Elon Musk unveiled the famous Tesla Master Plan 3 at the Investor Day event on March 1. The event conducted at Gigafactory Austin primarily focused on sustainable growth and development of the planet and gave very few details of the actual products and financials of the company. As the event progressed, Tesla’s share price dropped by almost 5%.
Under Master Plan 3, CEO Elon Musk emphasized that Tesla will focus on creating sustainable and renewable energy not only for the company but for the whole planet. Over 80% of global energy comes from fossil fuels but only 1/3 of this energy is used for important work or to generate life-saving heat. Tesla will help to put an end to the consumption of fossil fuels and lead the world in sustainable energy. The company said that it would build a sustainable energy economy, as it not only helps the environment but also requires just 60% of the cost of fossil fuel investments.
Tesla Plans to achieve its sustainable energy goals by adding renewable power sources, replacing gasoline vehicles with Electric variants, finding sustainable heating solutions for buildings, installing high heat delivery systems and hydrogen for industries, and building the current long-distance travel options like aircraft and ships with sustainable materials.
Basically, Tesla will involve in almost all fields of infrastructure that use fossil fuels to replace them with renewable and sustainable sources of energy, so that it can create a ‘Sustainable Energy Civilization’. Musk said that there’s no need to live without electricity or proper heating just to attain sustainability as there is a clear path to sustainable living that does not require the destruction of the natural habitat or any sacrifices on our part.
How will Tesla achieve its Ambitious Global Sustainable Energy Goals?
Tesla has projected a massive investment of $10 trillion to achieve its global sustainable energy goals. CEO Elon Musk said that though the number looks massive, it is nothing when compared to the global economy.
The company plans to achieve its sustainability goals by increasing the world’s energy storage capacity by up to 240TWh. It plans to achieve this ambitious goal without plundering the major ores of the planet as unlike fossil fuels, sustainable energy requires less mineral extraction. The two major elements required for developing sustainable energy sources are Nickle and Iron. Musk said that Iron is one of the most abundant metals available on our planet and it will take less than 30% of available Nickel, to power the entire planet with sustainable energy. This means we can create sustainable and renewable energy without destroying the precious resources of the planet.
Musk further added that even though the infrastructure will take time and investment, it will take less than 0.2% of the area of our planet to install solar, wind, and other renewable energy sources that can power the entire world. In the end, he said that he wanted the day to be not just about Tesla investors who own stock, but really anyone who is an investor in Earth.
As a first step to fulfill its sustainable energy goals, Tesla has decided to not use any rare earth metals for making its next-gen vehicles.
Tesla’s Master Plan 3 – Company-level Goals:
Tesla will focus on cost-cutting, growth, and expansion in the coming years said Musk. The company will focus on efficient manufacturing processes, reducing costs, and expanding its presence in emerging markets. Tesla has already slashed up to 20% of its price for Model 3 and Model S. The price cuts have stimulated the dwindling demand and put the company back on track. To expand its manufacturing capacity, Tesla is building its sixth Gigafactory in Nuevo Leon, Mexico.
Tesla also demonstrated the novel ‘Unboxed Process’ during the Investor Day event. With this unique method, the company can build its vehicles all at once in the assembly line itself using parallel and serial assembly, with only the paint job requiring a separate process. This method will be used to make Tesla’s next-gen vehicles.
Investors were disappointed with Master Plan 3, as it did not include any details of new launches or products. Though the company has two mystery vehicles in the pipeline, it did not provide any details for the same.
Tesla Master Plan 2 – Unfulfilled Promises:
Tesla’s Master Plan 2, is considered a flop as the company could not realize most of its targets presented in that plan. Master Plan 2 which was unveiled in 2016, outlined the company’s major goals which included the creation of multiple new vehicles across major categories, achieving fully autonomous driving capability, launching Robotaxis that could help Tesla owners make money, and creating a robust solar energy business.
However, since 2016, Tesla has introduced only two new vehicle models, the Tesla Semi and Cyber Truck. After several delays, the company started delivering the Semi trucks just last year and the Cyber Truck is still under wraps with no definite timeline in place for its launch.
As for autonomous driving, Tesla has launched its Full Self Driving Hardware for an additional cost of $15000 but has still not achieved complete autonomy. And until the company makes fully autonomous, self-driving vehicles, it cannot even think of rolling out the Robotaxi project.
After the disappointment with Master Plan 2, investors were looking forward to some solid ideas and plans from the company in Master Plan 3. However, the company did not introduce any major products or plans during the event. When asked about Tesla’s upcoming products, Musk said that “We will have a proper sort of product event as we’d be jumping the gun if we were to answer that question.”
On Wednesday as the Investor Day event progressed, Tesla saw a 5% drop in its share price. Experts state that the price drop reflects the disappointment of investors who were looking forward to details of new products and services from the company.
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