Elon Musk’s New Master Plan

“While doing above, also provide zero emission electric power generation options,” Musk wrote, almost as an afterthought. “Don’t tell anyone.”

The gist of his “Master Plan, Part Deux”: Save the planet. He just didn’t mention how.

Musk stated that “we must at some point achieve a sustainable energy economy or we will run out of fossil fuels to burn and civilization will collapse,” and then went on to list four primary ways that Tesla plans to promote sustainability:

  • Create “stunning” and seamlessly integrated solar-plus-battery-storage products.
  • Expand Tesla’s electric-vehicle product line to address all major segments — this includes the Model 3, a future compact SUV, and a new kind of pickup truck, as well as a heavy-duty truck and high-passenger-density urban transport.
  • Develop a self-driving capability that is 10 times safer than the U.S. vehicle average “via massive fleet learning.” And as the technology matures, Tesla vehicles will have the necessary equipment “to be fully self-driving with fail-operational capability, meaning that any given system in the car could break and your car will still drive itself safely.”
  • Self-driving Tesla vehicles will be enabled for car-sharing so they can make money for their owners when the owners aren’t using them.

The plan shows that Musk is thinking beyond how to improve on individual products, to how he can disrupt entire systems. He’s thinking about how he can revolutionize the way people consume energy.

In what could be a testament to Tesla’s shift beyond the automotive sector, the company’s website URL changed this week from www.teslamotors.com to simply www.tesla.com.

“With the Master Plan, Part Deux, Elon Musk has shown us a glimpse of what the future of solar plus EVs plus storage could look like,” said Ravi Manghani, energy storage analyst at GTM Research. “It will involve customer turning into a ‘prosumer,’ not just of energy by deploying distributed solar-plus-storage, but also a prosumer of transportation services. It shows the path that Tesla is daring to take as a technology vendor, a service provider and eventually also as a platform provider.”

The path is daring — but the plan is also kind of obvious. And Musk offered very little detail.

Solar + storage

It comes as no surprise that offering an integrated solar-plus-storage package is at the top of Musk’s to-do list in light of Tesla’s recent announcement that it wants to acquire SolarCity. Wall Street has been critical of the acquisition deal, but Musk believes major Tesla investors will back it.

There are legitimate concerns about the acquisition. Analysts believe the proposed $3 billion deal could put financial strain on both companies and add pressure for them to raise more capital. Some analysts also believe the overlap between the two companies is limited, view the deal as a SolarCity bailout, and worry the purchase could be a distraction as Tesla battles its own production hurdles.

But, from a consumer perspective, the strategy makes sense. The idea is to build and scale “a smoothly integrated and beautiful solar-roof-with-battery product. […] One ordering experience, one installation, one service contact, one phone app.” Musk also wrote that the fact Tesla and SolarCity are separate companies at all today, given their shared overarching goal of advancing sustainable energy, “is largely an accident of history.”

Musk tweeted a follow up that said, “Both should have been done under the same corporate umbrella from the beginning.”