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I've noticed where they were going with their strategy a while ago. They're basically trying to cut the price in half or so for the next model, every 3 years. T

I've noticed where they were going with their strategy a while ago. They're basically trying to cut the price in half or so for the next model, every 3 years. This worked perfectly considering they were a start-up and could only build a few one of them at first, and then as they become more demanded, they can build more. We'll see a $30,000 model from them in 2015, and then a sub $20,000 model by 2018, with reasonable mileage. By then the country should also be covered with their solar-powered superchargers, that charge the cars for free. All of these factors should help them, and EV's in general, to become mainstream by 2020. In regards to the author's last statement, when Tesla started pushing for Tesla Roadster I also thought they would eventually become the "GM of the new electric car industry". Tesla is the Apple of EV's, and GM is Nokia. And both incumbents were gigantic at first in their own markets, compared to the new entrants, but that quickly changed in a few years.

lmkg 14y ago
How feasible is it for them to eventually reach sub-$20k pricing, given the significant cost of the batteries?
- lutusp 14y ago
  This will only happen if battery technology improves -- see my other post.
- stephengillie 14y ago
  How much will the cost of these batteries go down as more and more cars need them?
  - jessriedel 14y ago
    With current battery tech, not much at all.
  - bathat 14y ago
    The current pricing for the different size batteries that Tesla offers implies a cost of ~$500 per kWh (the cost differential between the 40 kWh, 60 kWh and 85 kWh packs is $10k). I read "somewhere" (random stranger on the Internet alert) that the cost of raw materials is in the ballpark of $80 per kWh. Now, I'd think that the current scale of battery production (certainly at least millions of units in the 18650 form factor that Tesla uses) doesn't leave much room to handwave the magic "scale effect" wand. On the other hand, it does seem like there is quite a bit of headroom between $80 (if that is realistic) and $500. If a large chunk of the delivered cost of a battery is attributable to fixed costs, like R&D, rather than the process of turning the raw materials into a finished battery, then maybe it isn't too implausible that the price could drop by a factor of two (or four). You might be able to glean some that information about that from carefully reading the SEC reports from public battery manufacturers.
    - guy_c 14y ago
      I seem to remember in an interview with Elon, that he quoted the current raw material cost per kWh. I think it was quite low, and that suggests good potential reductions in $/kWh. I'll try to find the interview
pekk 14y ago
Electric tech is clearly developing and generating buzz. And yet oil probably won't get too much more expensive for decades, while solar is ridiculously expensive without any clear prospect of becoming cheaper (currently parts are only as cheap as they are because the Chinese government is subsidizing their production, which can't last forever). Burning gasoline is not going to stop being economical and reliable any time soon. Also, given the expensive reality of solar and the way we generate electricity, electric cars would still be getting their electricity from plants which burn coal. Perhaps in 20 years we will be using more natural gas than coal, which at least means we're not depending on the Saudis - but still we'll be using hydrocarbons, fracking, etc. The only way electric vehicles will become mainstream is if the government mandates this. Seeing the way the Obama administration's "clean energy" agenda has tanked (even among the liberal base preoccupied with drones and Manning), there isn't going to be anybody to support this kind of action when it makes all transportation more expensive and thus makes everything more expensive. In a country which is physically very large, with an economy driven by domestic spending.
- PotatoEngineer 14y ago
  We're going to need something as fossil fuels run low and coal becomes increasingly stigmatized. Solar is an interesting field to explore, as is wind, hydro, tides, and other non-fossil energy sources. Sooner or later, one of those fields is going to generate electricity efficiently, even if only because fossil fuels (very eventually) get more expensive. Researching these things now means that there will be more options later.
  - jacoblyles 14y ago
    Unfortunately it seems to be more politically rational to invest in existing inefficient green technology than R&D (see: Solyndra). Fossil fuels can last a very long time. America's largest shale oil reserve isn't in North Dakota, it's in California in the Monterey Shale formation, currently unexploited.
  - bryanlarsen 14y ago
    There are lots of good arguments for electric cars. Fossil fuel supply is not one of them. At a bare minimum, we have 64 years of oil left, but that assumes that we will never be able to find any more or wring more oil out of fields than expected. History shows that both assumptions are not good ones to make. Emissions, cost & the environmental impact of tar sand mining are better arguments for electric cars.

lmkg 14y ago

How feasible is it for them to eventually reach sub-$20k pricing, given the significant cost of the batteries?

lutusp 14y ago
This will only happen if battery technology improves -- see my other post.
stephengillie 14y ago
How much will the cost of these batteries go down as more and more cars need them?
- jessriedel 14y ago
  With current battery tech, not much at all.
- bathat 14y ago
  The current pricing for the different size batteries that Tesla offers implies a cost of ~$500 per kWh (the cost differential between the 40 kWh, 60 kWh and 85 kWh packs is $10k). I read "somewhere" (random stranger on the Internet alert) that the cost of raw materials is in the ballpark of $80 per kWh. Now, I'd think that the current scale of battery production (certainly at least millions of units in the 18650 form factor that Tesla uses) doesn't leave much room to handwave the magic "scale effect" wand. On the other hand, it does seem like there is quite a bit of headroom between $80 (if that is realistic) and $500. If a large chunk of the delivered cost of a battery is attributable to fixed costs, like R&D, rather than the process of turning the raw materials into a finished battery, then maybe it isn't too implausible that the price could drop by a factor of two (or four). You might be able to glean some that information about that from carefully reading the SEC reports from public battery manufacturers.
  - guy_c 14y ago
    I seem to remember in an interview with Elon, that he quoted the current raw material cost per kWh. I think it was quite low, and that suggests good potential reductions in $/kWh. I'll try to find the interview

pekk 14y ago

Electric tech is clearly developing and generating buzz. And yet oil probably won't get too much more expensive for decades, while solar is ridiculously expensive without any clear prospect of becoming cheaper (currently parts are only as cheap as they are because the Chinese government is subsidizing their production, which can't last forever). Burning gasoline is not going to stop being economical and reliable any time soon. Also, given the expensive reality of solar and the way we generate electricity, electric cars would still be getting their electricity from plants which burn coal. Perhaps in 20 years we will be using more natural gas than coal, which at least means we're not depending on the Saudis - but still we'll be using hydrocarbons, fracking, etc. The only way electric vehicles will become mainstream is if the government mandates this. Seeing the way the Obama administration's "clean energy" agenda has tanked (even among the liberal base preoccupied with drones and Manning), there isn't going to be anybody to support this kind of action when it makes all transportation more expensive and thus makes everything more expensive. In a country which is physically very large, with an economy driven by domestic spending.

PotatoEngineer 14y ago
We're going to need something as fossil fuels run low and coal becomes increasingly stigmatized. Solar is an interesting field to explore, as is wind, hydro, tides, and other non-fossil energy sources. Sooner or later, one of those fields is going to generate electricity efficiently, even if only because fossil fuels (very eventually) get more expensive. Researching these things now means that there will be more options later.
- jacoblyles 14y ago
  Unfortunately it seems to be more politically rational to invest in existing inefficient green technology than R&D (see: Solyndra). Fossil fuels can last a very long time. America's largest shale oil reserve isn't in North Dakota, it's in California in the Monterey Shale formation, currently unexploited.
- bryanlarsen 14y ago
  There are lots of good arguments for electric cars. Fossil fuel supply is not one of them. At a bare minimum, we have 64 years of oil left, but that assumes that we will never be able to find any more or wring more oil out of fields than expected. History shows that both assumptions are not good ones to make. Emissions, cost & the environmental impact of tar sand mining are better arguments for electric cars.