Which company can give Tesla a run for its money in electrical vehicle and self driving segment?


Google, probably Apple and all tier 1 automobile manufacturers will give Tesla a run for it’s money. And Tesla can be expected to lose what ever leadership it now has.
Tesla has some leadership now in self drive and battery technology.
Today, it can be argued that Google is more advanced in getting to the goal of a fully autonomous Self Drive Vehicle (“faSDV”) than Tesla. In software, mapping and sensor technology. The Tesla approach is more driver assist and likely to be limited to limited access highways.
Tesla is heavily reliant on Panasonic with respect to battery manufacture technology. Maxed out, the Tesla Gigafactory for batteries will cost $5 billion. And Tesla needed a lot of outside funding to get this factory started. And maxed out, it can only make a few million vehicles.
If Tesla met it’s goals, it might get to 2 million cars per year by mid decade 2020’s. Likely with additional investments in the tens of billions. But probably won’t even be 5% of world auto sales. See worldwide sales chart below:
Tesla’s competitors already have the capability to beat Tesla in creating a faSDV. And they have the financial strength to spend on creating the manufacturing capacity to build them by the tens of millions. Tesla will not be able to keep up…it’s already too far behind. In the long run, it will buy faSDV tech from someone else.
The electric vehicle story is simply one of economics. When cost per KWH drops below $100, Electric Vehicle (“EV”) volume will skyrocket. This is a bit more than half today’s cost and the price that begins to make EV competitive with the Internal Combustion Engine (“ICE”). When the price drops to $50 per KWH, EV begins to dominate. The cost of vehicle ownership at all price levels favors EV over ICE at this price point.
Once we get below that $100 level with a trend to $50, the tier 1 manufacturers will invest the tens of billions to build battery factories. And they will be similar or better than Tesla costs.
In the long run, Tesla loses the battle for leadership and volume in the EV faSDV market. The auto business does not scale like software or cloud services. There is NO scenario for Tesla getting to the Toyota level of over 10 million vehicle units.
But it still might be a surviving EV faSDV manufacturer with tens of billions in sales and a few billion in profits. Not a bad outcome for Tesla.

==================
This post originally appeared on Quora.com on August 4, 2016: 
https://www.quora.com/Which-company-can-give-Tesla-a-run-for-its-money-in-electrical-vehicle-and-self-driving-segment/answer/Bob-Reisner


Comments

Post a Comment

Popular posts from this blog

Image
Why does Tesla receive the most attention when other companies are also producing electric cars? Other companies are ‘bolting on’ electric drive technology. They are simply modifying existing gasoline vehicles as best they can. The Chevy Bolt: Tesla is a ground up electric vehicle. No gasoline engine / drivetrain residual technology. Really new is interesting and often exciting. Tesla is both. Which is why they get all the publicity and popular attention. ---------- Note: This originally appeared as an answer on Quora.com on 2017 08 08.  The question answered was " Why does Tesla receive the most attention when other companies are also producing electric cars? "
Read more

A view on the future of Automobile Manufacturing and the impact of Tesla

Image
A view on the future of Automobile Manufacturing and the impact of Tesla Tesla's eventual success will cause its doom and likely the doom of most other passenger vehicle manufacturers. The advent of cost effective electric vehicle (“EV”) manufacture might mean hundreds of vehicle manufacturers rather than dozens. Maybe even thousands! Automobile Manufacture Will Move Away From Current Mega Corps And Become Fragmented There are two characteristics of electric vehicles that will drive fragmentation of manufacture: [1] EV’s are very simple when compared to internal combustion engine (“ICE”) vehicle construction. An EV very simple electric motor drawing power from a battery package with some straightforward control electronics. The EV might have a couple dozen unique parts in the core motor / drivetrain / power components and only a few of which actually ‘move’. The ICE vehicle will have many thousands that require much complicated engineering and most of them move or are subj...
Read more

Will the electric vehicle be produced in 2 parts? The body of the car separate from the chassis with the electric motor, batteries, and control systems.

Absolutely yes. Automobile manufacturing will undergo huge change with the introduction of mass market Electric Vehicles (“EVs”). Manufacture of a chassis with the motor(s), batteries, drive components and computer controls will be relatively simple. Each of the sub components like motors and batteries will be procured from a high volume supplier. A few platform types will address 80% to 95% of vehicle design needs. These will be easy to create and there could be a large number of manufacturers that go into the business of supplying these finished chassis. It will likely be the least profitable part of the new automobile manufacturing business. Much of the profits will go downstream to the suppliers of components like motors, batteries and computer control systems. Each of these providers will have some protection from competition due to legacy experience, patents and high upfront cost of building the manufacturing facilities. A single electric motor or battery facility mig...
Read more