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Comment by sxates | Hacker News Reader

I think these comparison's to other car companies really miss the mark. Those who are long on TSLA (myself included) aren't looking at them as a car company. Tesla is cracking open new markets in the following areas:

- Electric Cars (most visible. Also don't undervalue their unique direct sales channel, which is a huge competitive advantage)

- Batteries/Energy Storage (not just cars - utility scale energy storage, with capacity coming online that will double global output of lithium batteries)

- Solar panels and solar roofs (both residential and commercial, a market with a hockey stick growth curve coming)

- Self-driving AI (head to head with Google on one of the most fundamental changes to transportation our society has seen in a century, and they have the hardware driving around us all the time already, rapidly learning and improving)

Ford, GM, et al are irrelevant and poor comparisons. This is SpaceX for Terran energy and transportation.

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What makes you think solar is a hockey stick? I'm not saying you're wrong it's just the first time I've heard this before.

There's an exponential curve:

https://www.google.com/search?site=&tbm=isch&source=hp&biw=1...

The price has been rapidly decreasing in the last 10 years, to the point that it no longer makes sense to not have solar everywhere. It's cheaper than coal, and will soon be cheaper than all the other fossil fuels as well, and will continue to go down, never up.

China now employs over 1 million workers making solar panels. And they're ramping that up as fast as they can, and shelving coal power plants. We've reached that critical tipping point for PV solar to go vertical, and Tesla/SolarCity just built their own factory in Buffalo to take advantage.

I think solar is the future, but these claims are stupid.

> "to the point that it no longer makes sense to not have solar everywhere. It's cheaper than coal, and will soon be cheaper than all the other fossil fuels as well, and will continue to go down, never up."

Then the market should automatically have shifted to 100% solar by now.

Solar is getting cheaper yes, but it is dependent on hours of sunlight available, which like wind energy, is unreliable and doesn't work at periods (like night). Further, the capacity of a solar power plant isn't its produced electricity, because the capacity is mainly peak capacity, which is only reached a few hours a day.

> China now employs over 1 million workers making solar panels

Don't know where that figure is from, but I guess china must be covered in solar panels by now. 1 million is large number of people. Unless your figures are deceiving. For example, walmart sells solar panels. So, you will count every walmart employee as a solar panel retail employee.

>Then the market should automatically have shifted to 100% solar by now.

65% of new capacity in the US last year was wind or solar.[1] The world doesn't change overnight, but expect that trend to continue.

Renewable energy growth is only being slowed by lack of storage. As battery production and other storage techniques come online, it allows higher and higher % of energy to come from renewable sources.

>Don't know where that figure is from, but I guess china must be covered in solar panels by now.

Pretty good summary of the situation here: [2]

"In 2015, China installed half of the world’s wind power and a third of its solar photovoltaic capacity. Last year, solar capacity jumped 81.6 per cent and wind capacity grew 13.2 per cent. Greenpeace has said that China’s renewable energy growth rate is equivalent to installing one wind turbine and covering one soccer field with solar panels every hour. Five of the world’s top six solar manufacturing companies and five of the 10 biggest wind turbine companies are in China. By 2020, half of the country’s new electric generation will come from solar, wind, hydro and nuclear power."

[1]https://www.ferc.gov/legal/staff-reports/2016/dec-energy-inf... [2]http://blogs.ei.columbia.edu/2017/03/03/will-china-take-the-...

USA is a saturated market, where renewables are given incentives by the government (unfortunately it won't be so any longer).

Look at developing countries, only a fraction of new energy sources for India are solar, even though our coal is inferior quality.

I'm pretty sure that coal is still cheaper than solar

Government subsidies probably. My provincial government (Alberta) just introduced $40 million in solar subsidies. I don't think Solar City operates in AB, but I'm sure other states will come up with similar subsidies to replace the federal one that I believe is expiring.

And when the price undercuts other forms of power generation, you won't even need subsidies anymore. I'm guessing it'll be a while before this is true in latitudes like Alberta, though.

Alberta latitude is same as much of the European latitude. City of Edmonton, Alberta is at 53 latitude, Calgary at 51. Berlin is at 52. Amsterdam 52.

People tend to underestimate how far north Europe is. Europe's climate is a lot milder than North Americas, due to, mostly, Gulf Stream.

I agree. I don't think we'll see large scale solar power generation in Alberta. The gov subsidies are mostly for residential use. They introduced a revenue neutral carbon tax Jan 1, 2017 and need to return the tax to green projects. This is just one of them.

Alberta does have quite a bit of wind generation though. They blow pretty consistently off the mountains and we have a pretty low density population in the south end of the province. Hopefully under the NDP (left wing) government, we can see some expansion of this. Prior to this, oil sands was the only game in town.

How is GM irrelevant in self-driving AI?

They acquired Cruise Automation: https://www.getcruise.com/ or https://fortunedotcom.files.wordpress.com/2016/09/cru10_c.jp... .

Making acquisitions and executing on a cutting edge market opportunity are two different things. When GM adds something unique to the AI transportation market, then they'll be relevant. As of now they're just an outsider trying to get in.

Yeah I think car companies should focus less on making cars...

- Your first point is cars - there are a ton of evs for sale from many large companies and direct sale doesn't seem to sell more cars than indirect.

- Tesla is partnering with battery companies just as GM does on the bolt and volt. Nothing special here as their battery business is pretty minuscule.

- Again a niche market that compares to GMs after market crate motor program in revenue and size.

- Self driving tech doesn't belong to Tesla and Google, most luxury car companies had automated cruise systems when Tesla was making the roadster. Gm has a large fleet roaming around Detroit, Chrysler is partnering with Google with their Pacificas, and Ford has a fleet of fusions as well after billions in investment.

