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Tesla Effect: Expert dives into EV adoption and the internal combustion engine’s death
When Elon Musk took the helm as CEO of Tesla, he aimed to disrupt the transportation industry to such a degree that electric mobility becomes the preferred, primary form of transportation. It was a lofty goal, near-impossible at the time. Yet, more than a decade and several all-electric vehicles later, Musk’s dream and his all-too-familiar Master Plan are actually happening.
Spurred by the success and the demand generated by vehicles like the Tesla Model S and Model 3, the auto industry is shifting towards electric transportation. Coupled with the ongoing climate emergency, several regions across the globe are also looking to drastically reduce their emissions, and one of the ways they are doing that is by phasing out the internal combustion engine. Paul Eichenberg, managing director of Paul Eichenberg Strategic Consulting and a longtime veteran in the auto industry, discussed these shifts in a recent appearance at Autoline After Hours.
During his discussions, Eichenberg noted that the auto industry, including the companies comprising its large supply chain, is already undergoing a steady departure from ICE technology. Aggressive emissions targets in regions such as Europe and China will eventually make it impossible for gas and diesel-powered vehicles to comply unless they become electric. Technological advancements such as autonomous driving solutions are also becoming a priority. This could be seen in how massive companies such as Volkswagen and Ford are currently partnering in a push towards EVs and full self-driving technology. Eichenberg noted that there would likely be more high-profile collaborations in the near future.
It is at this point that Tesla’s disruption, the “Tesla Effect,” if you may, becomes incredibly evident. Tesla might still be learning the ropes when it comes to running a car business, but it is becoming undeniable that the company has created an objectively superior product. Sandy Munro, who has torn down the Tesla Model 3 and other EVs like the Chevy Bolt and the BMW i3, remarked that Tesla’s electric sedan is at least a generation ahead of what other companies have put on the road in terms of the architecture, the electronic systems, and the software surrounding the vehicle. Tesla still needs to figure out a consistent way to make money, but in terms of the electric cars themselves, the company seems to have everything figured out.
With traditional auto catching up to upstart companies like Tesla, large carmakers are now looking to leverage the innovations from younger, smaller companies. This could be seen in how Ford willingly invested in Rivian, which has developed its own skateboard platform that features much of the same concepts as Tesla’s skateboard chassis. Eichenberg, citing an OEM he spoke with prior to the announcement of Ford’s Rivian investment, stated that building a skateboard similar to Rivian’s and Tesla’s will likely result in a seven-year lead in the marketplace.
With electric cars being far more straightforward in terms of parts and components, a significant number of companies whose businesses rely on the internal combustion engine are currently being faced with a dilemma. Eichenberg gave an example of this in a brief discussion about forgings. “If you look at the forgings, a typical vehicle like the Pacifica — you know, V6, 8-speed — that has 107 forgings in it, in just that traditional ICE engine ecosystem. When you go to an electric vehicle, whether it’s the (BMW) i3, the Teslas, the (Chevy) Bolt, whatever it is, there’s eight or nine. So you have a 90% over-capacitation of an industry. And here’s an industry that’s only 90 billion globally, and half of everything it does is in the engine-transmission ecosystem,” he said.
Elaborating further, Eichenberg mentioned that big-tier corporations such as Honeywell and Delphi, whose businesses are tied to the internal combustion engine, are now positioning themselves through spinoffs as a way to shed their ICE-centered assets. Unfortunately, smaller companies don’t have it as easy, particularly as private equities and investors do not seem interested in ICE innovations anymore. Eichenberg shared the story of Dayco, a private equity-owned business which experienced multiple failed sale processes. Eventually, the company ended up taking the deal to China, where it failed to receive a single bid. Among the key reasons behind these failures was Dayco’s line of business.
“Why is Dayco an indication of what private equities are going to do? It’s because Dayco makes pulley systems that go in front of the internal combustion engine. And of course, what’s been the first element to be electrified? All the pumps and all these systems that run off this pulley system. So, the market has already recognized, ‘Hey you know what, we’re not interested in these types of assets,’” he said.
