Tesla Inc. released a new compensation plan for Chief Executive Elon Musk on Tuesday, with payments dependent on massive increases in the electric car maker’s stock market value.
The announcement comes as Tesla prepares to report 2017 financial results that are expected to include massive cash losses. The new pay plan is similar to Musk’s current arrangement, the crux of which is this: The higher Tesla’s stock price goes, the more Tesla stock Musk gets.
The eye-popping part: The new plan envisions the Palo Alto company’s value skyrocketing. It sets market value targets in 12 increments, starting at $100 billion and topping out at $650 billion. (The company’s current market value is about $59 billion.)
If the stock hits none of the milestones, Musk would get nothing. It’s unclear how much the financial rewards will motivate Musk, who already is a billionaire and by all indications isn’t in it simply to get rich. The company sees itself not simply as an electric car manufacturer, but rather, as it said Tuesday, as the “world’s first vertically integrated sustainable energy company.”
When it comes to AI, the Tesla and SpaceX CEO has strongly urged caution recently. But, on Thursday, Musk also confirmed that Tesla is developing its own artificial intelligence software and hardware as the company continues its push toward a future of autonomous driving. What’s more, Musk is confident that his own company’s work on AI will be fruitful, as the CEO boasted about the products’ potential at a machine learning conference in California yesterday.
Talking about the work of Jim Keller, Tesla’s vice president of hardware, Musk said at the conference: “Jim is developing specialized AI hardware that we think will be the best in the world,” according to CNBC. Tesla currently uses chips supplied by Nvidia to power its Autopilot hardware, but Musk’s announcement signals a move away from the partnership.
Musk also reportedly predicted that it will only be two years until fully autonomous driving is available with the new Tesla-developed AI systems, and that the technology will be “an order of magnitude better than humans” within three years, according to Salesforce scientist Stephen Merity, who was at the conference on Thursday and tweeted parts of Musk’s conversation.
Musk was also busy this week stoking competitive fires with regard to his plans to transport humans to Mars with SpaceX rockets. On Thursday, Musk responded to a boast from Boeing CEO Dennis Muilenburg, who predicted that the first person to set foot on Mars would arrive in a Boeing rocket. Musk, who has been vocal about his desire to reach Mars and even colonize the Red Planet, responded to Muilenburg in a tweet that said, simply, “Do it.”
Tesla’s November 16 introduction of both the new Tesla Semi and the Tesla Roadster managed to impress even observers used to the electric carmaker’s lofty ambitions. When they come to market, the Roadster will be the fastest-accelerating production car in the world, and the Semi will deliver more range, for a lower price, than almost anybody expected.
Those and other promises would be difficult or impossible to fulfill with batteries on the market today. At current battery prices, Bloomberg estimates the battery for a freight truck with 500 miles of range would cost more than $100,000, but Tesla estimates that the entire truck will only cost $180,000.
Similarly, the power and range Tesla is promising for the Roadster will take a battery more than twice as big as anything in a current Model X or Model S.
Tesla says the Semi will be able to suck up 400 miles worth of juice in 30 minutes, but that would mean charging more than 10 times faster than Tesla’s current best chargers.
The Semi isn’t set to hit the road until late 2019, and the new Roadster isn’t due until 2020. Battery prices and sizes have dropped dramatically in the last five years, and many projections have them dropping by another half by then. The same goes for power density, meaning that by the time the Roadster and Semi go into full-scale production, batteries may well be good enough to do what Elon Musk is promising. A Carnegie Mellon battery expert speaking to Jalopnik agreed that the Roadster’s performance benchmarks were at least theoretically plausible, though they might also require advances in tire technology.
Announcing products years before perfecting the technology needed to make them work is certainly an unorthodox approach. It’s unlikely to appease critics of Tesla’s rapid spending, who tend to see displays like the Roadster reveal as media stunts aimed at raising badly-needed cash.
According to an article in Motor Trend, Wal-Mart Stores Inc., who operate thousands of trucks, said Friday they had reserved Tesla’s truck, which Chief Executive Elon Musk revealed at an event in Hawthorne, Calif., on Thursday. The first highway-ready vehicles aren’t due out until 2019, but the company is taking $5,000 deposits.
The Semi is designed to run up to 500 miles on a single charge, and incorporates Tesla’s semi-autonomous driving system, which the company said could allow big rigs to travel in autonomous convoys with other of its trucks. The company did not provide a sticker price, but said the truck would be cheaper to operate than diesel rivals and could potentially cost less than transport by rail.
