Elon Musk, the 21st Century Industrialist

[hyten1]

i was just rambling

 

i think everything that gm does gets filter through a glass is half empty glass

 

while varies other companies gets filter through a glass is half full glass

 

that is just how things work, since we  are only human

 

 

volt is a pretty revolutionary car (its branded as a dog vs what the competition has to offer)

http://green.autoblog.com/2012/09/25/say-what-you-want-chevy-volt-outselling-half-the-cars-in-u-s/

http://green.autoblog.com/2012/10/02/september-chevy-volt-sales-up-to-2-851-nissan-leaf-climbs-to-98/

 

while model S (so far good reviews) is somehow coin as this revolutionary car that where ever hicup so far is being brushed aside

 

I always find it funny critic of the volt always talk about 1) over prices (true depending on how you look at it) 2) you need to charge the vehicle (strange volt is one of the first car that solve that problem comparing to pure EVs) too hard for people to do 3) limited battery range.

 

These criticism all apply to  other EV's, but somehow the Volt is the failure, very strange.

 

 

hy

 

[ERICOPOLY]

The reason why I want to buy a Model S is that it's basically getting the same acceleration performance as an M5 -- I'm talking about the "performance" version of the Model S.

 

The performance version gets 0-60 in 4.4 seconds.  But it doesn't have the lag when you punch it -- it immediately starts pulling.

 

And they're in the same price point too.

 

The Volt is not competing with a Model S.

 

About 10 years ago I purchased an Audi S4.  It was fun, but I was very irritated that when I punched it there was always a lag before it would respond.

 

[hyten1]

eric i hear ya, i would love to get one of these EVs myself (but i live in the city a plugin is not as useful for now)

 

but i tend to wait for version 2.0 if you know what i mean

 

that is one of the benefits of electric motors, the torque/acceleration

 

hy

[hyten1]

eric you might want to take a look at this

 

http://www.gm.com/vehicles/future_vehicles.html#/2014_Cadillac_ELR

 

its the cadillac version of the volt,  just another option, which isn't out yet. but its not exactly the same class as the model s (its a 2+2)

 

hy

 

The reason why I want to buy a Model S is that it's basically getting the same acceleration performance as an M5 -- I'm talking about the "performance" version of the Model S.

 

The performance version gets 0-60 in 4.4 seconds.  But it doesn't have the lag when you punch it -- it immediately starts pulling.

 

And they're in the same price point too.

 

The Volt is not competing with a Model S.

 

About 10 years ago I purchased an Audi S4.  It was fun, but I was very irritated that when I punched it there was always a lag before it would respond.

[ERICOPOLY]

eric you might want to take a look at this

 

http://www.gm.com/vehicles/future_vehicles.html#/2014_Cadillac_ELR

 

its the cadillac version of the volt,  just another option, which isn't out yet. but its not exactly the same class as the model s (its a 2+2)

 

hy

 

The reason why I want to buy a Model S is that it's basically getting the same acceleration performance as an M5 -- I'm talking about the "performance" version of the Model S.

 

The performance version gets 0-60 in 4.4 seconds.  But it doesn't have the lag when you punch it -- it immediately starts pulling.

 

And they're in the same price point too.

 

The Volt is not competing with a Model S.

 

About 10 years ago I purchased an Audi S4.  It was fun, but I was very irritated that when I punched it there was always a lag before it would respond.

 

One thing I learned about the Roadtrek -- it's kind of a pain to plug it in and unplug it again whenever I park it at home.

 

The Volt (and Cadillac) have small range on the battery charge before it moves on to burning gasoline.  This means you probably have to plug it in every night.

 

I guess I'm lazy.  The 300 mile range of the Tesla is very appealing in that we would probably only charge it once a week.

 

[Liberty]

Plug-in hybrids like the Volt are a transitory thing until batteries are a bit better/cheaper and until there are more/better fast charging stations around. That transition might take a while, but eventually there'll be no reason for them except in some niche uses. They do the job, but they aren't the destination.

