Model S won’t see a second generation

Criswell predicts TeslaMondoTwo summers ago, Criswell suspected the Model S would enjoy an unfairly long shelf life without a “redesign” or even a significant “refresh.”

  • Redesign — When Big Auto spends a lot of money to update a product.
  • Refresh — When Big Auto spends a little money to feign a redesign.

That’s because the Model S has developed into a far better creature thanks to Tesla’s engineering kaizen and OTA update regimen. It’s not the same car that debuted six years ago, period. Not even close. So it’s fresh where it counts.

Yet the car hasn’t changed visually since birth, besides the schnoz. How long can this sameness continue before boredom creeps in and affects sales? And what would a second-generation Model S look like?

There won’t be a second generation.

The current one will go on for a few more years and then die just as interest starts to wane. Tesla can jettison its big sedan and pare its core lineup to the 3, X and Y without losing many, if any, customers. You want something more airy than the 3? Get the Model Y. You want something bigger still? Get an X. You don’t want the SUV profile? Maybe not this year, but you’re more easily persuaded with every passing year. Criswell knows this about you. Right now an SUV might seem like a sedan hampered by tallness. But five years from now, a sedan will seem like an SUV hampered by flatness.

The only problem with this strategy is the falcon wing doors. Some people don’t like them. They’re too fickle. They’re too showy. They preclude a roof rack. So Criswell hereby predicts that a second-generation Model X, with normal doors, will bow within five years and will negate the need for a second-generation Model S.

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Tesla brings love to an unloved segment

First sedan on Earth

See? Even the very first sedan drivers were miserable.

The word “sedan” is a variant of “seat,” and it traces back to that hand-carried thing in the picture. It had some pretty humble specs.

  • HP — almost
  • Torque — grounds for termination
  • Powerplant — dual motor
  • Turing circle — four-wheel steering, so pretty good
  • Acceleration — yes
  • Drag coefficient — moot due to velocity deficit
  • Suspension — height-adjustable, independent, lateral arms
  • Fuel type — pasta e fagioli and vino mixture
  • Road-holding, lateral Gs — performance rubber a must
  • Exhaust — dual

Skipping ahead a bit, the sedan evolved into a mainstay of automotive transportation. But now Ford says there’s an unmistakable change in the “silhouette” of the typical car, and so it’s ditching sedans entirely in the next few years. Fiat-Chrysler scrapped its Dart and 200 a few years back. It was a bold call.

Here’s a “then and now” of parking lots. Draw your own conclusions about whether the silhouette is really changing:

 

Then

 

 

 

Now

 

 

Actually, never mind your conclusions. It’s obvious that non-sedans are taking over. And remaining sedans are getting taller under peer pressure.

What does this have to do with Tesla? This is the wrong time for the debutante Model 3 to don its evening gown and make its appearance atop the ballroom staircase. It has a trunk? Ewwww! It should be pelted with tomatoes. And yet it’s hailed as the iPhone of cars. People wait in line to see it. It’s devouring market share from premium brands and unwashed brands alike. Frugal people who planned to hang onto their decade-old Civics for another decade are suddenly throwing in the towel and spending much more than they ever thought they’d spend on a car — just to have this sedan.

What does this mean? Three things:

  1. Tesla has built a very strong brand. Strong enough to violate trends.
  2. Lots of people can get by just fine with a sedan, regardless of their flimsy rationale to drive anything but a sedan. “Gotta haul people and cargo, and gotta handle all kinds of terrain.” Bullshit. When gas prices spike, suddenly a Corolla suits them just fine. Their adventurous lifestyle fits in a duffel bag. A really compelling sedan is having the same sobering effect, forcing people to re-think what they really need.
  3. Model Y won’t have to overcome a trend. A headwind will become a tailwind. TeslaMondo thinks Model Y will eventually become a serious rival to Toyota’s Recreational Activity Vehicle with Four Wheel Drive and Honda’s Compact Recreational Vehicle, also known as Comfortable Runabout Vehicle, even with Model Y’s higher price tag and profit margin.
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Pardon that brief intermission

The last post, a rhapsody about Tesla cranking out the $35k car, turned out to be premature. The company wasn’t financially ready for that car yet. More than a year later, the “affordable Tesla” is finally edging toward the on-deck circle.

Stuck with a post about an imminent car that wasn’t imminent, TeslaMondo had two choices:

  1. Modify or delete the post to reflect reality, and then continue writing more articles as if no misstep had happened. That would have been the easy route. Too easy.
  2. Freeze the site and wait for reality to catch up to the post. Only an utter shmegegge would entertain that option. Perfect!

