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Why We’re Keeping a Watchful Eye on Tesla (and Elon Musk)

Why Green Entrepreneurs Are Keeping a Close Eye on Tesla (and Elon Musk)

At this point in time, a lot has already been said of Tesla, originally an electric car development company named after brilliant inventor Nikola Tesla, and its CEO and visionary Elon Reeve Musk.

Feedback have been both positive and negative, and a lot more in between. But what is clear is that Tesla and Musk are disruptors. They have literally changed the automobile industry and is still shaking up the status quo.

In fact, the shakeup has made such a big impact that Tesla is banned from selling its vehicles in several U.S. states such as Texas, Michigan, Connecticut and Utah1

There are no Tesla stores in more than half of the U.S. and some states only have galleries where you can view Tesla cars but will not be able to drive away with one.2

But as Musk said, “if something is important enough, even if the odds are against you, you should still do it.3

And indeed, the man lives up to his mantra.

This despite reports that Tesla loses money in every car it sells, to the point that it has lost $290 million in 2014 and $888 million in 20154 But it seems that what is important to Musk is not the bottom line but literally making the world a better place.

And this is what makes the automobile industry, manufacturers, regulators, petroleum giants etc. quake with the challenge that Musk and Tesla present.

One, every Tesla vehicle sold means a reduction in petroleum and greenhouse gas emissions. A regular petroleum fueled car using a gallon of gas for every 25 miles will consume 400 gallons annually. This means that for every 100,000 Tesla cars, 40 million gallons of petroleum will not be sold.5

Why Green Entrepreneurs Are Keeping a Close Eye on Tesla (and Elon Musk) - Tesla Model X

And that is a big win for the environment.

Second, Tesla has deviated from spending a ton of money on advertising and big-time marketing. It sells directly to customers and does not have to wine and dine dealers, dealers, regulators etc. This makes a big impact on how the automobile industry is currently set up.

Third, Tesla is so open that they have released their patents to the world.6 Instead of guarding their patents and innovations so closely, they want to collaborate with the public and their competitors in order to spur more innovation in the industry, definitely an admirable feat. 

Fourth, Tesla pioneers an entirely different business model. The company takes deposits from clients one to three years in advance of production and delivery7 that will go towards funding its innovations. Of course, this model has its own risks but it shows commitment on the part of the company and builds long-standing relationships with its customers.

Fifth, it is totally committed to minimizing environmental impact. In order to make the Tesla Model 3, its first mass market car, the company is building Gigafactory – the largest earth-friendly, earthquake resistant building in the world at 10 million square feet – in Sparks, Nevada.8 And it is an environmental marvel.

It will not use any fossil fuels and will be largely dependent on solar panels that will be placed on the building’s roof and in the areas surrounding it. To sustain energy requirements, solar energy will be complemented by geothermal and wind power. It will likewise feature a state-of-the-art recycling center.9

But the innovations currently being done by Tesla will not stop with its electric cars. Musk has repositioned Tesla as an energy company, specifically a sun-to-vehicle energy company,10 which will work towards the continued development of solar cars, powerful solar batteries, and the solar rooftop.

On 31 October 2016, Musk has unveiled high-efficiency solar tiles that looked like the regular slate and Spanish clay roofs. Said tiles are made of strong and durable textured glass with what Musk termed as a “quasi-infinite lifetime” that are connected to solar cells or batteries.11

These batteries can then be used to provide the energy needs of the home, including the charging of the Tesla cars.

Currently, Musk is on track with the production of Tesla’s Model 3 electric car, acquired SolarCity to build the solar panels and partnered with Panasonic to develop the solar batteries. By 2018, the Gigafactory is expected to be in full capacity to deliver on Tesla’s potentials.   

The entire point of this new company direction is that Tesla wants to make “renewable energy more reliable and affordable than traditional fossil fuels.12 Of course, we already know that this conforms to Musk’s vision of making the world a better place.

With innovations such as these and the commitment to a better world, hopefully, we all will see more positive changes in the next few years not just from Tesla but from other ethical companies and small businesses.

What do you think about this new Tesla direction? Shall we see more companies in the next few years trying to effect changes for a better world? We would love to hear your thoughts!

