Tesla has been in the news a lot lately. That’s saying something for a company that tends to be hovering near the front of the business headlines in the country on a week to week basis. This go-round is not exactly the kind of positive press that the Tesla outfit is used to, though. Manufacturing woes, executive flight from the upper echelons of the company, and the incredible rate that the business is burning up cash have all gotten the attention of business publications and enthusiasts alike. The most recent development internally for Tesla was a memo released days ago by Elon Musk stating that the company was going to “flatten” its management structure. We’re not sure how many people will be laid off or when, but the words in the memo lead everyone (including us) to think that there will be some pink slips flying around.
Obviously a management reorganization is a key way for a company to cut down on expenditures and we’re guessing this is the first of several measures Musk is going to try and lock down the cash bleed that the company is experiencing. Hell, the guy just plowed a pile of his own money into the company, again, buying 33,000 shares of stock.
While laying off people saves money, the other thing that really costs loads of dough is developing new products from the ground up and that’s the case with the Tesla Semi truck that was introduced last year to incredible fanfare and continues to bubble up to the front pages of news sites on a frequent basis. The machine has the proposed specs to really change the way trucking works in the country and how Class 8 rigs look, feel, and get powered down the road. Musk kind of blew off questions regarding the future of the truck on a recent earnings, stating that Tesla was not actively “selling” the rig and just kind of taking pre-orders as they came in.
With the myriad of issues the company has been having trying to get production not only up to speed, but up to standard for the Model 3, the truck task looks Herculean. Why? As of this moment, a couple of prototypes exist and little else. There’s no factory for big rigs, there’s no production line for big rigs, there’s been no hiring of additional people to build them, design them, deal with production issues surrounding them, etc. It will be an incredible financial strain on the company to get that effort off the ground, let alone test and final engineer models in real world conditions.
It is a fascinating story and one that we have not seen in the automotive age. By that we mean the saga of Tesla. This is the type of stuff companies struggled with 110 years ago getting off the ground. The numbers were smaller back then but the forces against success were no less daunting or difficult. Think they can pull it off? The odds seem to get longer by the day.
Link: SeekingAlpha.com – The Tesla Semi Is Dead
Charging is the biggest killer here. Take a company with a small fleet on the order of 40 trucks, that all spend the night in one of two home bases. Think along the lines of a company that runs exclusively LA-SLC, or Dallas-Houston.
Each base will require a substation that could serve a town of 10,000, plus very sophisticated charging hook-ups for each truck. This is going to be high voltage, high amp stuff. That alone will eat up enough cash to buy millions of miles worth of diesel.
Then there’s the weight of the battery. If, as we’ve been told, the batteries will use up 20% of the allowable payload, that means you need 48 trucks and drivers to compete with a 40 truck conventional fleet. You also need to replace 20% more tires, and service the undercarriages of 20% more trucks. These factors alone will eat up more than what you can save in diesel costs.
Wild card! If you fully charge your fleet every day, you’ll probably lose 1% of your potential range every month. Even if you only lose 1/2 of a percent, that means you’ve lost 25% in 4 years. What if you’ve only got a 15% range factor to work with? What if your whole model is built around each truck having 15% left in the “tank” at the end of the day?
I’d say the Tesla semi is the flying car of the transport industry.
This wheeled abomination is as dead as the batteries that would have run it after their charge ran out in the middle of nowhere and jammed up the interstate with no hope of moving it!
Add in the center drivers position and no mirrors. It had to have been a layout don’t by kindergartens.