Long time no talk, Elon.


This morning as I was grabbing my bag to head off to breakfast before my Economic Anthropology class, my phone started buzzing. In a hurry, I decided to ignore the call and start walking towards my class. As I arrived to class and sat down, my phone started buzzing again. Then, confused about what all the fuss was about, I decided to excuse myself to the bathroom. As soon as I exited the class, I checked the screen of my phone and finally was able to discern the identity of my caller. It was my good old family friend Elon Musk. Before picking up the phone, I wondered if the time that I would take to talk to him would count as an excused absence from my class. I hesitated since I did not think the call fell under the category of an emergency of any sort, but then…you only live one, right?

Upon picking up the phone, I heard the voice of Elon on the other side of the line. His voice sounded different, not very much like himself. I remember this because the last time I had talked with him his voice was vibrant with excitement about starting his new Hyperloop project. This morning, however, his voice was low, grave, and discomforting. He started off the conversation with not many pleasantries, not even asking how my family was.  Right away, he started off describing how many governments around the world have stopped subsidizing Tesla cars since they reached a point where they questioned why should middle-class taxpayers whose incomes are falling pay to subsidize the purchase of cars that only the affluent can afford, just as a gesture of their superior environmental virtue. With this problem in hand, Elon – knowing my background in Markets, Innovation, and Design – asked me to become his Chief Innovation Officer and to come as soon as possible to his house in Bel Air. He said, I shouldn’t worry about buying tickets, since he had already sent his private jet to pick me up and assured me that it is the most environment friendly jet I have ever flied in. Before he hung up, he reminded me that I am free to bring anybody along for this project.

 

As Chief Innovation Officer, I decided that Tesla’s priority at this point in time should be to increase their efficiency in production. In order to achieve this, I notified Elon that it is recommendable to increase the effort into building the Gigafactory faster. There are mainly five reasons why I chose to focus on this area. First, cheaper batteries mean cheaper cars and will make Tesla’s EV’s more affordable. Second,  it diversifies Tesla’s revenue stream by allowing it to be a main competitor in the energy industry. Third, it spreads the costs of the factory build beyond just Tesla. This can be accomplished by partnering with more companies that could aport a superior LI-battery technology knowledge that would complement Tesla’s EV knowledge. Once partnered all companies would have the factory at their disposal and would be able to profit from it, as long as they pitched into its building. Fourth, building a factory that will be fueled by solar panels is a very strong advertisement for the Tesla brand since it reinforces a reliance on alternative energies. And fifth and most importantly for the business, Tesla gets to remain first in the EV industry by becoming efficient before its competitors -other more traditional car companies –  have the chance to delve into the industry.

As I am giving Elon my reasoning, I tell him that I did not come up with this on my own. Rather, the idea was produced by the collaboration of my group: Jensen – who advised me to create more value for the stakeholders while increasing profit-, Aayush, and the Hannah brothers – who pushed me to be green all around.

Advertisements

6 thoughts on “Long time no talk, Elon.

  1. Dan, I thoroughly enjoyed your post on Elon and Tesla. So glad someone brought him back into discussion after a few week hiatus. Tesla’s pricing is most certainly steep, and your idea of making the luxury car more affordable through cheaper batteries would bring about great societal benefits– the more affordable, the more accessible electric/ environmentally friendly cars will be to different classes. Building a factory with solar panels definitely is in line with Tesla’s larger societal mission and purpose within the marketplace: to accelerate the advent of sustainable transport by bringing compelling mass market electric cars to the market.

    Liked by 1 person

  2. I loved this. I feel like it would be a pretty good deal to casually talk with Elon over the phone advising him on efficiency. One day… I really like your lean on going even greener than Tesla already has. The improvements never stop.

    Liked by 1 person

  3. I still remember the first time I saw a Tesla store in a mall – there was just one Tesla in the center of the store and miscellaneous items on the walls surrounding it. The simplicity of the store definitely made a statement – and one that only the wealthy could afford. Like Morgan said, your innovation would definitely benefit Tesla, drivers, and the environment and I would even argue that it would fall under an act of Utilitarianism – by taking these actions, you’ll be helping the car industry become more “green”, which is beneficial to the planet overall.

    Liked by 1 person

  4. The amount of subsidies that Tesla receives per vehicle is pretty astonishing. I dont know the exact number but i did find this stat via a quick google search, “In 2013, ZEV credits to Tesla totaled $129.8 million — to a company that lost $61.3 million for the year on its actual manufacturing and selling operations.” If I were as close to Elon as you, Dan, I would advise him to develop a business model that is less dependent on government subsidies to survive, let alone turn a profit. I liken this to Saudi Arabia’s new initiatives to wean of their own dependence. Currently, 75% of their government revenues come from oil, and they are realizing that they wont survive if oil continues to crash. If these subsidies arent sustained, how will Tesla stand a chance???

    Liked by 1 person

  5. Great post! Tesla has emerged as a company who seems to be on the forefront of developing sustainable technology. Especially with cheaper models starting to roll off the assembly line in the future it will be interesting to see how affordable the cars will be.

    Like

Leave a Reply

Fill in your details below or click an icon to log in:

WordPress.com Logo

You are commenting using your WordPress.com account. Log Out / Change )

Twitter picture

You are commenting using your Twitter account. Log Out / Change )

Facebook photo

You are commenting using your Facebook account. Log Out / Change )

Google+ photo

You are commenting using your Google+ account. Log Out / Change )

Connecting to %s