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Plug In Drivers Not Missin' the Piston

This is the Kodak Moment for the Auto Industry. Electric vehicles are here to stay. Their market acceptance and growth will continue....

Friday, February 23, 2018

10 Years of EV Driving (Part 8 - Goodbye Prius, Hello Tesla)

Our gradual path to a 100% EV household.

This is the story of our home fleet slowly electrifying. It all began in 1999 when my wife's Subaru was hit by a driver that ran a red light and we replaced that car with a Prius. This chapter has some parallels to that first one.

One afternoon in February of 2016, my wife and I were headed to pick up our daughter after school. On the way there, a rideshare driver, apparently rushing to pick up a fare, ran a stop sign and struck my wife's car. She was driving her Prius. The airbags deployed and the car was totaled. Long story short, lawyers became involved and the case was settled.

With the Prius gone, we still needed two cars to get around. My wife took over the keys to the Leaf and I was relegated to the old Honda Passport SUV. After driving electric cars for years it was strange to be driving a gas vehicle again. This could not stand. I needed a plug-in vehicle.

The Prius was gone and now it was obvious that the Passport had to go too. The Leaf worked great for commuting and errands, but it could not pull our pop-up camper, nor was it suited to long-distance treks. To replace these two, we need something that can tow and had long range.

The vehicle that I had in mind was the Mitsubishi Outlander Plug-In Hybrid. With 30 miles of electric range and then 40 MPG in hybrid mode, the specs for this vehicle looked great on paper. However, I had been watching and waiting for this vehicle since 2013 and it was yet to make its US debut.

Next for our consideration was the Volvo XC90 T8 Plug-In Hybrid. This vehicle had an all-electric range of 17 miles and an MPG of 53 in hybrid mode. The electric range was too short for my round trip work commute and the price tag was nearly $70k. If I were going to spend $70k, I might as well get the vehicle that I really wanted, a Tesla Model X.

After a couple weeks of research, later in that same month that the Prius was destroyed, we placed a reservation for a Tesla Model X. The car could tow 5,000 lbs and it had a 257-mile range. In Sept of 2016, I drove the Passport for the last time and with a gas tank as empty as my desire to buy the gasoline needed to fill it, I handed the keys over as a trade for my new Tesla.

This was it, we were now an EV-only family. No more trips to the gas station. No more oil changes.


Tuesday, February 20, 2018

Tesla's Clever Plan to Time The 200k US Delivery

We've been tracking Tesla's 200,000th US vehicle delivery here for over a year. This is an important delivery since it will trigger the countdown to the phaseout of the federal EV tax credit.

Our latest estimate is that Tesla will cross the 200k mark in June of this year. Since the incentive operates on 3-month increments (quarters of a year), it is much more beneficial to EV buyers if the 200k mark is crossed in the beginning of a quarter than at the end of a quarter. If our estimate is correct and Tesla would cross the mark in June, it would be much better for their US customers if they delayed this event a few weeks and waited until July to cross the 200k mark. This will give their customers nearly 3 more months of the full $7500 federal tax incentive.

Elon Musk has commented that Tesla would do the right thing for their customers in this regards. Here's his tweet from 2016:

Now that the day is approaching, how will Tesla "beget loyalty"? The answer is to delay the 200k delivery into early Q3. This would mean that the full $7500 tax credit would last until the end of 2018. This will allow many more buyers to enjoy the full incentive as their production will be in much higher gear by the end of the year.

Additionally, I like the poetry of delivering the milestone car on July 4th; making it an "End Dependence" day. Perhaps Tesla could hold an event and deliver dozens of Red, White, & Blue cars that day. Topped off with a big evening flying droneworks (rather than fireworks) show (after all drones are electric vehicles).

Red, White, & Blue Teslas
Specifically, how would Tesla bump the milestone delivery into July? There are two things that have recently happened that potentially hint at Tesla's plan.

1) Some Canadian Model 3 reservation holders are reporting that their delivery estimation dates have changed from Late 2018 to Mid 2018. Diverting a couple weeks worth of Model 3 production to our neighbor to the North would allow Tesla to move the US milestone delivery out.

2) Tesla has delayed the Model X deliveries. Earlier this month (Feb 2018), many people began to notice that the delivery estimate for new Model X orders had moved from the typical 6 weeks to "June 2018". There is a speculation that this is for a Model X refresh. This speculation may be right, Tesla could be using this time when they need to temporarily slow down deliveries to refresh their high-end vehicle. The Model 3 has, for example, a much more responsive touchscreen and a better sound system. This feature "inversion" has to be resolved soon. A vehicle that costs ~twice as much should have at least as good of a touchscreen. Putting a gap between the current Model X and the refreshed X does two things: one, it allows the current inventory to sell before the refresh is announced, this avoids the need to discount the current stock and second, it helps delay the 200k vehicle by a couple months of Model X deliveries.

