What the New York Times Got wrong about Elon Musk, Tesla & The Chevy Bolt

A few weeks ago, I got really annoyed while reading an article from The New York Times about the soon-to-be-launched, affordable, all-electric Chevy Bolt.

Why? Because the article — titled “How Did GM Create Tesla’s Dream Car First” — focused on making fun of Elon Musk for being beaten to market with an affordable electric car by big… slow… old… GM, instead of focusing on the real story: how it is amazing that this immensely important change has finally hit scale.

How Did G.M. Create Tesla's Dream Car First?

“It’s a delicious irony: Cocky billionaire makes grand promises in a blog post. Ten years later, he gets his wish, in the worst way.” Farhad Manjoo, author of the NYT article.

Why are we laughing at Musk? There’s a more important story going on here.

Now, Elon is a big boy, and is quite used to being both heavily criticized and heavily praised in the media. And while I’m a bit of a self-admitted Musk “fan boy”, my point here isn’t about defending Musk’s honour and attacking the Bolt — which will launch by the end of this year (2016) — by trying to convince you that it doesn’t matter vs the Tesla Model 3 — which won’t launch until *hopefully* the end of next year (2017).

Tesla: The Improvisation Debt

My point is that the Bolt is tremendously important to the world, and the article missed the journalistic opportunity to tell a fascinating story:

1. The most-entrenched car companies, who have a history of killing the electric car, have finally woken up and started to make serious all-electric plays in the market (Chevy Bolt, BMW i3, etc.).
2. They woke up for three reasons: (1) the economics of fleet-wide fuel efficiency standards, (2) the buzz around Tesla has turned it into a small but sizeable competitive threat, and (3) Elon Musk and Tesla have created such immense conversation about electric cars, that it has skyrocketed consumer demand.
3. While the launch of the Bolt might be a short-term competitive threat for Tesla (absolutely), it could also be a short and long-term opportunity for them, due to the Bolt creating even more conversation about, acceptance of and desire for electric cars in the market.
4. And finally, while Musk may have underestimated the speed at which GM could execute, their entry into the all-electric market with a viable vehicle (i.e. 200 mile+ range) is exactly what Musk wanted to happen… what he was trying to make happen with Tesla. This is because Musk is ultimately in this to help the world make an immense change in how we create and use energy (while making lots of money along the way)… because he’d like us to be able to NOT destroy our environment. He’s not in this to take over the auto industry.

Musk’s mission with Tesla

The Secret Tesla Motors Master Plan (just between you and me)

“The overarching purpose of Tesla Motors (and the reason I am funding the company) is to help expedite the move from a mine-and-burn hydrocarbon economy towards a solar electric economy, which I believe to be the primary, but not exclusive, sustainable solution.” Elon Musk

That was Musk back in 2006, when he famously made his “secret plan” for Tesla public. Elon saw an issue the world had — global warming from carbon emissions, due to an addiction to gas guzzling cars — and an opportunity to do something about it — electric vehicles are the better option, and he had a discovered a team that could make them viable.

His plan was to create a massive and irreversible shift in industry that had barely changed in 100 years, by creating a truly amazing and breakthrough product that couldn’t be ignored. Which would use human-centric design to create a car that was so much more than the first viable all-electric vehicle, in order to make the public drool and obsess over it. If the public became obsessed, the big car makers wouldn’t be able to ignore electric cars anymore, and would simply HAVE to follow suit.

The accompanying business model/opportunity that he executed has made him a lot of money (for sure), but the cash has always been about financing this mission of change —(1) make a roadster for cash & buzz, (2) reinvest cash and use the buzz to launch a luxury car for more cash & buzz, and (3) reinvest cash and use the buzz to launch an affordable car.

Tesla has only ever intended to be a niche player in the auto-industry.

