Elon Musk wants to fix Tesla’s logistic issues by taking a page out of Amazon’s book

Elon Musk held a call with Tesla employees this week in which he emphasized that Tesla needs to move cars out of the factory faster in order to fix the …

Elon Musk held a call with Tesla employees this week in which he emphasized that Tesla needs to move cars out of the factory faster in order to fix the automaker’s logistic problems.

He made several comparisons to Amazon.

Tesla is not like other automakers in many ways.

One of those ways is that Tesla owns and operates all its own stores, service centers, and delivery centers without doing business with third-party franchise dealerships, like most other automakers.

This business model results in several obvious differences, but one of the least appreciated ones is that Tesla owns and is responsible for all its vehicles all the way until the customer takes delivery.

It creates more complex logistics problems for Tesla than other automakers who simply sell to dealerships who keep a lot of inventory on their lots.

Currently, Tesla’s custom-ordered vehicles often don’t move from the factory until they schedule a delivery date with the customer, which is not always as easy as you would think.

According to people on the call, Musk told employees this week that starting next quarter, Tesla will put the vehicles in transit right away and deliver them to local delivery centers for the customers to pick them up at their convenience.

Tesla is spending a lot of manhours trying to coordinate customer deliveries and it is backing up inventory at the Fremont factory.

Musk wants a constant flow of vehicles going to the end destinations and compare the logistics to Amazon.

The CEO said:

“Amazon would go bankrupt if they would have to wait for customers to be ready to take delivery before shipping.”

Interestingly, it’s also a financial problem since Tesla is investing all the money into building the vehicles and doesn’t get paid until the customer takes delivery.

Therefore, every day that the car is built and not in the hands of the customer, it’s a day that Tesla is several tens of thousands of dollars in the hole.

Musk has been emphasizing that delivering the vehicles faster to customers would greatly improve Tesla’s financials.

On a bigger scale, Tesla having production facilities closer to its customers basez would also have a big impact on reducing transit times.

That’s exactly what Tesla is trying to do with Gigafactory 3 in China and the company claims to be moving forward with a factory in Europe.

Electrek’s Take

According to people on the call, Elon was adamant about fixing Tesla’s logistics issues and he talked about Amazon as a good example of solid logistics.

It was a bold move for Tesla to build its sales, service, and distribution network around company-owned locations instead of franchise dealerships.

I think it paid off in many ways despite the fact that there are still some issues, including some sale bans in a few states, but I like that Tesla is still finding ways to optimize the business model like this and make selling electric vehicles a better and more profitable business in the long run.

Ultimately, it should be easier for customers who will have more availability to just go pick up their cars at Tesla delivery centers.

Amazon is an interesting comparison. It’s definitely an efficient company when it comes to logistics, but it is especially interesting with the context that Amazon has been itself looking into selling cars.


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Tesla Model S seven-seater version in the making, will be tested at the Green Hell

A number of developments have taken place at Tesla’s stable ever since its CEO, Elon Musk, announced that the company will test its Model S at …
Tesla Model S seven-seater version in the making, will be tested at the Green Hell

Tesla Model S&nbsp

A number of developments have taken place at Tesla’s stable ever since its CEO, Elon Musk, announced that the company will test its Model S at Nurburgring. Just to jog your memory; the information was shared by Elon after he took a jibe the Porsche Taycan models’ name. So, while the company prepares to put the Model S through its paces on the famed Nurburgring, the entrepreneur has shared another interesting information to keep the buzz high. Elon Musk recently revealed that the Tesla Model S at the Green Hell will be a seven-seater model. This certainly takes things up by a notch because originally, the Model S was supposed to lap Nurburgring to beat Porsche Taycan’s lap record at the ring. Currently, Taycan is the fastest four-door EV to go around the circuit, but it is also the only one in its category.

However, the latest piece of information shared by Elon hints that the company will attempt to set a new record at the Green Hell for fastest lap by a seven-seater car. Currently, the title for fastest seven-seater car around Nurburgring belongs to Skoda Kodiaq RS seven-seat version which lapped the Nordschleife in 9.28 minutes.

