Elon Musk was interviewed this week during the Financial Times Future of the Car conference. What was most notable from the Musk interview had nothing to do with his acquisition of Twitter, free speech, or Donald Trump. It was Musk’s thoughts on the business of automotive that were very enlightening.
Interestingly, Musk stated that he would not have wanted to go through the pain of making an EV if legacy automakers had invested in electric vehicles. Musk reminded the audience that the history of car startup survival is very low. Without confirmation, Musk commented that Tesla has scaled faster than any auto company in history, even beating out Ford and its Model T production from the early 1900s (In 1921, Ford produced slightly under 1 million Model T vehicles. In 2021, Tesla produced marginally less than 1 million Tesla models).
Musk suggested that it may be harder today for EV startups to compete, believing these companies have a hard time defining their niche now that Tesla and the legacy automakers are in the EV game. Additionally, Musk believes these new automotive startups do not appreciate the difficulties of Tesla’s first eight to ten years in business. Musk emphasized how making prototype vehicles is relatively easy. And he often reiterated that volume automotive production is extremely hard. Using a sports analogy, Musk described moving to volume production like attempting to be an Olympian without ever having participated in the sport. In fact, Musk believes 99% of the difficulty of being in the car business involves the challenges of vehicle production (similar to comments Musk made during the Battery Day presentation in September, 2020).
When questioned about Tesla’s goal to produce 20 million cars by 2030, Musk responded that this is more of an aspiration than a grand promise. Interestingly, Musk said the 20 million number is related to Tesla’s mission to accelerate the world's transition to sustainable energy. He described 20 million vehicles as a basic math problem. Tesla wants to replace 1% of the ICE fleet of vehicles per year.
Musk addressed questions about autonomy and FSD. These answers provided a helpful view of his engineering development perspectives. He believes self-driving does not require human levels of intelligence. He described how the cognitive load for humans driving a car is not difficult once people have experience driving. He reiterated (once again) that Tesla is close to achieving self-driving at a safety level better than humans. When describing what “better than humans” means, Musk described that people frequently don’t know their lives are being saved with autonomy. He said he focuses on the reality of good versus the perception of good, and emphasized the company’s willingness to be sued if he also knows Tesla is doing the right thing regarding autonomous technology and deployment.
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