Logo Financial Pages 4
Sunday, August 14, 2022

Driver less cars are coming before you know it and their arrival will herald the death of dirty fossil fuel cars and replace them with clean electric motors.

If this electric can be successfully generated by natural forces, for example wind and water turbines and new solar energy then electric driver less cars are the immediate future.

Before we get too far ahead of ourselves though the driver less bit may be a few years away but the electric motor is definitely in the here and now and Tesla motor cars are at the vanguard of this new technology.

Tesla is changing the way we think about the motor car market. They have not spent a penny on advertising or endorsements and yet they have managed the largest product launch by dollar sales in history.

The new Model 3 will retail for around $35,000, and 325,000 people paid a $1,000 deposit for a car that will only be delivered in 2017-2018.

That represents forward sales of $14 billion.

The current Model S and Model X are luxury vehicles with competitive specifications, the Model X goes from naught to 60 in 3.2 seconds. The car recently featured on the UK Top Gear program and the public reaction was incredible. The company has ambitions to make 500,000 cars a year.

This is in the context of a global car market of 60 million or 70 million cars sold every year, which clearly gives them enormous scope to grow.

Electric cars are more reliable than their ICE (internal combustion engine) forebears with less moving parts to wear out but its the cost of replacing the battery pack and worrying whether or not the motor will fail that is currently putting many people off. Tesla currently offer an eight year warranty with their batteries.

Worrying about the battery life though is not an argument for not buying into the technology because with economies of scale the price of replacing them will quickly drop and make them just another throw away consumer item.
Tesla (TSLA) rose +8.50 to $230.77 today and the price will continue to rise. Buy.