Tuesday, March 26, 2013

Would you pay $30,000 to never buy gas again?

Elon Musk is 41 years old has already changed the world three times. And we're not talking about tiny little ripples in human history. No, Elon has done the equivalent of inventing fire, the wheel, and the first money, all in the span of about twenty years. Imagine what he might accomplish with his next forty.

 
By now, everyone knows that Elon Musk was a co-founder of PayPal, a company that created a form of online money exchange so revolutionary that, as a never-before-seen hybrid of money transfer and financial institution, the Federal Trade Commission and the Federal Banking Commission had to split oversight into two separate parts. PayPal was so effective and had such great customer service that its early customers were nearly as zealous as current-day Apple followers.

In 2002, PayPal was acquired by eBay for 1.5 billion dollars, of which 175 million was Elon  Musk's portion. He could have retired to the beaches of the unspeakably rich, but instead Elon set out to fundamentally change the world.

Let's stop and talk about this for a moment. There are some entrepreneurs who, after their companies are established and proven successful,  claim they did it for one exalted reason or another; in Elon's case, however, the philanthropy came first. He said from the outset that paving an optimistic future for mankind was his ultimate goal. To do that, he invested every last cent of his new fortune in three major companies, and all three nearly failed; SpaceX had early rocket failures that brought them to within a hair of utter collapse; SolarCity had almost insurmountable problems establishing bank financing to allow it to grow into profitability; and Tesla Motors had a long string of early design problems and delays that forced them to beg at federal doors. In 2009 Tesla Motors was approved to receive 465 million in interest-bearing loans from the United States Department of Energy.

Now if Elon was simply a business owner, you might say he was too much of a gambler, but if you look at him through the prism of his intent, which is not to make money but to change the direction of human society, those have been small bumps in the road.

Today, SpaceX has righted its technology and its accounting books and now has a long list of first-ever accomplishments that would require several blogs just to list them. SolarCity has not only a sound financial footing, it is already a major electricity supplier in both the residential and commercial markets, and their new no-money-down solar leasing program has virtually revolutionized the industry. It is also in the midst of building a network of solar changing stations for electric vehicles.

Regarding Tesla Motors, Elon said from the beginning that they had to create an electric car with good range. But he knew limited production capability would make the cost of that first model too high for the average driver. It would, instead, need to be built for a luxury audience. The 2008 Tesla Roadster had a price starting at $109,000, and more than 2,400 have now been sold worldwide. In mid-2012, Tesla began delivery of its four-door Model S sedan, a car starting at about $60,000. More than 2,500 were sold and delivered in 2012. The company expects to deliver an additional 20,000 in 2013.

 
Finally, let's talk about Tesla Motor's latest announcement, which came directly from Elon Musk via Twitter: "$30k in 2013 ... w 200+ mile range w some really cool tech that we can't talk about yet."

This means that a $30,000, fully-electric Tesla car has finally arrived, and with a one-charge range of over 200-miles, it's well ahead of Chevy's Volt (40 miles per charge) and Toyota's Rav4 (100 miles per charge). The price also ensures that demand will be strong.

It looks as though electric vehicles may now be here to stay. Chalk up another one for Elon Musk.

So I ask you again, would you pay $30,000 to never buy gas again?

 

3 comments:

  1. WOW !!! this is awesome wonder how many will be produced this year?

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    1. Hi, Tom. I'm not sure how many of the new model will roll out of the factory, but change is finally coming. Another inventor on March 19th announced that he can get 200 miles per gallon of gas from a vehicle he has modified. A couple of years ago that would be exciting but today...Meh :-)

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