Ran across this spy shot online of a potential competitor to the Tesla Semi.
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Tesla Semi Competition
- Thread starter ohmman
- Start date
Oceanwolf
Oceanwolf
It is. You put gas in it and it turns into electricity.Is it rechargeable? They might have missed the idea of electric cars.
adiggs
Well-Known Member
The DTNA (Daimler) headquarters in Portland, OR has been posting positions in their eMobility group pretty much weekly. I'm pretty excited to see that they're building and delivering small volumes of electric trucks - getting trucks into hands of customers to use in their daily work to begin establishing that electric trucks "work" (can do the job, can be repaired and maintained, how does refueling work, etc..).
Once buyers of trucks understand that they "work", at least for some subset of jobs, I think that the next thing that buyers will be looking for is scale - can they get the trucks they need, when they need them?
adiggs
Well-Known Member
I started this reply over in the Investor forum - decided to post it here and link to it over there.
(Moving response over to the Semi forum - I'll add a link back to Invest forum as well)
I think we've got approximately the same point of view, with different language to articulate it.
Even on "compete". Compete, where the meaning is that Teslas offering appears to be better than DTNA's - completely agree. Compete, where the meaning is that one can sell trucks and the other can't (an admittedly extreme overstatement), no. You've also made that clarification.
Totally agree with the start being trial fleets at large companies, and then working their way down. My own thinking is that these trials will be with as few as 1 truck, but the size of the trial fleets isn't really an issue. The purpose of these initial trials is to establish that these new things "work". They might be cheaper, they might be more expensive - we don't know that yet (where "we" are buyers of commercial trucks). We think they might be the future, and the first thing we need to know is that they "work".
"work", as best I can articulate, is a mixture of:
- They can be used once to haul the load.
- They can be refueled (recharged) in a sufficiently moderate time that they can be used again to haul a load.
- Maintenance can be performed to keep them on the road, hauling loads.
At their core, the difference in the Semi market from the light duty vehicle market (S/X/3/Y/...) is that ~100% of Semi's are income producing assets for their buyers. They have a financial model that makes sense, or they don't. And when that financial model becomes compelling enough, the business case will switch to being skeptical of any diesel truck purchases.
The ideal outcome for evaluators of the trucks will be that there's some modest and scalable infrastructure that needs to be installed, and after that, the trucks can just drop into some existing regular route and they "work". Repetitively. At least as easily as diesels, and hopefully more easily.
Once they "work", and that'll need to be established over some period of time (month, quarter, year, ..), then they'll also acquire information about the cost to operate. My own simplistic estimate of what fleets will discover is that an electric class 8 semi will save them $0.30/mile in fuel costs. If we assume all other costs are the same, then that's $30k/year for a truck driven the industry average of 100k miles/year.
This cost savings is why I see a pretty fast industry switch from diesel to electric. As long as the electric variants are close enough to the diesel variant on price. Previous reading says diesel class 8's can be had for $120k - if an otherwise equivalent electric comes in at $180k, then that means that the first 200k miles pay off the electric premium, and after that is gravy for the buyers of the electric trucks.
The cost savings will be so compelling, it will create strong customer pull.
I see 3 phases to the adoption.
1) trial fleets. Do these "work"?
2) Each buyer will figure out their own financial model, and savings from electrification. And discover they gotta have it now
3) Manufacturers of electric trucks establish "scale". Buyers realize that even if they can't get the truck(s) they want TODAY, they can get them soon enough that they're better off postponing their purchase. Keep the current truck in service with more maintenance, buy used, etc.. Note here - from my reading, some of these trucks are purchased with a 5-8 year sort of timeline, so a 1 or 2 year delay getting the trucks could easily cause new purchases to be postponed for that year or 2. A new purchase of a more expensive to operate truck, that you're locking in for 5-8 or more years, sounds like a recipe for creating a stranded asset.
I think (and am honestly guessing here) that "scale" will be established in the minds of truck buyers at between 10 and 20% market share. To put a fine "I'm really guessing now" point on it, I think it happens at 1/6th. Partly because the math is easy.
The North American Class 8 truck market is around 300k trucks / year. 10-20% is 30-60k trucks per year, with 16% being 50k trucks per year.
My prediction is that however long it takes electric truck manufactures, all combined, to reach that 30-60k level, at that level you'll see the diesel truck market Osbourne. By which I mean - a sharp drop in orders from current levels to something that is too low for all of the truck makers to stay in business - say 10-20% of current levels. There will be a few very hard, very lean years in there where diesel trucks aren't selling, and electrics (and their supply chain haven't ramped enough) to supply all of the demand.
