Elon Musk Digs Deeper as Vision to Change the World Further Unfolds
Tesla reported a mixed quarter, beating revenue expectation but missing on earnings. The company earned $2.7 billion in revenue but lost an astounding $397 million as the company burns through cash in anticipation of the Model 3 - an affordable sedan for the regular consumer. Tesla is doubling the size of its super charger network and vastly increasing its gallery locations which tend to outperform other locations selling Teslas by 1.5 to 2 times.
Earlier last week, Elon gave a TED talk in which he briefly outlined many of the projects that his companies were working on. He is quite busy, although much of the excitement will be focused on Tesla.
His new company called The Boring Company aims to dig holes. That's right, Elon will start by digging up California, starting in front of the SpaceX building. A multi-level network of 3D tunnels will alleviate traffic. The challenge being that it costs $1B per mile with current technology to drill. Elon has a snail named Gary who can crawl 14x faster than the tunneling machine. It's Elon's goal to beat Gary in a race.
"The deepest mines are deeper than the tallest buildings are tall." -Elon Musk
Furthermore, autonomous driving technology seems to be on track for enabling people to sleep in their cars in approximately 2 years. That said, the technology is there but the regulatory approvals are not. The car should be able to drive from a parking lot in California to a lot in New York autonomously, even if the route changes along the way. This test will be performed in November or December of 2017. Tesla also plans to have an Uber-like service in the future where you can loan your car to friends, family, 5-star drivers, etc, and earn money while your car runs your business for you.
Tesla seems to still be the most exciting aspect of Elon's companies. Especially given that investors can only buy Tesla to get in on the excitement. Elon sees himself working for Tesla as far as the imagination can see.
Tesla will be announcing the Tesla Semi later this year in September.
"If you had a tug o' war competition, the Tesla Semi would tug a diesel semi uphill." -Elon Musk
The Tesla Semi would not compete with many of the traditional car companies which do not sell into the same market.
Contrary to the rumours, Elon isn't delaying the solar roof. 2 models will be coming out this year and 2 the next year. The company is shifting to higher margin projects and customers who pay up front. 31% of Solar City's orders fell into this category, whereas previously this was 9%. There is still a long way to go to turn the Solar division around.
When asked about fuel cell competitors, Elon predicts that these manufacturers will soon realize that fuel cells are not the way to go. Elon says all transport to be electric with the "ironic exception of rockets."
The Model Y (affordable SUV) will be produced on a different platform, with 30x less wiring than the Model S. The Model Y will be more efficient than even the Model 3, and Tesla believes they can reach 1M cars by 2020 with the Model Y. Lastly, Elon still believes that Tesla's market cap could reach $700B eventually, though he hopes not to be completely delusional about this.