Tesla Announces Part 2 of Its Master Plan, With Part 1 Still Unfulfilled

Smart cities, Tesla, SolarCity, public transportation, ridesharing, Leon Kaye, electric vehicles, Elon Musk, autonomous cars
Tesla keeps driving forward, but some want to put on the brakes.

You might doubt the Tesla-SolarCity merger, but you cannot dispute the ambition and vision of Elon Musk. His drive to disrupt the financial sector proved successful. And with the money Musk made from PayPal, he set out to transform the transportation and energy sectors. A decade after outlining his first master plan for Tesla, Musk released a sequel that aroused a wide range of reactions from the media.

Dystopian yet optimistic, Musk builds on last month’s announcement that Tesla and SolarCity will become one. “We must at some point achieve a sustainable energy economy,” Musk wrote, “or we will run out of fossil fuels to burn and civilization will collapse.” To that end, Musk’s vision is part defense of the Tesla-SolarCity alliance, part fist-shaking at his critics. And, of course, it’s unapologetically bombastic and futuristic. The main points of the plan include:

  • Integration of clean energy generation and battery storage
  • The scaling of electric vehicles beyond passenger cars to heavy-duty vehicles and buses for public transportation
  • Autonomous cars, which will further enable ridesharing and allow Tesla to take on services such as Uber

Reactions, of course, were all over the map. “Tesla stock falls,” screamed the Los Angeles Times. “Execution still an open question,” declared CNBC. “An even more grandiose vision of the world,” mocked Fox Business. Bloomberg yawned, saying the announcement “falls flat.” Other commentators expressed surprise, from the new focus on trucks to Musk’s description of a future that goes far beyond cars and transportation.

But many skeptics say the issue with Musk’s second act is that the first one has not yet reached fruition. Yes, the first models that Tesla rolled out to the market disrupted the automobile industry, as the future of transport also came with a stellar design that wins plenty of attention at any automobile show. But Tesla continues to lose money. Furthermore, while the number of orders for the mid-range Tesla Model 3 are astronomical, the recent decline in deliveries of its Model S raised red flags. And as far as becoming a huge clean energy provider, that vision from 2006 remains to be seen. The SolarCity deal could make that goal a reality, but the merger is still not set in stone.

Musk has a history of making bold predictions — which helped him groom a devoted following, while angering skeptics of both his companies and the emerging clean technology sector at large. And despite all the bold announcements and naysaying, there is much to admire about what Musk is trying to do. His “gigafactories” in Buffalo, New York, and Reno, Nevada, have the potential to help transform those regions’ economies. A focus on electric buses and trucking can help shift those vehicles away from fossil fuels and help cities tackle their climate change goals.

Indeed, the dream of having a Tesla car that can be summoned at any moment to take you to work, or make money for you by carting around passengers when you are on vacation, is an awesome scenario. But it is not unreasonable for Tesla’s investors to demand that the company’s original master plan become a reality. Tesla’s fans, its investors and the market deserve to see that plan fulfilled before a new Tesla-SolarCity entity embark on a new, expensive plan that looks great on paper but risks the company’s long-term prospects.

Image credit: Joseph Thornton/Flickr

Investment & Markets

Recent headlines from the 2100 articles in this category:

Based in Fresno, California, Leon Kaye is a business writer and strategic communications specialist. He has also been featured in The Guardian, Sustainable Brands and CleanTechnica. When he has time, he shares his thoughts on his own site, GreenGoPost.com. Contact him at leon@greengopost.com. You can also reach out via Twitter (@LeonKaye) and Instagram (GreenGoPost).

Leave a Reply