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Tesla vs The Big Three – An uneven contest

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Elon Musk has said many times that his ultimate goal is to increase the adoption of electric vehicles, a goal that’s advanced with every EV that rolls off a dealer’s lot, even if it’s not a Tesla. “The biggest impact that Tesla will have is not the cars that we make ourselves, but the fact that we show that you can make compelling electric cars that people want to buy,” he said in Revenge of the Electric Car.

When it comes to making compelling electric cars, the company has succeeded spectacularly. But when it comes to inspiring the industry leaders to sell their own EVs in substantial numbers, that isn’t happening. Spokesmen for the major automakers (especially when speaking to the EV media) say things like, “the future is electric,” and “we intend to stay at the forefront of technology,” but when it comes to action, the playbook is: sell just enough EVs to satisfy government regulators, while keeping the focus on profitable trucks and SUVs.

A recent article in CleanTechnica takes a look at the lineup of plug-in models offered by the Big Three (Ford, GM, and Fiat Chrysler). The current roster consists of 3 pure electric vehicles (EVs) and 5 plug-in hybrids (PHEVs). Of the 3 EVs, only one, the Chevy Bolt, is truly an attractive option. The Fiat 500e is a compliance car that’s only available in two states, and Fiat Chrysler CEO Sergio Marchionne has asked the public not to buy it. The Ford Focus EV was introduced in 2011, and not updated until 2015 – it sold a grand total of 901 units in 2016.

However, the handwriting is on the garage wall. Plug-in vehicle sales have increased every month for the last 20 months, Tesla’s Model 3 has accumulated somewhere around 400,000 advance orders sight unseen, and battery prices are falling rapidly – several industry observers have predicted that EVs will reach cost parity with legacy vehicles in about 5 years. So, is Detroit raising its game, and preparing to expand its portfolio of electric models?

Fiat 500e [Credit: Car and Driver]

Well, sort of. In January, Ford announced that it plans to introduce 13 new electrified vehicles over the next five years. However, it offered specifics for only 7, and only one of these is an electric vehicle for the US market: “an all-new fully electric small SUV, coming by 2020, engineered to deliver an estimated range of at least 300 miles.” The other 6 include hybrids and an electric commercial van to be sold in Europe.

Ford representatives have made it clear that the company will be taking a gradual, go-slow approach to electrification. CleanTechnica’s Loren McDonald spoke with Brett Hinds, Ford’s Chief Engineer of Electrified Powertrain Systems, in early January, and was left with the impression that the automaker feels little urgency about upgrading its electric vehicles. When McDonald mentioned that industry experts expect EV ranges to increase to 300 miles in 5-7 years, and that battery charging rates are also expected to improve, he was told that “Ford just doesn’t see it that way.” (Yes, this directly contradicts Ford’s official announcement quoted above – the major automakers often make contradictory statements about their electrification plans.)

More recently, Ford replaced CEO Mark Fields with Jim Hackett, the head of its Smart Mobility division, a move that is believed to signal more emphasis on electric and autonomous vehicles. Ford Executive Chairman Bill Ford confirmed this, telling Bloomberg in an interview that the CEO switch “is about EVs, and it’s about AVs [autonomous vehicles].” However, he seemed to acknowledge that the focus would remain on short-term profits (read: trucks). “Wherever we go, we have to make sure that the returns are great for our shareholders,” said Ford. When asked if he could foresee a future in which EVs would generate the kind of margins the company makes on the F-150 pickup, he thought silently for a moment, then changed the subject.

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The voltage level is much higher over at GM, where the new Chevy Bolt has been earning rave reviews, and making respectable sales – it moved 1,566 units in May, #5 in the US plug-in ranking. However, the rollout has been slow – the Bolt went on sale in December 2016, but it still isn’t available in all 50 states.

“I wouldn’t necessarily call it a slow rollout; it was a phased rollout,” Chevrolet spokesman Jim Cain told Bloomberg. “In terms of sales, I think we’re right on plan.” And that’s kind of the point. As Elon Musk and others have pointed out, GM doesn’t seem to have any desire to sell the Bolt in mass-market quantities – it’s likely to limit production to 25,000 or so per year.

Ironically, the considerable media buzz around the Bolt seemed to disappear as soon as it actually went on the market. “The little car hasn’t captured any of Tesla’s Silicon Valley street cred, and it hasn’t whipped up any of the cultish following that still benefits the Toyota Prius,” writes Bloomberg’s Kyle Stock.

GM’s future electrification plans are vague. In February, GM CEO Mary Barra told CNET’s RoadShow that the Bolt platform will be the basis for a range of future EVs, but no details have been forthcoming.