So TeslaMondo has been quietly observing the game from the bleachers this whole time, watching as Tesla’s dirty opponents, their bookies, their beholden cheering squads and a posse of crooked referees try to disallow a Team Tesla victory in Model 3 and profitability. The default metaphor is “moving the goalposts,” but that doesn’t capture the desperation of these nincompoops. They’ve installed a row of exact-change-only tollbooths at the goal line. And they’ve covered the end zone with a tarp that makes it look like more gridiron to conquer. So a Tesla touchdown, like, totally can’t happen.

  • Model 3 backlog is swelling? Tesla has no supply.
  • The backlog is shrinking? Tesla has no demand.
  • Production hits 2,500k/week? A fluke.
  • Production hits 4k/week? Another fluke.
  • Tesla becomes profitable in 2018? Another fluke.
  • And if this stuff isn’t a fluke? Then the company is doomed.
  • Tesla is stealing customers from the Germans? Only until the Germans catch up.
  • The Germans aren’t catching up? The Japanese are.
  • The Japanese aren’t? The Americans are.
  • The Americans aren’t? The Chinese are.
  • The Chinese aren’t? The FBI is.

And so Tesla will never get a cheer even in victory, and even on home turf. The crowd is stacked. This is why Musk can employ dirty tactics, such as jolting the stock market to rattle short sellers, without looking like a bully. This isn’t a mere game. It’s a dirty theater of war with no rules of engagement, and everyone knows it.


Let’s check in on TeslaMondo’s cast of characters. It’s been a while.

Darth Dieter TeslaMondo

Darth Dieter is stepping down as Daimler CEO next spring. He’s open to another duet with Tesla, like the plug-in Smart and Benz cars of yesteryear. But at this point, what could Tesla possibly gain from collaborating with anyone?

Marchionne Godfather TeslaMondo

Sergio Marchionne, CEO of Fiat Chrysler Automobiles, died this summer. While other Big Auto CEOs tried to belittle Tesla, Sergio gave credit to Elon Musk. He also begged everyone not to buy his compliance car, the electric Fiat 500. So he was honest, at least.

count-carlos-teslamondo

A couple years ago, Nissan chief Count Carlos surveyed the walls of his castle and laughed at the notion of a raid. “I know the media love to say we have a new superman coming here, and it’s going to make all of you look like dinosaurs,” Ghosn said. “But, frankly, the likelihood that this is going to happen in our industry, in my opinion, is very limited.” Musk would be the first to agree. Yet it’s happening.

Diesel Weasel TeslaMondo

Germany’s diesel weasel scandal culminated with Audi’s CEO going to jail. But nobody knows or cares. This is the car business. A rap sheet comes with the territory.

max-headroom-bob-lutz

The climax of his multi-year Tesla Sux media tour came late September, when he said Tesla was headed for the graveyard. A month later, Tesla’s Q3 results proved it’s hardly moribund, while reinforcing the suspicion that Lutz and his old-school mindset are exactly that.

 

Faraday Future breaking ground

Speaking of moribund, here’s Faraday Future digging its own grave along with Nevada Gov. Brian Sandoval, who somehow missed the ground with his shovel. He also missed the abundant clues that this company consisted of boring people who could never break into a padlocked industry like autos. It’s now common knowledge that a successful auto startup in the 21st century must be led by an insomniac, manic-depressive, verbally abusive, sociopathic, megalomaniacal, narcissistic, schizophrenic, substance-abusing, autistic savant who whips up brilliant products in between bouts of head-butting a wall and kicking a cat.

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Applauding the Model III scoffathon winners

Now that we’re about to cross the finish line of Tesla’s first master plan, this also marks the end of the Model III Scoffathon. Let’s pause and reflect on the sage words of various experts who flashed their credentials and then swore up and down that Tesla would never get here, to the high-volume $35k car. Sure, the car hasn’t materialized in volume quite yet, but we’re on the home stretch.

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He speaks at events, you know.

Sept, 2014: Battery expert issues “sobering” report. Wanna talk credentials? This guy, Dr. Menahem Anderman, sure has ’em. He’s the chairman of AABC, which stands for Advanced Automotive Battery Conferences. It has a logo and stuff, so if you’ve never heard of it, you must be out to lunch. Anyway, the sobering report says Model III will start at $50,000, PERIOD. So a round of applause for Dr. Anderman as he crosses the finish line. This guy is a battery consultant, you know. His client list contains about every automaker except Tesla. But he’ll sell you his report on Tesla’s batteries for $2,800, the rascal.