 

The problem with the plug-in hybrid concept is that you are lugging around a gas engine and all the mechanical parts that come with it, so it cuts down on your battery range. Going 100% battery is much more elegant, even if right now it is still kind of expensive (but Tesla's third platform should be around $30-40k, which isn't much more than the average vehicle if you count the saved fuel over time).

[ERICOPOLY]

I think what sets the Model S up for success is that it is a really fun car to drive that people will have a blast owning.

 

The Volt/Leaf/etc... just aren't sexy.

 

 

[west]

My parents were neighbors with a designer at Tesla and apparently the designer thought Musk ran the company in haphazard fashion - frustratingly so. I have the impression that he is a great visionary, but a poor CEO - at least when it comes to building a car company from scratch, which must be one of the harder things to do successfully.

 

bathtime,

 

I've got the exact same thoughts.  I've had a longer discussion with one of the engineers at Tesla, and he was just amazed at both Musk's lack of understanding of some of the basic mechanical engineering aspects of building a car, and his complete disregard for engineering reality when things didn't work the way he imagined they would.

 

I guess you could say he's one of those people where when the q-tip stops going in, he keeps pushing!

 

Probably not a terrible trait for a "visionary" and someone who has access to a very large supply of cash I suppose.

[bathtime]

Thanks, west. Interesting to hear another perspective.

 

It's almost as if you're describing some passages from the Steve Jobs bio. I've made it halfway through and he was more of a nightmare to work with than I thought - at least in the early years.

 

Maybe Musk has a faster learning curve (and fewer demons), I'm actually really impressed by the Model S after reading the NYT review. If I had the money, I might buy one myself.

 

http://www.nytimes.com/2012/09/30/automobiles/autoreviews/one-big-step-for-tesla-one-giant-leap-for-evs.html

 

 

[ItsAValueTrap]

This reuters article throws some numbers around:

http://www.reuters.com/article/2012/09/10/us-generalmotors-autos-volt-idUSBRE88904J20120910

 

It looks like volume is really low and manufacturing costs are really high for the other cheaper electric cars out there.

 

The independent cost estimates obtained by Reuters factor in GM's initial investment in development of the Volt and its key components, as well as new tooling for battery, stamping, assembly and supplier plants — a price tag that totals "a little over" $1 billion, Parks said. Independent estimates put it at $1.2 billion, a figure that does not include sales, marketing and related corporate costs.

 

Spread out over the 21,500 Volts that GM has sold since the car's introduction in December 2010, the development and tooling costs average just under $56,000 per car. That figure will, of course, come down as more Volts are sold.

 

The actual cost to build the Volt is estimated to be an additional $20,000 to $32,000 per vehicle, according to Munro and the other industry consultants.

 

The production cost estimates are considerably higher than those for the Chevrolet Cruze, the Volt's conventional gasoline-engine sister car, which Munro estimates at $12,000 to $15,000 per vehicle.

 

...

 

Other such vehicles haven't done nearly as well. Nissan's pure-electric Leaf, which debuted at the same time as the Volt and retails for $36,050, has sold just 4,228 this year, while the Honda Insight, which has the lowest starting price of any hybrid in the U.S. at $19,290, has sales this year of only 4,801. The Mitsubishi i, an even smaller electric car priced from $29,975, is in even worse shape, with only 403 sales.

 

*This is not a high conviction trade for me and I don't consider cars to be in my circle of competence.  The short interest on Tesla is absolutely, absolutely ridiculous (which makes it not a great short).

[twacowfca]

Thanks, west. Interesting to hear another perspective.

 

It's almost as if you're describing some passages from the Steve Jobs bio. I've made it halfway through and he was more of a nightmare to work with than I thought - at least in the early years.

 

Maybe Musk has a faster learning curve (and fewer demons), I'm actually really impressed by the Model S after reading the NYT review. If I had the money, I might buy one myself.

 

http://www.nytimes.com/2012/09/30/automobiles/autoreviews/one-big-step-for-tesla-one-giant-leap-for-evs.html

 

 

Warren gave an interesting talk in1999.  One of the things he pointed out was that there were over 3000 US manufactures of automobiles in the early 20th century.  They had all gone bankrupt or been adsorbed by the three survivors by 1999.  (Anybody remember the DeLorean, the Tesla of its day?). 

