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Tesla’s new master plan is not a new car, just thoughts about Earth : NPR


Tesla CEO Elon Musk is pictured as he attends a production kick-off at Tesla’s “Gigafactory” in Gruenheide, southeast of Berlin, Germany. on March 22, 2022. Tesla held an investor day on Wednesday. It didn’t reveal a new vehicle, but it did reveal some ideas about the big picture of climate change.

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Tesla CEO Elon Musk is pictured as he attends a production kick-off at Tesla’s “Gigafactory” in Gruenheide, southeast of Berlin, Germany. on March 22, 2022. Tesla held an investor day on Wednesday. It didn’t reveal a new vehicle, but it did reveal some ideas about the big picture of climate change.

Patrick Pleul/POOL/AFP via Getty Images

Predictions have been building for days. Tesla is poised to announce a new strategic plan at Investment Day, only the third time the company has offered a “master plan” that will guide its future.

Analysts are eager to see a new Tesla model – specifically a much cheaper Tesla, one that could help the most popular electric car brand in the US reach more buyers.

But at Investment Day on Wednesday, Tesla didn’t reveal that vehicle.

Elon Musk’s new master plan? End of fossil fuels.

Instead of a shiny new car, the company had a big picture of climate change, creating the opportunity for a positive global transition away from fossil fuels – a transition with large numbers of electric vehicles and batteries, Tesla’s core products, are key components.

Good for a company that always advertises its green credentials, but Wall Street would prefer a newer car. Tesla stock fell markedly in after-hours trading.

Musk has a lot on his mind about planet Earth

In some ways, though, it’s a classic Tesla.

Tesla has completely reshaped the climate conversation, by driving the auto industry to electric vehicles.

The new “master plan” extends beyond the automotive sector to talk about decarbonizing the global power grid as well as all industries, shipping and air travel.

Musk opened the event by arguing that the world could quickly transition to renewable energy with the help of batteries (for example, to store solar energy for use at night) and of course Even electric cars run on batteries. This new “master plan” also nods to heat and hydrogen pumps for industrial purposes.

Numerous researchers, analysts, and nonprofit groups have outlined avenues to combat climate change. Most stress that time is running out and the scale of change needed is difficult.

Musk’s tone is more upbeat. He said Tesla did the math and the transition would cost $10 trillion, less than what the world would spend on fossil fuels in the same time frame. All of that $7 trillion will go to electric vehicles — a market that Tesla has revolutionized and intends to dominate globally.

“Today is not just for Tesla investors, but anyone who is an investor on Earth,” Musk said. “The Earth can and will turn to sustainable energy, and it will do so throughout your lifetime.”

A Tesla charging station for electric cars is seen in the parking lot of a mall in Puebla, Mexico, on February 26, 2023. Tesla executives talked about new ideas about everything. aspects of its business, including charging, at the date of investment.

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A Tesla charging station for electric cars is seen in the parking lot of a mall in Puebla, Mexico, on February 26, 2023. Tesla executives talked about new ideas about everything. aspects of its business, including charging, at the date of investment.

Pedro Pardo/AFP via Getty Images

Make the case for innovation, though without major revelations

Without an entirely new vehicle to drive on stage, Tesla executives and engineers shared information on how the next generation of vehicles will be designed and built.

The company claims a completely revamped assembly process, which includes building the front and back of the vehicle separately, could cut production costs by 50%. Tesla also says future vehicles will not require rare earth elements and can incorporate any of the battery chemistry, making it easier to source raw materials.

To bolster its reputation as an innovative company, Tesla also attacked investors with examples of how it has developed new features and cut costs.

Tesla boasts a software update to automatically adjust the mid-drive air suspension, based on data from other vehicles about rough road location and a cost-cutting strategy for Supercharger stations by how to pre-assemble entire stations and drop them off from cranes, instead installing individual chargers in place.

A Tesla Model Y car is displayed at the Tesla showroom in a shopping mall in Beijing, China, on April 29, 2022. Tesla shares fell after it failed to reveal an umbrella. new car on investment day.

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A Tesla Model Y car is displayed at the Tesla showroom in a shopping mall in Beijing, China, on April 29, 2022. Tesla shares fell after it failed to reveal an umbrella. new car on investment day.

Ngoc Gao/AFP via Getty Images

At the forefront of the electrification race

Investor day comes as investors feel more optimistic about Tesla’s future, despite increasing competition.

Every major automaker today believes zero-emissions vehicles are the future of the industry, and they’re racing to catch up with Tesla. That leaves Tesla’s share of electric vehicle sales likely to shrink due to more competition. That’s one reason the company’s stock price plummeted last year.

But Tesla is producing vehicles in larger numbers than its rivals, and it recently slashed prices sharply. That has increased interest in Tesla vehicles, and the move has been warmly received by Wall Street.

And Teslas are still popular with motorists. The company just won the top award for “Overall Loyalty” for a product in S&P Global Mobility’s Automotive Loyalty Award. Overall, about 50% of the time used car buyers stick with their used brand. For Tesla buyers, two-thirds of a solid return goes to Tesla.

“Tesla has had a very, very successful year,” said Vince Palomarez of S&P Global Mobility. “They’ve produced a product that appeals to consumers… They’ve lowered the price. They’re also reaching out to tax credit again.”

Palomarez also noted that Tesla owners often install Tesla chargers in their homes. That can be an added incentive to stick with the brand, rather than having to swap devices or use an adapter after every charge. He compared it to Apple’s proprietary charger.

“If you have an iPhone, an iPad and a MacBook, you know, you’ll have an Apple Watch…. the infrastructure is built there,” he said.

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