Show 12 footnotes

  1.  Hull, D. and Fisk, M. 2016. Tesla Cranks Up Pressure to End Ban on Direct Auto Sales. Bloomberg, 22 September 2016. Available at: https://www.bloomberg.com/news/articles/2016-09-22/tesla-lawsuit-claims-michigan-direct-sales-ban-unconstitutional.
  2.  Wagner, S. and Albright A. 2015. Ban and Buy: U.S. States’ Love-Hate Relationship with Tesla. Bloomberg, 15 September 2015. Available at: https://www.bloomberg.com/news/articles/2016-09-15/ban-and-buy-u-s-states-love-hate-relationship-with-tesla.
  3.  Musk, E. 2012. In: Hibbard, S. 2012. Marketing – 5 Lessons from Big Idea Guy, Elon Musk – Infographic. The Marketing Bit Made Simple, 15 October 2012. Available at: http://www.themarketingbit.com/marketing-lessons/marketing-5-lessons-from-big-idea-guy-elon-musk-infographic/.
  4.  Dyer, J and Gregersen, H. 2016. Tesla’s Innovation Are Transforming the Auto Industry. Forbes, 24 August 2016. Available at: https://www.forbes.com/sites/innovatorsdna/2016/08/24/teslas-innovations-are-transforming-the-auto-industry/#4f6c015519f7.
  5.  Gross, D. 2016. Tesla’s Real Innovation Isn’t the Electric Car. Slate, April 2016. Available at: http://www.slate.com/articles/business/the_juice/2016/04/tesla_s_real_innovation_is_its_business_practices_not_its_electric_cars.html.
  6.  M, AJ. 2014. Disruptor Status: Tesla Motors. Republic Wireless, 22 December 2014. Available at: https://pwk.republicwireless.com/disruptor-status-tesla-motors/.
  7.  Gross, D. 2016. Tesla’s Real Innovation Isn’t the Electric Car. Slate, April 2016. Available at: http://www.slate.com/articles/business/the_juice/2016/04/tesla_s_real_innovation_is_its_business_practices_not_its_electric_cars.html.
  8.  Thompson, C. 2016. 8 Awesome Innovations in Elon Musk’s Gigafactory. Business Insider, 13 April 2016. Available at: http://uk.businessinsider.com/features-in-teslas-gigafactory-2016-3?r=US&IR=T/#at-10-million-square-feet-the-building-will-be-one-of-the-largest-on-the-planet-1.
  9.  Ibid.
  10.  Randall, T. 2016. Six Things We Know About Tesla’s New Solar Strategy. Renewable Energy World, 28 October 2016. Available at: http://www.renewableenergyworld.com/articles/2016/10/six-things-we-know-about-tesla-s-new-solar-strategy.html.
  11.  Randall, T. 2016. Elon Musk Just Showed Us the Grand Unification of Tesla: Fast Cars, Big Batteries and a Stunning Solar Rooftop. Bloomberg, 31 October 2016. Available at: https://www.bloomberg.com/news/articles/2016-10-31/no-one-saw-tesla-s-solar-roof-coming.
  12.  Coren, M. 2017. Tesla has Dropped the “Motors” From Its Name in a Race to Become the World’s Solar Supplier. Quartz, 01 February 2017. Available at: https://qz.com/900393/elon-musk-seeing-teslas-future-as-an-energy-company-has-dropped-motors-from-the-company-name-tsla/.

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About the author

Polly Michelle Cunanan

Polly Michelle Cunanan

Polly Michelle Cunanan is a results-driven media and communication expert with over 15 years of experience and proven track record in working with the Philippine Government and donor agencies such as the USAID, World Bank, UN-FAO, ADB, European Union (EU) and media. Political and strategic communication, messaging and campaigns are among her expertise. She spearheaded the communication program on the Bangsamoro peace process which led to a conducive environment for the signing of the historic Comprehensive Agreement on the Bangsamoro between the Government of the Philippines and the Moro Islamic Liberation Front. She is a graduate of BA Broadcast Communication from the University of the Philippines and has completed the academic requirements for MA Communication Research from the same university. She is a UK Chevening scholar currently studying MA International Public Relations and Global Communications Management at Cardiff University.

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