Who was the Tesla Model S built for?

Imagine your great grandfather. It was the turn of the century and his faithful horse ‘Elmo’ had seen better days. He needed to safely transport your family and take care of business without relying entirely on public transport. The prospect of $200 for another horse and $400 for a carriage was a year’s salary. There must be a better way.

Sitting in the dark corner of his local drinking establishment, he overhears a group of gentlemen discussing the prospects of the Motor Car. A thick cloud of smoke impairs any chance of recognising the faces of these unfamiliar voices. He closes his eyes and listens in, over the drunken rash of the bar.

“They’re saying it will replace horses.”
“You don’t even need to pay for it up front. Pay half now, and the rest later.”
“But what if you run out of fuel? Your horse can eat anywhere!”

As the conversation continues, he thinks to himself:

What’s the world coming to? We’ve had horses for hundreds of years, everyone has at least one. I can’t imagine our streets without horses.

Fast forward 100 years and the same conversation take place in the same bars. The only difference is the subject of discussion; the fundamentals remain. Each time the world contemplates change, it takes the courage of a few to take a leap of faith. Revolutions aren’t said to be adopted, they’re born.

Your great grandfather might have been the catalyst for the safe and reliable transportation we enjoy today. I hope this article challenges you to consider whether you will do the same for generations to come.

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If you want to jump head-first into our thoughts on the Tesla Model S, skip the next two headings. If you prefer to peek into the future, keep reading.

Update: full trip report with my experiences on the Model S can be found here

Electronics vs Electricity

Most people would have you think that the most extraordinary thing about the vehicles coming out of Tesla’s factory is that they are electric and fast. This couldn’t be further from the truth.

A full-electric car was the obvious choice. It would have been silly for the Tesla Musketeers (you get the joke) to consider building anything else. Whilst this sounds incredibly obvious, most of us don’t stop to question why it was the obvious choice.

With a mission to accelerate the advent of sustainable transport, Tesla Motors whole-heartedly believes that sustainable transport is inevitable, not optional. Whilst the other automakers continue to dance around the edges of the long-term viability of their industry, Tesla treats the Darwinian evolution of personal transport as a constant.

Removing our dependence on fossil fuels is part of the evolution, but not the entire story. Tesla Motors’ finest achievement is choosing not to put a smarter computer in a car, but rather to wrap a sexy car around an hyper-connected computer. The electronics hardware, distributed software deployment, and immensely powerful data analytics underwrite the value of Tesla Motors.

After all, Tesla is a technology company who builds remarkable cars. Not the other way around.

Producing an electric car wasn’t an optional consideration. It was an imperative for the next evolution of fully autonomous driving to be realised within the exact same product. After all, Auto-Pilot is the [tootip tip=”Minimum Viable Product” location=”top”]MVP[/tootip] of full autonomy.

Tesla Motors were destined to either rise with the tide of [tootip tip=”Electric Vehicles” location=”top”]EV[/tootip] adoption or die a painful death. Their mission however, was not optional. Advancing sustainable transportation would indeed be fought to the death. Luckily for their investors, they’re winning.

Giving away the joke

Google the term ‘jokes’. You’ll chuckle as you read a few of the good ones to yourself; now try tell it to someone else. They might laugh (because they like you) but it’s likely you aren’t a very good comedian. Jokes are like recipes, they are simply the raw ingredients and instructions, but lack the subtle queues that transform logic and science into art.

In June 2014, Elon Musk announced to the world they have open-sourced all 196 patents to be used by anyone in good faith. This included innovations that significantly contributed to the success of the Model S:

DualMotorModelSChassis
Tesla’s patents are the joke, the raw ingredients, the essentials of what it takes to build an Electric car company. What’s omitted is the process of harnessing vehicle and driving data to increase the value of every existing Tesla vehicle. This single variance in their business model — using data to improve the value of and for existing customers — separates Tesla Motors from the entire automotive industry. And will for a long time to come.

The existing industry built their distribution and customer relationships based on what worked in 1960 to 2000. The latest car is always better than the last model and the dealers are the only way of getting your hands on one. Be prepared to bargain. Decoupling these relationships to compete effectively with Tesla Motors will take years, if not decades.

The facts are simple: existing motor companies need to sell cars to survive and keep their distribution chain happy. They need to steal market share from their competitors and ensure that their old cars are worth less than their new cars.

Think about that for a moment.

When you purchase a brand new Model S today, there is no doubt that your car will be smarter, more useful and thoughtful in five years time. Nothing illustrates this anticipated appreciation of value more than asking a Tesla owner at what price they would sell their car. When asked on the Tesla Motors Club forum, responses averaged 10-25% more than what they paid for the car. Whilst this is the endowment effect at work, it hints that the forced-depreciation economics of the automotive industry may not apply for full-electric or autonomous vehicles.

If their competitors are using Tesla patents to increase their speed-to-market, they are missing the point.

The joke’s on them.

How does Tesla compete?

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Tesla wins when the world chooses electric cars. Buy one of their cars, or a competitor’s, they win. The biggest hurdle isn’t convincing the world they are the best, nor achieving the manufacturing cost-reduction challenges necessary to appeal to the mass market. The driver for Tesla’s success is the mass adoption of Electric Vehicles — when the excuses are made by laggards, not the masses.

