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Tesla , Patriotism and the Marshmallow Test

Tesla , Patriotism and the Marshmallow Test

Tesla , Patriotism and the Marshmallow Test

In 1972 an experiment was conducted on 4-6 year old nursery school children. A marshmallow was put in front of them and they were told they could have the marshmallow now or wait 15 minutes and they would be rewarded with a second marshmallow. The overwhelming majority of the kids could not defer gratification and ate the first marshmallow before the time was up...see... http://en.wikipedia.org/wiki/Stanford_marshmallow_experiment . The lesson learned was that most people even to their determent want instant gratification and can’t wait even if it’s their will end up later in their own best interest. Therefore, Tesla can do chart after chart with depreciation and gas costs all day long but the majority of new car buyers want their savings now.

Some fun facts ...The average cost of a new car in the U.S. has risen to a record high $30,748, is driven an average of 13,476 miles per year gets 24 miles per gallon and is owned just about 6 years (another record high). The United States imports 45% of it’s oil from foreign countries of which 2/3 goes to transportation. With the average consumer using 561 gallons of gas a year and with the average cost of $3.60 a gallon the consumer spends about $2,000 a year on gas for their cars alone. Having your base model $20,000 above the cost of the average car will change the world to some extent but at this point most people see the $30,000 marshmallow now and won’t and can’t seem to wait for the future savings and a second marshmallow.

The population who have deferred gratification by both waiting a long time for their Tesla and have figured out that the savings in gas and regular car maintenance will pay for itself over the long haul have already probably put down a deposit with Tesla. On a side note, you will be happy to learn that the kids who waited till the 2nd marshmallow were found years later to have higher SAT scores, better social skills and a bunch of other presumably good traits. http://www.newyorker.com/reporting/2009/05/18/090518fa_fact_lehrer .

During a dinner conversation over this past weekend I mentioned to a few friends that I test drove the Tesla and have a deposit and reservation for the X model to be delivered sometime in early 2014. (By the way the S model was one of the most amazing car’s I have ever had the pleasure to be in and drives, handles and accelerates like a dream). I mentioned during dinner that I consider the buying the Tesla one of the more patriotic things I could do at this point in my life. The reason ,I explained, is that if you believe it’s in the United States best interests to cut it’s dependence of foreign oil then Tesla can not fail. If you also believe in the marshmallow theory then the only way to severely cut our dependence on oil and have electric cars be 50% new car sales quickly, then Tesla must make a car that works amazingly well at a price tag at $30,000. Lastly the only way Tesla can make a car that is dependable and sellable at $30,000 is to

1) have a bunch of people who lucky enough to afford the current cost of the car to buy the car (deferring their cost benefit( aka marshmallow) over the next 5 years thereby keeping Tesla alive and well,
2) spread the word about the car whenever they talk to friends and drive the car as much as possible and not stick in in a garage
3) buy the preceding models to the 30k car and continue to feed the company feedback so that at the time the $30,000 car comes out, there is a learning curve.

If you believe in the concept of Moore’s Law (the so-called law, that the number of transistors that can be fit on a computer chip will double every two years, resulting in periodic increases in computing power)
Then logically, in a few years Tesla should be able to make the battery on it’s car go longer distances and the same time make the battery more affordable . An example of Moore’s law would be charting the personal computer’s hard disk capacity from 1990 to today with both cost of GB and capacity. Bottom line is when Tesla comes out with the $30,000 model and the patriots and marshmallow grabbers take hold of them then the world will change dramatically and change dramaticallyfor the better.

Signed Racer X (brother of Speed Racer and new member of the Tesla family).

P. S. If Israel is listening, then the same logic flows for Israel as well .. That being if Israel believes it’s in it’s long term interest that the United States be independent of foreign oil, then , the Government of Israel should send in deposits now for Teslas for all it’s Government cars. Israel doesn’t have a car company making cars in Israel and by keeping Tesla alive and well it has a strong chance to eliminate the Unites States need to import any oil from the middle east thereby logically making Israel safer and stronger.