As a brief aside, I want to highlight that niche does NOT mean ‘electric’… yes, in the immediate-term, the sub-segment of the market is thought of as ‘electric vehicles’, but in the medium-term there will (and should) be electric cars across many/all car segments… electric is a feature, not a segment. So, ‘niche’ for me likely means ‘advanced’, or some form of luxury… I look at Tesla more like competing with Audi and BMW, because of the strict focus on performance and design. Teslas just happen to all be electric because of a product-design choice, just like Subarus happen to all be all-wheel-drive because of a product-design choice (except the BRZ, which is rear-wheel-drive… a very strange choice for Subaru, in my mind)

GM’s entry into this market has always been a part of Musk’s plan, because the change that is needed is system-wide. This is not about how Tesla is trying to take over the car industry, because it’s not trying to do that. It’s trying to change the car industry… very different.

While the Chevy Bolt will likely cost just slightly more than the Tesla Model 3, it will come out a year earlier, have slightly more range, and have massive production speed / scale advantages over Tesla.

How GM Beat Tesla to the First True Mass-Market Electric Car

So given that GM is actually playing right into Musk’s altruistic hand — albeit earlier than maybe originally expected… well, more like Musk is later than originally expected — isn’t laughing at him, like Manjoo did in this article, just missing the point?

Yes, it makes for a good headline… and yes, the news certainly highlights Tesla’s short-term competitive risks and puts a spotlight on all of the various delays in their plans since 2006. But I just don’t think that’s the story that the world needs to be told.

To me, the really important (and responsible) story to tell is: GM has joined Tesla in helping the world move past our dependence on fossil fuels… there has never been a better time to believe that there is light at the end of the tunnel. By focusing only on the micro-competitive nature of the pending launch of the Bolt diminishes the excitement and momentum needed to continue the progress our environment needs us to make.

The importance of big manufacturers joining Tesla

So, why is it so important that GM (and other) car manufacturers enter into the all-electric market as fast as possible? Well, here’s the way that I see it:

1. 2014 was the warmest year on record, until 2015… and there’s apparently a 99% chance that 2016 will beat 2015, now that every month since October 2015 has been a record breaking month.(link by Joe Romm)
2. To make a dent in emissions (10% reduction), the entire population would have to either double fuel efficiency, or reduce driving by half…. we know the second one isn’t going to happen, and 10% isn’t enough. (link)
3. Double fuel efficiency = everyone driving a hybrid
4. Electric cars (Tesla Roadster as the example) result in 1/3rd as much emissions getting to the atmosphere from its use of the grid (assumes 100% Natural Gas = conservative assumption) as your typical hybrid (Prius as the example). (link)
5. If everyone went electric, instead of going hybrid, then that’s a 30% reduction (I’m assuming, based on very obviously basic math)… now we’re talking.
6. 100M cars are sold every year… Tesla plans to make & sell 1M cars / year at its ultimate scale, or 1% of the total market. The world needs serious alternatives across all car segments from the other auto-makers to make up the other 99%. (link)
7. With 2B cars on the road, it would take 20 years to make every car electric, IF all new cars sold were electric… and it’ll take a very long time before all new cars sold are electric. (link)
8. SO… this shift needs as much speed as possible. Who cares whether GM beat Tesla. Let’s stop gossiping about something that doesn’t matter, pop champagne and celebrate that the real change is starting, and get aggressively busy working to chip away at the rest of that 99%.

NASA temperature analysis for August: “Another month, another record.” Credit: NASA (and link)

How Tesla Will Change The World - Wait But Why

Anyway, rant over. I hope you agree that the news of the Bolt should not be about making fun of Elon Musk… sure, he’s messed up a WHACK of delivery estimates over the years, and has a massive up-hill battle ahead of him to ramp up his production to the scale & quality it needs to be at to hit his production targets… BUT, by focusing on that, we diminish the real story:

We’re finally gaining some traction in the most important change we need to make as a society to ensure we have an environment to live in tomorrow: ditching fossil-fuel-based vehicles and going all-electric.

Thanks Elon. Your plan is working.
B

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