And then there is Fiat Chrysler, the only automaker that has always been honest about its lack of interest in EVs. CEO Sergio Marchionne has said that the company loses about $14,000 on each unit of its Fiat 500e, and famously asked consumers not to buy it. The little electric runabout has garnered excellent reviews, can be leased for as little as $100 a month, and has been selling a surprising 600 or 700 per month, despite being available only in California and Oregon. Chrysler recently launched a plug-in hybrid version of its extremely popular Pacifica minivan, but it’s too early to tell how it will do.

One glaring problem is that the Big Three continue to put out lackluster designs for their electric cars. Diarmuid O’Connell, Tesla’s vice president of business development had said, “In essence, they’ve delivered little more than appliances. Now, appliances are useful. But… they tend to be unemotional.” Tesla’s CEO, Elon Musk, goes one step further, pointing out that an electric car shouldn’t “feel like a weird-mobile.”

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On the other hand, the issue with the majors’ plug-in models has never been quality – almost all who’ve driven them, including this writer, agree that they are excellent automobiles. What remains puzzling is the companies’ willingness to market them. The automakers do almost no advertising for them, and most (not all) of their dealers do their utmost to steer customers away from them. Meanwhile, the companies continue to lobby to have fuel economy and emissions standards watered down.

A recent article in Plug-in Future, “How the Major Global Automobile Manufacturers Fell Asleep at the Wheel” notes a cling-to-the-past cultural dynamic. “Part of it comes down to mentality and culture. Senior executives in automobile companies tend to be [oftentimes] male mechanical engineers who… [enjoy] tinkering around with old cars and tractors. It’s what they do; it’s what they love and their careers have been about perfecting the highly complex internal combustion engine. And now you are telling them to get rid of that engine and replace it with a simple electric drive and a battery to power it. No wonder they are resistant… Changing such a culture is very difficult.”

So what gives? Is it short-sightedness? Fear of the future? Plain old stupidity? Not likely. Sure, they might be stuck in their ways but we’re talking about highly informed veterans of the auto business, who have access to all the same articles, statistics and reports that you and I do (much more, actually).

What’s really happening here is a phenomenon called The Innovator’s Dilemma (the title of a 1997 book by Clayton Christensen, and yes, I believe most auto industry execs have read it). Incumbent corporations can’t keep up with disruptive technological changes, because their shareholders demand quarterly profits. They can experiment with new technologies, but they can’t pursue them whole-heartedly, because that would mean cannibalizing their proven profit centers (to sell an electric car, you have to explain why it’s better than a gas car). Once a new technology improves to the point that it can offer similar capabilities (range, charging time) to the old at a similar price, the incumbents’ market can disappear surprisingly quickly – remember Kodak, Blockbuster, and Blackberry.

by Charles Morris

This story was originally published on EVANNEX

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Google just picked SpaceX for its first step into orbital AI

Google will launch its first Project Suncatcher AI satellite on SpaceX’s Transporter-18 rideshare next week.

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Google is about to put its own AI chips into orbit for the first time, and it is paying SpaceX to get them there.

The company said Thursday that the first in-orbit test of Project Suncatcher, its research effort to find out whether space can host large-scale AI computing, will fly next week on SpaceX’s Transporter-18 rideshare mission.

The satellite, called MVP, is about the size of a refrigerator and carries four of Google’s Tensor Processing Units, the same chips Google runs in its ground data centers. Google originally planned to launch two custom satellites in 2027, but chose to move faster by integrating its chips into a satellite.

MVP’s solar panels supply about one kilowatt of power, and Google will run Gemini models on the TPUs only in bursts of roughly 15 minutes before the chips shut down so the radiators can shed heat. In a blog post, Google said its Trillium TPUs survived vibration testing that mimicked sustained launch loads of up to 10g, with individual components seeing 50 to 100g, and handled a radiation dose greater than a five year mission would deliver.

SpaceX and Google mull massive partnership on Musk’s orbital data dream: report

Next week’s flight, slated for October 1, follows a relationship that became public in May, when Teslarati reported that Google was in talks with SpaceX for a launch deal tied to orbital data centers. Google also holds a stake of roughly 6% in SpaceX.

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The two companies are chasing the same idea from very different starting points. SpaceX’s own orbital compute program is built around the AI1 satellite, a roughly 70 meter structure derived from Starlink V3 hardware that is designed for 150 kW of peak compute, about 150 times the power MVP will draw. Elon Musk has brushed off concerns about crowding orbit with those satellites, and SpaceX is building its Gigasat factory in Bastrop, Texas, to produce them, targeting an annualized rate of about 1 GW of space compute by the end of 2027.

Musk also posted on X on Thursday that “the amount of compute in space will obviously round up to 100% of all compute.”