Etographer | 25 July, 2012

What are your thoughts about the cost of the Model S & X as the Dollar devalues? Wouldn't you say 60K is the new 30K? I like what you wrote, I would love to see an equation that factored in more projected variables that move into the future. While the averages you quoted are last years numbers, when you factor in Moore's law into our monetary system the Tesla looks even more attractive.

In my opinion, Tesla is about 7 years ahead of its time. That is great for us early adaptors. When the average consumer catches up, it will thrust our nation into a golden age.

Your essay is very interesting. Thanks.

Eric

Volker.Berlin | 25 July, 2012

Re: Israel. They already have a small infrastructure of BetterPlace battery swap stations in place, and those are used by a small fleet of Renault Fluence Z.E. electric vehicles. They are "listening" but not necessarily drawing the same conclusions...
http://www.betterplace.com/global-progress-israel
http://www.greenprophet.com/2012/01/better-place-israel-roads-100/
http://green.autoblog.com/2012/01/27/better-place-starts-renault-ev-deli...

brianman | 25 July, 2012

"The lesson learned was that most people even to their determent want instant gratification and can’t wait even if it’s their will end up later in their own best interest."

... when they are 4-6 years old.

jbunn | 25 July, 2012

I have met and worked with 6 year olds of all ages. What was interesting about this study was its predictive qualities. That tendency is a part of our core, persistent personality.

PS. Curse you Racer X!

Sudre_ | 25 July, 2012

I don't know a single wife that doesn't insist her husband has the mind of a 4-6 year old when it comes to TOYS. As you get older the toys just get more advanced.

brianman | 25 July, 2012

@Sudre_ - Yah, the high end "toys" start nagging about other toys. ;)

Teoatawki | 25 July, 2012

"The only difference between men and boys is the price of their toys!" -author unknown.

CIAOPEC | 25 July, 2012

@karenkessler

great article.

a few comments...

don't forget about "opportunity costs" associated with purchasing a more expensive car. In other words you loose the use of that extra money that could be put to good use somewhere else in your life such as funding your 401K or towards your child's education etc. Arguably if you are going to spend 60 or 70k on an automobile regardless of whether its an EV or ICE, opportunity costs of the purchase are not a concern.

second

equating Moore's Law to battery technology doesn't work. Li-Ion battery technology improves roughly 7-8%/year not exponentially like that of transistor doubling . Certainly nothing to sneeze at though. each year battery tech will provide greater range and lower cost/mile.

I'm on board with paying a bit more upfront for all the benefits that come with electric drive (decreased fuel costs, lower maintenance, increased national security, 6 star safety (ok, 5 stars in all categories), and superior drive characteristics).

I'm fortunate, my two kids passed the marshmallow test (at least for now).

Maestrokneer | 25 July, 2012

Great post! Very interesting thoughts to consider, but let's not forget one of the most important reasons why buying a Tesla is patriotic: Made in America! Bringing manufacturing, high-tech, green jobs back to California and the US.

Living in the Bay Area, I'm extremely excited that I get to "buy local" with my next car purchase.

cerjor | 25 July, 2012

At a 7-8% improvement in battery technology, this technology should double in about 10 years. That's about the length of the warranty.

BYT | 25 July, 2012

@Maestrokneer, I feel the same way. I have in my notes to try to get new plates for my Model S (because my personalized BYT plates are beat up) and to look for a frame for my license plate that reads:

********************My Tesla Model S************************

BYT

****************Is Made in Fremont, California**************

BYT | 25 July, 2012

Darn, I tried to space out "BYT" to be in the middle of the frame above... oh well! :D

Brian H | 25 July, 2012

cerjor;
The actual experience the last 2 yrs is 17%/yr, and Elon said today that about the time of GenIII's introduction another major step forward in battery chemistry would occur (re replacing old ModS battery and having your car 'better than new').

Some of the stuff coming out of the labs is offering much more than incremental improvements. Extrapolating past battery development isn't necessarily adequate.

BYT | 25 July, 2012

He (Elon) also said they need to come up with a better name then Gen III

Brian H | 25 July, 2012

Model C (for 'Car'). ;)

Alastair.Nantes | 26 July, 2012

It seems to me that the only true patriotism left is for all people (whatever their citizenship or place of birth) to support green initiatives wherever they find them, especially around Oil. The pursuit of oil by violence has caused (and is causing) more than enough deaths.