 

High tech pure battery powered cars require a lot of high tech people to design and build them and service them.  These people often drive two or more regular cars.  They hop on airplanes frequently and sometimes fly on private jets.  They work in air conditioned offices.  The high tech batteries require exotic materials that have to be scraped or blasted out of far away places that require cutting down a lot of trees to bulldoze roads to collect the ore and transport it to a refinery that belches smoke that warms the planet. 

 

Oh, by the way, where does the electricity come from that is used to charge the vehicle? 

 

It may be possible to build a pure battery powered car that has sufficient range to cover commuter distances.  But there is another limitation: battery life.  I luv my Prius.  It's interesting why Toyota didn't design the Prius in the first 10 years of its existence to be capable of being recharged.  It seems that that would have put more stress on the batteries and cut the life in half.

 

High tech batteries aren't cheap when they have to be replaced.

[hyten1]

folk i think everyone is aware that volt like setup is a transitory setup (even GM), but its underlying technology can be use for future pure EV cars.

 

as for the cost of the volt, that is another example of everything gm does is filter through a glass half full , its a new technology there are a lot of RD cost. I don't see many critics write similar articles (maybe there are I haven't seen it) about Toyota's or Nissan's effort on their spend on their respective EV related technology and spread that out to the vehicle sales (leaf sales is lower than volts and nissan spend more on leaf related tech base on some article).

 

people forget GM was the first one that came out with the concept of drive by wire (were that driving part of the car is just a skateboard like thing http://en.wikipedia.org/wiki/General_Motors_Hy-wire) back in 2002.

 

i guess all this doesn't matter at the end of the day, its sales and profit.

 

 

Base on my anecdotal evidence Volt owners are very happy and having <b>fun</b> with there volt. But i understand about sexy.

 

Its similar to the new ear phone from Apple, I am sure people have seen the new ear phone commercial from apple "Wow ear phone that is shape more for the ear, instead of being round" wow. This has been around for quite a while from Bose etc.

 

 

hy

[ERICOPOLY]

Base on my anecdotal evidence Volt owners are very happy and having <b>fun</b> with there volt. But i understand about sexy.

 

VW Bug owners have fun.

 

I meant fun in terms of top of the line sports sedan fun -- M5 level fun.

[rkbabang]

Base on my anecdotal evidence Volt owners are very happy and having <b>fun</b> with there volt. But i understand about sexy.

 

VW Bug owners have fun.

 

I meant fun in terms of top of the line sports sedan fun -- M5 level fun.

 

My commuting car is a $15K Hyundai Elantra with a 5 speed manual transmission.  While I'll admit that I've never driven a Volt. I have a suspicion that my Hyundai is more fun to drive (and at much less than half the price).  The Model-S is in another class entirely.

 

EDIT:  At least by the first website that came up in a google search my statement above appears to be true:

 

from: http://www.zeroto60times.com/Hyundai-0-60-mph-Times.html

 

"2007 Hyundai Elantra SE  0-60 mph 7.8  Quarter Mile 16.1"  (my car is a 2007)

 

from: http://www.zeroto60times.com/Chevrolet-Chevy-0-60-mph-Times.html

 

"2011 Chevrolet Volt    0-60 mph 8.9    Quarter Mile 16.7"

 

The Volt doesn't seem to be a performance car to me.  At quite a bit more than double (almost 3x) the cost of the Hyundai, you'd have to save quite a bit of money on gas to justify that difference in price for a less fun car.  The 2012 Elantra's are rated at 40mpg, mine was rated on 36, but gets 32-34 in real use.

 

[hyten1]

i am not comparing model S to volt, its like comparing toyota camry to lexus, no one said volt is a performance car.

 

volt after rebates is 31k

 

the cheapest model s after rebate is 50k

 

everyone has their preference, camry or lexus take your pick. you want to talk about cost efficient, i am probably by a used car (lets say honda civic) at $5k and get excellent mileage at the lowest cost.

