Tesla has become synonymous with automotive excellence, replacing the word "Cadillac" that ruled for nearly a century. The term "Gigafactory," pioneered by Tesla, is in the lexicon, and several companies in the United States use it to describe the planned new factory.
Tesla has performed a miracle. He is not the first company in the world to enter the field of electric vehicles, but is the first company to become profitable solely on the basis of pure electric vehicles, and the scale of profitability is expanding rapidly year after year.
Musk is the soul of Tesla. He has too many qualities that others don't have. He has huge, seemingly unattainable ambitions that he is largely able to deliver on; he is completely unencumbered by the traditional business rules of the auto industry and goes straight to the heart of the problem.
Charles Morris, a leading journalist in the electric vehicle field, has followed Tesla for several years, resulting in this book, Tesla: The Disruptive Innovation and Business Wisdom of Elon Musk. The book centers on Tesla's development experience and shows the public how Musk made important decisions at each of Tesla's key decision points.
Tesla comes out of nowhere
The brief electric car renaissance movement came to an end in late 2003 as General Motors overhauled and crushed its EV1 electric car, and the electric car industry entered a gray period.
But on the Pacific West Coast, a company called AC Propulsion managed to develop an electric car prototype called the tzero. It is not a small, narrow moped, but a convertible sports car with Porsche-like performance. They hope to commercialize the production of electric cars and are looking for a project leader.
Musk became their target. At the time, Elon Musk had made his fortune from the online financial service PayPal and then founded a private space exploration company called SpaceX, and everyone knew he loved rockets, fast cars and green technology. After being introduced to the company and taking it for a test drive, Musk started the startup called Tesla.
In response to the current state of the electric car industry, Musk quickly realized that the high price and toy-like performance were major obstacles. For this reason, he and his partners adopted a three-stage strategy to overcome it in the early stages of the business.
The initial strategy was to start with a high-end car (Roadster) that could be built in small quantities and sold at a premium price, use the lessons learned from that to build a higher-end car (Model S) that could be sold in volume and methodically build a large organization that could achieve the economies of scale needed to build a midsize car (Model 3) for the mass market.
Today, Musk has completed steps one and two and is moving forward to step three of his plan.
Roadster from the assembled
Tesla's first production electric car took the name Roadster, which was actually a stitching of two models, the Elise and the tzero.
The tzero, a product of Tesla's predecessor AC Propulsion, was never mass-produced, and they had no intention of using the tzero's brightly shaped fiberglass body or its heavy steel frame, "but it overcame all the shortcomings that the prototype had. Musk and its founders intended to assemble a car on this basis that was exceptional in every detail, and for this they turned to the sports car manufacturer, Lotus (Lotus Sports Cars).
At the 2003 Los Angeles Auto Show, Tesla had access to Lotus, and the two companies worked together on several different levels. Tesla received multiple technology licenses from Lotus and also worked with Lotus Engineering on much of the design work on the Roadster. When manufacturing began, Tesla contracted with Lotus to build the car at Lotus' well-known facility, with Tesla supplying most of the parts.
Lotus designed the Lotus Elise chassis using extruded aluminum components that were bonded together rather than welded. This improvement strikes an optimal balance between strength and weight, important for electric vehicles, which must be as light as possible to maximize driving range.
The Tesla team took full advantage of this technology, but redesigned the chassis in a variety of ways. They lowered the height of the door sills by 2 inches, making it easier for taller people like Musk and Eberhard to get in and out. They also redesigned a heavier car than the Lotus Elise, which has a built-in battery pack but no fuel tank, muffler or exhaust. They lengthened the entire wheelbase by about 2 inches to accommodate the battery, and made several other corrections and improvements.
Lotus offers an airbag system and ABS braking system, both of which would be difficult for Tesla to develop on its own. That's why the Roadster's steering wheel and instrument panel look so much like the Elise, while most of the rest of the interior is Tesla's. Tesla also used the Elise's windshield and other window designs.
In July 2006, Tesla officially presented the Roadster to the public, and at the show, the mayor of California came out and affirmed the sports car, "Every industry must participate in the fight against global warming, and these clean, efficient alternative fuel vehicles are leading this environmental revolution."
Solving the production capacity problem
The lack of production capacity is holding Tesla back, and the main reason is that Musk misestimated the production cost of the Roadster.
In its April 12, 2007 prospectus, Tesla estimated that each Roadster would cost $65,000 to produce, but it actually exceeded $100,000. This caused the production schedule for the Roadster to start spiraling out of control, but any delay could lead to a cash flow disaster. If the product wasn't delivered to customers, there was no revenue, and for a startup with limited capital, that meant not being able to pay the bills.