I have a 5 year old boy so I am going to go and try this experiment out on him. Of course, as a European based (albeit US-born) Tesla reservation holder, I WANT MY CAR NOW! :-)

Great post and thread.
Alastair
"We must hang together,...else, we shall most assuredly hang separately" - Ben Franklin

Tesla229 | 26 July, 2012

@karenkessler et al:

An enthusiastic +1!!!

I'm having Solar City install solar panels before my Model S Signature Performance is delivered. Although it won't completely cover my total power usage, they and I have calculated that it will easily cover the power to keep my Tesla charged, assuming a daily round-trip commute of 50 miles. As such, I plan for my new AWESOME transportation to be off both the "oil" grid and the electrical grid.

GoTeslaChicago | 26 July, 2012

"equating Moore's Law to battery technology doesn't work. Li-Ion battery technology improves roughly 7-8%/year not exponentially like that of transistor doubling ."

EVFNBOY,

It is still exponential growth, just the doubling time is about 10 years instead of 2 years. Not instant gratification, but enough to be a game changer in a few more years.

PS disk drives and computers increase in capacity and speed according to Moore's Law, but need for storage capacity and processing power increases too so that at times it seems they're barely keeping up.

Now think about battery capacity. When it doubles and we can go 600 miles on a charge or the same 300 miles for half the cost, and after doubling again, 1,200 miles (for the sake of argument), we will have achieved capacity in excess of our need for range quite beyond what computers achieved in the same 20 year span. (After all our need for range is limited by basic things like needing pit stops and sleep at least until Google's driverless cars catch on!

BYT | 26 July, 2012

Unless our cars start doing 0-60 in 2.5 seconds with a top speed of 210 MPH

Sudre_ | 26 July, 2012

I still wonder how the charging will work for batteries that large. A 300kw battery is going to take quite a while to charge after I drive it to Florida from Missouri. I don't think hotels are going to have 480 volt 100 amp chargers for all their guests. That amount of power draw from all the guests every night would dim the lights in the rooms :-)

CIAOPEC | 26 July, 2012

@goteslachicago, point taken

clearly i'm not a mathematician however my intent was to suggest not using the Moore's law analogy because that terminology implies doubling every two years, a big difference to doubling every 10 years. Like I said, nothing to sneeze at. If Karen was to publish her article elsewhere (I encourage her to do so) I just wanted to point out the analogy is not quite accurate. The marshmallow test analogy on the hand illustrates perfectly well our short sighted human desire for instant gratification...

In my opinion a 7-8% annual battery efficiency improvement speaks volumes without the need to muddy the waters with Moore's law. That term is reserved for transistor/circuit board tech.

No doubt, we are on the brink of a paradigm shift in transportation... exciting times!

Teoatawki | 26 July, 2012

That's the problem! Charger capacity isn't going to scale. 500-600 miles seems like a practical limit. It will take 19 hours to charge on a 50A circuit and 9.5 hours on a home HPC.

With super chargers easily available, when you hit the big road trip, you could drive 250-300 miles or so, stop for late lunch or early dinner and add back in 150 miles of range during that stop, then drive another 250-300 miles, ending the day with 150 miles range. Day 2, start off with 450 miles range (50A connection for 10 hours), drive 250 miles, long lunch supercharge back to 450 mile range, knock off another 300 miles leaving 150 miles range.

2 days driving like that could get you from NY, NY to Tampa, FL.

Timo | 27 July, 2012

I should point out that recent development in batteries is quite a bit faster than 7-8%/year. More like 10-12%, and silicon nanostructure-based anodes are just now coming in commercial products. Silicon makes energy density increase of around x5 possible.

@Teoatawki, I would not say "limit" but I would say "goal". Practicality of larger batteries depend of accessibility of chargers, in some places quite a bit larger batteries and ranges will be needed just to be safe from getting stranded in middle of nowhere.

Teoatawki | 27 July, 2012

@Timo, it's a great goal, but I'm suggesting that 600 mile range is about the point where larger capacity mass market car batteries start to make less and less sense. Batteries are heavy and expensive, so people are going to be less willing to spend for battery capacity they can't use.