 

at the end of day:

 

everything from GM gets filter through a glass half full glass, good or bad. hopefully not forever, since i have a good position in GM :)

 

 

 

 

[hyten1]

eric i understand model S is intrigue ( i understand)

 

however, just a personal taste issue, i think the center console from model s is not very attractive (a giant flat screen), not saying flat screen is not good there are benefits, but this implementation seem a big awkward to me, that is  just me

 

http://media.caranddriver.com/images/media/51/2013-tesla-model-s-inline-01-photo-468581-s-original.jpg

 

 

Base on my anecdotal evidence Volt owners are very happy and having <b>fun</b> with there volt. But i understand about sexy.

 

VW Bug owners have fun.

 

I meant fun in terms of top of the line sports sedan fun -- M5 level fun.

[rkbabang]

eric i understand model S is intrigue ( i understand)

 

however, just a personal taste issue, i think the center console from model s is not very attractive (a giant flat screen), not saying flat screen is not good there are benefits, but this implementation seem a big awkward to me, that is  just me

 

http://media.caranddriver.com/images/media/51/2013-tesla-model-s-inline-01-photo-468581-s-original.jpg

 

 

My point was that the Volt shouldn't even come up in the same conversation as the Model-S.  There is no overlap in the market.  There isn't anyone who is seriously considering a Model-S who says, "No I'd rather have a Chevy Volt instead".  My point was that a $15K Elantra is what people might consider in the same conversation as the Volt, and might wisely choose to buy it instead, not the Model-S.

Someone who considers the Model-S and chooses something else instead will most-likely choose a gas-guzzling luxury sedan in a similar price range, maybe a hybrid Lexus if they want to play on the "look at me, I drive a hybrid" environmentally conscious thing.  But a hybrid Lexus is still quite a gas-guzzler compared with a Volt or even my Hyundai.  The Model-S is in a category all by itself right now.

[hyten1]

rkbabang

 

i hear ya, i think volt/gm was brought up (by me i am afraid) due to the fact their makers are both car companies. 2 company with very different perception in the public as well as valuation (among many other differences).

 

model s an EV (not without its faults) targeting the luxury market (which i believe is a wise move) vs volt that is very different

 

you'll be surprise what cars are being compare to when people buy a volt (considering its 32k price tag).

 

i do think GM made one little mistake (among many others), maybe they should of use their EV technology and release a luxury cadillac version first instead of a chevy. then again are many arguments for doing that as well.

 

hy

[VAL9000]

A few points:

 

- I disagree that the environmental costs of an electric vehicle exceed those of a gasoline vehicle.  The arguments I've seen so far are pure FUD on the EV side and don't account for the equivalent costs on the gasoline side.  e.g. people who design gas engines also use air conditioning, and there is a significant environmental cost associated with extracting oil from the earth (BP was just 18 months ago don't forget).  If you are going to use those arguments, you have to give fair play to both sides.

 

- Really the only reason why we're talking about electric cars AT ALL today is because of Tesla and they deserve full credit for that.  They are doing very interesting things around what a car company ought to be.  Huge flat panel display, trunk in the front and the rear, mobile servicing/telemetrics, free charging stations, new retailing concept.  Some of this stuff is necessity, some is only possible in an electric vehicle,  but it's certainly all valuable in the context of capitalism.  Somebody's out there trying new things and that's going to benefit the world.

 

- Tesla's strategy is very cool.  For people who have studied how start-ups work, Tesla understands the concept of bootstrapping.  Car manufacturing and bootstrapping typically do not go together very well due to the capital needed to reach scale, but they are giving it a go and I respect that.  The approach they're taking (multipurpose robotics vs. assembly line) is much more suited to the < 100k vehicles market that they are creating.

 

Whether it works as an investment...  Who cares?  Nobody's going to bet their savings on this, but what you can bet on is that the world will improve in a measurable way because of this.  Maybe you'll lose or double a small position, but I doubt it will move the needle for anybody other than Elon, the original VC's, and anyone insane enough to make a huge bet on such a risky venture.

