My dad and I were in Washington, DC a couple weeks ago and stopped by the showroom for Tesla Motors. Tesla is a really cool company that’s made some awesome electric cars – first the Roadster and how the four-door Model S. I wrote about them for our book a few weeks ago in our chapter about cars, where we talk about hybrids, hydrogen, and electric cars. Tesla’s gotten a lot of coverage lately. They have a flashy product with a great design; they see themselves as the Apple of car makers:
When director Jon Favreau struggled with portraying brilliant billionaire Tony Stark as a believable human character in the film Iron Man, he sat down with Elon Musk, the forty year-old South African who helped found PayPal—which he sold to EBay for a billion and a half dollars—Solar City—the largest solar provider in the United States—SpaceX—which recently became the first private company to dock its craft with the International Space Station and aims to eventually begin colonizing Mars—and Tesla Motors. Musk co-founded Tesla in 2003, using his money from PayPal to provide much of the startup capital, in order to bring a “Silicon Valley” mentality to the auto industry. He also wanted to make a “cool” electric car.
By 2006, Musk had gotten his wish. At a small event in Santa Monica, California, he revealed the Tesla Roadster, which went on sale in 2008 and has since sold more than 2,300 units. The Roadster is nothing if not cool: small, sleek, and fast. If the Toyota Prius is an ugly car that people drive to show their concern for the environment, the Tesla Roadster is the anti-Prius. It uses the body of the Lotus Elise and can go from 0-60 in less than 4 seconds. Most impressively, it can go 240 miles on a single charge from its 6,831 miniature, triple-fused lithium-ion laptop batteries. At $109,000, it’s far from cheap. Yet with the Roadster and the later, slightly improved Roadster Sport, Musk wasn’t aiming for the mass market; he wanted to build a car that early adopters would buy that would push the technology forward while demonstrating the viability of his company. On June 22nd, 2012, Tesla began to deliver the four-door Model S, aimed to compete with high-end luxury cars instead of supercars. They already have taken upwards of ten thousand reservations for the car. As the battery technology improves and cheapens, Tesla plans to build progressively more affordable electric cars. As Tesla garnered media attention and racked up reservations in the last few years, the bigger car companies, the government, and consumers all began to take notice.
While Tesla may form an important niche in the future car market – rich people who never use their car for road trips – we’re convinced that electric cars are not the technology that will replace the traditional automobile:
Boosters of electric cars often justify costs and current constraints by predicting breakthroughs in battery technology. This would make sense if batteries were an unproven technology, but this is far from the case. Electric cars use the same type of battery that currently powers your laptop, cell phone, iPod, or any other expensive, portable electric good. They’re expensive, they heat up, and lose maximum capacity over months and years—not decades—of use. Anyone with a cell phone or laptop has experienced battery degradation, which often means buying new batteries as often as once a year. While they have improved over the last few years, the progress has been incremental rather than exponential. The original iPod touch, for example, could play 22 hours of music with the screen off, or five hours of video. The current generation model can now play up to 40 hours of music or seven hours of video. For electric cars to replace the family gasoline-powered car, the rate of improvement would need to increase substantially. It’s not enough to improve from 100 miles of range to 120; it needs to double, or triple. And there’s little evidence to suggest such a possibility. Even in moving from the lead-acid and nickel metal hydride batteries of the EV1 to today’s technology, the range of electric cars on the market has not increased substantially. . . and there’s no clear replacement for lithium ion technology over the horizon. New technologies are often defended by arguing that costs will come down as the volume increases. This may be the case for some parts of electric vehicles, but seems more doubtful for the batteries themselves; lithium ion batteries are already made in great quantities around the world, so the “economies of scale” argument has little truth to it. Tesla had initially planned to price the Model S at roughly half the cost of the Roadster, and the base model may have achieved this, but only by cutting the range in half. For range near that of the Roadster, consumers will need to pay something more like seventy-five percent of the original model’s cost. High-performance batteries exist, but remain extremely pricey. It seems unlikely that battery technology will become truly affordable in the near future. According to Ford Motor Company CEO Alan Mulally, batteries make up more than a third of the entire cost of current electric cars. “They’re around $12,000 to $15,000 for a type of car that normally sells for about $22,000,” he said. “So you can see why the economics are what they are.”
Besides the cost of the battery, charge time remains a persistent problem. Tesla’s current “fast charger” will charge the battery in about four hours, and any improvements in the battery will make it take more time, not less. So, while Tesla’s cars are fun to look at, we think (as we get into more in the chapter) that hydrogen fuel cell vehicles are a much more likely option.
The excerpts above are from a forthcoming (and so far unnamed) book by Thomas E. Drennen and myself. If you like this and fiction, please check out my spy novel, The Men Behind the Curtain, on Amazon