Once you can drive 600 miles between charges, most people would consider that a full day of driving. With less than hour of super charger time at a meal break, you can extend that to 750 miles in a day. A side benefit of the larger packs is that super charging will be less of a stressor on the packs, so maybe you could super charge at another meal break and extend that day's drive to 900 miles. Also, many people would feel that once you can consume more energy in a long day of driving than you can put back in a 10 hour overnight charging session, increasing battery capacity beyond that point is a waste.

There will always be a need for larger batteries for special purposes, such as pickup trucks, farm equipment and tractor trailer rigs.

Brian H | 27 July, 2012

Timo;
In 2 yrs, from 2.9 to 3.5 to 4.1.
That's about 18%/yr average. By the rule of 72, that's doubling every 4 yrs.

Call it the semi-Moore's Law. >;)

Cattledog | 27 July, 2012

Teoatawki +1.

That's why 300 miles is appealing - for me the practical limit for a sustained business drive is 200 miles - anything more and I fly, and I even fly the 200 a lot (San Antonio to Houston).

For a family trip, that limit is more like 500-600 miles, so I'd love an approach where the frunk or footwell of the trunk would allow the addition of a rentable 'travel battery' to increase range by 100+ miles. That would guarantee only one stop on a long day's drive.

I've driven 800+ miles in a day, not fun, and that was without kids. Not really looking to replicate that.

So I'd probably look for increased technology to represent decreased cost, reduced weight (not my own), and increased performance in the future, more than radical range increases in range.

cattledog

Timo | 27 July, 2012

@Cattledog, 200 miles as threshold to fly seems small to me. That's just about three maybe three and half hours of driving, and to me getting to airport and to destination, waiting for luggages, queuing to get to the plane etc. + actual flight time takes more overall time and you lose the freedom of not caring about exact times, you just jump to the car when you feel like it and that's it.

300 miles I start to consider flying. 400 I might actually fly. 500 I probably fly unless I like having freedom of Model S (or in my case GenIII sport sedan) at the destination (or if the ticket costs me more than two week full upkeep vacation in holiday paradise, like it sometimes does).

As I said, bigger battery might be necessary if there is no chargers on a way. With only 220V@16A accessible you get only 35kWh in overnight ten hours and that just might not be enough. with supercharger infrastructure 600 is enough. Without you might want more. Given your example 800 mile trip or 1600 mile round trip 600 mile range battery just isn't enough, you are 1000 miles short of destination and 35kWh/10 hour overnight is only about 150 miles. It would take you week to get to your destination with just 600 mile battery.

So 600 for majority is enough, but not always.

Peter7 | 27 July, 2012

Timo,

Saying there are no chargers along a route is not a reasonable assumption. Even now there is no route you can travel that doesn't pass by electrical outlets that can be used for charging. At slowest they are the 30A-240V J1772, and more often campgrounds with 240/50A service. That would make the 800 mile drive on a 600 mile pack need charging along the way of 7 hours worst case ... not optimal but stopping a the 240V/50A takes it down to 5 hours...

That said, I just got back from a semi regular road trip of 1000 miles each way, driven in one day. We took 16 hours to drive down of which 14 was driving. I'm looking forward to driving the same trip in the S which, with Superchargers, would make the same trip 14 hours of driving plus 3 hours charging/relaxing/eating totaling 17 hours. I think that is the perfect example of how much of difference superchargers would make. The addition of one hour of breaks on a long trip is minor, esp when it means you can drive electric.

Peter

Timo | 27 July, 2012

Saying there are no chargers along a route is not a reasonable assumption.

World is quite a bit bigger place than USA.

Peter7 | 27 July, 2012

Timo,

With all due respect, where exactly in the world are you trying to drive 600 miles without passing a outlet? Even gas stations typically use 240 volts to run the car lifts. If you are driving 600 miles without passing a gas station you have now exceeded the range of most cars by a good bit.

Peter

David70 | 27 July, 2012

Peter, remember that unless you're talking about an outlet that is normally used to provide use to customers, don't expect to be able to use it. RV parks yes. Gas stations that expect to be able to use it themselves, no. Same situation with laundromats.

