Alternate Theory For Battery Swap Endgame

Alternate Theory For Battery Swap Endgame

Ok, I'm having a hard time believing that Elon believes this battery swap thing is actually worth the time/money they're putting into this for the reasons they're giving. I'm not on board with the marketing theory, either, but I do have an alternate idea.

They know they need batteries at the SCs anyways to supplement the solar panels, right? So maybe they're trying to squeeze the most use out of them. Kind of killing 2 birds with one stone? Provide backup power for SCs and if someone wants to take one with them they can. Perhaps they're thinking: "Hey, we have to have batteries there anyways, what if we made them more versatile?" Maybe they would have opened with that, but on the other hand, maybe it wasn't ready yet.

Can someone comment on the technical/feasibility aspects of this proposal?

Sorry if this was already posted (looked and didn't see it).

TFMethane | 22. juni 2013

I think they would have to let you know that they are using your battery to back up the superchargers, and compensate you according to some formula - perhaps how much "battery life" they used up on your battery vs. how much "battery life" you used up on your "rental" battery.

That only makes sense since they allow you to keep the swapped battery, but they intend to charge you if your battery was more "used up" than the rental battery. Clearly they are assigning a dollar value to the "used-up-edness" of a battery. If they are going to charge you to get a "younger" battery, then they should compensate you for "aging" your battery.

If they don't tell you up front, I smell a class action lawsuit in the future. I'm sure they'll do it right.

Sorry for all the quotes. I got carried away.

eisnerw | 22. juni 2013

I have a better alternate theory. It looks like a 400-500 mile battery is going to be possible fairly soon. In addition to making some supercharging less necessary, there will be a downside in that charging a 170 kwh battery will take twice as long as an 85kwh -- about an hour. That would be too long and could eventual lead to serious backups at the supercharging stations. "BatSwap" is a reasonable alternative, especially since you might only have an 85kwh for normal driving, pick up the big battery for a long trio, and trade back for your original on the return trip.

Roshandosh | 22. juni 2013

Actually, they don't have batteries already at the SC's. As the solar arrays produce power it is either consumed by charging Model S's or it is put back into the grid at a profit. As needed, Tesla also buys power from the grid, but this is usually at night so it is at a much cheaper rate. They don't have a need or reason to store the electricity they produce, as they are actually making profit off the electricity already.

tobi_ger | 22. juni 2013

Most people don't seem to understand, that swapping the battery as being just a sort of a trip extention is merely a byproduct of the base model design.
From manufacturing and (battery) servicing standpoint it offers huge advantages. Regardless of any swapping stations becoming accepted/worthwhile or not, this core functionality has a high practical value to TM (manufactoring in the first place) and customers for e.g. when new battery capacities become available for upgrades or packs need to be replaced within warranty or to restore basic mileage per customer wishes in several years.

erici | 22. juni 2013

It's Labor Day weekend 2015. A lot of cars have been delivered.

You leave for your big vacation and get stuck in line at a supercharger -- everybody else is leaving on the road trip at the same time.

Your 5 year old kids are whining.

Battery swap or wait for hours at supercharger and get to your destination beyond midnight?

celtrog | 22. juni 2013

I think the main impetus for the battery swap is not the time to charge.
There is a huge market of car owners (particularly those in the upcoming Gen III market) that don't live in their own dwelling (ie they live in apartments or condos). Thus they can't easily put in their own 240v plug..... this is a long term marketing problem for TM. They need to try to get into this market.
problem solved...(or at least mitigated)

wheatcraft | 22. juni 2013

I too am a bit puzzled by the pack swap program. I think it is really cool, and I guess I welcome the choice. But I have read that it will take about $500,000 per installation. That is a lot of infrastructure investment for something that might be obsolete in 5-7 years. I would rather see them invest in a higher density of supercharger locations, and a faster roll-out of same.

That being said, we should all know better than to bet against Elon! Those who shorted Tesla stock know that all too well!