What followed was the financial crisis of 2008, which turned Tesla's cash flow negative, even after raising the selling price of the Roadster. To do this, Musk took out all the money he got from selling PayPal and $40 million of his personal fortune, but it didn't mean much to boost Roadster production.
Musk came up with a bolder business decision - to supply battery packs and charging components to German auto giant Daimler's electric version of the Smart car, thus completing the Roadster's delivery.
In September 2007, Musk flew to Germany to discuss the deal, but his presentation failed to convince the other side that Tesla was a viable battery pack supplier. Musk said, "In reality, Daimler's key requirement was to demonstrate effective hardware."
To win over the pragmatic Germans, Musk and others decided to retrofit a Smart car with Tesla's electric powertrain and give it to Daimler executives.
In January 2008, Daimler executives showed up at Tesla headquarters. Musk took them into the garage, where they saw a Smart car that looked exactly the same. Professor Herbert Kohler, Daimler's vice president and one of the company's leading lights for electrification, got in the car, took the wheel and drove down the street. 15 minutes later, he returned, the skeptical look on his face turning into a wide grin. Shortly thereafter, Daimler signed a $70 million contract with Tesla, which supplied the batteries for what would become the electric Smart.
In May 2009, it was reported that Daimler had acquired "nearly 10 percent" of Tesla for $50 million. Herbert Koehler voted to become a member of Tesla's board of directors. It's no exaggeration to say that this deal saved Tesla's life. "The credit for saving Tesla should go to Daimler," Musk said later.
Model series debut
After the Roadster, Tesla wanted to overthrow the structure of traditional energy vehicles and build a framework structure belonging to new energy vehicles, which is the background of the birth of the Model series.
On March 26, 2009, Tesla presented the Model S prototype at a press conference at SpaceX headquarters. In less than a week, the company received more than 500 reservations.
The road to the Model's design, however, was not a smooth one.
In the earliest days, Musk brought in Henrik Fisker to do the industrial design of the Model. He is a star car designer who has worked for BMW, Ford and Aston Martin. He is best known for his work on the BMW 28 sports car and the Aston Martin DB9 (James Bond's car in the "Casino Royale" movies.) In 2005, he and business partner Bernhard Kohler started a company in Southern California called Fisker Coachbuild, which specialized in customizing luxury cars.
But Fisker came to Tesla for a different reason; he actually worked for a rival car company. And with information stolen from Tesla, Fisker Coachbuild began building the Karma plug-in hybrid. in 2008, the Tesla team sued the other side for stealing trade secrets, ending in a crushing defeat and having to pay $1.14 million in fees.
Musk was determined to have his own design studio. The first decision they encountered was: retrofit or rebuild?
In a 2012 interview, Musk vaguely argued that the strategy of retrofitting existing vehicles would not work well for the Roadster. "It turns out that AC Propulsion's technology didn't work, so we had to push back. once the powertrain was added to Lotus Cars' Elise sports car, it made all the crash work ineffective, with a 30 percent increase in mass, a different weight distribution and different load points. We had to stretch the chassis to be able to accommodate more people."
However, this approach required a series of compromises by designers to sacrifice many of the benefits that electric powertrains can offer. Electric vehicles have many advantages over fuel vehicles, but designers wanting to maximize those advantages had to throw out the chassis and body that evolved to meet the demands of gasoline engines and start a completely new design.
If you start with a "clean sheet of white paper", you must conclude that the best place to put the battery pack is at the bottom. This yields several advantages: it gives the car a low center of gravity, which greatly improves handling; it allows the car to be designed so that the battery can be easily removed for repair or replacement. Most importantly, it means that the entire interior space of the car can be used for passenger and cargo space.
This concept is nothing less than a revolution in car design. Thanks to placing the battery on the bottom of the car, the Model S has excellent handling and much more interior space than a comparably sized sedan: space for up to seven passengers (with optional rear seats); a rear cargo area more like a hatchback than the trunk of a sedan; and the front of the electric car where the fuel car's engine sits empty, as if it were a " luggage compartment". It is also theoretically safer than a fossil-fueled vehicle, at least in a frontal collision, because the "trunk" space area provides a longer buffer in the front than a large lump of iron smashing directly into the passenger compartment.
In October 2014, Tesla released the D package for the Model S. The D package adds a second motor to the front of the chassis, bringing the total power of the Model S P85D to 691-hp. This is an improvement in the automotive industry that helps high-speed cars become faster, with the 85D capable of reaching 60 mph in 3.2 seconds, "like taking off from an aircraft carrier! taking off from the deck ......"
Reinventing the automaker
From the beginning, Tesla has been trying to reinvent not only the car, but also the automaker.
