Most of us have already seen Tesla’s new Cybertruck. A lot of people say that it’s not the most appealing design, or even may call it the ugliest car after Fiat Multipla. Even the stock price of Tesla Inc. has dropped by 6% right after Cybertruck was introduced.
Despite all that Tesla nowadays is doing as good as ever. So how do they manage to be so competitive in the automotive industry?
Magic behind electricity
It is no news that world oil reserves are almost depleted. Oil was humanity’s favorite fuel for about 150 years now. Its products ran the first car. It mechanized both World Wars. It gave us cheap and fast travels. And most importantly it allowed consumerism to rise.
What will happen, when there is no oil left? Short answer: a lot of things. But let’s focus on means of transportation for now.
In the automotive industry, the weight of the cargo is crucial for a measure of costs and efficiency. Having that in mind, oil-based fuels were and still are a preferred option because of energy density. But as commonly known, we must find an alternative source.
The electric motor has been around even longer than currently used internal combustion engines. Experiments with electricity and movement have been conducted as early as 1740 by Benjamin Franklin. However modern electric motors have been invented only in the XIX century, but it came a long way since.
Nowadays Tesla along with several other companies are innovating the automotive industry by using electric motors instead of regular gasoline engines. It is a clean and ecological solution. But despite its advantages, it has some downsides.
It is all about batteries.
For an electric motor to run, you need to have electric power. And you can not just plug your car into a power outlet to drive it. It must be a mobile source of electricity. Here comes the need for a battery.
Battery technology is as old as the electric engine, but for the most part of history, it hasn’t been as efficient as it is today. Despite its increase in efficiency, it still is no match for gasoline in energy density. It means that you cannot travel as far as one pound of batteries as you would with one pound of gasoline.
Tesla has been working on battery energy density since it is the first day. It is crucial for an economically viable means of transportation. As you can see, they did a terrific job over the years.
As commonly known, the price of Lithium-ion batteries has dropped dramatically over the years. Electric cars industry and especially Tesla are responsible for all the innovations that led to an increase in performance and decreased price. They are driving other battery manufacturers to decrease the price as well. It is even speculated that the price per kWh will drop to 100$ until 2024.
Also, this decrease in cost means, that less and less material is being used to produce them, which leads to lighter batteries, that one day might even be able to power up a cargo plane.
There is no magic behind Tesla Inc. There is a simple reason why they are doing so well. It’s the innovations and consumerism. They are working very hard to make their products as cheap, as reliable and as efficient as possible, which leads to cheaper overall battery quality and an increase in profit.