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You get paid for execution at Tesla.

 

Management's incentivized to hit 30% gross margin:

 

In the March and June 2013 10-Q’s there is a section titled “Performance-based Stock Option Grant”. There are 782,500 stock option shares for certain employees that have four performance milestones.

1/4th of the shares to vest upon completion of the first Model X Production Vehicle.

1/4th of the shares to vest upon achieving aggregate vehicle production of 100,000 vehicles in a trailing 12-month period.

1/4th of the shares to vest upon completion of the first Gen III Production Vehicle; and

1/4th of the shares to vest upon achievement of annualized gross margin of greater than 30.0% in any three years

 

http://www.forbes.com/sites/chuckjones/2014/08/12/deutsche-bank-upgraded-tesla-from-hold-to-buy/?partner=yahootix

 

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Tesla has also opened up all of it's patents around Superchargers and has invited all other car manufacturers to use it's chargers.  They just have to pay an access charge in order to facilitate scaling up the network for greater usage.

 

So basically, Tesla Superchargers everywhere, and meanwhile the evolving charging tech will improve the speed of charging a car.

 

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There is now a 400 mile range battery EV.

 

The Tesla Roadster:

 

http://www.gtspirit.com/2014/08/15/tesla-roadster-to-receive-new-battery-pack-with-400-mile-range/

 

“The Roadster had an old generation battery. We’ll upgrade it to a new generation battery pack and it should have a range of about 400 miles, which will allow you to drive from LA to San Francisco non-stop,” he said.

 

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how easy and cheap is it to recycle these batteries? How much lithium reserves are there? You would say with mass adoption it would become expensive after a while?

 

Relatively easy and a lot.

 

http://www.teslamotors.com/blog/mythbusters-part-3-recycling-our-non-toxic-battery-packs

 

I saw something a few years ago about how bolivia alone has enough lithium for billions of electric cars.

 

http://www.bloomberg.com/apps/news?pid=newsarchive&sid=aVqbD6T3XJeM

 

But there's a lot of it in many other places too, and unlike oil, it doesn't get destroyed in use so after a while most of it will come from recycling.

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I may have asked this earlier, but I don't think I got a conclusive answer. In a laptop, constant battery use will eventually make the battery almost useless, i.e. not being able to hold much charge for too long. How is this addressed in Tesla cars? With 8 year warranty, it looks like they're estimating their batteries will die down in about 8 years. What then, do you have to buy new battery pack? For how much?

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Let's say you buy a BMW with a 5 yr warranty.  Does this mean that they're estimating the BMW will die in 5 years?

 

Okay, let's say I'm totally wrong in assuming this. My questions are still: 1) Are these batteries expected to deteriorate over usage period, similar to other Li-ion batteries, 2) If so, when will they draw-down? And 3) if so, what is the replacement cost?

 

Edit: I googled around, and there seem to be a few forum threads on Tesla site and others discussing this as well. Overall, my impression is that nobody really knows what's going to happen to their cars' batteries a few years from now, since it's all new.

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Okay, let's say I'm totally wrong in assuming this. My questions are still: 1) Are these batteries expected to deteriorate over usage period, similar to other Li-ion batteries, 2) If so, when will they draw-down? And 3) if so, what is the replacement cost?

 

Laptops and electric vehicles have different design parameters for their batteries and how they are used, even when they use the same cells. There are ways to make batteries last a lot longer, for example by never fully charging and discharging them (in a way that is not visible to the user), and when they deteriorate you start to use that buffer to mask the decline, and only after a long time do you have a decline in performance visible to the customer.

 

I expect most EVs batteries to last the life of the vehicle and few people to replace them. They'll get fewer miles out of a full charge toward the end of their life, just like a gasoline cars gets fewer miles out of a full tank after 10 years or whatever, but they won't suddenly go dead and stop working.

 

I think most batteries that will end up being replaced will be replaced not because they deteriorate too much, but because newer much better, and cheaper, batteries will be available in 5-10 years and some people will want the upgrade.

 

There are many hybrids that have been used as taxis and have hundreds of thousands of miles on the counter, and they're still going fine. This is an important test because most have older battery tech (NiMH), and because a smaller hybrid battery cycles a lot more often than a larger full EV's battery.

 

That's my understanding of the situation, anyway.

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It looks like about 75% of original capacity after 8 years:

 

http://www.teslamotors.com/fr_FR/forum/forums/battery-warranty-model-s

 

I've seen it written that one aim of the Gigafactory is to recycle Tesla batteries.  So they'll probably offer a reduced replacement price for trade-in.

 

You would drive to a service center, and the battery swap only takes about 5 minutes.

 

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http://online.wsj.com/articles/the-musk-family-plan-for-transforming-the-worlds-energy-1411055676

 

Thanks to the economies of scale that will come from Tesla's gigafactory, within 10 years every solar system that SolarCity sells will come with a battery-storage system, says Mr. Rive, and it will still produce energy cheaper than what is available from the local utility company.
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So there is a chart in that article where the "projected cost" for batteries is $400 in 2014.  It shows how the cost dropped below $500 two years ago.

 

However, in the third paragraph of the article they say that "currently" they cost $500.

 

How do they manage to print mistakes like this in Fortune magazine?

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