On Saturday the 15th of January, Tesla Motors provided an opportunity for the public to take a close look at the Roadster that is now available for sale in Australia. Under dark clouds that threatened to open up and rain on their parade, the Tesla Motors representatives and their two electric supercars were nevertheless shining beacons to what may very well be the future of not just what we drive, but also the entire process of buying and owning a car.
We travelled to Circular Quay in Sydney, just outside the Museum of Contemporary Art to see firsthand what Tesla Motors was offering. The Tesla Roadster has already received a huge amount of publicity worldwide, so a brief recap on vital statistics. The Roadster is an all-electric supercar powered by over 6,800 lithium-Ion batteries with no combustion engine whatsoever. Globally, over 1,500 Roadsters have been sold so far, travelling over 14 million kilometres completely emission-free. It can accelerate from standstill to 100km/h in 3.7 seconds, and can travel just under 400 kms on a single charge. But this isn’t the story we’re telling today. What we’re talking about is a radical shift in our perception of the personal transport industry. It’s an exciting time to be witness to the foundations being laid to what may be the norm in years to come.
After seeing the car, talking to the local Tesla Motors sales and engineering managers, and understanding that the Roadster is out of reach of most of the working population, you realise that there is a much larger agenda at work here. People who want a AUD$223,000 supercar will buy one because they can afford it, because of the exclusivity and its performance. The fact that this is the most environmentally advanced vehicle in the world will appeal to a lot of those buyers who can contribute to energy consumption change while enjoying the image that the car conveys.
As an aside, if the government really wanted to make this car more attractive and boost their climate change credentials, they could look at concessions on the luxury sales tax and other duties that total 53% of the sale price of this car. Then we might see quite a few on the streets very quickly, and bring the electric car offer to the forefront of the industry. Think about it, a supercar that costs only half its current drive away price? The value in marketing emission-free vehicles that hundreds of these cars on the road would provide could surely justify some level of support.
But Tesla Motors isn’t interested in just selling supercars, or the battery packs that power them, even though both sales operations would keep them in business. Tesla Motors wants to change the world. And that’s an awesome mission.
Much of the way that today’s car industry works is based on large dealerships and frequent services. What car dealers discount on a new vehicle sale is made up in the labour charges for future service visits. Anyone that owns a car knows how complicated an engine is, and how many things can and will go wrong. If we think about it, the current car market is built on negative expectations: that components will fail and so on. The new car market that Tesla Motors envisage, and that I’d love to see eventuate, is a car market built on customisation, minimal service levels and high reliability. Let’s take a sneak peek into that future:
I’m ready to buy a new car, so I jump onto the Tesla Motors website, which directs me to the Australian sales portal. I choose the car I want, selecting colour, number of seats, type of speakers, etc. I negotiate and order online, and the car is delivered to me a fortnight later, fully charged. After enjoying the first couple of days cruising around town and travelling to and from work, I go home and connect my car to my mains power in the garage, and overnight the car’s batteries are fully juiced up again.
After a year of driving with no petrol fill-ups, oil changes or radiator top-ups, Tesla Motors sends a service agent to my house to look at the car. After a firmware upgrade, dusting the fans and checking brakes, the cooling system and the four (yes, only four!) moving parts on the car, the service agent leaves for another year.
In this brave new world, at no point during the ownership of this car would I need to visit a petrol station or a service centre. Of course, I’d need to change tyres and brakes during the life of the car, but other than that it’s pretty much firmware updates and vacuum cleans. Even the replaceable batteries will last at least 7 years of regular driving.
This whole scenario is a massive mind shift for both car buyers and car sellers, and it certainly won’t be an easy path to pioneer for Tesla Motors. However, the plan to introduce a mass-market vehicle in 2012 will mean that finally, a fully electric car that can be owned outright will be within reach of the mainstream market, and that will begin to really challenge the status quo.
We’ve seen this shift before in lower value markets, like television. We’ve gone from tube televisions connected to VCRs, and evolved to 3D Flat Panels with content delivered through the internet. But we’re still doing the same thing – watching and enjoying visual programs. Likewise with electric cars, the purpose and method is still the same – we need to get from A to B, and we will do it with a car. However, the method of sales, delivery, service and of course environmental impact has the potential to experience a massive overhaul.
The business model that Tesla Motors is rolling out can’t be ignored by traditional car manufacturers. Even though only 7 Tesla Roadsters have been sold so far in Australia, the vision of a society making its own environmental contribution and minimising its carbon footprint through one of life’s basic needs – transport – is what drives this company despite the nay-sayers and barriers to entry.
Tesla Motors is looking at the inefficiencies of the traditional “car yard” and redefining the entire customer interaction model. There won’t be dealerships, instead there will be a central showroom and supporting service centre. The service centre is currently located at Botany in Sydney. There’s definitely a hint of the Apple philosophy here, keeping tight ownership of the brand image and its product range.
Without a local showroom as yet, Tesla Motors are finding innovative ways to present the car, and their vision, to as many people as possible. In February, Tesla Motors begins its roadshow on the east coast of Australia, starting in Queensland and ending in Melbourne or potentially Adelaide. Hopefully we’ll have an opportunity to spend some face time with the guys that run the Australian Tesla Motors arm and take an in depth look at the local operation.