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Tesla's Edge

Discussion in 'Tesla Motors' started by ekwng, Sep 3, 2012.

  1. ekwng

    ekwng Member

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    Hi All,

    I think clean tech and EV would be the future and I'm long on Tesla as well.

    Having said that, I'm not quite sure how Tesla can maintain their edge when big players get in. Now Tesla is the leader in the premium EV niche but soon will face competitions.

    If a BMW i-series is on par with Tesla in terms of performance, range, price, quality etc, will people still choose Tesla?

    Any unique technologies or "patents" that would make Tesla ahead of competition? Unique Battery management? or drive-train maybe?

    Perhaps the big boys are just waiting....


    Thoughts welcome. Thanks for sharing!!!
     
  2. Jason S

    Jason S Model S Sig Perf (P85)

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    They've got a reasonable number of patents on various battery bundling techs. The motors are in-house as well, from what I understand. The traction control is pretty impressive and prolly patented.

    "If a BMW i-series is on par with Tesla in terms of performance, range, price, quality etc, " .... That's a pretty big IF. If BMW comes out with an equivalent car, the likely many will choose BMW over Tesla. If BMW doesn't measure up, as is currently the case for their electric offerings, then people choose Tesla.

    A completely different battery tech could put Tesla in a bind. But it would do that to other manufacturers as well.
     
  3. Mycroft

    Mycroft Life happens

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    Just look under the hood of the Leaf, Focus Electric, etc. and see the mess in there. Compare that mess to what Tesla has come up with on the rear axle of their car.

    The dinosaurs are playing catch-up and they're flopping around. That's why Daimler and Toyota are buying Tesla's tech.
     
  4. jerry33

    jerry33 S85 - VIN:P05130 - 3/2/13

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    That's not how big companies work.

    1. They all have many layers of management so the real story almost never makes it to the top (Snowballs chance...).

    2. They have a vested interest in the status quo and will keep from changing until it's too late.

    3. They all are slaves to the share price (because that's what the CEO's bonus and salary are tied to) and in almost all cases going with something new hurts the share price in the short run. CEOs have golden parachutes so they almost never care about the long-term viability of the company or its employees, only about their current pay.

    The only thing they're waiting for is for Tesla to fail and the whole messy EV thing to go away so they can go back to business as usual.
     
  5. gg_got_a_tesla

    gg_got_a_tesla Model S: VIN P65513, Model 3 Res Holder

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    Even if BMW does match Tesla - the most likely big fish to possibly do that - I'd continue to support Tesla for a couple of reasons:

    1) Tesla's a true American startup that's challenged the status quo.

    2) The Tesla store/no-dealer/fixed-price selling model.
     
  6. brianman

    brianman Burrito Founder

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    This characterization is where some in the press miss the market, and thus their conclusions are suspect.

    With the Roadster, Tesla aimed for the sports car market.
    With the Model S, Tesla is aiming for the premium car market.
    With the Model X, Tesla is aiming for the SUV/crossover market.
    With Bluestar, Tesla is aiming for the economy car market.

    None of these markets is niche.

    EV is "just" the propulsion technology within the vehicle that opens up new possibilities.
     
  7. 78Lion

    78Lion Member

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    I would think Audi/WV would be a more likely choice.
     
  8. SCW-Greg

    SCW-Greg Active Member

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    It's all about the ability to be nimble, creative/innovative, and low overhead. These are all things found in a startup... and what Steve Jobs cultivated in Apple's key projects.

    Compare the iPhone to anything Microsoft has put out. How long has that taken? Compare the iPad to any other competitive company attempts.

    GM or Chrysler - seriously?
    Ford - maybe.
    BMW - possible but likely over-engineered (please kill the iDrive)
    VW - possible.
    Mercedes - only with the help from Tesla.

    Toyota, Hyundai/Kia, Honda - these are the three I'd be worried about.

    The Model S (and Tesla), has for the foreseeable future though, no company that can truly innovate (without ripping off), and keep up intellectually and be as flexible as Tesla... not sustainably, not yet. I believe it will be a solid two to three years before we see true competition (from Asia).
     
