
Free transportation for life - prezjordan
https://medium.com/we-live-in-the-future/32eeaacc207a
======
droithomme
> 1\. Supercharging stations cost very little to install

False.

> 2\. They are solar powered

False. The ones with solar paneled roofs do produce electricity which is sold
to the electric company at an inflated rate of 26-32 cents a kWh, the station
then buys normally produced electricity back at normal rates of 8-12 cents a
kWh. The electricity produced is nowhere near enough to maintain a four car
charging station that is running 85kWh 90 minute long recharges or 40kWh 30
minute long recharges on 4 cars throughout the day, this is a simple matter of
physics, area, and solar technology.

> 3\. They can dump 150 miles of drive time into your car in an hour

True.

~~~
julian37
_3\. They can dump 150 miles of drive time into your car in an hour_

Which works out to what, one hour of idling at the station for every two hours
of driving, making your trip roughly 50% longer compared to a gasoline car? We
need much better batteries and/or better charging technology for this to
become attractive.

Graphene-based batteries are a promising candidate:
<https://vimeo.com/51873011>

(For the record, I think Tesla and their Supercharging stations are awesome,
just wondering why the author would list this ridiculously long stay at the
charging station as a "mind blowing" feature.)

(And yes, battery swapping instead of recharging would also solve the
problem.)

------
aqme28
Completely ignores the cost of the car, which is elevated to pay for the
charging stations. Especially notable is this part:

 _"If you make a middle-class salary of, say, $40k to $60k after tax in the
USA, you're spending 5% to 15% of it on gas."_

If you make a middle-class salary of $40k to $60k, you probably aren't buying
a Model S.

~~~
veemjeem
Well, the Tesla S is essentially their first consumer electric car. It's like
buying the first laptop Apple produced (Powerbook 100) which costs around
$6000 in today's dollars.

------
saosebastiao
Oh, so we have been hoodwinked, duped, and bamboozled by the mysterious
"political industrial complex" huh? All this time, electric vehicles have been
perfectly viable and competitive with internal combustion? It is all just a
big conspiracy?

That is a perfectly interesting opinion...but it also happens to be one that
will make me disregard any further opinions you might have.

------
gcb0
i can pay $20k for a car (actually driving one that i paid $2k, but i will
leave that edge case out). then i can use $10k of gas a year. maybe will have
$10k year of repairs. and it is _certain_ and proven for ages.

now, tesla. I have to pay $60~80k... not depending on leather or comfort, but
how far I have to drive! then there's the fact that there's still not know
pricing model for charging stations. it's all fine now that the costs of the
cars are paying for it. but what will happen next year if Kia starts to make
electrics. do you really think Elon will continue to let everyone uses their
power stations? will he make it tesla only (and ultimately failing his model
as nobody will be able to charge easily as every company will do the same) or
will he start to charge for it?

Then there's the fact that nobody knows if those cars will last the same as my
$20k 2nd hand cars. How much will you spend on battery over 10years? may be
zero. may be another $60k.

so, option A) $20k upfront, $10~20k an year for gas/repairs. option B) 60~80k
upfront, 0 to $80k an year.