These are the two things that Tesla could be doing to time the golden ticket. If this is their plan, I say bravo and congratulations to the lucky Canadians that will be getting their cars sooner and (if the rumors are true) to the soon to be Model X owners that will be receiving an upgraded car in July of this year. And most importantly, to everyone that takes delivery of a Model 3 in October, November, and December of this year and qualifies for the entire $7500 incentive instead of just $3750.

Friday, February 16, 2018

Tesla Competition: Culture Eats Strategy!

Tesla Roadster 2020
If you read traditional auto press, you'll frequently see stories along the lines of "big automakers are going to start making EVs in a couple years and when they do, Tesla is doomed."

Traditional automakers have the resources, factories, and engineers to design electric cars and they are very good at manufacturing, so, on the surface, this "Tesla's doomed" statement seems logical, but it is completely wrong. I'll explain why.

For the legacy automakers, there is a phrase that applies: Culture Eats Strategy!

For over a decade now, many automakers have been announcing EVs "coming soon." Like “Tomorrow” from the musical Annie, it's always a day away, or in this case 3 to 4 years away. As I write this in Feb 2018, you can find multiple press releases for EVs coming in 2021.

Toyota has announced plans for EVs multiple times that have resulted in half-hearted low volume offerings at best. If they really jumped into EVs with both feet, they could be a significant threat to Tesla's future. But they can't turn the ship. Toyota's revenue sources are gas and hybrid cars and trucks. And Toyota has years of R&D sunk into fuel cells. They have a culture of designing, manufacturing, and selling these gas and hybrid cars. They have been very successful doing this. Success detours change.

If you are in a failing company, it is obvious that you need to pivot. If you're on a path to failure, nearly any alternative looks like a better option. If, however, you are on top and things are going well, it is far more difficult to see the need to change course. The Kodak view of ignoring upstarts is far more common when things are going well. Find a few flaws with the current generation of competitive technology and you can erroneously use them to dismiss the entire category, present and future.

The world has changed. Millennials will not live or drive like boomers. Emission standards are higher than ever. Many cities will have emission-free zones and many countries have announced plans to become fossil fuel free. Strategies that were successful in the last five or more decades are not likely to be successful in the next decade. To borrow from Marshall Goldsmith’s book, what got you here won't get you there.

Toyota is just one example but this could apply to most legacy automakers. If they cannot adapt to the sea change that is happening, the market will pass them by. Their past success is their biggest hurdle to taking the company in a new strategic direction.

Success can blind a company to the need to change for market factors that will impact the bottom line in the long run.
A senior executive can say, "We're making EVs and they will be out in 3 years!", but if no one in the company believes in the vision because they have built their careers on hybrid technologies or optimizing combustion engines, then there will be little or no progress on the announced strategic direction. Culture Eats Strategy.

You might argue that this applies to Toyota or Honda, but what about companies like GM and Nissan that have put EVs on the market in a big way?

GM has the Volt and the Bolt EV on the market. Both are great plug-in cars. In the race to an affordable long-range EV, the Bolt even beat the Model 3 to market by a year. Yet 400,000 stood in line to wait for the Model 3. Whereas GM sold about 23,000 Bolts in 2017. GM has the capability to produce hundreds of thousands of cars. Why don't they have people standing in long lines for their EV? GM is not a pure play. Their dealerships often divert people to other cars when they come in and ask about a Volt or Bolt. They cannot market the environmental benefits of their plug-in cars without making every other car that they sell look bad. And finally, GM has refused to invest in EV infrastructure. They are car makers, not a fueling company. They participate in the standard, but infrastructure deployment is someone else's problem. Culture Eats Strategy.

If you want to launch an entirely new way to drive, you have to consider the entire user experience. That might mean doing somethings that are different than what you've done in the past. Despite their resources and the fact they are selling EVs, they have been unable to adapt. They don't have a culture of providing fueling solutions, so it is not even on the table for these new vehicles.

Fiat's CEO has time and time again said that no one wants to buy an EV and that they lose money on every car that the California zero-emission mandate requires them to sell. They are making only a de minimis effort. Rather, they should have taken this "requirement" and turned it into an opportunity. Fiat owns the Ferrari and Alpha Romeo brands. If they would have made a high performance, long-range sporty or luxuries (or both) EV, it could have commanded a high enough price to offset the battery cost. It might have been a car that excited people. Instead, they made an EV version of the tiny Fiat 500 and only sold it in ZEV states. This is known as a "compliance car." Here culture actively fought against a new strategy.

