Musk's Tesla Master Plan Is A Letdown, And It Doesn't Say Much About New Cars
Musk's Tesla Master Plan Is A Letdown, And It Doesn't Say Much About New Cars

Musk’s Tesla Master Plan Is A Letdown, And It Doesn’t Say Much About New Cars

Investors were disappointed with Elon Musk’s much-hyped third Master Plan for Tesla Inc. because it didn’t give any solid information about the company’s long-awaited next generation of electric cars.

The four-hour presentation was heavy on Musk’s vision to build the next phase of Tesla’s growth around a sustainable energy future by moving into products like heat pumps, but it was light on any detail of new vehicles, particularly a cheaper electric vehicle similar to the $25,000 model that was flagged more than two years ago.

The chief executive officer, who is 51 years old, has stated that the next generation of automobiles would be built in a new plant in Monterrey, Mexico; however, he did not provide any details regarding the timing of the announcement, saying that a “real product event” will be held later. In a similarly evasive manner, Tesla’s vice president of vehicle engineering, Lars Moravy, responded to a query posed by an analyst by saying only, “We’re going to go as fast as we can.”

As the event dragged on for longer, it looked that more and more investors were losing hope. During after-hours trading, Tesla’s stock dropped as much as 6.8%, reaching a price of $189 a share. Before today, the stock had skyrocketed from a two-year low that it had plummeted in early January, adding almost $310 billion to the market value and restoring Musk to the top spot on the Bloomberg Billionaires Index.

Musk began the presentation by presenting his vision for a global switch to electric vehicles, which would be driven by $10 trillion in spending to produce sustainable energy worldwide. This spending would take place all over the world.

He said-

“Earth will move to a sustainable energy economy”

“And it will happen in your lifetime.”

As a rebuttal to the assertion that he has disregarded the automobile manufacturer ever since he purchased Twitter for $44 billion, he also took advantage of the occasion to highlight the extensive executive talent pool at Tesla. At one point, sixteen other CEOs, many of whom are relatively unknown to the audience of investors, joined him on stage.

For instance, Rebecca Tinucci, the head of global charging infrastructure for Tesla, approached the stage to discuss the company’s Supercharger network as well as the “Magic Dock,” a feature that enables drivers of other electric vehicles to charge their vehicles at Tesla stations.

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A significant amount of emphasis was also placed on cutting expenses. As part of the electric vehicle manufacturer’s ongoing efforts to improve operational efficiencies, the company intends to cut the footprint of any new manufacturing facility by forty percent. The Chief Financial Officer of Tesla, Zach Kirkhorn, has pledged to reduce production costs for Tesla’s next-generation vehicles by 50 percent.

Musk's Tesla Master Plan Is A Letdown, And It Doesn't Say Much About New Cars
Musk’s Tesla Master Plan Is A Letdown, And It Doesn’t Say Much About New Cars

Jessica Caldwell, executive director of insights for Edmunds, stated that while the emphasis on cost-cutting was “encouraging,” Musk “failed to put the cherry on top — an actual look at a lower-priced Tesla, if only just conceptually.” Caldwell said that while the emphasis on cost-cutting was “encouraging,” Musk “failed to put the cherry on top.”

She noted-

” It would have been a sensible move to attract future purchasers given the growing choice of EVs that are available, while simultaneously “generating even more investor love for Tesla” 

Caldwell said in an email-

“Musk’s clear path to a sustainable-energy Earth is admirable, but investors may have preferred if Tesla outlined a clear path toward sustainable profits in a high-growth market” 

Other important things to learn from Tesla’s Investor Day are:

  • Musk said that Tesla will build its next auto plant near Monterrey in Mexico, but he didn’t give any new information other than the fact that the next-generation car will be made there.
  • Drew Baglino, Tesla’s senior vice president of powertrain and energy engineering, confirmed that the company has started building a lithium refining plant in Corpus Christi, Texas.
  • Musk said that AI makes him nervous and that there needs to be a regulatory body to make sure that this “quite dangerous technology” works in the public interest.
  • Tesla has made 4 million cars at this point. It took 12 years to make the first million Teslas, 18 months to make the second million, 11 months to make the third million, and then 7 months to make the fourth million.
  • Colin Campbell, who is in charge of Powertrain Engineering, said that Tesla’s next drive unit will use a permanent magnet motor that doesn’t use rare earths. This caused the shares of Chinese companies that mine rare earths to drop sharply.

Heat pumps are one product that Tesla could sell more of. Musk and Drew Baglino, his senior vice president of powertrain and energy engineering, said that heat pumps could cut home and office heating costs by a lot. They called heat pumps one of the low-hanging fruits of the move to renewable energy.

The company also wants to offer unlimited overnight charging at home in Texas for $30 a month. This is similar to how mobile phone billing has changed. The company also said that it was getting better at setting up production facilities quickly. It plans to start making lithium at the Corpus Christi refinery within a year.

“That’s the target,” Baglino said.

Tesla did say again that the Cybertruck is coming this year, with mass production expected in 2024. The new corporate vision aims to build on the market leader in electric vehicles in the US’s growth from a niche player to a major automaker. Tesla’s two previous plans for the future were shown to the public in 2006 and 2016.

Musk released his first Master Plan more than ten years ago. In it, he explained how Tesla would go to market by making an electric sports car and then a series of cheaper cars. This vision has been carried out by the company with the Roadster, the Model S, and then the Model 3 sedan, which starts at about $43,000 and is its least expensive car.

Ten years later, when Tesla bought SolarCity, Musk put out Master Plan, Part II. Musk was the chairman of the company that put up solar panels. His cousins ran the company. This plan talked about solar roofs with batteries, a wider range of vehicles, and technology that lets cars drive themselves.

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About Sam Houston 1811 Articles
Hello, I'm Sam Houston, and I'm proud to be a part of the team as a content writer. My journey into journalism has been quite an exciting ride, and it all began with a background in content creation. My roots as a content writer have equipped me with the essential skills needed to craft engaging narratives and convey information effectively. This background proved invaluable when I decided to make the transition into journalism. The transition allowed me to channel my storytelling abilities into producing news articles that not only inform but also captivate our readers.

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