yeah, having $0/year would pay off option B in 4years, but it's not certain.
The fact that i never spent one dollar in Vegas will make me stick to option A
for now.

~~~
RansomJac
They're currently Tesla only...

------
jstalin
So much pessimism here. Although I can't afford a Tesla S, I thank god for
those who can. They are the early adopters that make the market for future
models that surely will be cheaper, either from Tesla or another company.
Tesla is on to an awesome idea and so far it's an exciting execution. If only
they could get the price for a supercharge-capable car down to $30k, then I'd
be happy to get one.

------
jaggederest
Battery pack replacements are going to be the cost of ownership of electric
cars. With as extensive a pack of batteries as they have, it'll be very
expensive. Lithium ions discharged at least every other day only last ~5
years.

------
JumpCrisscross
I wondered what the present value of people's expected gas expenses are, i.e.
if you told a random American you'd give them free gas until the end of their
days (given they consume gas at the author's rate), how much would you have to
set aside today into a safe asset to cover the future expense? TL;DR about
$100 000, without hedging longevity and fuel price volatility risks.

The median U.S. age in 2011 was 37.3 years [1]. Thus, the median year of birth
was 1973 and cohort life expectancy 74.7 years for men and 79.5 years for
women, or 77 years on average [2]. Let's assume 39.8 (best 29.8; worst 49.8)
years.

Let's assume the author's $250/month petrol expense. U.S. city petrol prices
have increased at an average (standard deviation; CAGR) of 5.5% (19 percentage
points; 3.2%) from 1980 to 2012 [3]. Let's use that (best -13.5%, 0%; 3.2%;
worst 24.5%) as our expected gasoline inflation rate.

Linearly extrapolating today's 10y30y [4] to 40y we get a crude discount rate
of 3.8% (best 3.2%; worst 4%).

Thus, those cash flows are worth $167 934 today, though this varies from $16
765 for the best case, $56 038 for the best case assuming flat nominal petrol
prices, $106 732 for the base case with CAGR, and $218 031 for the worst case
assuming 5.5% petrol inflation (using the worst gave a nonsense result for
nominal gas prices).

[1]
[http://www.census.gov/popest/data/national/asrh/2011/tables/...](http://www.census.gov/popest/data/national/asrh/2011/tables/NC-
EST2011-01.xls)

[2]
[http://www.ssa.gov/oact/NOTES/as120/LifeTables_Tbl_7_1970.ht...](http://www.ssa.gov/oact/NOTES/as120/LifeTables_Tbl_7_1970.html)

[3] BLS APU00007471A (U.S. city average, gasoline, all types, per gallon/3.785
liters)

[4] <http://markets.ft.com/research/Markets/Bonds>

------
_mulder_
Interesting article but too many holes to hold much weight.

In no particular order..

You only don't pay for the charging electricity when using a supercharging
station. If 'free' travel involves spending an hour a day at a service station
waiting for the car to charge, then it doesn't seem quite so free! It would be
more convenient to charge overnight at home but then you pay for this energy.

A minor point, but name any consumer device made in 1985 still receiving
regular updates, software or hardware.

Finally, Selling a vehicle that only needs replacing every 50 years isn't
going to be much of a business plan.

Negativity aside, I think its a great idea. I rarely drive more than 60 miles
a day and I'd love to have an electric car. I'd even hook it up to some solar
panels and I'm sure the economics would be comparable to a fuel car. If only
the cars were a shade cheaper.

~~~
saraid216
> Selling a vehicle that only needs replacing every 50 years isn't going to be
> much of a business plan.

It makes me sad that this is true. Is this really the only place we can go
now? We have to produce crappy product in order to artificially create
turnover so that income remains steady? It makes me hate capitalism.

~~~
HeyLaughingBoy
Are you serious? Your definition of a crappy car is one that doesn't last 50
years? I've heard of high standards, but really...

~~~
saraid216
It's a problem in virtually all industries. Lasting solutions simply aren't a
good business model.

~~~
HeyLaughingBoy
That's odd. Last I heard, farm and construction equipment manufacturers were
doing a great business selling stuff that stood up to decades of hard work. Of
course, they cost multiples of what a cheap family car (itself capable of a
decade+ of use with proper maintenance) does, but that's a minor issue.

And there are those annoying over-the-road trucks that easily rack up well
over 1,000,000 miles and keep going. But it's a crappy business model, so they
should all be out of business tomorrow!

Of course you can build a car that will last 50 years. The problem is that
very few people would be willing to pay the price, so no one bothers making
them.

FWIW, I have a garden tractor in my garage that's coming up on 30 years old
and I expect to get at least another 10 years out of it.

~~~
saraid216
> The problem is that very few people would be willing to pay the price, so no
> one bothers making them.

Do you have any idea why this is?

------
alberich
I think I'm missing something. How's that you'll be driving "for free" ?
Someone has to pay for the energy the cars will be spending.The cars need
maintenance. The car will be the "fastest, sexyest" for how long?

There is no free lunch. And Mr. Musk is not trying to give humanity free drive
for life... he's just trying to make money. He is just trying to make his
stuff popular so he can sell more of it and make more money. It's just
business.

~~~
lox
The article claims that the supercharging stations are solar. The whole point
of the article is about independence from oil, if you ignore the hyperbolic
title.

Jason isn't saying Tesla isn't out to make money, simply that they are out to
make money from great cars, rather than the oil industry.

I'm still skeptical that the charging stations will scale up to a national
scale, but I admire Musk trying.

~~~
elemeno
As another comment on here points out, the power produced from the solar
panels is nowhere near enough to power the charging station. At best, it helps
them offset the costs slightly due to the difference between the price they
sell the (solar) power to the grid, and the price they pay for power from the
grid - there's a 18-20 cent/kWh difference in their favour.

~~~
alberich
So, actually the tax payers are paying for the "free" ride :)

------
jbuzbee
Free transportation for life? Sounds good, but what about maintenance such as
battery replacement, tire replacement, windshield, fluids, plus insurance,
tolls, parking etc. May not be as expensive as fuel, but there's no such thing
as a free-ride

~~~
maxmcd
Exactly, and during those 3-4 decades that the car is around, you have to
replace the battery pack 3-4 times. I'm all for EV's and the apparently
impressive quality of this specific car, but it would be nice to see a more
accurate cost benefit analysis.

~~~
kux
Battery replacements are around 10k/decade[1]. Quite a bit less than the
30k/decade estimated petrol specific costs provided by the author.

1\. <http://en.wikipedia.org/wiki/Tesla_Model_S#Battery>

~~~
greenyoda
Your break-even point depends a lot on how much you drive each year. I drive
about 3000 miles a year (primarily to get to mass transit) and my car gets
about 25 mpg in local driving, using 120 gallons of gas a year. At around $4
per gallon, that's only $480 a year or $4800 per decade. My car is 12 years
old, so I'd expect a car bought this year to be more efficient.