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April, 2014: Harvard Business School guy says Tesla “won’t be able to scale.” Again, check those creds. This is hah-vid we’re talking about. So why can’t Tesla scale? Because it lacks the money, clout and experience required to drive down pricing far enough to make Model III hit the tipping point. Round of applause as Tom Bartman, billed as “a member of the Forum for Growth and Innovation, a Harvard Business School think tank studying disruptive innovation,” crosses the finish line. His LinkedIn page is stuffed with Tesla knocks to boot.

max-headroom-bob-lutzFeb. 2, 2014: Bob Lutz goes on his ill-will campaign. Tesla can’t make money on Model III, but can’t afford to lose money on it like a big automaker could, so Tesla is finished. TeslaMondo has chronicled Lutz’s frustrating brushes with EV greatness. He’s the game show contestant who hits the buzzer first but then botches the answer, over and over, while Musk keeps racking up the points. It’s enough to make a man froth at the mouth.

May 18, 2014: Wall St. Journal rounds up battery experts to sweat n’ fret the Gigafactory.

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That stuff in the background means this guy knows what he’s talking about.

K.M. Abraham is a research professor at the Northeastern University Center for Renewable Energy Technology, has worked for 30 years on lithium battery technology, was one of the first to demonstrate rechargeable lithium batteries and invented next-generation lithium air batteries. He also has a battery consulting company called E-KEM Sciences.

 

“I don’t see how they can reduce the cost more than 20%. They are dependent on the whole battery community. We are already reaching the limit on the energy density you can get in the lithium-ion battery. Next-generation chemistries, such as lithium air, are another 25 years away from commercialization.

“It won’t be as simple as it has been so far. We’ll need scientific discoveries in the electrode materials. Usually, from invention of battery materials to production it takes 15 to 20 years, and we haven’t invented it yet.

“As far as scale manufacturing, it’s an already perfected business; just doubling the world production wouldn’t get that much improvement per unit. The major producers in Korea, Japan, are using massive amounts of material already. And battery manufacturing is a very, very low-margin business at scale.

“And [the major producers] are integrated manufacturers, they can put their battery cells into portable consumer devices, and they can make up the price there.”

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He died a few months ago, so he never did see the Model III launch.

Peter Wells is a professor of business and sustainability with a focus on the global automotive industry at Cardiff Business School’s Centre for Automotive Industry Research, in Wales.

“Tesla is taking advantage of the moment to make an enormous roll of the dice.

“You rush into these things at your peril. The reason the car industry has been so conservative is that there are major concerns with safety, reliability, customer confidence. That’s the reason the industry has been very slow with adopting technologies.

“The danger there is if Tesla cannot make this work, the whole electric-vehicle sector will be set back a lot.

“But it could change the way we buy cars, we use cars, the revenue streams, the business models. In an industry that has hitherto been riddled by conservatism, this is a disruptive idea.

“There’s a lot of cost that can be taken out at larger scales of battery manufacturing. But it’s all about the capacity utilization. A battery plant that’s not running will cost you a fortune.”

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Here’s looking (askance) at you, kid.

Bill Reinert was national manager of Toyota Motor Sales U.S.A. Inc.’s advanced-technology group from 1990 to 2013. He co-led the U.S. product-planning team for the second-generation Prius and worked on several advanced hybrid electric products, direct hydrogen fuel-cell vehicles and plug-in hybrid concepts, among others.

“We didn’t anticipate Prius would sell like it did. There was at least a year or more where we couldn’t increase sales because not just the battery but a whole host of other parts couldn’t be ramped up quickly enough.

“But the worst thing in the world you can do is plan for a high volume and not reach it. Then you’ve got all these factories that are idle, and all these workers who are idle, and all these parts that you ordered. It’s better to slowly add to production when you are making a profit than to shut down lines when you are losing money.

“Toyota can take a suspension they use on hundreds of thousands of cars and put it on a low-volume car. Volkswagen is the king of this. Tesla doesn’t have that ability. It has to be bespoke, built from the ground up.

“If I were in [Tesla Chief Executive Elon] Musk’s shoes, I’d be on a jet tomorrow to go to [battery makers] LG Chem, Panasonic, GS Yuasa, and telling them this is our long-term projection. But if [they couldn’t commit to meeting my needs], I wouldn’t be discussing this grand design, this mythical plant.