Overall, it appears that traditional automakers’ decision to “wait and see” if Tesla survives and succeeds was a miscalculation at best. As it turned out, well-designed, long-range electric cars caught on, and with the advent of the Tesla Model 3 Standard Plus, which currently starts below $40,000 with Autopilot as standard, it is now becoming quite evident just how much catching up is needed for traditional auto to thrive (or even survive) in the age of the electric car. Yet, as more large automakers collaborate on technology that companies like Tesla have developed on their own, and as investments flow into young, innovative companies like Rivian, it is becoming a certainty that the internal combustion engine is indeed on its twilight years.
Watch Paul Eichenberg’s segment in Autoline After Hours in the video below.
Elon Musk
SpaceX’s Anthropic deal has a catch, and Elon Musk just addressed it
Elon Musk says SpaceX’s Anthropic compute deal cuts both ways after Chamath floats higher prices.
Elon Musk pushed back on Sunday against the idea that SpaceX’s compute contract with Anthropic is a one way bet, after venture capitalist Chamath Palihapitiya argued the company could use a termination clause to charge the AI lab far more.
“It works both ways, of course. If compute becomes plentiful and cheap, SpaceX revenue will drop. No crying in the casino for either party,” Musk wrote on X Sunday evening, replying to a clip of Palihapitiya’s comments shared by AI commentator Rohan Paul.
On the All-In podcast released Sunday, Palihapitiya said either side can walk away from the agreement on 90 days’ notice. If data center supply tightens, he argued, SpaceX could exercise that option and bring the contract back at two to three times the current price, and Anthropic would have little choice but to accept. He called it “the kingmaking move,” according to BigGo Finance.
The clause itself is not new. SpaceX disclosed in its IPO filings in May that Anthropic would pay $1.25 billion per month for dedicated capacity at its Colossus clusters through May 2029, nearly $45 billion in total, with both companies able to terminate on 90 days’ notice, as Teslarati reported at the time. SpaceX’s later compute deals with Google and Reflection AI carry similar exit terms.
What has changed is the political backdrop. Palihapitiya’s thesis rests on incoming Democratic governors pulling tax incentives for data centers and slowing new construction. In Texas, Gov.-elect Gina Hinojosa campaigned on a moratorium on new data center approvals, and Deutsche Bank analysts warned last week that SpaceX’s Texas compute capacity could face delays. SpaceX and Tesla shares both fell after the midterm results.
A slowdown would favor companies that already own capacity. SpaceX acquired xAI in February and has been renting data centers to outside AI labs before the space is needed for Grok. At the Baron Investment Conference on Friday, Musk said SpaceX was “getting 50 billion a year for 35 billion dollar investments” and that it can bring a data center online in eight or nine months, compared to two and a half years for competitors. He also said SpaceX is tracking toward an annualized revenue rate above $100 billion in December, with a “best guess” of $500 billion by December 2027.
Musk’s reply points to the other side of the clause. Anthropic has signed large compute agreements with Amazon, Google and Microsoft, and if that capacity comes online faster than new construction slows, the AI lab would have its own leverage to renegotiate or leave. Musk has called Anthropic “obviously currently the leader in AI,” and it remains one of SpaceX’s largest compute customers.
SpaceX shares rose more than 2 percent in overnight trading late Sunday after closing Friday at $134.27, according to Stocktwits.
Elon Musk
Elon Musk spotlights the Starlink rescue that got through where no cell tower could
Elon Musk spotlighted how Starlink helped rescuers reach five people stranded in Kazakhstan’s snowy mountains.
Elon Musk put a spotlight on a mountain rescue in eastern Kazakhstan on Sunday, writing “Starlink saves lives” in response to a post describing how SpaceX’s satellite internet helped five stranded people reach emergency crews.
The post from DogeDesigner, which had been viewed more than 500,000 times by Sunday afternoon, said the group’s SUV broke down about 15 kilometers from the village of Kystau Kurchum in an area with no usable mobile network. Starlink carried their call for help and kept them in contact with rescuers, who used the connection to locate them.
The rescue itself took place in October. Local outlet YK.kz reported on October 22 that Kazakhstan’s Ministry of Emergency Situations responded to the breakdown in the Kurchum district of East Kazakhstan region and noted that the group stayed in touch through Starlink. Rescuers covered roughly 100 kilometers in a Trekol, a low pressure tire vehicle built for snow and marshland, then escorted the disabled SUV back to Kystau Kurchum. Nobody needed medical attention.