I also think that the new electric truck market will surge past the current 300k level - my guess is to 2x (600k / year), but I also wouldn't be surprised at anything up to 10x current level (1.5 - 3M per year). The higher levels are a mixture of aggressive retirement of trucks in the current fleet, plus the incremental demand that is created when something comes along that makes the prior thing much cheaper to do.
To put some numbers on the installed base - I found a source (previously) saying 16M trucks in North America. If those are replaced on a 10 year schedule, that is 1.6M trucks / year. That's clearly not happening with the diesel trucks, but with lower cost of operation, that might happen with electrics while they are replacing the installed base of diesel trucks.
There will be corner use cases where the class 8 semi is used infrequently over the year. Those trucks won't be changed out in the beginning. They will have to be changed out later in the change over, due to diesel becoming harder and harder to source (we're all happy with how much closer to a solution to climate change we have by this time)
The big limitations in each phase:
1) Buyable trucks, in single digit units. Buyers need to get their hands on trucks, and start using them on real routes to do real work (after some initial testing on fake routes with fake work / loads).
2) Happens fast, and probably in parallel with 1 - buyers do their financial models. Some or many of these will make it into the press.
3) Everybody watches the ramp of trucks with baited breath, buying every truck they can to fill routes / use cases that the truck can solve, pushing diesel trucks out of anything an electric can do.
So far, the primary limitation is the question nobody (I claim) can answer authoritatively at an industry level - electric trucks "work". Every appearance is that they will, but the testing to prove the hypothesis is barely started, much less repeated with high quality results for an industry-wide consensus to emerge that "electric trucks work".
The next limitation, simplistically, is battery supply (cells and packs). 300k trucks / year, at 1/2 MWh per truck, is 150 GWh/year. Tesla, if they took their current output and went all in on Semi can maybe supply 1/3rd of that today. And to do so, they'd shut down Model production completely.
Tesla looks like the best opportunity for that cell supply to be created to me, but there's a LOT of growth needed. I'm ready to hear that the remaining build out of GF1 is underway, and that site selection for the next North American GF is started. We need ANOTHER GF1 in North America, and maybe 2 or 3 more.
(Moving response over to the Semi forum - I'll add a link back to Invest forum as well)
I think we've got approximately the same point of view, with different language to articulate it.
Even on "compete". Compete, where the meaning is that Teslas offering appears to be better than DTNA's - completely agree. Compete, where the meaning is that one can sell trucks and the other can't (an admittedly extreme overstatement), no. You've also made that clarification.
Totally agree with the start being trial fleets at large companies, and then working their way down. My own thinking is that these trials will be with as few as 1 truck, but the size of the trial fleets isn't really an issue. The purpose of these initial trials is to establish that these new things "work". They might be cheaper, they might be more expensive - we don't know that yet (where "we" are buyers of commercial trucks). We think they might be the future, and the first thing we need to know is that they "work".
"work", as best I can articulate, is a mixture of:
- They can be used once to haul the load.
- They can be refueled (recharged) in a sufficiently moderate time that they can be used again to haul a load.
- Maintenance can be performed to keep them on the road, hauling loads.
At their core, the difference in the Semi market from the light duty vehicle market (S/X/3/Y/...) is that ~100% of Semi's are income producing assets for their buyers. They have a financial model that makes sense, or they don't. And when that financial model becomes compelling enough, the business case will switch to being skeptical of any diesel truck purchases.
The ideal outcome for evaluators of the trucks will be that there's some modest and scalable infrastructure that needs to be installed, and after that, the trucks can just drop into some existing regular route and they "work". Repetitively. At least as easily as diesels, and hopefully more easily.
Once they "work", and that'll need to be established over some period of time (month, quarter, year, ..), then they'll also acquire information about the cost to operate. My own simplistic estimate of what fleets will discover is that an electric class 8 semi will save them $0.30/mile in fuel costs. If we assume all other costs are the same, then that's $30k/year for a truck driven the industry average of 100k miles/year.
This cost savings is why I see a pretty fast industry switch from diesel to electric. As long as the electric variants are close enough to the diesel variant on price. Previous reading says diesel class 8's can be had for $120k - if an otherwise equivalent electric comes in at $180k, then that means that the first 200k miles pay off the electric premium, and after that is gravy for the buyers of the electric trucks.
The cost savings will be so compelling, it will create strong customer pull.
I see 3 phases to the adoption.