  9. jerry33

    jerry33 S85 - VIN:P05130 - 3/2/13

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    In the past Toyota has done everything they could to kill the electric car. There is only one now because of legislation in California. My belief is that they will spend a lot of money trying to get the law repealed. Honda just follows Toyota's lead so I don't think they're a concern either. Toyota only developed the Prius because in the early 1990s they were in a bad situation: Sales in Japan had fallen so low that a 40% market share looked like an impossible goal (traditionally their share was 80%). They had to do something so they put their top engineers in a room to get some new technology going. They never expected an actual car to come out of it. However, now that they are back on track again, the old inflexible management structure has taken over again, so don't expect any innovation or forward thinking.

    Hyundai/Kia, well maybe, they'll do whatever becomes popular. I've never even considered one of them because I recall the horrors of the past and because other Korean products (non-automotive) I've purchased have had horrible warranty service.
     
  10. Doug_G

    Doug_G Lead Moderator

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    I doubt Honda will do anything. They've been doing the fuel cell boondoggle.
     
  11. JRod0802

    JRod0802 Member

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    So when Tesla becomes a big company, is that how you think they'll be?
     
  12. jerry33

    jerry33 S85 - VIN:P05130 - 3/2/13

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    Once Elon leaves and the bean-counters take over, unfortunately, yes.
     
  13. vfx

    vfx Well-Known Member

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    I would not call $39,999.99 base model car "economy".
     
  14. brianman

    brianman Burrito Founder

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    @vfx - Where'd you get that figure from? And what market would you call it?
     
  15. vfx

    vfx Well-Known Member

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    Elon has said the genlll will be in the $30K range.

    Just like he said the Model S would be $50K.


    A Fiat 500, Smart, Fiesta, Scion are economy.
     
  16. Robert.Boston

    Robert.Boston Model S VIN P01536

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    Tesla has made it very clear that it's not aiming -- ever -- to compete with Kia. The Model S, Model X, and Gen III are all aimed at the higher end market: compare to BMW 5/6/7, X5, and 3 series. Econoboxes are not on Tesla's strategy roadmap.
     
  17. neroden

    neroden Happy Model S Owner

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    A combination of "right choices"

    This is a good summary. Tesla designed an electric car from the ground up using people who understood electric technology.

    Going from the Roadster to Model S, humorously, several of the changes are actually reversions to "traditional car" tech for areas where the "all-modern all-electric" tech in the Roadster was not getting sufficient reliability (for instance, the standard automotive 'buffer' battery for the auxiliary equipment which was added to model S).

    For some reason, all the old-line car makers (except Nissan) have been trying to *convert* a gasoline car design to an electric car design, and the results are predictably poor. I think it has to do with what they have expertise in. They don't know electric motors, so they don't think like electric motor designers. They think like gasoline engine designers.

    Nissan is actually approaching design roughly the right way, but
    (1) Nissan is at least 3 years behind Tesla (Roadster 2008, Leaf 2011 -- and the Leaf was missing stuff which was already in the Roadster, such as battery temperature management)
    (2) Nissan made the mistake of targeting the bottom of the market for its experimental car, rather than the top. While this may work for a large carmaker, it will not generate the cachet or reputation which drives future sales, and it will not generate the profit margins necessary to cover development, so Nissan will need to continue supporting its electric car research from other income. Tesla looked at the business models of successful new car companies in the late 19th/ early 20th century, and copied the ones which worked; they *all* started at the top of the market and worked down. Even Ford.

    So far, nearly every electric carmaker has either made the mistake of trying to convert a gas car (or the worse mistake of making 'hybrids') or made the mistake of starting at the bottom of the market. There are a few exceptions, but Aptera hit management problems, and effectively got taken over from its inspired engineers by non-engineer businessmen who wrecked the company (which is unfortunately typical of startups, as I know to my chagrin). There are some designs with sprung wheel motors (like trains have) which have huge potential, but they haven't found financing yet. Elon Musk was an engineer first and then a competent businessman, so, avoided the startup problems.