Also read: Top 5 Interesting Things about Tesla Cars

Tesla Model S white.png

Another piece of information coming out of Tesla’s stable involved a new world record. Tesla Motors revealed that its Model S became the fastest car at the Laguna Seca by going around the track in 1.36.55 minutes. This makes the Model S quicker than Jaguar XE SV Project 8 by almost a second. However, the car wasn’t a production-spec model but part of an advanced R&D testing. The company noted that it was testing a new powertrain–Plaid– on the Model S, which is powerful than the Ludicrous mode and makes use of three electric motors instead of two. The Plaid powertrain will also make its way to Model X and Tesla Roadster in all likelihood. Currently, the Ludicrous mode helps the Model S dispatch the 0 to 100 km/h run in a mere 2.4 seconds.

*~ Some personal news ~*

We lapped Laguna Seca @WeatherTechRcwy in 1:36.555 during advanced R&D testing of our Model S Plaid powertrain and chassis prototype

(That’s a second faster than the record for a four-door sedan) pic.twitter.com/OriccK4KCZ

— Tesla (@Tesla) September 12, 2019

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Tesla Model S P100D+ On Nürburgring Industry-Pool Prototype

While many companies pay for ad space on their products, Elon Musk simply sends a few tweets and the media does it for him. Tesla is already …
Cars

Published on September 14th, 2019 | by Johnna Crider

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September 14th, 2019 by Johnna Crider


In a video uploaded by TALEA Media, several high-performance vehicles are seen running laps on the Nürburgring, a 13-mile long German track, including both the Porsche Taycan and the Tesla Model S P100D+.

The Tesla, which can be seen at 2:28 into the video, speeds along the track almost quietly. The wheels are the loudest thing there, and this simply reflects just how quiet Tesla are in general. This scarlet beauty zooms along the track, twisting and turning from left turns into right turns, then gliding effortlessly down a straight path before easing into another left and eventually disappearing from the angle of the camera with barely a whisper of sound from the tires.

⚡️⚡️⚡️Attention⚡️⚡️⚡️

Tesla Model S P100D+ on Nürburgring Industry-Pool Prototype

September 12th 2019

via : https://t.co/itYxoL2WBp$TSLA#Tesla#ModelSpic.twitter.com/vrNATxJ3bQ

— Vincent (@vincent13031925) September 13, 2019

The Tesla seems to be preparing for its ultimate race against the Porsche Taycan, which made its appearance at 5 minutes into the video. The American Tesla and German Porsche weren’t the only electric vehicles representing on the track at that time. A Mercedes EQC was also on the track at just over a minute into the video.

It’s great to have more electric vehicles on the track. Many people perceive electric cars as cute little things that don’t go fast (unless they’re from Tesla), so the idea of racing them is oddly refreshing and revives the auto industry as well as the market. It’s like bringing new life to an old room, so to speak.

While many people are hyped up about the coming race, let’s take a quick moment and reflect on why Tesla doesn’t need to buy ad space. This upcoming race on the Nürburgring track is highly publicized and provides the perfect opportunity to talk about future upgrade package options. While many companies pay for ad space on their products, Elon Musk simply sends a few tweets and the media does it for him.

Tesla is already winning. In challenging Tesla, both Audi and Porsche are actively promoting Tesla while referencing Tesla because the media is eating up the competition like it’s hot, fresh bread pudding with a side of homemade vanilla ice cream. (And when I say the media, I am using this term to include small blogs as well as car review sites such as Edmunds, which, in the tweet below, you can see is actually buying Twitter ads to promote Porsche while also mentioning — or taking shots at — Tesla.)

pic.twitter.com/F4CuXSTFQY

— Neil Dunn (@NeilRDunn) September 10, 2019

The Upgrades

The upgrades mentioned in Elon’s tweets include the fact that the Model S on the Nürburgring track has 3 motors and Plaid Mode, which will soon be applied to the Model S and Model X, and will also reach the coming Roadster, but not the 3 or the Y.