AmpedRealtor | 22. juni 2013

@ cb17 - no, they don't need batteries at the supercharging stations to supplement the solar panels. What gave you that idea? All supercharging stations are grid-tied, so whatever is not supplied by the solar panels is drawn from the grid. Did you actually think each supercharging station was off the grid and powered by battery power at night? LOL

Flaninacupboard | 22. juni 2013

@AmpedRealtor well that is the ultimate plan, to make them zombie apocalypse proof.

ir | 22. juni 2013

AmpedRealtor: if the cost of electricity varies by time of day, charging the batteries at night, over a week to run the supercharger during the weekend crush would save lots of money for Tesla. Remember, supercharging is free for Model S owners, but Tesla still needs to pay for the power. I'm pretty sure the utilities pay less for surplus power than they sell it for. That's incentive to store it yourself when possible.

Roshandosh: I don't suppose you've used a super charger on a busy weekend? Every pair of bays share the same AC -> DC rectifier stack. The result is each car gets roughly half the 90 / 120 kW advertised charging power! The extra batteries can supply extra DC power to make each bay run at full 90 / 120 kW capacity. The rectifier stacks can also be used to charge the batteries during week nights instead of idling like they do today.

TFMethane: if I'm on a road trip, I'll be burning a full 85 kWh pack every 3 hours or so. A round trip SF -> LA -> SF means placing 4-5 discharge cycles on the loaner plus time spent at the destination. It would only be fair if Tesla burns a few discharge cycles on my pack to run the supercharger. They know my GPS location and battery usage via 3G, so they can ensure my battery is not worked harder than the loaner and to top it off when I'm on my way to pick it up.

markinfl | 22. juni 2013

Have read the threads. Still don't get the economics. Have they shared how the batswap model take into consideration the value of a new battery versus a five year old battery? It would seem they would have to be able to assure us that the swapped battery is as strong and has same warranty as the one we had prior to the swap or it would be a bad trade for one of the parties.

AmpedRealtor | 22. juni 2013

@ markinfl - Here is what my gut says about all of this battery swap hooplah... At a cost of $500,000 per location, and assuming that is above and beyond the $200,000-$300,000 cost of each supercharging location, the cost of adding battery swapping to the 27 supercharging locations planned between the two coasts will come at a cost of over $13 billion. Tesla's current valuation is around $11B, I believe. So I don't see how this is every going to make it to prime time.

I think this whole battery swapping idea was hatched to create some positive press and to give us headlines about how you can recharge in less time than it takes to fill a tank of gas. Probably more impactful doing it this way than spending tens of millions on marketing to broadcast the same message. I think we are going to see a handful of battery swapping stations in California, but that's it. I believe within a year of them going live, Tesla will discontinue them citing "lack of demand" and we will never hear about it again. However, by then Tesla will have reaped the benefits of the positive marketing message.

That's just my opinion, I tend to be cynical. :)

tobi_ger | 22. juni 2013

@AmpedRealtor +1

wheatcraft | 22. juni 2013

@AmpedRealtor: I think your math is way off. At 0.5 million per pack swap, assuming 150 SC across the country, my calculator says that is 75 mil. A significant infrastructure investment, but by no means overwhelming. I don't recall the exact ultimate planned number, but I seem to recall reading something like 150. But even if twice that many, that is still just 300 mil.

That being said, I still wish they would spend the money on more SCs, with a faster roll out, as I wrote above.

tobi_ger | 22. juni 2013

I don't think the testing period of swap stations is taking away (too) much away off the SC expansion efforts in both capital and resource levels. Construction is probably done by different teams/companies anyway. Building the swap stations w/ robotics can also be sub-contracted.

AmpedRealtor | 22. juni 2013

OMG I'm a moron... $13.5 MILLION - not billion! I have added three zeros between my brain and my fingers. So sorry... Now that doesn't sound like much!

AmpedRealtor | 22. juni 2013

The other thing I hadn't considered is that most of the superchargers aren't built out yet and haven't even broken ground, so it's not like they are going to have to retrofit a lot of stations to accommodate this. The vast majority haven't even been built yet.

wheatcraft | 22. juni 2013

@AmpedRealtor - well I made a math error too; 300 pack swap stations would be 150 mil, not 300! I am actually a mathematician/physicist at a university, but my arithmetic has always been terrible; I need greek letters in the equation!! :))

tobi_ger | 22. juni 2013

@wheatcraft: is there a nice physics formula where t, e, s, l and a are combined in a meaningful way? Would be great for t-shirts. :)

markinfl | 22. juni 2013

@AmpedRealtor- thanks for the laughs. Still don't get how they make the fair trade work without having a large inventory of batteries (e.g., several for each vintage). Thanks

Brian H | 22. juni 2013

you slipped 3 decimal points. 27 x .5 million is 13.5 million, not billion. Chump change, marketing expense.

carlk | 22. juni 2013

@markinfl. I'm sure battery usage in all MS are logged. Tesla can easily assign a value to each accordinly.

@cb17 The swap is just one element, and a necessary element, to complete the total package to convince all potential buyers who are still sitting on the fence that there is absolutely nothing to worry about the battery and range. No one can use that to argue againt the car after the demo. For that 10~20 million investment is totally worth it. Remember 99% of people outside this forum are not like us early adopters who are willing to take some risks and inconveniences for the best technology.

Brian H | 22. juni 2013

Oops, overlapping posts. Should have refreshed before typing!

Brian H | 22. juni 2013

Keep comparing the costs to TV ads. They're marketing, not capex, at heart. They're trying to undermine the fears of the wider public. Even if they turn out to be lightly used, they let the air out of that anxiety-balloon.

Bighorn | 22. juni 2013

So you can get 27 swap stations or 4 30 second Superbowl ads. Hmmm.

wheatcraft | 22. juni 2013

@tobi_ger: hmmm, good idea, I will give it some thought!

Mark Z | 22. juni 2013

My brother called me and said, "Brilliant, the man (Elon Musk) is brilliant!"

He continue to explain that most Model S customers will gladly pay to save time. The wealthy are wise too, so they will SuperCharge while dining or shopping. (Please Elon, install HPWC at SC shopping locations as needed.) The majority will prefer to battery swap if time is valuable to them.

bb0tin | 22. juni 2013

I don't see the battery swap as a marketing gimmick. I see it as simply another argument pitted against electric vehicles getting knocked down. Elon is trying to, and succeeding in, making transport renewable via electrification. If he has to sacrifice some money to do so then he will. The same applied to SpaceX when he started it. He also, as far as I can gather, views battery swapping as an intermediate step until we get batteries with larger capacity and faster charging.
That being said, it is pointless to argue that battery swapping is a no-go because of economic reasons. There are many business models which potentially will make battery swapping work, but that is not the ultimate aim. For those who would rather that the money was instead spent on more superchargers, my question to you is: Would you say the same thing if the superchargers were not free but instead cost an amount similar to a battery swap or the equivalent range in gas? Elon made them free to encourage the shift to electric vehicles. Using the money-centric logic of many on this forum, he should not have made them free.

DouglasR | 22. juni 2013

Like the superchargers, the battery swap is an argument for the EV only if the process is available -- not just technically feasible, but actually operational along routes people want to travel. The superchargers will be deployed fairly quickly, so they will help sales over the coming year or two. The swap machines will be deployed slowly, and only if there is "demand." I have my doubts that enough demand will develop under the current pricing scheme, but TM has time to tweak that before too many of these swap stations are built. I do hope they succeed.

markapeterman | 22. juni 2013

I agree with the OP that the batteries at the swap stations could be used for energy storage. I imagine that there will be 2 stacks of batteries: tesla owned and private owned (swapped waiting for pickup by their owner). Clearly they can't put your battery in another car while you are on your trip, so it has to hang out and they have to recharge it - so why not use it to buffer the grid while they have it? Or perhaps the private batteries wouldn't be used to buffer only the tesla owned ones waiting on a swap customer. Regardless, doesn't this make too much sense to not be true. Elon has said they will have 0.5MWh storage (~6 85KWh packs) Sounds like they could put in as many as 10-12 and have the capacity vary based on how many are swapped out. Selling electricity back to the grid at peak rates could subsidize the station costs and reduce the need to buy energy from the grid at night.

HenryT2 | 22. juni 2013

If you think that the $10 to 20M needed to put in 20-40 swap stations in is going to make a difference on how fast superchargers are going to be put in, you should sell your Tesla and short TMC NOW! That would mean that a company valued at $11.5B that just paid back a huge loan on a giant successful offering is now so short of cash that they can't handle $20M over several years for a major infrastructure improvement.

Tesla are not rolling out superchargers at the rate they are because of cash limitations. Undoubtedly, it's due to logistical problems in sourcing locations, getting the hardware, etc.

I really don't get the negativity against the battery swap. First, it gives more flexibility to travellers (time vs. money) and second, it makes swapping batteries part of the EV repetoire.

I think Tesla's got 500 mile packs coming up sooner rather than later AND they will be available for "rent". Announcing that they will be allowing owners to swap out 150s whenever they need them for a long trip will cannibalize and alienate 85 sales.

nickjhowe | 22. juni 2013

Didn't noticed it mentioned in this thread, but also note that ZEV credits go from 4 to 7 for cars that support battery swapping. At $5k per credit and 20k cars per year that is $300m a year. I don't know the small print about how widespread the capability needs to be to qualify.

Assuming the small print is satisfied, then the credits cover the cost of the buildout of the stations - if they are even needed. Maybe simply demonstrating it is possible, and putting one at each service center is enough. $200m+ straight to the bottom line.

wcalvin | 22. juni 2013

For the "Why swap?" question, forget the grand strategy bit and try this scenario instead:

1. Production line manager brags about 40-sec battery install time achieved by reprogramming the robots.

2. "Can you remove one as fast, and get swap time down to 90 sec?"

3. Bet won. Bragging reached Elon's staff.

4. Someone says, "That might be interesting for selling to fleets."

5. It might be hard to earn back the 500K cost of a BattSwap Station via individual MS owners, but with fleets contracting to keep the SwapStations busy....

6. Good publicity too. Twit the ICE naysayers with more EV stream-roller tactics. More free advertising, putting off the day of full-page ads a little longer.

7. Finally someone volunteers that people who rent (and perhaps park on the street) need a charging alternative when time is too short to work a long recharge into their schedule.

8. "Peg cost to the price of a full talk," someone says.

9. Then someone notes that gas station owners need an escape path. Maybe they will want BattSwap franchises.

As I have said elsewhere, Model S is okay for executive cars within a fleet (say, rentals), but it is the Model X that will appeal to fleets in a big way. Taxi, airport shuttles, even police.

How to launch it? Turn loose the event planners on the individual driver angle--makes for good theater (no need to stress the fleet angle for now).Result: June 20 video.

DouglasR | 22. juni 2013

@wcalvin - Elon has said that the battery swap concept was part of the plan from the beginning.

Brian H | 22. juni 2013

Plausible. Exact sequence may be different, but the considerations covered make sense.

Jolinar | 23. juni 2013

Some SuperChargers already have 500kWh battery for grid buffering (Elon said it in last investor call, listen to it if you don't believe me) so Battery swaping is just better utilization of this grid buffering idea.
Also 500,000$ per swap station is a lot of money in my eyes but with 100 stations acros the US it's just 50 milions $, so not that big money for covering the most frequented routes in the US. My biggest worry is about price per swap (price per "recharged" mile comparing it to the price per ICE car mile). SuperChargers are great, we yet have to see how great SuperSwaps will be :-)

jamestily | 23. juni 2013

Some battery storage at superchargers would improve the performance of the facility. More cars charging at once would slow down the charging rate per car, unless you enlarge power source and number of stacked inverters, or use storage batteries to buffer the power-use surges. If the system happened to be connected through a demand meter to the grid, then the cost of electricity would go way up without batteries to balance out high use times and at night.

katskar | 14. august 2013

Hi DouglasR,
I have been watching Tesla for a number of years, it is true Elon and team have had the swappable battery idea at the start of Model S design. I remember vividly being disappointed when I started reading the Model S designs were omitting the swappable capabilities. I began to hope again when I noticed where and how the Model S battery was installed. Tesla knew better than to over promise and under deliver! Much smarter to get the awesome car out and figure out the battery swapping infrastructure in the background and use it as additional marketing WOW factor later!

Brian H | 14. august 2013

Elon wanted the capability designed in, but has always had reservations about the business viability. Part of the motivation to demo it may be enhanced ZEV credits.

shs | 14. august 2013

"Part of the motivation to demo it may be enhanced ZEV credits".

The rapid charging credits may well go away soon.

Bob.Calvo | 29. januar 2015

Has anyone with a 60 kWHr battery tried to swap for an 85 at the new station and kept it? What was the cost? If a 100 or 110 kWHr battery became available, how many folks with 85's would pay for the permanent upgrade?

AmpedRealtor | 29. januar 2015

@ Bob.Calvo,

Swap is in beta test and available to a select group of owners by invitation only. It's likely that those who have been invited to participate in the program are also under NDA not to discuss the program.

decibel | 29. januar 2015

Here is an excerpt from a Sept. 2013 California Air Resources Board staff report which explains the advantages provided by a battery swap in relation to earning ZEV credits. It also conveys the preference (bias) that CARB staff have for hydrogen fueled vehicles. In the end, after some pushback, CARB retained the battery swap as eligible for more credits "so long as it is based on real-world use". But clearly, TM needs to get the battery swap operational if it wants to earn ZEV credits at a higher rate.


Adopted in 2001, ZEVs with the ability to refuel to 95% of full capacity within 15 minutes are allowed to earn more credit, under the Type IV and Type V ZEV definitions. ...

Some BEVs have been qualifying under the fast refueling definition by means of battery exchange. However, it has not been publically demonstrated that battery exchanges have occurred on the vehicles earning credits. Though staff does recognize the potential for a battery exchange to help market the vehicle, other vehicles earning Type IV and V ZEV credit depend on fast refueling for vehicle operation and success. Staff is proposing to remove battery exchange from qualifying under the fast refueling definition, starting in 2015 model year.

Hydrogen fast refueling capable Type V ZEVs will still earn 9 credits each in model years 2015 through 2017 upon placement in service. Staff believes it is important to maintain the difference in credit level between the two ZEV technologies to ensure appropriate incentives are in-place to support hydrogen technologies as infrastructure ramps up through 2017. Hydrogen remains a long-term solution for all vehicle classes, and is essential for meeting California’s long-term air quality and GHG reduction goals.


The Board voted to retain the fast refueling accreditation for battery swapping, so long as it is based on real-world use of the fast refueling and maintains fuel neutrality. Manufacturers will earn fast refueling credit for fast refueling events within the eligible fleet supported by appropriate documentation. This requirement does not apply to manufacturers of FCEVs.
The modified fast refueling definition bases credits on individual fast refueling events.

Brian H | 29. januar 2015

They're even prohibited from revealing they're under an NDA.

DTsea | 29. januar 2015

Brian pretty much all NDAs are that way.

GreenBehindTheEars | 29. januar 2015

Let's look at the long term perspectives of this. In ..some years from now(not soon).. when the Teslas are fully autonomous, we will not necessarily own our cars, but simply book them in an Uber-kinda style. The Teslas will have very little downtown and, hence, not much time for charging, so will need super fast recharging - or battery swap which the self-driving car will do in between bookings!

Yeah yeah, many things will have changed before we get there, but it is an interesting thought, is it not?

Bob.Calvo | 30. januar 2015

After the ZEV credits end and before everyone is booking driverless Uber Tesla's, I think that there might be a decent chunk of time where people will want to permanently upgrade the size of the battery that they originally bought to whatever super capacity sized option for increased range exists in the coming years ahead, especially after the Gigafactory is operational.