Talking about Tesla, Ford's CEO, Mark Fields (ousted in 2017) said, "We have driven the Model S, torn it down, put it back together, and driven it again. We’re very familiar with that product." Yet Ford does not make anything like the Tesla Model S. The Model S was Car of the Year in 2013. That's five years ago. Where is the proof that Ford learned anything from the disassembled Tesla? Where are the over-the-air updates? Where are the big touchscreens? Where are the long-range electric cars? Where are the coast-to-coast charging networks?

BMW, Ford, Mercedes, and Volkswagen have all reverse engineered Tesla's vehicles. They know the technology, Tesla's patents are open source, there is nothing that these legacy automakers could not produce. Yet they don't. It is not in their culture to take risks. For the legacy automakers, what's past is prologue.

So when I hear statements like, Tesla is doomed as soon as <insert legacy automaker> gets serious about EVs. I know that they will not "get serious" about EVs while they are still making money on the gas cars that they are currently selling. Only after they are no longer profitable with combustion engines will they have the epiphany that they need to "get serious". While they dwell on the status quo and attempt to delay the arrival of the future, Tesla continues to position themselves for that future.

This fret and delay by the legacy automakers grants Tesla a lot of runway. It gives Tesla time to build out their battery and vehicle production capacity, time to build out their charging network, time to bring more product lines to market, time to build customer brand loyalty, and time to establish themselves as the leaders in the electric vehicle space. I am long Tesla.


Saturday, February 10, 2018

10 Years of EV Driving (Part 7 - GL-LEAF-FULL)

In part 6, I met with executives and engineers from Nissan and told them what was important to me in an EV. In the summer of 2009, I found out more about what they were planning. Nissan announced the Nissan LEAF with many of the things that we'd asked for. In December of that year, we got to see the Leaf in person. They had a static display at OMSI. This event was similar to the one that we'd attended there for the Toyota Prius eight years before. After seeing the car, I put down my $99 reservation and picked out my color (red).

Almost a year later, in November of 2010, I was finally able to drive one. Nissan had a ride & drive event touring around the country. The one near us was in the parking lot of the massive Solar World factory in Hillsboro, OR. We took the car for a spin, it was peppy, quiet, and fun. I was sold. This was going to be my next car. The only thing I was not sure of was my color choice.

At the event, we got to see all the colors they offered. I still like the red car but the chrome accents on the car had a blue tint and, to me, it didn't go well with the red paint. If I had a "chrome delete" done to the car, I think the red would have looked great, but with the "blue chrome", I liked the look of the black and the blue cars.

Now, the waiting began. Every week or so (I admit, occasionally daily), I would log in to the Nissan ordering page and check on my car's status and I would usually change the color. I was still not sure if I wanted red, black, or blue. This went on for months; then one day in early 2011, I was doing my usual routine of logging in, checking the status changing the color and I was surprised to see that the color was now locked down. I could no longer change the paint color. My (blue) car was going into production!

On March 10th, 2011, six hundred Nissan LEAFs which left port in Japan on their way to the US and my car was one of them. This was the day before the island country that built my car was rocked by a devastating earthquake and tsunami.

On May 18th of 2011, after arriving in port in California and being trucked up the west coast, it was time to pick up my car.
Delivery day for a brand new 2011 Nissan Leaf
This car was great. With 72 miles of range, this was nearly double the range of the 40-mile range truck that I had been driving. This was the first new car that I'd ever bought. Previously, I bought used cars. The Prius from Part 1 new, but that was my wife's car. This one was mine. It had keyless entry, a backup camera, and an app that let me pre-heat or cool the car. It was great.

As for the Leaf's place in automotive history, this car was monumental. Today the Leaf is often overshadowed in the press by the likes of the Tesla Model 3 or the Chevy Bolt, but it is important to point out the historical achievement that the Leaf represented when it was delivered in 2011. This was not a low volume car that was only available for lease by "influencers" in California. It was being delivered to all 50 states and around the world. It was an affordable, all-electric, practical car. It was not a strange 3-wheeler, it was not 100 thousand dollars. It held the promise of replacing a significant number of gas cars that were on the road at that time. It was not the car for everyone, but for a large number of commuters, this car would be perfect.

I drove this car up and down the West Coast Electric Highway in the northwest. Oregon and Washington state were installing DC fast charging stations that worked with the Leaf. This allowed me to drive to Great Wolf Lodge and to Spirit Mountain. I wrote 35, and 6-year reviews of the car.

As monumental as the Leaf was, it was not perfect. Their batteries suffered from degradation, especially in hot regions. Nissan had the early mover advantage in the affordable, all-electric market, but they did not maintain a fast pace of innovation. They made only small incremental changes. Even after the battery degradation problems became apparent, Nissan did not redesign the car to use an active liquid cooling system. They made only small incremental improvements to the range, with the 2017 model having a 107-mile range.