Whilst many journalists in the motoring and technology communities tend to compare the Model S to the nearest cars relative to price, performance or features, I believe this is a toothless cop-out.

Asking the questions: “What other cars accelerate this fast?”, and “What else can I get for my $200k?” will never reveal why customers who never saw value in a prestige car are now placing orders for a Model S.

To understand who is buying the Tesla Model S, Model X, and who will buy the Model 3, we need to understand the dominant of the three personalities in the Tesla owner’s DNA. I believe that at least two of these are present in every owner, but there is one stand-out trait that characterises every Model S owner.

The Greenie

Whilst probably a politically-incorrect term to use, I’m using it.

Every mainstream article written about Tesla generally focuses on the notion of electric cars being a sustainable mode of transportation, emphasising their low impact on the environment. Whilst this is true, it doesn’t come close to encapsulating what makes a Tesla vehicle special. It’s the easy thing to talk about — like you’re teaching children for the first time — and typically invites critics to raise their voices.

If you are entirely a heart-and-soul Greenie, which is absolutely fine with me, you probably won’t be spending $200k on an electric car where that same cash can have a much more significant impact in the world. I believe that one of your alter-egos — the Driver or Technologist, could be weighing on your decision.

On the other hand, when the Model 3 comes around, it might just be the defacto form of personal transportation for the environmentally conscious middle-class. Time will tell if the other auto manufacturers produce an equally compelling proposition aimed square at the Greenie.

The Driver

Watch every Youtube video about the Model S or Model X and no doubt 95% of those videos will show you the 0-100km/h Ludicrous acceleration with shocked faces, screams, and euphoria. Straight-line performance is guaranteed to be your party trick when owning a Tesla. However, a true Driver cares about much more than simply straight-line performance.

The punchline: the Model S is not a Driver’s car.

Here’s why.

A Driver (capital ‘D’) is someone who grabs their keys, jumps in the car, and goes for a drive with no destination in mind. They do it for the driving experience. They may also meet with friends to drive to absolutely nowhere, in two separate cars, just to talk about the drive.

The Model S indeed performs well, I took my P90D for a night run with the folks at ZoomSpeed, accompanying a range of incredible Mercedes-Benz AMGs, Audis, BMWs, and a Lamborghini. It kept up, performed among the best, and had sufficient street cred from my driving counterparts that evening. But it’s not a Driver’s car.

Driving is about the senses. All of them.

What makes the Model S such a remarkable car for non-Drivers, makes it a bit too sanitary as a Driver’s car. There’s no noise, no downshift jolts, no risk of losing the back-end in a twisty corner, and the car doesn’t beg you to treat it viciously.

If you’re not a driver, you won’t understand. That’s okay with me.

The Technologist

The Tesla owner is a technologist — a disrupter of sorts; one who questions the status quo and seeks the opportunity to justify a high price to a different set of values than ‘everyone else’.

They love being called crazy. It’s a reminder that they can see beauty and systems where others see chaos.

After spending 76 hours with the Model S, I’m convinced that this is a car built by, and built for, people who join the revolution when it’s socially risky. They are crusaders for change — even if it’s just for change itself.

Tesla is a technology company, solving problems in personal transport. Just as the original iPhone was an incredible computer, sneaking its way into your pocket by replacing the role of your phone, Tesla’s technology replaces your car. But it’s so much more than that.

Your great grandfather’s wisdom

Your great grandfather was likely a wise man. Whilst Elmo the horse had his day as the family transportation, he was put out to greener pastures in the advent of the motor car. Comparing the cost in the early 1900s, annual incomes were typically $400-$600 and the Ford Model T entered the market (1908) at $850. By the 1920’s and 30’s, annual incomes had risen to around $1500 and the Model T decreased to $265 by 1924. With an equal replacement cost of the horse and carriage, the car was a clear economic winner. We see this same diffusion of innovation cycle today with the Model S, Model X and soon Model 3. As the costs continue to drop, the economic imperative will force your existing car into greener pastures.

Which car is right for you? You won’t know until you drive one for yourself. After 76 hours with the Model S, I’m pleased to have put my $1500 deposit on a Model 3 for 2018, but I won’t be purchasing the Model S before then.

One of the common misconceptions about the transition to fully-autonomous electric cars is that the beautiful driving machines born in Europe will become extinct and useless. This isn’t further from the truth. In fact, it will be the mediocre and mundane mass-produced cars that will be worthless. Elon Musk says it best:

“Any cars that are being made that don’t have full autonomy will have negative value. It will be like owning a horse. You will only be owning it for sentimental reasons.”

Tesla will be delivering my daily driver in 2018, but my driving car — the horse — will be born in Europe for a while to come.

Learn more about Tesla

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Have you been for a test drive? Book in and do that first.

I’m currently producing a selection of articles and videos about my Tesla experience on Ride Hacks. Whilst this is in production, here are my recommended go-to resources.

Video introduction from the Ride Hacks Tesla experience

Video reviews

Here is a roundup of my favourite video reviews of the Tesla Model S:

Local written reviews

Here are my choice local reviews of the Tesla Model S:
D’Marge
Hey Gents
The Versatile Gent
Behind The Wheel
Performance Drive

 

Fancy driving the Tesla Model S?

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