Yes. To be clear, Plaid powertrain is about a year away from production & applies to S,X & Roadster, but not 3 or Y. Will cost more than our current offerings, but less than competitors.

— Elon Musk (@elonmusk) September 12, 2019

I think this is a brilliant marketing move — take on Porsche at Nürburgring and see how many more people discover Tesla.


Tags:Germany, Nurburgring, racing, Tesla, Tesla Model S, Tesla Model S P100D, Tesla Model S racing, Tesla Racing

About the Author

Johnna Crider Johnna Crider is a Baton Rouge artist, gem and mineral collector, and Tesla shareholder who believes in Elon Musk and Tesla. Elon Musk advised her in 2018 to “Believe in Good.” Tesla is one of many good things to believe in. You can find Johnna on Twitter

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The Less Big News It Makes, the More Attractive Tesla Stock Gets

Markets like calm and that is particularly true when it comes to Tesla (NASDAQ:). Tesla stock often is volatile to in large part to CEO Elon Musk having …

Markets like calm and that is particularly true when it comes to Tesla (NASDAQ:). Tesla stock often is volatile to in large part to CEO Elon Musk having a penchant for the controversial and flamboyant.

Tesla Self-Driving Car News: The Latest Project Dojo Rumors

Source: Sheila Fitzgerald / Shutterstock.com

At one point on Wednesday, Sept. 11, Tesla stock was higher by about 5% as the shares paced for their best intraday performance in seven weeks, extending the stock’s September gain to 8%.

That after Tesla stock dipped 7% in August. A simple tweet from Musk noting that Tesla’s flagship Model S recently set the record for seemed to be the catalyst for Tesla stock on Wednesday.

Of course, there’s much more to the story than that and investors should not caught up in something as superficial as an automotive test. Much of the story, meaning can the company produce cars at a rapid enough rate to meet current demand and lure more luxury car buyers away from internal combustion engines (ICE) to electric vehicles.

There are signs electric vehicle demand is growing, as expected. For example, Chilean lithium producer SQM recently said it plans to invest $2.1 billion over the next to bolster production of the material that is a vital ingredient in the production of the ion batteries that power electric vehicles.

Additionally, a recent permit application with the city of Fremont, Calif., Tesla’s headquarters, indicates the company is looking to build another assembly line, which could be used to manufacture the Model Y crossover vehicle slated to debut in 2020.

Reasons to Cheer and Be Skeptical

Few companies divide investors the way Tesla does. the only source of investment decisions for investors, but in the so-called “FinTwit” space, the segment of the social media platform where money managers and pundits dwell, an investor is just as likely to find some noted folks saying Tesla stock is a four-digit name in the future as they are to find someone referring to the stock by the ticker “TSLAQ” with the “Q” referencing a bankrupt company.

Tesla management has previously been prone to bombastic claims regarding cash flow and production targets, so some skepticism is warranted.

“2019 delivery guidance remains 360,000-400,000 vehicles and management said it feels the company is self-funding and able to generate free cash flow except possibly during product launches such as the Model Y crossover next fall,” said Morningstar . “We have heard this assertion on self-sufficiency as recently as late last year and then Tesla raised capital in 2019 so we are somewhat skeptical.”

Conversely, the company has its supporters, including JMP analyst Joseph Osha, who rates Tesla stock “outperform” with a price target of $337, about 40% above the Wednesday, Sept. 11 close. The analyst likes and views rival offerings as “weak.”

Speaking of market position, integral to the Tesla stock thesis is understanding what market the company operates. This is a luxury car company with comps being Lexus, BMW or Mercedes, not a mass-market maker like Chevy, Honda or Toyota.

“Tesla has a chance to be the dominant electric vehicle firm and is a leader in autonomous vehicle technology, but we do not see it having mass-market volume for at least another decade,” said Morningstar. “Tesla’s product plans for now do not mean an electric vehicle for every consumer who wants one, because the prices are too high.”

