Free “Gas” for life? WHAATTT?!

Elon Musk is a name you should be very familiar with as in my opinion he is the most influential entrepreneur/inventor today. He is best known for creating SpaceX, a private rocket and spaceship successor for NASA, cofounding Tesla Motors which takes aim to revolutionize the auto industry and Paypal the worlds largest internet payment system. Talk about accomplishments!

On September 24th, Elon Musk had unveiled the Tesla Superchargers, a revolutionary charging method for its line of high-end luxury electric sedans- the Model S ($77,400 – $105,400). The Tesla Superchargers will use solar energy to charge the Model S with 100 kilowatts of energy that will be good for about 3 hours of driving at 60 MPH in an impressive 30 minutes. The amazing feature of these Superchargers is that all Model S owners will be able to charge their vehicles for free, FOR LIFE. Musk claims that the energy captured by the solar panels will be more than what the vehicles will require. This allows Tesla to actually make money by pumping the excess energy back into the grid.

 

Musk had also revealed that this network of superchargers is a reality. At the time of the unveiling there are six locations in California ready for use. Within two years he plans to cover the United States with these stations in all “high traffic corridors across the US.” Long term (2 – 4 years) Musk plans to cover the entire US and southern Canada as well expanding into Europe and Asia.

First thing that came into my mind after seeing the map above is that this is a very aggressive forecasting model. They are targeting to cover the continental US in a very short period of time. On top of that they have future plans to expand into Europe and Asia. With absolutely no data on how many Tesla drivers will actually attempt long distance drives the Tesla team is taking a huge risk in investing so much capital in building this network of superchargers. The second issue they face is either under-use or over-use of the stations.

Lets face it; today these are very expensive cars for most Americans. With the base model starting at $77,400 I don’t see it having much mass appeal and that is needed to make such a huge network be feasible.
On the other hand, as the years go by the technology will surely become less expensive and there could be a Tesla in everyone’s drive way. With an explosion in these vehicles they may not keep up with demand.

As Tesla goes through its product life cycle they can better define their forecasts. From the looks of it they are very optimistic. What are your opinions?

Chime in and check out the press release in the link below:

Tesla Motors Supercharger Event

http://www.engadget.com/2012/09/24/tesla-supercharger/

13 thoughts on “Free “Gas” for life? WHAATTT?!

  1. If Tesla Motors can pull this off, I think they will sell a lot of these vehicles. I see what you are saying that the cars are expensive for most Americans, but what I wonder is if people can lease the cars, if more people will take that course of action. I also agree that they would need to find a way to control the under-use or over-use of the stations. Tesla Motors would need to do a lot of research on where these charging stations need to be located in order to avoid the under or over-use of them. Overall, I hope that Tesla Motors makes this a success, it would save a lot of money for Americans not having to purchase gasoline.

  2. The first time I heard about the Tesla cars was about 2 years after the U.S. government decided to give up on electric cars, (I believe this was in 2004 in a documentary called “Who Killed the Electric Car?”). It seemed promising and it really does cut down on the overall cost of gas especially if you agree with arbitrage. I totally agree with what you are saying about these cars being expensive for us today but if they keep throwing in the incentives like “charging vehicles for free, FOR LIFE”, then I think the Tesla company can resurrect the electric cars from the dead. Also, these cars are very exotic looking which could benefit the market demand in their introduction stage in this product life cycle. Overall, great post and great pictures thank you for sharing.

  3. I really liked reading your article about Tesla. I have heard many family members who are in the auto industry talk about Tesla cars and how they were suppose to cost the gas for people and be better for the environment. The only concern with these cars was how pricey they can be. I think that buy creating like what was stated above the incentive to “charge vehicles for free, FOR LIFE,” is a great catch to get people to purchase the cars. I think more people are looking at purchasing cars that are more friendly to the environment and save money in the long run.The one advantage that Tesla has over other companies with electric car is that their cars look “stylish” and “sporty.” I think they have a chance of competing in a competitive market and seeing success.

  4. I agree with you that it is an interesting concept for Tesla to use such an aggressive forecasting method to project and share with the public. Maybe it is their way of trying to find if people will be interested in this idea? It could be possible for more Americans to become interested in this concept with the way gas prices continue to rise, especially in Chicago as we have some of the highest gas prices in the country. If they can continue to find interesting and creative marketing ideas to share this concept with the country, I believe that Tesla has the possibility of extending the electric car’s life cycle and create a huge demand.

  5. This is a very interesting article, with gas prices continuously rising and falling, and soon reaching $5 per gallon on gas. The Tesla concept seems pretty good, but the starting price for the car priced at $77,400, not many average Americans will be able to afford the car unless the car saves them a lot of money in the long run. On the other hand, they are already talking about expanding the Tesla Supercharge to other foreign countries without having to do any sort of market research, there could be a chance their plan to expand overseas can fail because each country is different. They have to target their market and from targeting their market they have to sort down to their potential market and have an estimate of how many consumers will purchase the car.

  6. I agree with everyone here stating that these cars are too expensive. Yes, you wouldn’t have to ever pay for gasoline again and the charging is free, but then again, it is only three hours. If someone were to drive across the country, there might not be a location where you can charge the car. Maybe Elon Musk should consider creating a car the takes both gasoline and electricity.

