My Town Hall Notes

tonybelding · 12-12-2007, 01:35 PM

Here are my notes from the "Town Hall" conference. . .

Production car number one -- Elon's car -- has been assembled at Hethel. This car does not have the final transmission, and it has a life expectency of only a few thousand miles before the transmission is liable to fail. Elon apparently finds this acceptable, but he acknowledges that that's not going to fly with Tesla's regular customers.

The first and second transmission suppliers couldn't deliver, and now Tesla are on their third and fourth suppliers. That means they have two companies working on the problem in parallel. As Ze'ev explained it, even if one fails the other will come through. If they are both successful then Tesla will be able to accelerate their production plans. Now that Tesla is a recognized name, it's easier to get the bigger and more experienced transmission companies to work with them.

The EV has very unique transmission requirements, and Tesla have learned a great deal about them. "We've seen every possible way a transmission can fail." Transmission companies 3 & 4 are not starting from scratch; they are taking the existing transmission design and improving it. The design itself belongs to Tesla, and could become an important IP asset for the company. White Star will "probably" use the same transmission unit as the Roadster.

A single-speed transmission wouldn't solve the problem. Some of the problems they've experienced are related to shifting, but many are not. Elon expressed frustration with durability problems, because these are things that only show up after driving the car a few thousand miles. That makes the problems time-consuming to diagnose and fix. Tesla will probably ship at least some of the first cars with a less-than-perfect transmission and slightly reduced performance, then upgrade them later. (Ze'ev pointed out how expensive the upgrades could be for Tesla, but insisted they'll do it regardless.)

The car is very nearly 100% approved for sale, from a regulatory standpoint. There is a minor test, a "door vibration" test as I understood, which is all that remains. No mention was made of the airbag exepmtpion, but it would seem to be implied that they have that resolved.

The previously announced EPA range of 245 was the result of an error by the testing lab. The corrected result will more likely be somewhere in the area of 220-230 miles. This does not reflect any change in the car's actual performance, and the "real world" results described on Tesla's website are still as valid as they were before. It is also likely that some changes to the car will require re-testing for range, so it will be some time before there is a truly final, official number that goes on the window sticker.

A question was asked of why they couldn't get a higher top speed from the car. The explanation was, to design the car to be stable and operate correctly at a high speed would have required compromises that would have reduced its energy efficiency. For example, the aerodynamics would have to generate more downforce to keep the car glued to the road at that speed, which would result in increased drag at normal driving speeds. Other parts would have to be over-engineered and their weight increased.

There is no change to Tesla's "Master Plan". They are not planning to sell out to any other company. They are going through another private investment round now. They do eventually want to go public, but they are wary of doing that too early. Fundraising is not a concern for the company's immediate survival. According to Elon, even if all their many other investors got cold feet, he personally would back the company financially to whatever extent necessary.

Future Tesla cars, including White Star, may be "pure EVs" or "pure EVs with range extenders" (apparently all are pure, but some are more pure than others). Tesla's goal is to increase the number of miles people drive on grid power, and they are agnostic about the means used to achieve that.

Elon reiterated several times that they are absolutely committed to delivering a car that buyers will love. Production will be very slow until the transmission problems are fully resolved, which means full-rate production will probably begin about summer, probably late summer. There are some uncertainties about the schedule, and they are trying not to over-promise until they have it figured out better.

BlackbirdHighway · 12-12-2007, 02:03 PM

They would not promise that all 600 (or so) present buyers would get cars by the end of 2008. I got the distinct impression that this is unlikely to happen. Being #584, I'm expecting a 2009 model. Up until now, I had some hope that it would just make it in 2008, like Santa would deliver it on Christmas eve or something.

Also, they are not yet ready to declare what the warranty period and coverage will be, but it would be appropriate for a sports-type car. Again, my impression is that it would not be the 7-years, 100,000 miles full drivetrain warranty that one caller requested.