------
malbs
Once everyone is driving a Tesla, and filling up for "free", where do the
taxes come from to pay for the infrastructure?

In Australia, the high price of fuel comes because the government puts
something like a 50+% tax on it. Most people (incorrectly) assume that your
car registration pays for infrastructure dev/maint, but car registration just
pays for insurance/payouts for car crashes, and running of the registration
system.

Most of themoney used to build and maintain roads, highways, etc, comes from
the fuel tax. If we transfer to a new form of fuel that is supposedly free as
this article suggests, where does the aus government look to get the money to
pay for the roads?

------
TamDenholm
Just one minor comment, he used to spend $250 a month on gas, i'm amazed,
thats absolutely nothing. Here in the UK it costs me £100GBP to fill my tank
with diesel, which lasts about 10 days, granted i drive a fair bit, but £300 a
month is $465 USD. So i hear ye, bring the electric cars and their super
charging stations over here, i'll deal with the minor inconvenience of waiting
an hour for a charge, which i personally think is a temporary problem. In the
mean time, i'm planning to see how viable making my own biodiesel is.

~~~
TamDenholm
Just because i was curious, i did a quick google:

    
    
      [1] Cheapest gas in California is $3.71 a gallon.
      [2] Cheapest petrol in UK is £1.32 a litre (rounded)
      
      100 litre fill up in UK is £132 or $204.88
      100 litre fill up in Cali is £97.89 or $124.43
      
      [1] http://www.californiagasprices.com/
      [2] http://www.petrolprices.com/

------
pedalpete
Great read, but a bit too much blowing sunshine.

The idea of 'free' energy for purchasing a car which will last significantly
longer than your current car could have major long-term economic ramifications
which could need to be considered in the long-term.

I'm not saying we shouldn't be doing these things, it's great, it's innovative
and disruptive. But cars that last longer and don't need as much repairs
(theoretically) means less being built, less being repaired, less jobs all the
way down the line from the manufacture of spare parts to the installation and
general maintenance. There are similar implications for moving from the
massively complex oil industry to a much simpler and flexible electric one.
Particularly if solar is the chosen source, vs. hydro or nuclear where, I
think, more people would be needed in the process.

Lastly, a reduction of spending and resulting taxes (which for fuel are
currently huge) would also have mass implications for government.

Maybe we don't label any of these things good/bad. They just are, and will
need to be dealt with.

I hope people are looking at these opportunities and the implications for the
economy.

Lastly, how do people feel about calling Elon Musk the 'heir to Steve Jobs and
the second coming of da Vinci'? To me, he is as different from those two as
they are to each other. Prolific and brilliant, absolutely, but Steve Jobs
isn't the second coming of Rockafeller, so why the comparisons, and do they
fit?

~~~
jeffreyrusso
You could say the same things about the internet or about software... that
ingraining these technologies into every part of our society could have major
long-term economic ramifications that deserve consideration. Even today, the
number of low to middle-wage jobs that could still be replaced with software-
driven solutions will amount to a huge number of jobs that will no longer be
necessary. Agree with you that we shouldn't label these things good or bad -
they represent progress. But we shouldn't ignore the likely ramifications of
massive shifts like this until society feels the pain.

------
yock
The nerd in me couldn't resist doing the math, and given a few starting
figures for my current situation ($13,500 car loan,60 months, good interest
rate, $350/mo on gas) it would take 14 years of driving a Model S to make up
for the fact that I'm not paying for gas. This discounts the fact that I don't
have the $1000 - $1500 a month for the Tesla car payment.

This electric car business is exciting for sure, but it'll be some time before
it benefits my income bracket.

------
BruceIV
What got me is a charge rate of "150 miles of drive time in an hour" - so it
takes an hour to charge for every 2.5 hours of driving?

~~~
dman
Would be neat if the battery itself was something that was like a module. You
could drive up to the driving station and some kind of robotic arm would just
hook up - swap out your battery module and replace it with a charged version.
In essence companies owning the charging stations would own a pool of
batteries that they would charge and swap in and out of drivers cars.