The larger point is that elon and his 16 companies seem to do no wrong and avoid comparisons to the existing car companies, he should focus on getting market share in the extremely competitive automotive market instead of making a space/AI/brainlink/tunnel/solar/ev company.

1. Tesla's EVs are outselling everyone else combined, even with an average sale price that's double everyone else.

2. Tesla is partnered with Panasonic, but they're practically married with communal property. They haven't outsourced this, they've put billions into building a gigafactory. What part of "doubling global output of lithium batteries" is minuscule to you?

3. In 20 years, probably half the world's electricity will come from Solar PV. Was coal a niche market? Because this will be bigger.

4. Most other car makers are licensing systems from others, not building their own, and they don't have the self-driving hardware in any cars yet. Tesla has 10's of thousands of cars on the road right now (25k just in Q1) with their second generation system, while GM and Chrysler are still fiddling with prototypes.

If you don't see how all these things connect, then I understand your view. But when you recognize how they're all interconnected it makes complete sense to me to be building all of them at once, otherwise a failure in one dooms them all.

1. Nope. Are you just pulling numbers from a hat? Nissan sold 14,000 leafs last year, add that to the 24,000 volts and the 8,000 i3s and you get more than the model S.

2. Im saying the current business is minuscule, if we looked at elons promises as gospel (which you apparently do) we would have had a model x three years ago. LGchem and Samsung SDI are more than capable to meet the demand of the current lithium battery market without panasonic.

3. Speculation

4. Tesla has a SAE level 1 system which is the same as my VW golfs adaptive cruise with lane assist. They sell the car with the "hardware" and you think they are done? -> " All we have to do is build the controls and software now!!" By this logic throwing a couple cameras on the car means it has "self-driving hardware".

1. "Tesla delivered over 76,000 vehicles in 2016" [1]. My math may be rusty, but I'm pretty sure I'm right that they're outselling everyone combined with $100k cars. They're tracking to over 100,000 for 2017.

2. Several billion dollars worth of capital investments disagree with you. And what's important isn't the current market, but the future market - these things are growing and production bottlenecks kill growth.

3. Again, look at the trend lines not just what it is today.

4. A golf you buy today will keep lanes, and will never do anything better. A Tesla has all the hardware needed for Level 5 autonomy (which they've demo'd, but requires regulatory approval), and it's a software update away. And their whole fleet is sensors-on all the time, whether you're using it or not to enable that, which is not true for any other vehicle manufacturer. Google is the only other company that's close.

I'm no disciple, but I can see where the puck is going to be.

[1] http://www.theverge.com/2017/1/3/14159292/tesla-q4-2016-deli...

You do buy in Tesla's marketing as gospel though.

> A Tesla has all the hardware needed for Level 5 autonomy (which they've demo'd, but requires regulatory approval), and it's a software update away.

Audi, BMW, Google etc. demoe'd similar capacity as the tesla did 2-3 years ago. Do you even understand how difficult problem it is? It's not a problem you engineer away. Do you think Tesla made machine learning breakthroughs that Google or CMU (Uber) researchers couldn't? Tesla beating Google at Machine learning?

> And their whole fleet is sensors-on all the time, whether you're using it or not to enable that, which is not true for any other vehicle manufacturer.

Does it matter what kind of sensor? Almost everybody else agrees LIDAR is necessary. And what use is random data from useless sensors? It's like saying that you'd put cameras in a pedestrian crossing, and soon you'll process it to make a human level intelligence.

They demo'd it, but they didn't ship it!

Ahh, a controlled demo on a test track with impeccably clear road lines and signs. Something they could have tested a hundred times with, potentially overfitting a route. Even then the Tesla was over-cautius, stopping metres before in front of a stop sign.

And that is still level3 or level4. Level5 is inarguably far far away.

1. You are comparing all of tesla models to individual models from other brands

2. You want to speculate on the future market, go ahead, I dont think Tesla has any special position on lithium batteries.

3. Solar is not a hockey stick, not sure what trend lines you are talking about.

4. Talk to anyone working on self driving cars and they will tell you level 5 is at least 10 years away. Can a tesla drive on icey road in northern canada in blizzard conditions with a couple failed sensors? Nope, then it is not level 5.

All of these products can potentially be commoditized. But their brand is strong.

Commoditization is never instantaneous. You start of highly competitive because the products are all immature. During this period people who can differentiate become market leaders. Companies without R&D staffs can't compete yet because by the time they copy last year's product, next years product is out.

After a while, usually decades, commodity producers take over the lions share of the market. The high end is captured by one or two of the market leaders. Being first to market helps you get there, but you still have to fight for that position.

Look at iPhone. It was the best and the cheapest smartphone for probably a decade. Now Apple only has what, 20% of the market? But they have all the profits. The other 80% goes to commodity manufacturers but they don't make any money.

Tesla hopes to be that for mobility and home energy. Even if they fail, they'll still make a huge amount of money in the ramp up, before the commodity manufacturers eat their lunch. They're the market leader right now, so the prize is theirs to lose.

There's a big difference between being the premium product when the range for them is $0-$1200, your margin is massive, and everyone on the planet needs one.

It's another when the range is $12,000-$100,000, margins are much more competitive with way more competent adversaries, all the while car ownership is changing drastically to rental/ride sharing for a great many people.

At that point, you don't necessarily care the car you hired that day is a Tesla or Ford, because you experience it for 20 minutes and are done. The buyer in this case is the fleet owner not an individual, which does not necessarily favor Tesla.

I don't think that you can compare Tesla's product to Apple's (not to mention Apple's software ecosystem permeates so many more aspects of one's life if you are a part of it, Tesla not so much)

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