Walmart has preordered five units for the U.S. and 10 for its Canadian division, and sees potential for the trucks to help meet company targets for lower emissions, a spokesman said Friday. The company has one of the largest private fleets in the U.S., with some 6,000 trucks. Walmart has tested other new vehicle technology, including diesel-electric hybrid trucks and some that run on liquefied natural gas or other alternative fuels.
The Semi’s 500-mile range on a single charge exceeds what some analysts had expected but could still limit its use on long-haul routes, at least until a nationwide network of charging stations is built. The battery’s weight could also be an issue, as heavier trucks can carry less freight. Tesla says it is planning to build a global network of “megachargers” where truckers could recharge vehicles in about 30 minutes, gaining another 400 miles of range.
One typical reaction to all new technology are fears about economic change – self driving cars are no different. As companies such as Tesla push the boundaries of autonomous vehicles, worries over job-loss in the transportation sector increase.
Writing for MSN Auto, Kyle Cheromcha addresses what appears to be a pretty credible fear about job loss in transportation due to future us of autonomous vehicles; potentially as high as 300,000 jobs a year according to a Goldman Sachs report. This number includes truck drivers, taxi drivers and bus drivers. The same Goldman Sachs report also notes that freight transportation may take the biggest hit because of the hard demands of the job.
While the report accounts for the snails pace of bureaucracy and red tape, it estimates that by the end of the next decade twenty-some percent of new cars sold will be autonomous.
Driving jobs account for 2% of the job market in the U.S., however the Goldman Sachs reports notes that the labor market should be able to absorb and retrain these workers. None-the-less, those working in the commercial driving sector are not likely soothed by this fact.
What do you think? Are autonomous commercial vehicles a good idea?
Writing for Bloomberg, Tom Randall takes a serious look at what might happen to the EV market with the looming cut of a $7,500 U.S. Tax Credit. He begins by comparing the $37,000 Chevy Bolt to the $17,000 Chevy Cruze, two very similar cars, and noted that the electric bolt isn’t “$20,000 better” than the Cruze.
Randall sites an example from the car-research company Edmunds, who think the loss of the tax credit will absolutely kill the EV market in the US.
“Edmunds pinned its argument on what happened in Georgia, a state that became an unlikely leader in electric cars thanks to an extra $5,000 incentive. At one point, almost four percent of new cars being sold in Georgia were electric. Then they pulled away the punch bowl.”
Randall notes that after Georgia pulled the extra state funding, Teslas sales actually ultimately went up. He notes that this is what happens when an electric vehicle “reaches parity with fuel-burning competitors in both price and function.”
Randall discusses the fact that the battery is basically the only thing holding back sub-luxury EVs from competing with their fuel consuming counter parts in price. Otherwise, he notes, that production and maintenance are actually far cheaper with an EV.
A member of the Victor crew had the opportunity to see a Tesla close up. The Tesla will go from 0 to 60 in up to 2,8 seconds and will go a range of 270 miles on a single charge. It is fully electric (not hybrid). The Autopilot mode is the next best thing to a self-driving car. It will follow the curves in the road, change lanes, stop and go with traffic, and even detect a parking space at your destination and park itself. There is a front AND back trunk since it doesn’t need an engine compartment.
The owner had an app called PlugShare that showed all the nearby charging stations. The app shows stations that are in use, hig power stations that will charge your car quickly, public stations installed by businesses or governments, and residential stations owned by people that allow other PlugShare members to use their charger. No matter where you go, you should be able to charge your car.
Consumer Reports says it is the best car tested and it has the Highest Safety Rating in America by the National Highway Traffic Administration. Be prepared to pay $75,000 or more or lease for about $838/mo. You don’t have to pay for gas so that’s an expense you don’t have to worry about.
Tesla Model S
Tesla Model S – front trunk with hamster in a cage toy
The Tesla Model S was voted the 2013 Motor Trend Car of the Year. Let’s find out why, Jody.
So what sets this car apart? It’s quick and it’s … electric! The range is about 265 miles. But Tesla is putting in charging stations that will be free. The charging stations should recharge for 150-180 miles in 30 minutes. It has an mpg-e of 118.
Tesla Model S is top in its class for safety.
For more information, read the article. You can view a gallery of pictures here.
~ Joe Victor