Real Leaders

Elon Musk Just Made Your Car (and NASA) Obsolete

Photo by Simon Abrams on Unsplash

It takes a special type of car manufacturer to add a button to their car called “insane mode.” It’s what Tesla founder Elon Musk decided would highlight the fact that battery-powered cars had moved on from kids’ toys and golf carts. That didn’t stop him from going one step further a year later by adding “ludicrous mode” to his Model S P9OD in 2015, which saw the all-electric car accelerate from 0 to 60 mph in just 2.8 seconds. That’s faster than falling.

Over and above the obvious adrenaline rush of being thrust forward at the pace of a fighter jet, it had less to do with boastful bravado and more to do with the pace of Elon Musk’s brain, the founder of the most innovative automobile company on the planet.

How we transition to a sustainable energy economy, in which electric vehicles play a pivotal role, has been his central interest for almost two decades, and he’s pursuing this vision at a frantic pace. He has also set his sights beyond our roads, into outer space, and is the chief designer for space exploration company SpaceX, where he oversees the development of rockets and spacecraft that he hopes will one day allow humans to colonize other planets. For Musk, it’s dream big or go home. Musk and Tesla are an example of how inspired business leaders are taking on some of the world’s most challenging problems and solving them profitably.

But what kind of crazy dream would make you want to reinvent the auto industry, an industrial sector that has operated along the same mechanical principles since the first fossil-fueled car of 1886? Musk already pondered this question at university. “I thought about the problems that would most likely affect the future of the world or the future of humanity,” he says. “I think it’s extremely important that we develop sustainable transport and sustainable energy production.” Silicon Valley, not Detroit, was to be the home of the automobile revolution. Musk’s first solution was the Tesla Roadster in 2008, which sold well, but wasn’t without its problems. As with most tech products, it’s sometimes best to wait until version 2.0 comes out before embracing brand new software or products.

Tesla’s next move was into the luxury market, and the launch of the USD70,000 Model S heralded a shift in consumer perception – here was a luxury performance car that was also environmentally friendly. It went against all the stereotypes of wealth, oil, gas and performance cars that belch out CO2 and accelerate our environmental demise – all for the sake of attracting smiles from attractive strangers at traffic lights.

As alluring as the Model S seemed to those who valued clean, renewable transport, there was one glaring problem for the ordinary person: a price tag that would buy you a three bedroom house in Syracuse, New York, USA. However, there was some method to his pricing madness. Musk had formulated a financial model that saw his high-end, premium models subsidize the development of a much larger dream – the production of affordable electric cars for the masses.


You might say that Musk’s impatience at finding responsible solutions to our mobility has seen him subscribe to a familiar business mantra: “Say yes, and then find a way to do it afterward.”

“Given that we have to solve sustainable electricity generation, it makes sense for us to have electric cars as the mode of transport,” he says. By creating demand, Musk thinks that others will jump onboard and help create the infrastructure and products needed to drive his new world – and all-important profits along the way.

Key to Tesla’s success will be the ability to scale electric batteries at a massive rate. It’s a lesson Henry Ford learned in 1913, when he realized that assembly lines and mass production was the way to drive down automobile costs to levels that middle-class Americans could afford.

n July, Musk unveiled the Tesla Gigafactory, 24 miles outside Reno in the Nevada Desert. The new building, the size of 107 American football fields, will house the world’s biggest battery factory that aims to deliver most of the world’s lithium-ion batteries by 2018. Still in its infancy, the Gigafactory is only operating at a fraction of its capacity and will see another USD5 billion-plus being spent on completion over the next few years. It’s the usual cart-before-the-horse scenario, without any guarantees of success. You can only imagine the conversations that took place with investors, based on Musk’s propensity to find a solution after the fact.

The entire Gigafactory will be powered with solar panels and offsite renewable energy. The only fossil fuel to be found on site will be in the tanks of visiting, vintage cars.

The Gigafactory is not just for car batteries. Stationary Powerpack units for businesses and utilities will be manufactured too, and Powerwall units for homes, linked to roof solar panels. A typical Powerwall installation with solar panels costs around USD16,000, which is steep, but some families have already reported an incredible 90 percent saving on energy bills (from USD6 a day to just USD59 cents a day). Another financial perk of buying a Tesla car is that Supercharging stations for recharging your car are free, for life. No more swiping your card at the pump.

tesla car

While Musk reinvents mobility and new ways of storing solar power here on earth, he keeps his head above the clouds at all times. Way above the clouds. SpaceX wants to advance rocket technology, and in particular try and crack a problem that Musk thinks is vital for humanity to become a space-faring civilization – a rapidly and fully reusable rocket. NASA has been doing space exploration since 1958, what would a guy building battery cars know?

Musk made USD165 million from his sale of Paypal and decided to start a space company. “I tell people I was trying to figure out the fastest way to turn a large fortune into a small one,” he jokes. Another example of his gamble with the future of humanity, but unlike the Tesla financial model, this bill was on him.

“I built rockets as a kid, but didn’t think I’d be involved in something like this. It was more about the things that need to happen in order for the future to be an exciting and inspiring one. There’s a fundamental difference between a humanity that’s a space-faring civilization, exploring multiple planets, compared to one that is forever confined to Earth until some eventual extinction event.”

Space exploration has always been about huge, expendable waste. The first Apollo missions of the ‘60s and ‘70s, the Space Shuttle and the thousands of commercial satellites flying overhead today were all made for once-off use.

Reusable parts could revolutionize the launch industry with lower costs. “The space shuttle was an attempt at a reusable rocket, but even the main tank of the space shuttle was thrown away every time,” says Musk. “The parts that were reusable took a 10,000-person group nine months to refurbish for flight. The space shuttle ended up costing a billion dollars per flight – not great for scaled-up space exploration.”

Amazingly, fuel only accounts for 0.3 percent of the cost of a space rocket, meaning you could get a 100-fold improvement in flight costs by reusing components. “Every mode of transport that we use, whether it’s planes, trains, automobiles, bikes or horses is reusable, but not rockets,” says Musk. He compares the waste with rockets to a scenario where we’d burn a cruise ship after each voyage. “How popular, and more expensive, do you think vacation cruises would be if we did this?” he asks.

Musk is a brave pioneer, a king of the new frontier, a scientist, a workaholic and an inventor. How on Earth (or space) has one man managed to innovate on so many levels? One theory is that he has an ability to pull together design, technology and business in a way that few can, and then have the unbelievable confidence to pull it off – taking crazy risks without fear.

Being a deep thinker, Musk has considered this question before. “Most of our lives, we essentially copy what other people do with slight variations, just to get through the day. But when you want to do something new, you need to do things that are counterintuitive.”

Born and raised in South Africa, and severely bullied throughout his childhood, Musk rose above the small-mindedness of others to become a highly-motivated entrepreneur with a single-minded vision that borders on obsession. The lesson for the rest of us is less about how to become a mad scientist and more about whether we will wait for the future to happen, or actively take a hand in shaping it.

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