    - - - Updated - - -

    Absolutely. But it's a process of "institutional decay". It'll take a while. Ford wasn't like this when Henry Ford was running it -- Ford was nimble and innovative and willing to kill his old products with new products. Ford only *became* like this over the decades.

    I think it's a problem with any institution which has lasted for a long time -- it ossifies. I would say it's happened with the US Government -- every "new" democracy uses party-proportional representation and a Westminster-style "prime minister" system, because our system has some serious flaws; when US experts advised Germany and Japan on their new Constitutions after WWII, the US experts told them to do these things and not to copy the US system; but we won't consider changing our system because of inertia, status quo bias, etc.


    Toyota also started out as a nimble upstart and is now an ossified institution. It will inevitably happen with Tesla too. However, we could easily have several decades before it happens with Tesla. That's good enough for me.

    - - - Updated - - -

    I don't think that's strictly true.

    It's important to remember that Tesla's priority is not actually profit. Elon Musk has said outright that his goal is for electric cars to replace gasoline/diesel cars. He was asked what he would do if electric cars took over, but some other company outcompeted Tesla and became the big seller of electric cars.

    He basically said he didn't care; he'd have achieved his goal.

    Going somewhat far afield philosophically, this gets into what I think is wrong with the modern corporation; they're soulless operations focused on profit, or empire-building, or power, or something. Corporations were supposed to be chartered with a *purpose*, back when they were first established (build a toll bridge; provide electricity; etc.) Tesla has a purpose. This is another thing which makes it different from the big companies, which have long since ceased to have purposes.

    So to get back to the original comment which I was responding to, if someone else produces an electric econobox and sells lots of them successfully, Elon will be perfectly happy. He won't feel a need to compete with that manufacturer.

    If nobody produces one, though... then he will go ahead and produce one, because it is likely to be necessary for his goal of replacing gasoline cars entirely. (Unless the econobox market is replaced by walking/biking/public transportation, in which case it won't be necessary.)

    Likewise, if nobody else manages to make electric trucks successful, eventually Elon will feel that he has to do it, but if someone else (like Smith) makes it work, then Elon won't bother.
     
  18. brianman

    brianman Burrito Founder

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    Wouldn't that mean $29,999 then?
     
  19. mulder1231

    mulder1231 Active Member

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    #19 mulder1231, Sep 3, 2012
    Last edited by a moderator: Mar 13, 2016
    I wouldn't underestimate Kia. I drive a Kia Optima SX, wouldn't call it an econobox. At a price of $35K, you get 0-60 under 6 sec, a fully loaded car: heated and cooled leather seats, seat memory, backup camera, nav, SiriusXM, HD radio, pano roof, HID headlights, smart key fob, push button start, auto folding mirrors, cooler glovebox, etc.

    I looked at Mercedes E-Class and Audi A6 before deciding on the Kia Optima, which by the way was designed by Peter Schreyer, former chief designer for Audi. They may not have the brand name but know how to make quality cars with all the convenience features for a lot cheaper.

    Here's what they are planning on the EV front:

    Kia Naimo Electric Vehicle


    Kia Ray Electric Vehicle


    I'm not saying these cars will compete with Tesla, but they have the ability to do nice things styling wise once they have the tech.
     
  20. Robert.Boston

    Robert.Boston Model S VIN P01536

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    I wasn't just making up the competitor list in my earlier post; take a look at p5 of the April 23, 2011, Company Overview, which clearly identifies the target competitors:

    Model S/X: BMW, MB, Lexus, Audi, Cadillac, Fisker

    Gen III: BMW, MB, VW, Audi, Mercury (!?!)

    Tesla put all the other companies is tiers below its target market: Toyota, Nissan, Ford, Hyundai, Honda, Chevrolet, BYD, Suzuki, Mini, Smart, and Mitsubishi. Kia didn't even merit a mention (although I agree it should).
     

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