The Strategist

Tesla couldn't uphold more than 20 promises

08/16/2016 - 15:36

Over the past five years, Tesla has not fulfilled more than 20 promises of its CEO Elon Musk, from item plan to financial results.
In particular, Musk initially wanted to present one car model each year after launch of Model S. Yet, crossover Model X was presented in September 2015 - almost two years later than originally planned.

Budget-oriented Model 3 was to be released in early 2015, but Tesla introduced it in March 2016. More than this, the car’s mass production will start no earlier than 2017. In May 2016, Musk said that mass production of Model 3 will begin on 1 July 2017, yet he didn’t confirm this expectation an interview with WSJ two months later.

Now, Musk is promising that Tesla will produce a million cars a year by the end of 2020. However, analysts doubt these forecasts, the company has released only 140 thousand vehicles since 2008.

Under US law, top managers can be held liable if they knew in advance about inability to hit targets. Musk himself says he does not set "tasks that cannot be accurately completed" and "one needs to set the bar high for a good result". In his view, failures on terms do not have much impact on the company as Tesla still reaches its goals.

Earlier, Elon Musk introduced the company's development plan for the next 10 years. He presented the company’s main objectives, existing developments and how they are supposed to change the world. In short, Musk is set to unite Tesla and SolarCity introduce solar energy across the whole world. His team is also working on electric trucks and passenger buses, which are promised to be showcased in the next year. Perhaps the most interesting is a car park with a model similar to Uber, by which Tesla cars’ owners can monetize their electric cars when they do not use them.

This is the second master plan of Mask - he had written the first 10 years ago. Then, the first point was quite contradictory: to create limited edition of an expensive car. "That's all I could do with the money earned from PayPal. Our chances of success were so small that I did not want to risk money of foreign investors. List of successful automotive startups is short. In 2016, there were only two American car companies which avoided bankruptcy: Ford and Tesla".

The next item of the first plan has been a gradual reduction in cost and increase of production volumes thanks to profit obtained with the first models. In this way, Tesla had repeatedly faced criticism in media, stigmatized Tesla as a company that "makes cars for the rich". To combat this, Musk decided to reveal the first plan.

Second master plan of Tesla’s creator is aimed to reach this goal as quickly as possible. The strategy consists of four items:

•    Create high-performance solar roof with integrated batteries
•    Expand production of electric vehicles to cover all major areas of human activity
•    Develop autopilots ten times safer than human drivers thanks to massive machine learning
•    Make sure that Tesla cars can earn money for their owners even when the vehicle is not used

One of the most interesting plans is to create a sharing economy in the segment of self-driving Tesla cars.  Simply put, Tesla’s owners summon cars through an app, and the vehicles soon show up. On their way, people may read something or dine while the car is driven by the autopilot.

In addition to the future of the world, Musk is also looking in the space. Recently, his company SpaceX for the second time successfully set down Falcon 9 returned from space. The rocket was used to put Dragon cargo ship into orbit for the International Space Station. 


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