Starlink saves lives
— Elon Musk (@elonmusk) November 8, 2026
Conditions in the region were rough at the time. Kazakh broadcaster Channel 7 identified the five as hunters caught in a snow trap and said satellite communication allowed rescuers to pinpoint where they were. A spokesperson for the East Kazakhstan emergency department said a storm warning was in effect and urged residents not to leave populated areas unless necessary. The same weather stranded seven utility workers repairing power lines in the nearby Kuygan rural district, according to Tengrinews.
Kazakhstan has been one of Starlink’s more notable markets in Central Asia. Teslarati reported in 2024 that Starlink was serving 1,731 of the country’s 1,879 schools, with the country’s Education Minister saying it had set a new standard for internet service in schools.
Rescue stories like this one have followed Starlink for years, usually in places where ground networks fail or never existed in the first place. Then Florida CFO Jimmy Patronis called Starlink a “game changer” for search and rescue crews during Hurricane Milton, and SpaceX and T-Mobile switched on Starlink Direct to Cell in North Carolina to push emergency alerts to phones after Hurricane Helene.
The next target is dead zones for people who do not carry a dish at all. SpaceX is building out Starlink Mobile and earlier this week selected Qualcomm to supply core infrastructure for a planned terrestrial 5G network in the United States, which it intends to pair with its next generation satellite constellation.
Sunday’s post is at least the third time Musk has written “Starlink saves lives” on X this week, following identical posts on November 5 and November 7.
SpaceX plans to attempt what will be a defining moment in rocket reusability on Starship Flight 15.
As Elon Musk announced in a recent X post, SpaceX will attempt to catch both the Super Heavy Booster and the Starship upper stage during the upcoming orbital flight. If successful, it will mark the first time that all parts of an orbital rocket return to Earth intact, a breakthrough Musk has called essential to making life multiplanetary.
SpaceX will attempt to catch both the Super Heavy booster and Starship on the upcoming flight.
If both are successful, it will mark the first time that all parts of an orbital rocket return to Earth intact.
This is the critical breakthrough needed to make life multiplanetary.
— Elon Musk (@elonmusk) November 6, 2026
Previous flights have demonstrated the tower-catch technique with Super Heavy. SpaceX has successfully caught V1 boosters three times (on Flights 5, 7, and 8), with some even reflown. The Ship upper stage has never been caught.
Returning from orbital velocity after deploying payload makes it a significantly harder challenge due to higher energy, heat loads, and the need for precise belly-flop reentry, a flip maneuver, and a final landing burn to settle between the Mechazilla tower’s chopstick arms.
Flight 15, using Booster 22 and Ship 42 (both Block 3 vehicles), is targeted for no earlier than Friday, November 13, 2026, from Orbital Launch Pad 2 at Starbase, Texas. The 75-minute window opens at 4:45 p.m. CT, pending regulatory approval. After hot staging and separation, the booster is planned to return for a catch roughly 6 minutes and 35 seconds after liftoff.
The Ship will insert into a roughly 275 km orbit, deploy 26 advanced Starlink V3 satellites, complete about 14 orbits over more than 22 hours, and—if systems check out—perform a deorbit burn, reentry, flip, and landing burn for a tower catch at approximately T+22 hours 32 minutes.
SpaceX confirms Starship 15 launch window with massive ambitions
A simulation shown during SpaceX’s October earnings call depicted the Ship descending in a belly-flop attitude, flipping upright with a short engine burn, and being captured by the arms:
From simulation to reality
SpaceX is just ONE WEEK away from attempting its most ambitious Starship catch yet https://t.co/nHrxSX6DSz
— X Freeze (@XFreeze) November 6, 2026
Contingency splashdown zones exist in the Gulf of Mexico (booster) and Pacific (Ship) if a catch is not viable. SpaceX has stressed rigorous health checks before committing the Ship to a return-to-launch-site trajectory.
Musk has described the odds of success on this first dual-catch attempt as “more likely than not,” noting a steady stream of additional flights is already scheduled if needed. Full recovery would enable rapid inspection, refurbishment, and reflight—slashing costs and supporting the high launch cadence required for Starlink expansion, lunar missions, and eventual Mars settlement.
As Musk put it, this is “the critical breakthrough needed to make life multiplanetary.”
SpaceX’s Anthropic deal has a catch, and Elon Musk just addressed it
Elon Musk spotlights the Starlink rescue that got through where no cell tower could