1) trial fleets. Do these "work"?
2) Each buyer will figure out their own financial model, and savings from electrification. And discover they gotta have it now
3) Manufacturers of electric trucks establish "scale". Buyers realize that even if they can't get the truck(s) they want TODAY, they can get them soon enough that they're better off postponing their purchase. Keep the current truck in service with more maintenance, buy used, etc.. Note here - from my reading, some of these trucks are purchased with a 5-8 year sort of timeline, so a 1 or 2 year delay getting the trucks could easily cause new purchases to be postponed for that year or 2. A new purchase of a more expensive to operate truck, that you're locking in for 5-8 or more years, sounds like a recipe for creating a stranded asset.
I think (and am honestly guessing here) that "scale" will be established in the minds of truck buyers at between 10 and 20% market share. To put a fine "I'm really guessing now" point on it, I think it happens at 1/6th. Partly because the math is easy.
The North American Class 8 truck market is around 300k trucks / year. 10-20% is 30-60k trucks per year, with 16% being 50k trucks per year.
My prediction is that however long it takes electric truck manufactures, all combined, to reach that 30-60k level, at that level you'll see the diesel truck market Osbourne. By which I mean - a sharp drop in orders from current levels to something that is too low for all of the truck makers to stay in business - say 10-20% of current levels. There will be a few very hard, very lean years in there where diesel trucks aren't selling, and electrics (and their supply chain haven't ramped enough) to supply all of the demand.
I also think that the new electric truck market will surge past the current 300k level - my guess is to 2x (600k / year), but I also wouldn't be surprised at anything up to 10x current level (1.5 - 3M per year). The higher levels are a mixture of aggressive retirement of trucks in the current fleet, plus the incremental demand that is created when something comes along that makes the prior thing much cheaper to do.
To put some numbers on the installed base - I found a source (previously) saying 16M trucks in North America. If those are replaced on a 10 year schedule, that is 1.6M trucks / year. That's clearly not happening with the diesel trucks, but with lower cost of operation, that might happen with electrics while they are replacing the installed base of diesel trucks.
There will be corner use cases where the class 8 semi is used infrequently over the year. Those trucks won't be changed out in the beginning. They will have to be changed out later in the change over, due to diesel becoming harder and harder to source (we're all happy with how much closer to a solution to climate change we have by this time
)The big limitations in each phase:
1) Buyable trucks, in single digit units. Buyers need to get their hands on trucks, and start using them on real routes to do real work (after some initial testing on fake routes with fake work / loads).
2) Happens fast, and probably in parallel with 1 - buyers do their financial models. Some or many of these will make it into the press.
3) Everybody watches the ramp of trucks with baited breath, buying every truck they can to fill routes / use cases that the truck can solve, pushing diesel trucks out of anything an electric can do.
So far, the primary limitation is the question nobody (I claim) can answer authoritatively at an industry level - electric trucks "work". Every appearance is that they will, but the testing to prove the hypothesis is barely started, much less repeated with high quality results for an industry-wide consensus to emerge that "electric trucks work".
The next limitation, simplistically, is battery supply (cells and packs). 300k trucks / year, at 1/2 MWh per truck, is 150 GWh/year. Tesla, if they took their current output and went all in on Semi can maybe supply 1/3rd of that today. And to do so, they'd shut down Model production completely.
Tesla looks like the best opportunity for that cell supply to be created to me, but there's a LOT of growth needed. I'm ready to hear that the remaining build out of GF1 is underway, and that site selection for the next North American GF is started. We need ANOTHER GF1 in North America, and maybe 2 or 3 more.
@adiggs That's a well reasoned logical post...stop screwing up these interwebs.
edit: heck it is worse because it was even informative...shame shame
edit: heck it is worse because it was even informative...shame shame
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doghousePVD
My grandfather’s car
Good post, adiggs.
I think long term there still be edge cases (10%? 20%?) that diesel will survive for a very long time. Long haul up to the North Slope Alaska. Multi-shift forest fire fighting where time and infrastructure doesn't permit charging. Major snow plowing, no time to stop to recharge. Very low annual mileage vehicles that are not economic for batteries, like fire departments, especially rural and volunteer. FEMA and other emergency services, especially post hurricane or flooding. Road construction and repair on remote sections of the Interstate system and rural roads. Military vehicles.
None of this challenges your thesis, though.