 

Finally, say what you will about Elon Musk, but this guy has drive, vision, and balls.  He's probably out of his depth when it comes to solar technology, auto manufacturing processes, and aerospace engineering.  But he's the chairman of companies that specialize in all three.  Between them, these ventures are responsible for thousands of solar panel system installations, reinvigorating the EV market with two brand new models built from scratch, and have launched rockets to the International Space Station for NASA.  In fact, one of his life's goals is to die on Mars.  Regardless of the success of SolarCity, Tesla, or SpaceX, the world really needs to appreciate these unique individuals for their audacious thinking and their ability to impact how the world works.  Alright that's enough out of me...</ManCrush>

 

 

 

[rkbabang]

rkbabang

 

you'll be surprise what cars are being compare to when people buy a volt (considering its 32k price tag).

 

hy

 

I'm sure I would.  But if you look at it rationally. Comparing size, comfort, performance, and total cost of ownership.  The Volt will lose to cars that are anywhere from $10K to $17K cheaper.  How could you buy a Volt over a Corrolla or an Elantra, or even a Chevy Cruze?  I can't think of a single metric where the Volt wins, other than the "look at me I drive an electric vehicle" factor.  I don't think that is a good long term strategy.  I think you are correct they should have gone after the high end market where people can afford the premium and introduce a Chevy when the costs had come down to compete with similar gas vehicles on something other than environmental-bragging rights.  I don't think many middle-class people can't afford to pay double for a vehicle just to wear their environmentalism on their sleeves. A 10-15% premium, maybe, but not double.

 

I think Tesla is positioning itself correctly.  Targeting the performance/luxury sedan market with a premium vehicle, that is desirable in its own right, at a premium price.  I know starting a new car company isn't the easiest thing in the world to do, but with a little luck they could just pull this off.  I'm not investing (too risky), but wouldn't short it right now either.  If I invested at all in Tesla it would be with some long term calls. A small enough amount where I wouldn't care if they ended up worthless.  That just might payoff much better than expected.  Where shorting it, might just cost you a lot more than expected.

[hyten1]

rkbabang,

 

i think you are being a little to rational

 

volt was the latest great toy/car, its a electric car that you can plug in, people looking at a  economy 15k car will not look at a volt.

 

also remember chevy has corvette which can cost over 100k.

 

i am not part of GM insider so i don't know for sure, but i highly doubt GM's strategy long term is to sell a high prices EV that has a chevy badge on it. also don't forget the nissan leaf (which is not cheap either and its purely electric)

 

This is 1st or 2nd ining for electric cars.

 

Over time cost will come down etc.

 

also GM (its been in the works) to release in 2014 Cadillac model base on the volt technology.

 

i am not shorting tsla nor do i own it (i might sell a very small amount of way out of the money puts)

 

hy

[hyten1]

rkbabang

 

GM must have a very bad perception in the market, you are using 15k car to compare to Volt!?

 

even toyota prius cost 23k to 28k

 

volt cost 32k after rebate

http://www.edmunds.com/chevrolet/volt/2012/consumer-reviews.html

http://www.thestreet.com/story/11723219/1/all-electric-cars-are-not-the-same-volt-vs-leaf.html

http://www.csmonitor.com/Business/In-Gear/2012/0727/Chevy-Volt-wins-drivers-hearts-gets-top-marks-in-satisfaction

 

hy

 

rkbabang

 

you'll be surprise what cars are being compare to when people buy a volt (considering its 32k price tag).

 

hy

 

I'm sure I would.  But if you look at it rationally. Comparing size, comfort, performance, and total cost of ownership.  The Volt will lose to cars that are anywhere from $10K to $17K cheaper.  How could you buy a Volt over a Corrolla or an Elantra, or even a Chevy Cruze?  I can't think of a single metric where the Volt wins, other than the "look at me I drive an electric vehicle" factor.  I don't think that is a good long term strategy.  I think you are correct they should have gone after the high end market where people can afford the premium and introduce a Chevy when the costs had come down to compete with similar gas vehicles on something other than environmental-bragging rights.  I don't think many middle-class people can't afford to pay double for a vehicle just to wear their environmentalism on their sleeves. A 10-15% premium, maybe, but not double.