BYT | 27 July, 2012

I am getting the 300 mile battery pack because on long trips, I am never doing 55 MPH, more like 70 MPH bare minimum and so my range would be much lower. This is a case where a 600 mile battery pack would be optimal for someone like me to do a Bay Area to L.A. trip and avoid the SuperCharger all together. Especially if it's only recommended a few times a year to use.

Peter7 | 27 July, 2012

David,

Perhaps I just get lucky, when traveling in an EV I'm use to charging up at restaurants, hotels, and other miscellaneous locations. People generally are very helpful and interested in EVs. I think it's of great benefit to the EV movement to use both the official charge locations but to also remind the general public that there are outlets almost everywhere, people just don't notice them. In an ironic twist, it seems the worst place to try to charge a Leaf is a Nissan Dealer.

And while I'm sure not all gas stations will let you, I have seen at least once, a Roadster charging at one.

Volker.Berlin | 27 July, 2012

"How Many Miles Are Enough To Kill Electric-Car Range Anxiety?"
http://www.greencarreports.com/news/1078045_how-many-miles-are-enough-to...

jerry3 | 27 July, 2012

Teoatawki -- Once you can drive 600 miles between charges, most people would consider that a full day of driving

Agreed 600-700 miles is all I care to drive in a day. Of course, if there were enough superchargers and if the superchargers don't reduce the battery life dramatically (So far what's been said varies between using them only 5-7 times a year, and using them no more than once a day. There doesn't seem to be any verifiable facts about this), then a 300 mile pack would be fine. The problem I have is that Elon has said the superchargers will be located along the Interstates, which I studiously avoid (Interstates are for 18 wheelers and RVs). So having a battery that will do a day's driving is important.

Now using RV parks or other 240 volt sources is fine, but at a charge rate 30 mph (assuming twin chargers), to drive 600 and a bit miles in a day you need two stops:

The first at 260 miles from home for eight hours to get 240 miles--you don't want to plan the first stop at the full 300 miles because you always want some reserve.

jerry3 | 27 July, 2012

The second at 500 miles for 3.5 hours.

That makes a 22 hour trip length.

Brian H | 28 July, 2012

If you drive that much in a day, on day two you zone out and take a tangent into an oak tree.

Timo | 28 July, 2012

To answer Peter7 question large areas of Africa, Siberia, inland China, quite large areas of Brazil and Canada.

World is quite a bit larger than USA. 600 miles is short distance in global scale.

600 miles is probably what makes people satisfied and what is reasonable for car manufacturers to build, but until fast charger infrastructure reaches entire globe, there will be areas where more is needed if we want to get rid of ICE permanently.

IMO the real BEV revolution comes with charger infrastructure, not with the cars. Problem with this is the famous chicken and egg problem, without BEV:s there is no point making chargers, and without chargers there is no point using BEV:s. One of those need to break the circle, and that is the car with high enough range that most people don't need the chargers.

jerry3 | 28 July, 2012

Brian H,

Presumably you would sleep during the hours of down-time.

Sudre_ | 28 July, 2012

I wish people would stop the bull about not driving more than X number of miles without having an accident. When my dad and I drive 1000 miles to Florida we switch off driving and do the entire 1000 miles no stop napping and eating while the other drives. It works perfectly and husband/wife team truck drivers do it often. Stop assuming your needs fit everyone. That said, with todays gas prices on the rise it is going to be cheaper to fly and rent a car than drive an ICE that far.

I commented on that greencar article on FB. I think realistically a 500 actual miles to the charge is a good range if it includes all the deductions like speed penalties, a/c, road conditions, etc. With supercharging it should work well.

With a 1000 mile battery you would never actually charge the battery completely except before a long road trips. As long as you had enough charge to get the distance why care if you are leaving for work with 400 or 1000 miles in the tank.

pilotSteve | 28 July, 2012

Sudre: With a 1000 mile battery you would never actually charge the battery completely except before a long road trips. As long as you had enough charge to get the distance why care if you are leaving for work with 400 or 1000 miles in the tank.

To me that means almost everybody (90%) would be overbuying with a 1000 mile battery. That idea I don't believe would be economically viable.

Actually I think the 160/230/300 mile options will tell Tesla a lot about how much battery the market wants.