~~~
droithomme
The Tesla battery contains over 6800 3100mA 3.7V Panasonic 18650 Li-ion
battery cells. It costs $40,000 to replace. This battery has a life expectancy
of 500 charge cycles. That means the battery cost per 240 mile charge is $80,
and the company would have to charge that to recover just their battery costs.
Add another $20 to handle tax, labor and the cost of maintaining the equipment
and the recharging, so $100 per swap, assuming this is run as a non-profit
endeavor. Do you feel there is a large market for people willing to pay $100
for every 240 miles they travel? Such a network of replacement stations
assumes that the market will pay these costs.

~~~
dman
a) [http://green.autoblog.com/2012/11/30/tesla-adds-
replacement-...](http://green.autoblog.com/2012/11/30/tesla-adds-replacement-
battery-pack-costs-to-price-increase-deta/) suggests that the battery
replacement costs are much lower ( < 12000 in the worst case for the 85-kWh
pack and as low as 8000 for the 40kwh pack). I dont know if this price assumes
that you will be turning your old batter in - otherwise I would imagine you
would be able to recoup some money for that via selling it to recyclers.

b) Also
[http://batteryuniversity.com/learn/article/how_to_prolong_li...](http://batteryuniversity.com/learn/article/how_to_prolong_lithium_based_batteries)
suggests that the 500 charge cycle number is only valid if every cycle
depletes the charge to 0. Assuming that each cycle discharges to 25% - the
number of cycles goes upto 2000 - 2500.

Assuming a price of 10000 (Using a medium capacity battery as well as assuming
whole sale prices) and a depth of discharge of 25% per cycle and hence
assuming battery life of 2250 cyles - you get the battery cost per charge to
be 12000 / 2500 = 4.8 . Assuming a 10% tax rate thats about 5.28 dollars per
cycle. This number does not seem bad at all.

~~~
droithomme
Tesla offers, for a $12,000 fee at time of purchase, a replacement policy that
will replace the battery AFTER 8 years of use, and only after 8 years of use.
This brings the price of the 240 mile range model to $91,900, plus tax and
licensing. It is not a warranty that replaces the battery if it fails. It
offers no coverage before 8 years, and at 8 years one may replace at any time.

Tesla also has cited a price of $40,000 for battery replacement for drivers
whose batteries have failed due to not being recharged properly or other
reasons. This price is consistent with the lowest wholesale costs of these
battery cells on the global market, with no markup for their added value of
the battery enclosure, cooling, heating, monitoring, and recharging hardware,
thus it is a fair deal and good value as Tesla is clearly not taking any
profit at this battery price point.

Tesla does not sell the 85kWh batteries (the ones needed to have a 170-240
mile range) for $12,000. If you hand them $12,000, they will not hand you a
battery pack. If Tesla could sell these batteries at this price, they could
sell a tremendous number to Nissan, GM, Boeing and others. They could even
charge $20,000 and would still have plenty of buyers as it is far below the
lowest wholesale cost of the 6800 3100mA 3.7V Panasonic 18650 Li-ion battery
cells it contains. Or even better, customers could buy the 6800 new 18650
cells in the pack from Tesla for the $12,000, remove them from the battery
pack, and become a wholesale dealer of the cells, able to undercut Panasonic's
lowest wholesale price by up to 75%. One could make millions selling new
battery cells to laptop battery pack manufacturers that use these cells. It is
a sure fire guaranteed profit if, as you say, Tesla is selling battery packs
containing 6800 brand new 3100mA 3.7V Panasonic 18650 Li-ion battery cells for
only $12,000. It is the bargain of a lifetime. No VC would pass on funding
such a venture, it is a guaranteed profit.

The claim that Tesla is selling these battery packs for $12,000 is false.
Tesla is not selling these batteries for that price. They will sell these
batteries for $40,000 though, as Tesla's Vice President J. Joost de Vries has
stated that that is the price for those who need a replacement.

Tesla does offer to deliver a replacement battery in no less than eight years
from purchase date for $12000 (February 2021 if you buy today), to the
original owner, provided this fee was paid for when the car is purchased, and
provided Tesla is still in business. This is not the same as selling batteries
for $12000.

~~~
dman
Thanks for providing this information - I stand corrected.

------
cpursley
Agree with overall idea expect the call for government involvement. Let the
market figure this out. If the math makes sense for most people, then it makes
sense. If I could get a 25-35k electric vehicle with free or cheap charging
and 150 miles on a charge, I'm in.

------
getabike
I have free transportation for life, it's called a bicycle. But I guess for
those who have to drive, this is great. But bicycling is easier than you
think, and has many benefits.

------
pinchyfingers
This article is old. Also, J cal wants to have Elon's babies so bad.

------
Datsundere
I turn off my computer at night to save electricity.

