I would not invest in Tesla. I think Elon Musk’s style is a little bit annoying, and I think many of his supporters are very annoying. More importantly I am not sold on the claim that Tesla will be able to compete against other auto or tech firms, even assuming that electric vehicles really do become widespread soon.
Looking at Musk’s business moves individually they appear, at best, to be high risk, high reward.
— Tesla’s approach to autonomous driving is not to use LIDAR, because LIDAR is expensive. This is unique: the other auto and tech firms are all betting on LIDAR. And because the economic viability of electric vehicles probably depends on autonomous driving (the vehicles need to be able to drive themselves to and from charging stations, as otherwise charging batteries may be too inconvenient when compared to conventional or hybrid vehicles), if this LIDAR-free strategy fails, it might put Tesla in a very tough position.
— Large electric trucks do not seem to make obvious economic sense: the batteries are too big, bulky, and expensive. It is difficult to see why these would be able to compete, in the short run, against conventional trucks, and in the long run against robots making it much easier to transfer cargo between electric railways and “first-mile/last-mile” conventional trucks or smaller electric trucks.
— Solar City. Even assuming that solar can compete with other power industries, and even assuming that using batteries to store power can compete with other forms of energy storage, it is difficult to see why a diffuse system of rooftop solar panels would be able to compete with solar farms, where installation and maintenance costs per panel are lower and where there is less shade.
–Boring company. Even assuming that Musk does succeed in reducing urban tunnelling costs, such tunnels would still be hugely expensive, so it is not clear why you would use them to move cars or people on `sleds`, when it would be much more efficient from a capacity point of view to simply use an existing technology within the tunnels: namely, trains.
The Unconventional, Long-Shot Case: Tesla Parking Lots
Readers of this blog will know I have a weird obsession with parking lots, because parking lots are the most ubiquitous type of American real estate and because they may be impacted more than other types by technologies like e-commerce and autonomous parking. Let’s imagine what Elon Musk might be able to do with a typical supersized suburban parking lot:
— No LIDAR, no liability, no problem: while autonomous vehicles in general might need LIDAR and might face liability issues, in a controlled, pedestrian-free environment — for example, in a designated autonomous zone of a parking lot — an autonomous car could function without LIDAR. This would have two benefits: one, it would act in effect as a valet service, making it easy to park; two, the parking lot could have an autonomous charging station for electric cars, so that your car could be charged while you are in the mall
— Sledding. The car-carrying ‘sleds’ imagined for use inside the Boring Company’s tunnels may not make economic sense within those tunnels, but they could make sense as sleds that could carry conventional, non-autonomous cars (there are hundreds of millions of these cars in America today, and they aren’t going to disappear overnight) to and from parking spots.
— The Boring Company. If the Boring Company ends up reducing the cost of conventional subway trains, the value of autonomous valet parking lots could increase, as people will drive their car to a parking lot at the nearest subway station, then get on the subway train while the car goes to park itself. (They may also be able to get in another car at their destination station’s parking lot, thus overcoming the ‘first-mile, last-mile challenge’ that plagues suburban transit in America today). Short-distance tunnels created by the Boring Company could also be used to link together parking lots that are close together: lots of suburban parking lots are giant ‘archipelagos’ separated by highways, for example.
— Electric Trucks. Electric trucks may not be economical in general, but could be economical in a specific situation: driving short ‘first-mile/last-mile’ distances, in daytime or overnight (electric vehicles are quiet, so better for nighttime use) between, for example, a commercial/industrial parking lot and a rail or conventional truck logistics station. So, for example, a company like Walmart could use electric trucks to bring in cargo quietly at night when its parking lot is empty, and also charge their batteries in the lot.
— Solar City. Rooftop solar panels may not be economically competitive in general, but on large flat roofs with little shade — notably, on large commercial/industrial roofs, next to large parking lots — they may be more economical. It may even become economical to put a solar roof above the large parking lots, to generate power while also helping to keep the parked cars shaded.
Okay, I admit, this is all unfounded, unclear, and far-fetched. Ultimately, it is based on the assumption that if wholly autonomous cars do not become widespread in the near future, then the most efficient, clean, and convenient methods of transportation and commerce may instead involve a combination of electric cars, conventional transit, and autonomous parking. Elon Musk’s unique mix of assets may be uniquely suited for this outcome.