I just want to preface this by about why we are we doing this, why does Tesla exist, why do we make electric cars, what does it matter? It is because it's really, really, really important for the future of the world to accelerate transition to sustainable transport. We have record high CO2 levels. We have recently passed over 403 ppm (parts per million) of CO2 in the atmosphere. On a chart it looks like a vertical line and it’s still climbing. The last time there was this level of concentration was 11 million years ago, that was approximately when primates started walking upright. The world was very different, we do not want to return to that situation. What that CO2 increase results in is a steadily increasing temperature. We’ve already increased by 2°F. In fact that doesn’t tell the whole story, because the extremes of temperatures increased as much as 20°F. and that line is going to keep going for sometime in the future. Beyond global warming there is just the fact that combustion cars emit toxic gases. According to a MIT study there are 53,000 deaths per year in the US alone from auto emissions. It stands to reason that if a vehicle is spewing toxic gas, that's obviously bad for your health. To address this we at Tesla came up with what we called ‘The Secret Tesla Motors Master Plan’ it wasn't all that complicated and basically consisted of:
. Create a low volume car, which would necessarily be expensive
. Use that money to develop a medium volume car at a lower price
. Use that money to create an affordable, high volume car
And...
. Provide solar power.
No kidding, this has literally been on our website for over 10 years. This was the first blog that I ever wrote for the company and it was originally a three-step trilogy, but now it’s a four part trilogy. We needed to figure out how can we as a tiny company with very few resources actually make a difference. The only way to do this was to start small.
Step 1 was the Roadster. The Roadster was high price and low-volume, but where it really made a difference was that it showed people and it showed the world that you could make a compelling electric car. What was unique about the Roadster was that it was the first really great electric car. For those of you who bought the Roadster, thank you.
Still lot of people said: “The Roadster is nice, but it's sort of a toy, and is very expensive, and you couldn't really make a car that people would use every day, or a car that can really compete against the great combustion sedans of the world.” so we said oke, we are going to make the Model S. I think the S is still a superior sedan. It was tested by ‘Road and Track’ and ‘Motor Trend’ and others as the fastest four-door car in history, ever. It was rated by almost every group as the best car in its year and by Consumer Reports as the best car ever. It’s a great sedan and it can seat up to seven people, five adults and two kids.
We came from the Roadster, making only 600 units a week where the non-power train portion of the car was made by Lotus and we did the power train and final assembly of the car, and we went from that to the Model S a far more complex car where we did the whole thing.
Now for cars about half the market wants a sedan and about half the market wants an SUV, so we thought well we’ll extend the Model S platform into the Model X. The Model X is an incredible car but it was overreaching for the first-generation of the product. The mistake that we made, and I obviously take the prime responsibility here, was having far too much advanced technology in version one of our product. I definitely burned out of few neurons and a lot of other people did solving the early production ramp. I feel we're in a good place at this point, I feel like the machine that's making Model X and Model S is actually functioning quite well right now.
Both of these are very important because the revenue from the Model S and the X is what was needed to develop the Model 3. The Model 3 with very high volume and all the engineering to achieve the cost reductions and the capabilities cost billions of dollars. The S and the X are what paid for that Model 3 development, so all of you who bought a S or a X thank you for helping pay for the Model 3.
In the case of Model 3 we're strived hard to simplify and make sure that it has everything essentially to be a fantastic car. We aimed for something that was a very simple clean design because in the future, or really the future being now, it will be increasingly autonomous. You won't really need to look at an instrument panel all that often, you'll be able to do whatever you want, you’ll be able to watch a movie, talk to friends, go to sleep. Every Tesla being produced right now, the Model 3, the Model S, and the Model X has all the hardware necessary for full autonomy. I think a lot of people still don’t realize that.
I personally probably took a year off my life or more camping out at Fremont factory along with a number of other members of the Tesla team. We went through bloody hell in the first half of the year, but as the saying goes: “If you’re going trough Hell, keep going” we feel we have gained a lot of experience. We certainly aspire to learn from the mistakes of the past and I think we largely have.
We do no promotion of Model 3, we don't advertise – we don't advertise in general – but we don't – like, how often do you see me mentioning a Model 3? I think people sometimes forget that all we did for the Model 3 was half our webcast. There's no advertising, no guerrilla marketing campaign. We sent out a few tweets, like hey, there's going to be a webcast. There were a lot of people that decided they wanted to place a deposit for the car, which is cool. I want to emphasize you couldn’t see the car unless you wanted to look at pictures online, you couldn’t test drive a car, and you had to put down a $1,000 deposit. There were 500,000 net reservations, to be more accurate there were 518,000 gross reservations and we had 455,000 net reservations, but those cancellations occurred over the course of more than a year.
