until every car on the road is electric. His transportation vision is what led him to create Tesla. He won't back down on that promise and leave us stranded.
     
  4. Fiver

    Fiver Member

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    I could see Tesla spinning off the car business in the next ten years. The battery business is going to be way way way bigger, and much less risky then cars will be.
     
  5. No2DinosaurFuel

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    While that is true, Elon didn't say it needed to be tesla to do the bidding. I suspect if he gets enough companies on board building EVs, I suspect he would say, I will supply you the battery and you build and maintain the cars. I would say he's still true to his mission.
     
  6. Cosmacelf

    Cosmacelf Active Member

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    I could see Tesla spinning out their car business ... In 20-30 years, but not much before then.it won't stop making car until everyone is making significant numbers of electric cars.
     
  7. FreeOfPge

    FreeOfPge Member

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    Agree, spinning off either the auto or battery division is likely but not because auto mfg is more risky. If anything, I would think it is less risky since batteries have no moving parts and can (it would seem) be replicated or copied easier. Now, the tech managing the battery's power might be a different story altogether and probably could be spun off or sold as well.
     
  8. Grendal

    Grendal Active Member

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    #8 Grendal, Aug 25, 2015
    Last edited: Aug 25, 2015
    From merely a business point of view, I get your point. Making cars is not easy. Making batteries and forming them into great packages is much easier.

    That said,

    Elon is not interested in just making money. Tesla is now the business of Elon Musk. He has a goal and simply making batteries and battery packs will not achieve his goal. The goal is to get every vehicle on the road to be an electric sustainable vehicle. He doesn't intend for Tesla to make every one of those vehicles. Tesla might make a lot of the battery packs that power those vehicles, so I agree with you there.

    That said,

    I don't think that Tesla intends to sell tens of millions of cars a year unless they are forced to do so. I don't think Elon wants Tesla to become Ford or GM. A company that size will be a bureaucratic monstrosity that will, by its nature, stop being the innovative leader. Tesla will hopefully focus on specific vehicles and make the premiere vehicle in each segment. I can see a large and smaller sedan, a large and smaller CUV, maybe an SUV as well, a large and small truck, and a small sporty car which will replace the roadster. I believe that making an incredible EV in each of those segments that is so superior that it forces rival manufacturers to make something similar will achieve Elon's goal. You can already see that happening with the Model S. Nearly every manufacturer uses the Model S as their goal and the "car to beat" in the large sedan segment. I think Tesla will leave the smaller EV personal vehicle market to Nissan, BMW, and GM unless they totally fail at making a decent inexpensive EV. Other than making specific vehicles, I see Tesla focusing on battery manufacturing and battery packs which they might sell to as many manufacturers willing to buy them.
     
  9. OlderThanDirt

    OlderThanDirt Member

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    +1 on that.

    Elon doesn't just do easy. He's willing to eat the "Glass Sandwich" if he has to make our world a better place. The current majors won't do that. Maybe that's why their cars just literally stink up the place??
     
  10. Zythryn

    Zythryn MS 70D, MX 90D

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    Tesla's goal is to speed the replacement of gas cars with EVs.

    Tesla won't get out of the car business until that trajectory is assured.
    The battery side of the business is there to support the cars, that won't change.

    I think there is a bigger chance of Yellowstone erupting.

    Now, once the trajectory of EV replacing ICE cars is secure, then I could see Tesla getting out of the car business.
    By definition though, when that happens I will have lots of options for other EVs.
     
  11. eloder

    eloder Member

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    I imagine it'll happen in 20-30 years, but not in the short term. EVs are still at a stage where they can be EV1'd if the wrong companies get their hand over the big names, in my opinion.
     
  12. kushari

    kushari Model S 70D

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    I think they will have both businesses. Energy/Battery and Car. Just run them separately. Once they are making a profit, they can easily go after the Van, other markets as those don't need to be sexy and meticulously designed like Sedans, SUVs, Sports cars. They just need to get from place a to b and save the user money. I see them selling vans to UPS, FedEX, DHL, etc. Those companies will save millions if not billions in fuel cost and get to toot that they are going green.
     
  13. DuncanWatson

    DuncanWatson Member

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    I only see Tesla dropping cars and moving to batteries if Elon is dead.
     

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