 

I think Tesla is positioning itself correctly.  Targeting the performance/luxury sedan market with a premium vehicle, that is desirable in its own right, at a premium price.  I know starting a new car company isn't the easiest thing in the world to do, but with a little luck they could just pull this off.  I'm not investing (too risky), but wouldn't short it right now either.  If I invested at all in Tesla it would be with some long term calls. A small enough amount where I wouldn't care if they ended up worthless.  That just might payoff much better than expected.  Where shorting it, might just cost you a lot more than expected.

[VAL9000]

I'm sure I would.  But if you look at it rationally. Comparing size, comfort, performance, and total cost of ownership.  The Volt will lose to cars that are anywhere from $10K to $17K cheaper.  How could you buy a Volt over a Corrolla or an Elantra, or even a Chevy Cruze?  I can't think of a single metric where the Volt wins, other than the "look at me I drive an electric vehicle" factor.  I don't think that is a good long term strategy.  I think you are correct they should have gone after the high end market where people can afford the premium and introduce a Chevy when the costs had come down to compete with similar gas vehicles on something other than environmental-bragging rights.  I don't think many middle-class people can't afford to pay double for a vehicle just to wear their environmentalism on their sleeves. A 10-15% premium, maybe, but not double.

 

I think you're right - the Volt and the Elantra are nearly direct competitors in terms of what each vehicle offers in terms of utility/comfort/etc.

 

Where I think you're wrong is with the value of the environmental benefit.  It's a very difficult benefit to measure, but I would imagine that the market looks something like: .01% of people would pay a $10,000 premium for an EV because they know that it helps the environment.  Maybe 1% would pay $5,000.  and maybe 10% would pay $1,000.  Some kind of distribution like that exists in the market.  If you take this approach to what the market is willing to pay, the Volt has a place.  And over time we'll see if it's .01%, .001%, or 1% who are willing to part with that money for that benefit.  There are way more factors (e.g. the Volt is ugly compared to the Elantra), but given enough competition we'll learn what the majority thinks the environment is worth to them.

 

My next vehicle (1-2 years) will almost certainly be electric or plug-in hybrid, so I guess that puts me in the $15k category.  I am not a huge environmentalist, but I support the vision and this is the only way I can do it.  Being an armchair critic isn't enough.  I feel like.. as someone who is lucky enough to live in a developed country with all of these great advantages, I am morally obligated to part with some of my earnings to help out in a small way.  Plus, even dorky electric vehicles are cool.  Gas is soooo 1999.

 

[rkbabang]

rkbabang

 

GM must have a very bad perception in the market, you are using 15k car to compare to Volt!?

 

even toyota prius cost 23k to 28k

 

 

Not GM, so much as the Volt.  Compare the two vehicles in any metric you wish, looks, size, comfort, features, luxury, performance, or total cost of ownership. The $15K car comes up as better or just as good in each one.  As far as the Prius goes, I don't really understand why anyone would choose to buy one of those either, but $23K is much more reasonable a starting price. It at least puts it in spitting distance of similarly featured/equipped cars.

[hyten1]

rkbabang,

 

i don't see how you compare volt to a 15k car, volt is not a traditional car. (its like comparing when first cell phone came out, its so big and heavy look at my traditional phone its better, but you forget the cell phone is mobile)

 

maybe because of the chevy badge (one reason i bought up corvette, its a 100k car)

 

to say volt compare to a 15k  is similar (looks, size, comfort, etc etc) you forgot the ONE main reason volt exists, the electric plugin, the price premium is definitely not for everyone.

 

also we need to compare apples with apples sure you can argue you don't want to pay the price premium but doesn't mean others won't.

 

as for the toyota prius at 23k, that is the base model and its not a electric plugin, toyota prius model that is electric plugin is 40k (after rebate is $32k similarly price to volt)

 

 

hy

 

rkbabang

 

GM must have a very bad perception in the market, you are using 15k car to compare to Volt!?

 

even toyota prius cost 23k to 28k

 

 

Not GM, so much as the Volt.  Compare the two vehicles in any metric you wish, looks, size, comfort, features, luxury, performance, or total cost of ownership. The $15K car comes up as better or just as good in each one.  As far as the Prius goes, I don't really understand why anyone would choose to buy one of those either, but $23K is much more reasonable a starting price. It at least puts it in spitting distance of similarly featured/equipped cars.