We didn't want to get people too distracted from today's product in favor of tomorrow's product. It should also be noted that one of our big concerns was that Model S particularly, and Model X demand would suffer with the introduction of the Model 3. In fact, this has turned out to be the opposite situation. Model S and Model X demand increased with the release of Model 3. It was a big concern but it has turned out to be a pleasant surprise. When somebody comes into our store to buy a Model 3 we say, well, why don't you buy Model S or an X instead? we anti-sell the 3. Still a lot of people order the 3, we basically sold out the first year of production, so the first 12 months production or thereabouts. With a small amount of effort we could easily drive the Model 3 reservation number to something much higher but there's no point. It's like if you're a restaurant and you're serving hamburgers and there's like an hour and a half wait for the hamburger, do you really want to encourage more people to come order hamburgers? that doesn't make sense.
A frequent question I noticed popping up on Twitter quite a lot is: “Where is my Model 3?” sometimes not phrased quite as nicely as that. We’re building the cars as fast as we can, we are going to drive the ramp up as hard as we possibly can. Probably the second most common question I get on Twitter is like: “The Supercharger is full what is wrong with you, why are you such a huge idiot?”
If you see the reviews, one could not ask for better reviews. I just thought I'd give you one little anecdote which I found quite surprising is that when the journalists were driving the car and doing test drives, about 80% of the journalists said that they would buy the car themselves, most of the remaining 20% said probably. This is crazy, I've never seen anything like it, so this is a very good sign.
What's great about the Model 3 is we have the A suppliers, and we have the A-teams at the A suppliers. With Roadster and certainly with Model S, and to a slightly lesser degree with Model X, we often could not get the top suppliers, and we certainly couldn't get the A-team at the top suppliers. I can't tell you how important this is. It makes a massive difference, and I'd like to give some credit to all the suppliers that worked so hard to get us to this point.
We now got 3 cars in production, there’s the X, there’s the S, and the 3. Those letters can be combined however you’d like. Things got a little confusing because of the nomenclature of being Model 3 versus Model S and X, which was I guess sort of my fault being too clever for my own good there, because especially the Model E, as you can tell I have a wonderful sense of humor.
I just want to say to those that have lined up to buy a Model 3 and in some cases have spend days outside of our stores to be first on the list, I just want you to know that really matters to us, we really care. We will do everything we possibly can to get you the car as soon as possible. We’re going to work day and night to do right by the loyalty that you have shown us. Thank you for doing that. And I'd like to again thank all the customers who own a Model S and X and those who buy a Model S or X because in doing so you make the 3 possible. The money that we make with an S and X all goes into building Model 3, so thanks for doing that the Model 3 is happening because of you.
In addition to consumer vehicles there are two other types of electric vehicles needed: heavy-duty trucks and high passenger-density urban transport. Both are in development at Tesla. We believe the Tesla Semi will deliver a substantial reduction in the cost of cargo transport while increasing safety and making it really fun to operate. Essentially it's meant to alleviate the heavy-duty trucking loads. This is a heavy duty, long-range semi truck with the highest weight capability and with long range. This is something which people did not think is possible, they think the truck doesn't have enough power or it doesn't have enough range. And with the Tesla Semi we want to show that no, an electric truck actually can out-torque any diesel semi, and if you had a tug-of-war competition the Tesla Semi will tug the diesel semi uphill.
I'll tell you about what this truck can do, it blows my mind I think it'll blow yours. It was quite bizarre test-driving when I was driving the test prototype for the first truck. It's really weird because you're driving around and you're just so nimble and you're in this giant truck. I drove it around the parking lot and I was like this is crazy, it’s like ‘It’s alive!’ driving this giant truck and making these mad maneuvers. It’s definitely a case where we want to be cautious about the autonomy features.
Starting with performance, one thing we really care about at Tesla is performance, we want a vehicle that feels incredible, that accelerates like nothing else. The Tesla Semi will go from 0 to 60 in five seconds, by itself or with a trailer. Now at 80,000 pounds max gross vehicle weight, that's the most amount of weight you can carry on a US Highway, even with 80,000 pounds pulling max gross it’s getting 60 miles an hour in 20 seconds. Now what about up a hill? the best diesel trucks can only do 45 miles an hour up a 5% grade. Tesla Semi can do 65 miles an hour at a 5% grade, that’s 65 miles an hour continuous at max gross. What this means is that if you're pulling a load over the Rockies or some mountainous terrain up a hill you’re earning 50% more per mile then you are with a diesel truck. That’s a gigantic difference.
