Tuesday, March 19, 2019

A Response to Elon Musk's Detractors

Elon Musk is battling a number of obstacles, including production problems and legal hurdles. Musk is the genius behind Tesla Motors, Tesla Energy, SpaceX, and the Hyperloop. The list of his accomplishments is impressive. He has innovated online payments, shown EV leadership, pioneered commercial space exploration, revolutionized power storage and brought residential solar to the home energy market.

Nonetheless, Musk has his share of detractors. A recent Forbes article proclaimed Musk is ruining his own reputation pointing to what they call "unnecessary and distracting fights with government regulators". He got into hot water for his tweets last August when he said he was going to take Tesla private. After the US Securities and Exchange Commission (SEC) failed in its bid to remove him as CEO of Tesla Motors, they struck a deal whereby there would be oversight of Musk's social media activity. In February the SEC claimed he broke that agreement and they filed a motion to hold Musk in contempt for his statements about the number of vehicles he was going to produce.

Musk claims the SEC is trying to unfairly silence him. Tweets aside, Musk is bringing sustainable technologies to the world and his philanthropic pursuits are making a difference. He was among the first to came to Puerto Rico's aid after the island territory was devastated by Hurricane Maria in 2017. Tesla batteries brought power to important infrastructure like hospitals when the island territory was in the dark.

Tesla's highly cost effective battery systems are revolutionizing renewables. According to wind power operators Neoen, their $66 million Tesla 100MW/129MWh Powerpack battery system in South Australia saved the company about $40 million in 2018. It is estimated that Tesla’s giant battery in Australia reduced the grid service cost by 90 percent. At the end of the day this radical efficiency translates to a reduction in wholesale price of energy all without emissions.

Musk is also revolutionizing the electric vehicle market including truck transportation. Although Tesla Motors has had trouble keeping up with demand for its Model 3 it is important that we understand Musk's strategy. He used the proceeds from the higher end Tesla S, to finance the Model 3 which Musk is intent on pricing at $35,000 US to make it accessible to consumers. As an illustration of his dedication Musk slept on the factory floor while he worked on the car's production problems.

Production problems have forced Tesla Motors to make changes. The electric car company has closed 10 percent of its retail outlets worldwide but they avoided more closures by increasing vehicle prices by around 3 percent. 

In one of his boldest acts of public good to date - and this may be the cause of some acrimony - Musk announced that he is giving away the secrets of his EV supremacy. Early this year Musk said he had released all of Tesla's patents, as part of an effort to fight climate change.

Musk is doing this because electric vehicles are not scaling fast enough to replace the internal combustion engine. He knows that if we are going to have a shot at keeping climate change within the upper threshold limit we will need to radical reduce car emissions in the short term.

As reported by ABS-CBN, Musk announced that he "will not initiate patent lawsuits against anyone who, in good faith, wants to use our technology."

"Tesla Motors was created to accelerate the advent of sustainable transport." Musk said. "If we clear a path to the creation of compelling electric vehicles, but then lay intellectual property landmines behind us to inhibit others, we are acting in a manner contrary to that goal."

Musk was also making a statement against patents which he said serves corporations and lawyers rather than inventors. "We believe that applying the open-source philosophy to our patents will strengthen rather than diminish Tesla's position," and he added the company will benefit by attracting talented engineers.

Despite his detractors and legal challenges from the SEC, Musk is a pioneer who has earned a place as a titan of sustainability.

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