I think long term there still be edge cases (10%? 20%?) that diesel will survive for a very long time. Long haul up to the North Slope Alaska. Multi-shift forest fire fighting where time and infrastructure doesn't permit charging. Major snow plowing, no time to stop to recharge. Very low annual mileage vehicles that are not economic for batteries, like fire departments, especially rural and volunteer. FEMA and other emergency services, especially post hurricane or flooding. Road construction and repair on remote sections of the Interstate system and rural roads. Military vehicles.
None of this challenges your thesis, though.
adiggs
Well-Known Member
I agree that some of these edge cases, and many others, have good reasons to live on using diesel. The tough thing that those edge cases have to deal with is that today, they get to effectively free load (my term - not a great one) on the much larger diesel infrastructure (refining, distribution, gas stations, etc..).
Those edge cases are going to see their supply of diesel dry up as the major consumers electrify. That will change the economics of refining, with the most likely outcome I can see being that the price of diesel will go up. Not pennies - possibly dollars / gallon. At some point in the transition, there might not be diesel available at any price, and those edge cases are going to discover an existential need to electrify. Not because it's the best economic solution in today's terms - because the edge case won't function without electrification because the fuel can't be found to do it. And the edge case can't not be done (like emergency vehicles - common - or road plowing, etc..).
The military can probably make it work - they'll just build and operate their own refinery if they need to
At some point further into the conversion, I see some of these edge cases as needing to go into an emergency / hero project type of mode to get the charging infrastructure and speed (or battery swap), capacity, etc.. to make them functional in an electrified world.
And I expect to see all of this happen in my lifetime (next 1-3 decades) - very exciting times.
(Heck - if I could find a job at a company involved in this transition, I'll probably make the change just because I want to be part of helping make it happen!)
doghousePVD
My grandfather’s car
Diesel is very likely to be available in commercial quantities and prices for our lifetimes. There are so many other used of diesel that will be exceeding difficult to change to batteries/electricity - heavy construction equipment, farm tractors that are running 24 hours a day in harvest season, commercial work boats, freight railroad engines on lines that aren't economical to electrify, irrigation pumps, ships such as tankers and freighters, emergency power, etc. Not that there won't be significant inroads by batteries in some niches, but many applications require the energy density that diesel provides. Batteries are still at least an order of magnitude away.
Jet fuel, of course, is basically diesel. The military uses the same fuel for trucks and jets.
Don't get me wrong - I am not rooting for diesel. It just will be very, very hard to eliminate the last 10%.
Jet fuel, of course, is basically diesel. The military uses the same fuel for trucks and jets.
Don't get me wrong - I am not rooting for diesel. It just will be very, very hard to eliminate the last 10%.
adiggs
Well-Known Member
This is an interesting one. The length of the list for other uses of diesel, outside of commercial trucking, is long. However the volume used by each application is decidedly unbalanced.
Here is 1 source from India, talking about the distribution in India:
70% of Diesel, 99.6 % of Petrol consumed by Transport Sector
This source has the information formatted differently, but has similar info for US:
Use of energy for transportation - U.S. Energy Information Administration (EIA)
For the second source, the second pie is the one to focus on. For the transportation sector, 54% of consumption is gasoline (where gasoline also includes the ethanol we blend into it). It also includes aviation gas, which I believe is primarily used in the small private airplanes. I'd guess that the ethanol plus the avgas are approximately rounding errors within this segment.
The next two big chunks are distillates (mostly diesel) at 23% and jet fuel at 12%.
To your point, I consider your conclusion to be a very realistic and reasonable expectation for how things evolve. Because really, there's a lot of guess work going into what the later evolution will look like.
My point (which could well be wrong) is that the economics of the companies that provide the diesel change dramatically from today's economics, as the easy-to-electrify segments (which also happen to be the 2 biggest consumers of refined crude oil, in the form of gasoline and diesel) electrify.
And it doesn't look today like those economic changes are to the good side for refiners.
I completely agree with the observation that these niches need the energy density that diesel provides - my point is that if the economics of getting diesel out of a barrel of oil changes such that 1/2 or more of the refiners go out of business, and gasoline becomes increasingly hard to find (it doesn't need to be reduced by 1/2 - these are big, capital intensive businesses that need big volumes to function - a 10% drop in demand will be catastrophic to today's business models), then diesel is going to start being increasingly difficult to find.
These applications will still demand diesel, but if refiners and distributors can only supply diesel at $10/gallon (vs today's $3/gal in the US), will those other applications still work economically? And will that be enough $/gal to keep the refiners and distributors in business? And will that kind of a change in the economics drive technology innovation to finding battery, natural gas/methane, or other alternatives to today's diesel based solution?
