Tesla in the New Yorker

[caption id="" align="alignnone" width="500" caption="The Tesla Roadster"][/caption]

I found a couple of interesting tidbits in a profile of Elon Musk and Tesla in the Aug. 24 issue of The New Yorker (subscription required for the full article, but it's worth it) I thought were worth calling out.

First was an indictment of a related business plan. Better Place is a California company trying to create an infrastructure of battery replacement stations for electric vehicles. The basic idea is a solution to the problem that without a super-fast charger, EV batteries are expected to take as long as 8 hours to fully re-charge. Most people who follow such things say we usually drive short enough distances that a trickle charge for short periods will be enough to keep our batteries topped off. But if EVs are ever going to replace the internal combustion engine, re-charging the battery has to be as quick and as easy as it is to fill our current tanks with gas.

Enter Better Place, which wants to own the actual battery itself. The company plans to build stations where motorists will have a dead battery switched out for fully charged one in under a minute using robotic technology, according to The New Yorker. The company is already planning to build test networks in Northern California and Israel. The hitch in this plan is that all batteries in all EVs have to be modular, located in the same position and work with Better Place's infrastructure. Otherwise, the scale it needs will never develop.

The main problem [Shai Agassi, CEO of  Better Place] faces, though, is persuading manufacturers other than Renault to build E.V.s with batteries that are easy to detach and exchange. None of the auto executives I spoke with expressed any inclination to build their cars to suit Better Place. They had liability concerns about swapping, and proprietary concerns about their battery's design. Herbert Kohler, the vice-president for E-Drive and Future Mobility at the German automaker Daimler A.G., said tartly, "A standardized battery would have to result from a standardized car, and a standardized car didn't work under socialism in the G.D.R."--East Germany.

In short, car makers don't care for Better Place's plans and won't support them because they think they have the right answer for batteries. Or that they will have that answer. It may be that the big car makers are on their way out, but for the near future anyway, they do still have the market share. If Agassi can't overcome this resistance, Better Place may have a hard time getting to scale.

On the other hand is the second nugget I pulled out of this article, which I think perfectly illustrates the lack of foresight and the arrogance of the world's traditional car makers (and puts a question mark on the importance of the above quote). It's a comment by GM's vice chairman of Global Product Development, Bob Lutz on what he calls, "The hubris of Tesla," and by extension, all new car companies looking to innovate away from the internal combustion engine. That hubris, he says, is

'We're not going to fall into the trap of being like Detroit--we're going to be the Silicon Valley guys, nimble and innovative,'" Lutz said. Everyone who tries to reinvent this business believes that auto companies are populated by dummies who don't understand Moore's Law. But, unlike a silicon chip, the modern automobile has to be a certain size, and carry a certain number of people, at a certain speed. Over 3,500 parts sourced from around the world have to come together at the right place and the right time to produce 60 to 70 of these things an hour. These things are called cars. And to make them you need a large engineering staff, a workforce that demands retirement benefits, a tax staff, a fleet of accountants, and an unbelievable amount of reliability testing that Tesla can't afford to do right now--and we can't afford not to do. Inevitably, Tesla will discover that the only way to succeed on the scale we have is to be exactly like us."

Whoa. Talk about hubris. It's hard to take seriously a man--and an industry--that thinks he is so all-knowing, especially in light of recent events, that any competitor has to be exactly like all who have come before them to have a chance at succeeding. All that statement above does is A) make me wonder how much longer GM can hang on if its leadership doesn't understand being nimble and B) makes me want to see an EV start up prove Lutz wrong as soon as possible.