Google has been more cautious in public. Its research estimates that launch prices need to fall below about $200 per kilogram before an orbital data center can compete with a ground facility on energy cost, a threshold the company believes could be reached around the mid 2030s. The Suncatcher team has said it expects the effort to remain a project rather than a product for years, which leaves the first real test of its hardware riding on a rocket from the company with the most aggressive timeline in the field.

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Tesla Cybercab gets initial tie-in to localized, in-house cathode plant

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Credit: Tesla

Tesla has taken another concrete step toward owning its battery supply chain, and it’s doing so with what is perhaps the most important vehicle in its short-but-storied history.

On September 23, Tesla announced that it has officially built the first Cybercab with cathode material produced in-house at the company’s first cathode plant in the U.S., and the first in the U.S. overall.

Active cathode material is the most expensive piece of a lithium-ion battery cell, and it often accounts for more than a third of cell cost. For years, the industry sourced a majority of it from Asia, but Tesla’s decision to make it in the United States bodes well for the Cybercab project. This is the latest chapter in Tesla’s vertical integration strategy, which began in public at Battery Day in 2020.

At the Battery Day Event, Elon Musk said the company would build a North American cathode plant and overhaul the process to cut costs and waste, while also making some of the most powerful and long-lasting cells in the industry.

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The Austin facility took years to appear. Tesla filed permits for “Project Cathode” in 2022 on land near Giga Texas. By mid-2022, the building frame was up and Tesla later invested hundreds of millions of dollars as part of a larger expansion of the Giga Texas plant. The company stated it was operating the first large-scale cathode production facility in North America to supplement 4680 cell production.

One month later, that material reached a finished Cybercab.

The timing of this breakthrough is monumental for the Cybercab program. As Tesla officially launched the first Cybercab rides to the public earlier this month, production of the ride-hailing-geared vehicle is moving forward on the planned S-curve that CEO Elon Musk told everyone to expect.

Nevertheless, packs of Cybercab units have been spotted throughout the United States, in an effort to potentially activate the fleet as soon as the company gains regulatory approval in various geographic areas.

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On top of that, Tesla owning the cathode step and pairing it with its own in-house lithium from the Gulf Coast refinery shortens the supply chain that once stretched thousands of miles and subjects every pack to fewer external price shocks and geopolitical risks.

Tesla is not yet independent of all of its foreign suppliers, as some precursor metals come from mines and chemical plants. But the first in-house cathode Cybercab shows the company is closing the most expensive and most concentrated gap in its battery production efforts. For a vehicle like Cybercab to operate at a high utilization within the Robotaxi network, that control over cost is so crucial.

It is arguably as important as the software that drives it.

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Tesla leaks Semi customers ahead of handover event

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Credit: Tesla

Tesla is set to inaugurate its dedicated Semi factory in Sparks, Nevada, this evening, but drone footage has already started to show who is expected on the handover stage.

Zanegler, a drone operator who regularly documents Tesla Semi operations in Nevada, filmed a row of new-generation Semi units parked outside of the plant with customer branding applied. The liveries visible in the video include companies like PepsiCo, U.S. Foods, Einride, DHL, WattEV, and others that have committed to utilizing Tesla’s Class 8 electric truck in their fleets.

Several of those company names already sit within Tesla’s public ordering book, including PepsiCo, which has been the program’s primary anchor customer since the first Semi deliveries in December 2022. PepsiCo now runs dozens of Tesla Semi units in daily service, with drivers completing regional routes.

Einride placed a 500-unit order in August, which was, at the time, the largest single Semi commitment. First deployments of their Semi units are planned for this month and will eventually span across California, Texas, New Jersey, Illinois, and Georgia. Meanwhile, IMC Logistics announced a 50-truck California order this week.

Tesla Semi lands the biggest electric truck deal in U.S. history

Other names, like LTS, OK Produce, and HMD, have not been widely confirmed as firm buyers, but their presence on the lot is perhaps the clearest signal that Tesla intends to expand on that list this evening at the event.

Tesla first unveiled the Semi back in 2017 with a 2019 production target.

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Limited pilot builds reached PepsiCo in late 2022, and high-volume production began at the new 1.7-million-square-foot plant that sits logically positioned next to Tesla’s Gigafactory Nevada. Tesla Semi program director Dan Priestley has said that Tesla expects to build “many thousands” of Semi units this year, but as with every Tesla release, there have been set expectations of an S-curve ramp.

Outside estimates still put 2026 deliveries in the 5,000-to-15,000 range, but it will ultimately depend on Tesla’s readiness to put those units out, as well as how smoothly production is moving internally.

Tesla’s Semi Rollout event is set to start tonight at the Sparks factory, and it will be livestreamed on X starting at 6 p.m. PDT / 9 p.m. ET.

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