Personally I chose the 300 because $10k over the 230 for the extra 30% range was just at my 'threshold of pain' for overbuying. My guess is that the 230 will be the best seller after 20,000 cars have been sold. Well know by Christmas of 2013, right?

Timo | 29 July, 2012

Actually I think the 160/230/300 mile options will tell Tesla a lot about how much battery the market wants.

Market wants infinite range. What is economically viable with current battery prices and physically doesn't take too much space and doesn't weight too much are those offered by Tesla. Prices will drop and tech will improve, so 1000 miles will not be too expensive forever.

I believe that most Model S sold do have 85kWh battery even that that is the most expensive of the options. To me that shows that people would buy as big battery as they can afford. IMO anything less than 200 miles is way too short range and puts car in category "city car", in which case way smaller and slower car is sufficient.

Brian H | 29 July, 2012

pilot;
Though TM discourages this "lesser future pain" kind of thinking, if indeed a much cheaper lighter higher-capacity battery can be dropped into the car in 5 yrs or so, then the calculus changes. At that moment, the 85kwh battery loses nearly all its residual value. So depending on your guess about when such new tech is likely to be available, it makes sense to "write off" the current high-cap investment as fast as possible, and justify it with near-term benefits.

All of which says, the 85kwh provides the most fun and benefit right now, which is why you're buying it! And why the market is buying/favouring it. Immediate utility and gratification.

Teoatawki | 29 July, 2012

Brian H,

Yes, a cheaper, higher capacity battery clearly does push the residual value of the battery pack down, but perhaps not as much as you think. Once the battery pack has served its term as a car battery pack, the real residual value may be repurposing to other applications, such as backup power or solar storage; applications that are not particularly sensitive to size and weight.

jerry3 | 29 July, 2012

-- All of which says, the 85kwh provides the most fun and benefit right now, which is why you're buying it!

+1

pilotSteve | 29 July, 2012

BrianH, +85 :)

Brian H | 29 July, 2012

Teo;
yes, repurposing is going to be a veddy interesting field in a few years. I suppose home backup and "UPS"-type setups will proliferate.

MandL | 30 July, 2012

There was discussion (including by Elon?) at some point of being able to swap out your battery for long trips. I could totally see dropping by the Tesla store and getting a 30 minute swap for a 1000 mile battery pack, swapping it again for a freshly charged one at my destination, and coming home to reclaim my dealer-refreshed 40 or 60kwh battery. For a 800+ mile road trip, I'd spend a total of 1.5 hours of time swapping batteries, no charging stops, and with the possibility of some sort of maintenance discharge/recharge reconditioning cycle done to maintain my battery's health. I would pay handsomely for that, especially considering I would have no reason to opt for an 85kwh battery for regular use.

jerry3 | 30 July, 2012

That was a long time ago (2009). Since then they've kind of backpedaled although the battery design could support it. I don't see them doing this in the foreseeable future because of the enormous infrastructure costs. I can see them supplying this technology to fleets so that they could do their own battery swapping (taxi and such).

MandL | 30 July, 2012

I don't expect it any time soon, but I'm not sure how enormous the infrastructure costs would have to be. Assuming they can make a higher khw battery (I think Elon said they could make a 500 mile battery now), it would simply mean putting a few of them at each service location. Not sure where the scale breaks out for most, but with a realistic 400 mile range battery available I could drive to Philly or Trenton from home in Baltimore, swap out and be good to get to Boston or Provincetown. A realistic 500 mile battery could make Montreal or Bar Harbor possible. Going south, I could swap in Northern Virginia and get to the Outer Banks or to the in-laws in Charlotte. For that matter, eventually I should be able to swap my way all the way to Key West or Seattle. Neither my battery nor the rented ones would have to undergo the stress of super-charging if there are sufficient places to swap.

No range anxiety, no super-charger wear and tear on batteries, and no reason to invest in a level of range I'll only use a couple of times a year at most. It would easily be worth upwards of $500/week to me. It seems Tesla could make that pay for itself pretty quickly. If you have enough Tesla shops near major interstate routes, swapping could make for a much easier, faster, and worry-free road trip than supercharging or hanging around at campgrounds (not something I am likely to seriously consider).

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