  7. In class last week, we discussed the concept of forecasting. I am interested to know how Tesla forecasted their demand of charging stations needed in the next 2-4 years. I am surprised that they are planning on reaching the entire US, instead of concentrating on growing their brand and recognition in one specific area first. I also surprised that their least expensive car is priced at $77,400, which rivals the BMW 7series, Mercedes ML350, along with other luxury cars. I think Tesla needs to work on creating a buzz around their products before they begin creating too many supercharge stations.

  8. You raise a good point on how the Tesla team is taking a huge risk in investing so much capital in building this network of superchargers, without having done research on how many Tesla drivers will actually attempt long distance drives. And, although the current price to buy one of their vehicles is on the high-end, I think the “free ‘gas’ for life” incentive is actually really smart. From reading another post on Tesla about a week or so ago, I learned that Tesla is actually planning on doing a mass production of their vehicles by next year. With that being said, Tesla has obviously found a quicker, and perhaps, an even cheaper way to build their vehicles; so, hopefully the price on their vehicles will tremendously drop and these superchargers will increase the sales for Tesla by offering free charges for life.

  9. This article was very interesting, I didn’t even know about Tesla cars until I read your article. I think this a great idea especially now that the gas is so expensive and the prices keep going up so I think this car will do great in this economy. The only problem I think Tesla will have is with the price of their cars they should definitely work on that part because I believe that the price is way to high especially now they should lower the prices and make different sizes and styles and then they could raise the prices higher. Also the charge lasts for 3 hours so that’s another thing they have to work they should try making it longer life especially if they are thinking of going outside of the country people will get annoyed if they have to charge the car every 3 hours. For example driving to Toronto, Canada is like 8 hours so if you had to stop every 3 hours to charge the car that would just not be fun at all and you will not make it in 8 hours. But, overall I think the Tesla car is a great idea.

  10. I think it’s about time that our generation experiences this type of innovation. Elon Musk is taking a major risk in developing this idea, but he’s been successful with his past accomplishments and probably can afford to take such a risk. Like you’ve all said, the cost might seem high for the Tesla, but over the years all that money you would be spending on gas would save up. The stylish and sporty design is also a plus. On the other hand, this part of the industry would need a lot more expanding, for example, most current repair shops don’t have experience on working on maintenance on these type of cars, which can be an issue. Number of charging stations will be another important aspect. For this to be successful, I think they are going to have to push hard on the marketing end, and make it really convenient for drivers. Overall, I think solar power technology has a lot of potential and that eventually this type of vehicle will be used by many.

    1. This article is very intriguing, however I find it very hard to accept that Tesla Motors is willing to invest so much capital in building these supercharging stations, that are expected to be developed in all parts of the U.S. within a span of two to four years. I believe their forecasting method may be too ambitious and therefore create an overestimate on the demand they expect, not to mention their overambitious projections in expanding the development of these supercharging stations in Asia and/or other parts of the world without having much data on the market and the demand for this type of innovation. Surely this type of technology is inevitable but to be established so early on with such high projections is a large risk Tesla Motors may be taking. However, with fairly recent collaborations with established automobile manufacturers such as Toyota, this company may in fact show that these ambitious forecasts may soon develop into a reality.

  11. All the previous comments above are intriguing as to the implications of the future of the cars, and the forecasting the expansion of the supercharger network, however i believe that everyone is truly just skimming the surface as to the issues at hand with the supercharger and its future of the network across the us. Yes, it is an incentive for consumers to purchase there pricy automobiles because of the incentives of free consumable electricity, but the legal issues behind the Supercharger network are outright never ending from my perspective.

    All that Elon Musk has done is take another one of his technologies of the high rate charging solar panels, and find another use for it. Apply it as a marketing campaign or solution of one of the Electric vehicle haphazards. However, he has yet to mention numerous questions at hand. Those questions being:

    Where is he going to aquire the land for the supercharger stations?

    Why would anyone sell him that land, if they can put solar panels there themselves and gross the profit of selling back to the grid without any “free” electricity given away.

    Why would you want to sell electricity at cents per kilowats when you can sell gasoline at the same location for 4-5 dollars a gallon?

    From a marketing and Eco “green” perspective elon musks idea sounds great. From a buisness/legal perspective, its just atrocious in my eyes.

  12. This article really makes me question Tesla’s strategy. It seems like a good idea at first glance. However, I am wondering how they can afford to give away free “gas” for life. I understand that the supercharging stations generate more electricity than the cars use. Is that only because there are not a lot of cars that use them. Lets say that these cars become popular and everyone buys one. Well everyone is gonna need to use these supercharging stations. There is only so much solar energy that these stations can produce I’m assuming so then eventually the number of cars needing charge will exceed the capacity of the stations. So would only the first buyers of the car get free gas for life? I think if these supercharging stations produce so much energy that they are making money off of them then it is a good idea to just build the stations alone. If they built them all over the country like they plan to then eventually they can just make money off of producing electricity theoretically. Maybe they can have these charging stations everywhere and universal. They can charge non Tesla owners to use them and Tesla owners would use them for free. They could become the first “gas station” company and car company.

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