Today, we still have our 2011 Leaf, and I'll be writing my 7-year review soon, but we plan to trade it in on a new 200+ mile EV later in 2018.

Going back to 2011, with the Leaf added to our home fleet, we now had a spectrum of vehicles. There was the all-electric Leaf, the hybrid Prius, and a gas powered Honda Passport SUV. We could use whichever vehicle met our needs for a given trip. The Leaf for commuting, the Prius for treks, and the SUV for ski trips or pulling our pop-up camper.

But this entire saga is how our garage became all-electric. For the conclusion, you'll have to read part 8 where the Prius gets a Passport to the wrecking yard in the sky.


Thursday, February 8, 2018

Tesla Model 3 Standard Range Battery Delayed

Just two days ago, I posted a story about Model 3 estimated delivery dates for the Standard Range battery and Dual Motor versions of the car coming soon.

Things are always dynamic with Tesla. Today, I and many other reservation holders received notice that delivery estimates are being recalculated and in most cases delayed. Here is my current recalculated estimate:

There are a few things in this estimate to note:
  1. The First Production delivery window has changed from 4 weeks to 3-6 weeks. This seems like a good, minor clarification. 
  2. Standard Battery vehicle has changed from Early 2018 to Late 2018. That is a big change for people waiting for the most affordable version of this car.
  3. Dual Motor has changed from July - Sept '18 to Mid 2018. This is not much of a change. But it does mean that the dual motor version of the car will be available before the $35k version of the car. That is a change, but not a surprising one. Tesla has a history of making it a priority to manufacture and deliver the high-revenue versions of their vehicles before the lower margin variants. They are a for-profit business, so it makes sense to sell the more expensive vehicles sooner if they can.
These estimates could continue to shift around depending on how the testing goes for these variants of the car. If they move significantly, I'll share it here.


Tuesday, February 6, 2018

Tesla Model 3 Variants Coming: Standard Range, AWD

The Tesla Model 3 is a game-changing car. There is no other electric car available that checks all of these boxes:
  • Affordable
  • Long Range
  • Nationwide Fast Charge Network
  • Beautiful Styling 
  • Awesome Performance  
You can find 2 or 3, maybe even 4, on other offerings, but the Model 3 is the only EV out there that ticks all 5 of these boxes. Tesla had their first employee deliveries in July os 2017 and they have been in "Production Hell" ever since trying to ramp up the volume of cars that they can crank out each week. There are now signs that they may have emerged from the bottleneck phase of early production.

I am a Day-1 reservation holder for the Tesla Model 3. As a currently Tesla owner on the west coast of the US, I'm near the front of the line for delivery (behind employees and owners in the Fremont zipcode). According to Tesla's website, I could configure my car today and have it in less than 4 weeks. I, however, have not configured my car because I would like the all-wheel-drive (AWD) dual motor version of the car which is not yet available.

You can see below, for my place in line, Tesla's estimate has been that I'll receive my car in the July to September timeframe of this year.

Periodically, I've been checking the website to see if this estimate has changed or if I could configure my AWD car. This week, I was surprised to see that my estimate had changed. Here (below) is my new estimate.

It's possible that this new estimate is not specific to me, but more of a general statement of when they will start delivering these vehicles, but I am optimistic. A spring delivery would guarantee that I'd receive the full federal EV incentive. Add the state incentive to that and that is $10,000 off the price of my new ride; not a bad deal for an awesome car.


Sunday, February 4, 2018

Solar Carport

If you drive an EV, one of the objections that you'll eventually hear is that EVs just move the pollution from the tailpipe to the coal plant. This is the long tailpipe argument. It has been disproven many times over, yet it continues to come up.

You can argue this point by citing sources that show how the grid is more efficient and that the amount of renewable energy on the grid is increasing... and these are important valid points, but it is a bit abstract. I find it is far more effective to say "My car is solar powered".

Our roof is covered with 12kW of solar panels. This is enough to power our EVs for about 48,000 miles annually. That is a much more powerful statement than saying "the grid is only 50% coal."

There are many homes where solar won't work for various shading or angle reasons. If you have these issues (or you just want more solar than your roof can provide), one thing that you might consider is a solar carport.

iSun makes solar covers that can be used with carports, gazebo, and patios. Here's a link to the company.

Having an EV parked under a solar carport is a clear and simple to understand statement about both emissions and energy independence.

iSun has a flat cover called the Palm and a new curved cover called the Oasis that comes out in February 2018.

If you're interested in a solar carport or pergola, here's iSun's link.
If you want solar panels on your house, here's Tesla SolarCity's referral code.