One of the biggest questions we’ve been asked about electric trucks is how far can they go? It’s got a 500 mile range at maximum weight at highway speed, like 60 miles. That’s worst-case scenario.
We designed the Tesla truck to be like a bullet, where as the normal diesel truck is more designed like a barn wall, this is a bullet. The Tesla Semi has a drag coefficient of 0.36, this is a really good number. By way of comparison a Bugatti Chiron, which is a 2 million dollar super car has a 0.38 drag coefficient. It’s got a better drag coefficient than a super car.
We also have four independent motors there’s a motor on each of the rear wheels, and independent front suspension so it’s incredibly comfortable to drive this truck. The driver is actually in the center of the truck, you’re positioned like you're in a race car you have complete visibility of the road and all the surroundings. It’s a beautiful spacious interior and you can stand up inside.
What will be really fun about this is you have a flat torque RPM curve with an electric motor, whereas with a diesel motor or any kind of internal combustion engine car you've got a torque RPM curve that looks like a hill. So this will be a very spry truck you can drive this around like a sports car there's no gears, it's like single speed. It feels incredible to drive this, it’s one of the most incredible feelings and it’s incomparably better than any other truck on the road. I can drive this thing and I have no idea how to drive a Semi.
It has a few other benefits as well. You have a low center of gravity that gives you really good handling, that means your probability to have a rollover is massively reduced because the battery pack is in the floor pan. Perhaps most importantly jackknifing is usually the worst nightmare of a trucker, how do you stop your vehicle from jackknifing when you are in difficult conditions? the truck will automatically stop jackknifing because it’s got independent motors on each wheel, it will dynamically adjust the torque on each wheel so that jackknifing is impossible with this truck. Your worst nightmare is gone with this truck, gone.
The feature I like best is the ‘thermo nuclear explosion proof’ glass, I mean it’s close, it’s like it either survives a thermo nuclear explosion or you’ll get a full refund.
The reason this is important is because truck windshields are huge and they crack about once a year, and if the truck windshield is cracked you're not allowed to drive. It’s truck off road if you have a cracked windshield, and that means lost revenue, disappointed customers, and if you’re stuck in the middle of nowhere it can take ages just to get a new windshield. This detail matters a lot to someone who really understands trucking, it’s small but very important.
Now one Tesla truck considered by itself beats other diesel trucks, but what if you have a convoy? what if you have two trucks following, so you’re more like a train driver. In fact the convoy technology, the tracking technology is something we are confident we can do today 10 times safer than a human driver. I want to be clear this is something that we can do now. Now if you look at the economics of a truck convoy it gets way better, now a diesel truck is twice as expensive. What this means is that it’s not just economic suicide to use one diesel truck, it’s economic suicide for rail. This beats rail, this is quite profound this product is better from a feature stand point that wins on economics from a diesel truck and it defeats rail in a convoy scenario.
Just for interest sake we created a pick up truck version of the Tesla Semi. It's a pick up truck that can carry a pick up truck. You can legally drive that, it shouldn’t be legal but you'll actually be able to legally drive it with a normal drivers license, it’s wrong but..
So we started Tesla with the Tesla Roadster a sports car. That baby got us going it was the foundation of the whole company and people have asked us for a long time: “When are you gonna make a new Roadster?”… We are making it now, and there’s I don’t know if you watched ‘Space Balls’ the movie, but there’s only one thing that’s beyond ludicrous, which is plaid. The base model will do 0 to 60 in 1.9 seconds. This will be the first time that any car has broken 2 seconds at 0 to 60. It will be the fastest to 100 mph, 4.2 seconds to a hundred miles an hour. It will do the quarter mile in 8.9 seconds, this will be the first time that any production car has broken the 9 seconds at a quarter mile. These are all world records and this is what we are achieving in the prototype. This is going to have a 200 kWh battery pack with a 620 Mile range, these numbers sound nutty but they are real. That’s a 1000 Kilometer range, this will be the first time a production vehicle breaks the 1000 kilometers, it will travel more than a thousand kilometers on a single charge at highway speed. You will be able to travel from L.A to San Francisco and back at highway speed without recharging. It’s also a 4 seater, it’s a convertible, and it has a ton of storage so you’ll be actually able to travel somewhere and bring luggage and bring whatever you want.This thing will have three motors so it's all-wheel-drive. It will be able to do torque steering. 10.000 Newton Meter of torque if you know what that means, it’s just stupid. I won’t say what the actual Top Speed is but it’s above 250 MPH. The new Tesla Roadster will be the fastest production car ever made….period. The point of doing this is just to give a hardcore smackdown to gasoline cars. Driving a gasoline sports car is going to feel like a steam engine with a side of quiche.