Friday, 24 October 2014

BMW & Tesla Talking Different Approaches But Will Ultimately Face Off

17:57

Not even going to try to analyze who has it right or who is a bigger innovator, but it's clear that both companies have chosen...

There isn't any point in trying to analyze who has got it right or who is a bigger innovator. However it's clear that both companies have chosen to focus on different aspects of their respective vehicles.

Looking closely at Tesla, it's all about the batteries. Unlike every other automobile manufacturer, BMW included, Tesla's approach isn't for their electric cars to complement their lineup of petrol and diesel offerings since they don't have any. However instead, its to render petrol vehicles from their competitors obsolete. In order to do so, their cars have to be at least as good or better than most features of competing gas cars; and that includes range, performance and utility. On the other hand BMW doesn't need to necessarily worry about making everything better. They only focus on the specific needs of certain customers, and to make a vehicle that is better than any other at a specific set of tasks, without cannibailzing sales of other vehicles in their lineup. Therefore if you accept that premise, it's not difficult to understand why we have the Model S and the BMW i3.

Even though Tesla Knew they had to knock it out of the park with their first high volume vehicle offering. They still knew they had to offer a car that could stand its ground against all of the top luxury sedans while offering a range, long enough to allow for the road tips enabled by the supercharger network. Even though that was an enormous task, one that few automotive analysts really believed they would pull off, however remarkably they did just that and the Model S is a smashing success. No disrespect to the 'Sexy' styling and the fabulous performance of Model S, but the heart and soul of what the car is can be attributed to the enormous batter pack it uses, filled with industry leading, with the high energy-density batteries. The main thing about the Tesla is the batteries, even though the Mode S uses batteries that have a higher energy density than any other EV manufacturer, they still aren't satisfied. they aren't waiting for the market to bring them better, cheaper cells for their future cars. However instead they are in the process of building what will be the first of many Gigafactories, which will be the largest lithium ion battery manufacturing plants in the world. Therefore this will drive down the costs, guarantee that they have the supply that they need, and allow them to constantly upgrade to better cells without needing to wait for battery manufactures to retool production facilities to produce them. The key to Tesla's success is having the best batteries available, and to manufacture them for less than what their competitors are paying for comparable cells. However this is the only way to offer a large battery for long range electric vehicles, and to be able to price them competitively. It's Tesla's edge, and perhaps their only hope to compete and actually beat the large, establish automakers.





















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