I don't know what will happen - only that it all looks very exciting and interesting to me.
The economic side of this evolution is something we're talking about in the Shorting Oil, Hedging Tesla thread in the Investors sub-forum (for those that think this sounds like fun, as opposed to those that think this sounds like contemplating the correct angle for watching paint dry
).To your last point - I agree it'll be hard to eliminate the last 10%. My own thinking about what will happen is that the economics will drive such a high price / gallon for suppliers to continue suppling that last 10%, today's dynamic will flip on it's head, and we'll have a flood of technology innovation from companies figuring out how to eliminate diesel from that portion of the consumption. Because the users will be desperate to find alternatives by then.
Tam
Well-Known Member
Tesla Beaten To The Electric Big-Rig Punch
It's good to have competition although its range spec is subpar!
It looks like Daimler internal testings are pretty much done and it's time for customers to test those trucks out!
It's good to have competition although its range spec is subpar!
It looks like Daimler internal testings are pretty much done and it's time for customers to test those trucks out!
The other issue is Daimler is run by adults. For the most part, their vehicles run, reliably.
I'm very fond of my 3P, but its a toy. It does strange, and bizarre things, reboots itself, sometimes turns off, etc. For the most part, everyone seems to have issues with that - and I'm not sure Tesla has the culture needed to build a commercial vehicle.
I also have a few friends who used to drive more complicated loads - large/heavy/hazardous, etc. None of them will drive an automatic truck, as they don't trust them in a steep down grade.
The alternative to engine braking was the first thing they all mentioned, when I discussed Tesla semis - that, and the range.
I'm very fond of my 3P, but its a toy. It does strange, and bizarre things, reboots itself, sometimes turns off, etc. For the most part, everyone seems to have issues with that - and I'm not sure Tesla has the culture needed to build a commercial vehicle.
I also have a few friends who used to drive more complicated loads - large/heavy/hazardous, etc. None of them will drive an automatic truck, as they don't trust them in a steep down grade.
The alternative to engine braking was the first thing they all mentioned, when I discussed Tesla semis - that, and the range.
I would argue that regenerative braking is superior to engine braking by a pretty long shot, so I don't think that one is a valid argument. Range, however, is a plenty valid argument for any hauls that approach the max.
Tam
Well-Known Member
You could be right. They were concerned about what happened going down a long steep grade with a heavy load.
adiggs
Well-Known Member
DTNA has a supply agreement for battery modules (from CATL):
Daimler will buy electric truck battery modules from Chinese supplier CATL - FreightWaves
it appears the plan is to assemble battery packs in Detroit and Mannheim (Germany).
Unfortunately, no word on how much capacity will be available, or is committed, or what it can scale too. These supply agreements, and more generally, declarations of intent around how companies will get the battery packs to produce commercial electric vehicles represent (IMO) the most important evidence of commitment, and scale that can be achieved.
And in commercial transport, I think the right scale about a decade from now is into the TWh. My own quickie estimate is 1 GWh of packs enables building 1,000 class 8 semis. The North American market is 300k / year, so 300 GWh (across the whole industry) enables the replacement of the current class 8 industry (only). I figure 2x that for the class 3-7 markets, and I discussed previously how I think the electric commercial truck market will be bigger than the current diesel commercial truck market.
I haven't sized the European commercial truck market. As a first order approximation, I figure it's as big as North America.
Then there's Asia, Africa, Central/South America, and the various islands hither and yon. There's a lot of commercial transport to electrify.
Daimler will buy electric truck battery modules from Chinese supplier CATL - FreightWaves
it appears the plan is to assemble battery packs in Detroit and Mannheim (Germany).
Unfortunately, no word on how much capacity will be available, or is committed, or what it can scale too. These supply agreements, and more generally, declarations of intent around how companies will get the battery packs to produce commercial electric vehicles represent (IMO) the most important evidence of commitment, and scale that can be achieved.
And in commercial transport, I think the right scale about a decade from now is into the TWh. My own quickie estimate is 1 GWh of packs enables building 1,000 class 8 semis. The North American market is 300k / year, so 300 GWh (across the whole industry) enables the replacement of the current class 8 industry (only). I figure 2x that for the class 3-7 markets, and I discussed previously how I think the electric commercial truck market will be bigger than the current diesel commercial truck market.
I haven't sized the European commercial truck market. As a first order approximation, I figure it's as big as North America.
Then there's Asia, Africa, Central/South America, and the various islands hither and yon. There's a lot of commercial transport to electrify.