Bottom Line Tesla Stock

At 42.37x forward earnings, Tesla stock is certainly and that would be a hurdle unto itself if value stocks continue rebounding.

More specific to the Tesla stock thesis is what investors’ tolerance level will be for the company’s spending plans, which could require capital raises. The company is building a gigafactory in Nevada, as noted above is planning a Fremont, Calif. expansion and must effectively integrate SolarCity into its fold. None of those efforts will come cheap and they don’t include new vehicle launches, such as the Tesla pickup truck.

Tesla’s room for growth is compelling, but the company’s ability to manage the cost of that growth is something investors must be aware of going forward.

Todd Shriber does not own any of the aforementioned securities.

The post appeared first on InvestorPlace.

The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.

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The Land Of Fire & Ice Is Now Open For Tesla Vehicle Orders

Icelanders tweeted Elon Musk over the next 2 years, asking, in what the Reykjavík Grapevine calls “direct Icelandic fashion,” what the problem was …
Cars

Published on September 13th, 2019 | by Carolyn Fortuna

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September 13th, 2019 by Carolyn Fortuna


No, Tesla isn’t coming to Westeros, oh, Game of Thrones fans. Instead, a real-life land with a history of violent tales of blood feuds, traditions, family, and character is the newest site for Tesla onsite purchases. Iceland, a land of fire and ice with a primary focus on information technology and environmentally friendly energy industries, is now is open for Tesla vehicle orders.

Tesla’s first branch in Iceland opened September 9, 2019, in Reykjavik. Tesla Model S, Model X, and Model 3 orders can now be purchased via the site.

Iceland is a small country by measures like population and population density. But such indicators do not always tell the entire story. Policymakers, researchers, and everyone interested in the future of clean transportation — all are keeping their eyes on Iceland’s vehicle market, because the small island nation is in a leading position on electric mobility.

Iceland’s Leap into the EV Market

Iceland quietly became one of the leading EV markets worldwide in the past 5 years, but the foundation for low-carbon transportation was paved there decades ago. Renewable power, low electricity prices paired with high fossil fuel prices, and a high urbanization rate have made Iceland an ideal market for EVs. In Europe, only Norway has the same ability to provide electric vehicles with 100% renewable electricity.

Low-carbon electricity is available to Iceland’s consumers at comparatively low cost — 20% lower than the average electricity price in the EU — while prices of conventional automotive fuels in Iceland are among the highest worldwide. Consumers in Iceland can significantly reduce fuel costs by switching from conventional vehicles to EVs. In fact, Iceland exempts vehicles emitting up to 80 g CO2/km from import excise duties, which can reach 65% of the vehicle’s customs value if emissions exceed 250 g CO2/km.

Consumers in the northern island country can significantly reduce fuel costs by switching from conventional vehicles to EVs. Right now, EVs comprise 15% of Iceland’s total population of motor vehicles. With Tesla’s entry into the Icelandic auto marketplace, that percentage is certain to climb exponentially.

Iceland & Renewable Energy: A Good Match for Tesla

Iceland’s development from one of the poorest nations in Europe at the beginning of the 20th century to enjoying one of the highest standards of living in the world is intrinsically linked to the development of sustainable energy. Iceland is a highly volcanic island with 26 high temperature geothermal fields and over 250 low temperature areas. In total, over 600 natural hot springs have been found in Iceland.

Today, Iceland is the only country in Europe that derives nearly all of its energy from renewable sources. On a per capita basis, Iceland is ahead of any other nation in geothermal generating capacity and is a world leader in sustainable energy development.

87% of Iceland’s electricity comes from hydropower and the remaining 13% is derived from geothermal power. Almost 100% of Iceland’s space heating and water heating is obtained from geothermal sources. Iceland only uses a fraction of its economically and environmentally viable potential for electrical production from renewable resources. Oil-powered fossil fuel power stations are only used as backups to the renewable sources.

That makes Iceland and Tesla a good match, as many current and potential Icelandic Tesla aficionados attest.