Musk gave little thought to marketing, believing that a truly revolutionary product did not need to be deliberately marketed. In fact, Tesla's marketing is more subtle, more customer-centric and more interactive than that of traditional car brands. Tesla's message has been delivered in a funky and irreverent tone. In the past, Tesla called its marketing department KASM (Kick-Ass Sales &Marketing, "terrific sales and marketing").
During the Roadster era, Tesla built 13 company-owned showrooms - the company does most of its ordering online - but it took a page from Apple's book and set up some trendy stores in the hippest retail areas. George Blankenship was one of the main architects of Tesla's sales strategy.
Blankenship's strategy is to focus on the needs and desires of the customer (including those they don't already know), a concept that can be summed up nicely in the words of Steve Jobs: "You have to start with the customer experience and then come back to the technology." While other companies working on electric cars are asking, "What can we do with the technology we have? Musk is asking, "What do customers really want from their cars?"
Tesla's sales efforts began in a store in Sunnyvale, California. Instead of a huge dealership on Airport Road where people would normally go, Tesla opened a sleek and small resto in a shopping center where most people who patronized it didn't even think about buying a car. The employees encouraged visitors to feel free to try it out and post photos online, rather than pushing it like a car dealership. The store was soon flooded with customers, and hundreds were willing to pay a $5,000 deposit for a Model S, even though it wouldn't be available for two years.
Revamping the retail store's staffing structure was also a big part of Tesla's approach. Like other tech pioneers like Apple, Tesla understands that it's not just a product it's selling, but an "ownership experience. "When you look at car ownership as a total experience, you're bound to conclude that there are certain parts of the car experience that people really don't like, and the smiling car salesman is almost at the top of the list."
Tesla's sales model saves money by eliminating the middleman, it gives the company control over how it presents the car to buyers, and it gives buyers a direct relationship with the automaker. It also brings another unprecedented benefit: it brings buyers (and their money) into the car-buying process before the company even builds the car.
They've managed to sell so many Model 3s before they're even in the final design phase," car designer Bandem Hunsinger told Fortune, "It's almost like they're raising money for the car. They've generated hundreds of millions of dollars in revenue before they've even built the final tool."
Putting rockets in cars
In addition to the Model tram, Cybertruck, Hyperloop, and Underground tunnel, are the three main directions of Tesla's future development.
In November 2017, at the launch of the Tesla truck, Musk revealed a new version of the Roadster. according to Tesla, this new Roadster will be the fastest car ever built. It accelerates from 0 to 60 miles in just 1.9 S, Acceleration 1/4 mile, 8.8 S, faster than supercars like the Bugatti Veyron, Porsche 918 Spyder and McLaren 720.
"These numbers sound crazy, but they're real." Musk said as he presented the specifications of the upcoming electric car. The new Roadster will have a top speed of more than 250 mph; a 200 kWh battery pack, Tesla's largest to date, with a range of 620 miles; and three motors that will provide four-wheel drive and a "brutal" 10,000 Nm of torque.
In June 2018, Musk made another joke: SpaceX offered an options package for the new sports car that would include "10 small rocket boosters seamlessly arranged around the car. These rocket motors will significantly improve acceleration, top speed and braking, and maybe they'll make a Tesla fly ......"
The reaction was predictable, but Musk was serious and clarified that the "rocket boosters" would work in compressed air. The automaker has actually built a concept car powered by compressed air.
Hyperloop, on the other hand, is a new ultra-high-tech mode of transportation that can transport passengers (and even cars) from Los Angeles to San Francisco in just 30 minutes and cost only 10 percent of what California plans to spend on its high-speed rail system to build.
Musk initially described the Hyperloop as a pair of elevated steel tubes with aluminum pods inside that could reach speeds of 800 miles per hour. "These pods will use air cushions," he told Bloomberg. "The pods are mounted on skids made of chromium-nickel-iron alloy with small openings in the skids that draw in air to form an air cushion. You can use the air cushion to move huge, heavy objects with very low friction."
Musk's ambitions don't stop there, as he has also set up an excavation company that hopes to ease traffic congestion by digging underground tunnels. Most transportation experts believe that opening new roads will do nothing to alleviate traffic congestion, because as capacity increases, local traffic will expand. Musk has thought of this one-by-one future tunnel network will include many layers of tunnels, some built for cars and others for super high speed rail.
Musk's company is currently working on at least three projects. One of the lines is from Baltimore to Washington, D.C., and another will connect downtown Chicago to O'Hare Airport. The closest project to completion is in Las Vegas, where two parallel 1.37-kilometer-deep shafts will serve the Las Vegas Convention Center. Construction on the project began in November 2019, and as of May 2020, tunnel construction is complete.