“What I would start out with would be bare-bones manufacturing and make sure that we are making as many of the product as we need.”

Screen Shot 2017-07-30 at 7.09.08 AM

Musk succeed where I failed? Impossible.

David Vieau served as chief executive of A123 Systems from 2002 to 2012. The company, which manufactured lithium-ion batteries for electric cars, power tools and utility grid applications, raised more than $1 billion in venture capital, public equity and government funds. In 2012, the company filed for bankruptcy, and its assets were acquired at auction by China-based Wanxiang Group.

“It was very clear back in 2008 that there would be in the long term a market for electrified vehicles. The question was, how long would it take to develop? It was also very clear that if left on its own, without some stimulus, it would take quite a long time.

“The difficult part is if you get out in front of demand and the industry just doesn’t make it. It could be a tremendous success in five years, but if you are caught with a factory at the wrong time, that’s where the obituary comes in.

“What [Tesla] is saying is that they need the capacity. It’s unlikely their suppliers are going to take the risk. They are going to have to take it themselves. The risk associated with their growth will be theirs.”

And bringing up the rear, in a swirl of dust, arms and legs, is the Tasmanian Devil from Looney Tunes. He never entered the Model III Scoffathon, but only because wildlife can’t conceive of such things.

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Daimler recall is a double-shot of “duh”

Diesel Weasel TeslaMondo

The company now looks super-stupid thanks to its massive diesel recall.

  1. It’s basically admitting it tried to defraud regulators, just like fellow diesel weasels VW and FCA. Chalk up a another demerit for “clean” diesel tech, and for ICEs in general.
  2. And, of course, Daimler can’t fix anything with an elegant over-the-air update like you-know-who. It has to drag millions of customers into its service centers for software updates. It’s another free advertisement for Tesla.

So in one recall action, Daimler has doubly dumbed-down itself in the public mind. Then again, the public is so scandal-fatigued that nobody cares anymore. “They’re all scumbags.” A fitting dismissal.

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Chevy Bolt “officially” in trouble

Despite the media narrative of late, the Bolt is stinking up the joint. GM is idling its Bolt plant and has a 111-day supply. So who beat whom? Remember, the Honda Insight beat the Prius to the US market by a few months. And the rest is history.

Officially in trouble TeslaMondo

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Korea tweaks incentives to include Tesla

Tesla debuted in Korea this spring, with some fanfare — but with zero tax incentives because Tesla charging time exceeded the max allowed. Today the local news says the Korean Ministry of Environment will stretch the charging time standard to get Tesla under the umbrella. The changes take effect in September.

You win some, you lose some (Hong Kong).

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Don’t fear the wafer, vol 2

 

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2018 Accord interior

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Tesla Model III interior

We’d better get used to this “afterthought” floating screen thing, for it has found a home in the ubiquitous, bread n’ butter Accord. But holy moly, look at the buttons, switches, dials and vents in the Accord. Compared to the super-sparse III, the Accord smacks of airplane cockpit if you want to be nice, or Rube Goldberg if you don’t.

You must click the images and view them full-size to really appreciate the stark difference.

Now that Tesla is making a mainstream car, it’s awfully unusual to see a mainstream car flatly ignore what everyone else is doing and chart a totally new path. Usually designs tend to exert gravity on other designs until everyone meets near the middle. But right now, Tesla has an orbit all to itself.

So the point of this post is: Look at the new Accord! It has a whiff of Model III. The other point of this post is: Look at the new Accord! It’s nothing like the Model III.

Further reading: Don’t fear the wafer.

Tesla’s Master Plan contains dark matter

In a couple months, while everyone fusses about the Model III ramp, the Tesla Semi will rush from the shadows and shock us. Tesla’s vast commercial applications will suddenly tickle the brain more than the bland ol’ Model III ramp.

It’s tempting to say the Semi kicks off the second part of Tesla’s master plan, but the plan never mentions big rigs at all*. It never mentions the Roadster either. Yet we know both are coming. This means the master plan is like Loch Ness. It’s vast and inky. Big things could lurk within. Things as big as a city bus, or a school bus. BYD currently builds the former, and now Blue Bird has a contract for the latter.

What creatures lurk in Tesla’s Loch Ness Master Plan? Paging Mr. Nimoy . . .

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*Bullshit. Read the comments.

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