Sunday, January 30, 2011

Why I Bought TSLA

I've been watching Tesla Motors for a few years, back when the Roadster was only a prototype. I've chatted online with Martin Eberhard and a few other early employees, and I watched with some dismay when many of them were forced out of the company. I've watched as they took less than ideal available components, improved them, and made them into the fastest production electric vehicle ever built. I've watched the company repeatedly do what detractors said couldn't be done. I've watched as major automakers stood up and took notice of what this little company had achieved. I stayed away from the IPO, stayed away when the price came back down after the euphoria, stayed away when it ran back up, and stayed away after it dropped back down after the 6 month lockup ended. I was hoping for a larger pullback but it never materialized. After all this time I can no longer ignore the potential of this company and what I think they are capable of, so I'm in. To me their biggest weakness has been their use of commodity cells to build a pack, yet by using them they've built the least expensive and most energy dense automotive pack on the market, and they will soon be using even better cells. Since the weakest part of their technology has proven successful and it's likely to get even better it's hard not to have a positive outlook on the company. The employees are skilled, passionate, and driven, as is Elon Musk. While I did not like his handling of the restructuring of the company and some of his design decisions I can't say that he was necessarily wrong. He obviously has what it takes to make innovative companies successful and I think betting against him is a mistake. The Model S sedan design is progressing well and looks to be as ground breaking in the performance sedan market as the Roadster was in the sports car market. Recent agreements with Panasonic should give them good pricing on improved cells. Partnering with Toxco and Umicore will provide a comprehensive recycling program for their battery packs when needed.
They continue to advance motor and controller design, battery technology, and vehicle design and construction. While some concern has been raised about rare earth magnets their motor doesn't use them. At 70lbs, 250hp, and 300 ft/lbs of torque they have the best power to weight ratio of any production EV motor. Their methods and results are actually influencing established automakers such as Toyota, who has partnered with Tesla for their RAV4EV program.
Tesla doesn't want to just build EV's, they want to build desirable vehicles that also happen to be EV's. Unlike most companies who try to keep costs as low as possible and target the general buying public Tesla has chosen to build vehicles without compromises that take full advantage of the benefits of their electric drive trains. A common complaint against Tesla is the average person can't afford their vehicles, which is true, for now. However, does BMW, Porsche, or Ferrari get hit with similar criticisms? Sure we all wish we could afford such vehicles but we don't argue that they should lower their quality or performance to achieve lower costs. Tesla creates products that compete directly with high end vehicles while also offering oil free transportation. They think, and I agree, that there is a strong and growing market for such products. The larger volume of the Model S production building on their experiences with the Roadster production will help them lower costs and move them towards profitability.
EV's are coming.  Tesla has led the way with the first real production EV in the 21st century, and I don't see them losing that lead any time soon. They won't lead in volume but they will lead in technology that other auto manufacturers want and in producing vehicles that people want. Going forward I don't see anything stopping them.

Monday, January 24, 2011

The Grid

Update:  The EIA shows only 45% of the grid is coal powered as of 2009, so the numbers are even better for EV's, with 55% of the grid not coal powered.
Grid percentages

I thought it might be useful to take a deeper look into the grid since that's where most of us will get our "fuel" for our EV's.  Detractors commonly say the grid is mostly coal, which is misleading at best.  Current stats have the US grid around 48% 45% coal, so while coal is the single largest generating fuel most of the grid, about  55%, is not coal at all.  Additionally if you look at population distribution and areas more likely to be early adopters of EV's, the West coast, East Coast, and most southern border states, all have much lower percentages of coal power than the US average.  Here's a helpful interactive map of the US grid and fuel sources: Grid Map
If you click on "Sources of Power" and then use the drop down menu to the left that shows "Major Power Sources" and choose "Coal" you get a nice visual representation of what I'm talking about.  These numbers have been improving in recent years and should continue to do so in the future.  With or without EV's the grid needs to get cleaner, and with new wind, solar, NG, and possibly nuclear there is no reason for it not to.  The mistake detractors often make is they use the state of the grid in years past but project the power consumption of EV's in the future to paint an inaccurate emissions profile for electric vehicles.  The final nail in their hypocritical coffin is that these same people usually don't think emissions are even important to begin with.  If they truly believe that then power plant emissions have no place in the EV argument and they should welcome the fact that all energy for EV's is produced domestically, not imported from other countries.  The benefits of not sending billions of dollars over seas every year should be obvious.

Tuesday, January 11, 2011

Another Milestone, EV Bike Kicks Gas.

Chip Yates on his new electric superbike takes 2nd and 3rd in two races against a field of ICE powered bikes.

Tuesday, January 4, 2011

Changing times

I thought these two images illustrated an important contrast.  The first is a fleet of perfectly functional EV1 electric vehicles being carted off under armed guard to be crushed, the second is a recent delivery of the new Nissan LEAF electric vehicle.

Hopefully the first image will not be repeated in the future.

Credit to VFX for the concept: