Tesla is expected to reveal a design for a semi-truck this month. CEO Elon Musk has been heralding this move into the freight business since last year, when he rolled out his “Master Plan, Part Deux.”
According to Morgan Stanley analyst Ravi Shanker, the vehicle will be what’s known as a “class 8” truck — a great big old over-the-road semi designed to haul large amounts of stuff. Despite that, Shanker doesn’t think that the Tesla semi will have a long-range battery delivering 600 or more miles of range; something like 300 miles is more realistic, due to battery costs, and Tesla will deal with the range issue by swapping batteries or enhancing its charging capabilities.
In a note published Wednesday, Shanker suggested that Tesla won’t start selling the semi until 2020, but that won’t prevent the company from lining up customers.
“We expect Tesla to start taking orders for the truck from the day of the event (we estimate a refundable $US5,000 deposit),” he wrote. “We believe this could set off competition for intelligent trucks in the industry.”
Shanker calculates that the truck business could add up to almost $US12 billion in business by 2028.
This all sounds pretty good, but remember that Tesla has taken something on the order of 500,000 deposits for its Model 3 sedan, at $US1,000 a pop. As of August, just over 100 vehicles have been delivered as Tesla ramps up production. But even with an aggressive ramp, it will take Tesla years to fulfil those pre-orders.
Shanker expects Tesla semi deposits to be refundable, and by now everyone knows that putting down some money to get a place in line to buy a Tesla can mean a bit of a wait. But in the short term, if Tesla debuts the semi alongside some industry partnerships and can encourage a healthy pace of pre-orders, it will have another funding stream at a time when its cash needs are rapidly intensifying.
Obviously, getting in early on a Tesla semi doesn’t come without risks. Job one at Tesla right now is getting hundreds of thousands of Model 3s into customers’ hands. It also has to figure out a way to get its solar-roof business cranking, as well well as grow its battery storage business and ensure that its Gigafactory in Nevada can supply enough lithium-ion battery cells to satisfy the company’s diverse needs.
It’s easy to see the semi as a very big distraction, although Musk himself seems quite excited by the project (And who wouldn’t be? Big trucks are cool.) There’s not arguing with the deposit funding, however. For Tesla right now, every dollar helps.
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