Aurora Borealis ✅

Blue Lagoon ✅

Sustainable energy ✅

Reykjavík service center ✅

Tesla vehicle orders open for Iceland NOW 🙌

— Tesla (@Tesla) September 9, 2019

The Way We Were: Tesla & Iceland

The first Tesla Model S arrived in Reykjavik in late 2013 and was delivered to Gisli Gislason of Northern Lights Energy — an entrepreneur whose personal quest has been to install charging stations around Iceland, open an EV dealership network, and more. To inspire curiosity about EVs, Gislason gave 60 test rides before the year was out. The result? Icelanders started buying Teslas sight unseen.

Image retrieved from YouTuber A Tesla In ICEland.

Icelanders had inquired frequently about whether the day that Tesla would open a sales venue would ever come.

“The supply of electric cars is not satisfying demand at the moment,” Johann Olafsson, who heads Iceland’s Electric Vehicle Association, toldFortune in a 2018 interview which took place in Reykjavik. If it did catch up with demand, he forecast, Tesla sales would probably “more than double each year for the next few years,” he declared.

Johann Olafsson, from Iceland’s #ElectricVehicle Association, says he’s “thrilled” to receive @elonmusk‘s positive response to his request via Twitter for @Tesla service center to open in #Iceland. “I hope it will happen before the release of the Model 3” https://t.co/WlO3uj81gz

— Anthropology of Iceland (@Mannfraedi) May 9, 2018

Icelanders tweeted Elon Musk over the next 2 years, asking, in what the Reykjavík Grapevinecalls “direct Icelandic fashion,” what the problem was with setting up a Service Center. Already, there were more electric vehicles sold in Iceland than in Denmark and Finland during the previous year, where Tesla had already set up operations. Icelandic buyers interested in electric vehicles (EVs) had to face waiting times of up to 9 months.

Tesla vehicles at that time were imported by citizens in Iceland. This is, of course, the case in markets where Tesla does not sell vehicles directly. The only recourse for individuals in non-Tesla supported countries is to buy and import the car from another country. In addition, while Tesla began to send mobile technicians to Iceland on occasion, this was far from the ideal solution.

Fast forward 18 months and the local Icelanders are quite excited.

For a country that starts with “Ice” we had a very warm welcome. Geothermal-powered cars! #Tesla#Icelandpic.twitter.com/PIiy5zA71s

— Jorge Milburn (@jorgemilburn) September 9, 2019

Tesla’s arrival in Iceland will undoubtedly help accelerate the adoption of high-potential electric vehicles in Iceland. Tesla’s next likely steps in Iceland seem to be to open a service center in Reykjavík along with a few Supercharger stations that will enable Tesla owners to travel around their small island, savoring the quiet high-tech Tesla ride that Icelanders savor.

Looking to Charging for Teslas & All EVs on Iceland

The fast rollout of public charging infrastructure, including fast charging stations, is a top priority for the Icelandic government, according to the International Council of Clean Transportation. National grants amounting to about 200 million Icelandic krónur (about €1.63 million or $1.61 million) over a three-year period (2016–2018) could more than triple the number of fast-charging stations on the island.

Iceland’s size is ideal for electric vehicles: 500 km from west to east, and about 350 km from north to south. This means that most trips are well within EV range: Icelandic car owners, on average, drive approximately 38 km per day.

Electric vehicles are for the most part exempt from VAT in Iceland (an exemption that will end when more than 10,000 EVs are sold) and are free of import duty. The government, headed by environmentalist Prime Minister Katrin Jakobsdottir of the Left-Green Movement, says improving the network of charging stations plays a key role in supporting the transition away from dirty fossil fuels.


Tags:Elon Musk, iceland, Tesla, Tesla Iceland

About the Author

Carolyn Fortuna Carolyn Fortuna, Ph.D. is a writer, researcher, and educator with a lifelong dedication to ecojustice. She’s won awards from the Anti-Defamation League, The International Literacy Association, and The Leavy Foundation. As part of her portfolio divestment, she purchased 5 shares of Tesla stock. Please follow her on Twitter and Facebook.

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