I thought it was a very good conference, lots of good information. I recorded it, but I'm not sure how that turned out. I'll have a chance to give it a listen tonight or tomorrow.

TEG · 12-12-2007, 02:24 PM

Thanks for posting the recap, folks.

..."pure EVs with range extenders"...

I still struggle with that phrase and concept.
If it is a BEV with a detachable generator, that you only take on long road trips, I could see that.
But if there is an ICE permanently part of the vehicle I will always think of it as a hybrid.

malcolm · 12-12-2007, 02:53 PM

Thanks for the posts gentlemen.

Good to see continued openness.

A 4th transmission supplier! Well at least some good will come of it if Tesla can get a few more patents out of the process.

I hope that Elon's comment about the depth of his own pockets can be tested with covering the cost of the transmission upgrades when they become available. Especially for car #2 :)

Mistake at the EPA lab? By 15 -25 miles? Maybe this happens a lot, we just never hear about it.

Iz · 12-12-2007, 02:55 PM

Tony, thanks for the update. Glad to know Elon is still on board with moving Roadster and WhiteStar forward.

Dogtown · 12-12-2007, 03:30 PM

I’m sorry but this is not “Openness.” This is damage control. The former “Open” policies were a way of doing business transparently in a very open and public way. This was a meeting with customers to make them feel better about the very questionable recent events. Events that were obviously not addressed and are still of great concern. I’m not saying this is the beginning of the end or anything. However, this meeting is not representative of the type of communication we have come to expect from Tesla.

I do fear that this is what we will continue to see from the current management. Just because you call it a blog that doesn’t mean you are being open. The recent posts have been no more than new marketing propaganda or more damage control for typos in news stories.

It is important that the new management at Tesla understand that we have come to expect a certain company culture from them. It is this culture that should be at the core of the company and our support of such a company. Just going through the motions while making unjustified decisions will not cut it. We know when it is being faked

TEG · 12-12-2007, 03:46 PM

Quote:

Originally Posted by tonybelding

Tesla will probably ship at least some of the first cars with a less-than-perfect transmission and slightly reduced performance, then upgrade them later. (Ze'ev pointed out how expensive the upgrades could be for Tesla, but insisted they'll do it regardless.)

Promises of a free transmission upgrade with purchase are definitely a bit odd, but perhaps the best attempt to salvage this situation.

But what about the terms... Do you get it in writing? Do they replace your gen 1 trans if it is still working a year later at 10,000 miles? Do they automatically retrofit everyone even if a particular car hasn't developed problems? This is a like a pro-active recall notice before they start shipping!

Wouldn't there be some sort of safety liability question if you ship a vehicle knowing full well the transmission may fail soon? Couldn't transmission failures lead to possible accidents?

I want to be positive here, but this sounds like it may not be a viable approach to get past this particular problem.
At least not on a production car for road use on sale to the general public. Maybe you sign something on delivery absolving them of liability related to transmission failures?!

This is really an unfortunate situation.

tonybelding · 12-12-2007, 04:13 PM

Quote:

Originally Posted by Dogtown

I’m sorry but this is not “Openness.” This is damage control. The former “Open” policies were a way of doing business transparently in a very open and public way. This was a meeting with customers to make them feel better about the very questionable recent events. Events that were obviously not addressed and are still of great concern.

Not sure what you are referring to. As far as I could tell, they answered every question that was asked.

siry · 12-12-2007, 04:16 PM

@dogtown

I disagree with you. First of all, I have managed communication at Tesla for over a year now so you can criticize me on how we are communicating but it has nothing to do with the recent changes. The second place where I disagree is that you seem to imply that an open invitation to all customers to come to our place of work or join us by conference call) and meet the entire executive team for a face to face meeting where any questions can be asked and addressed is somehow a step backwards from our previous practice, which consisted mostly of blogs. i am a big fan of the company blogs and definitely want to continue them but I would argue that the key issues that are concerning our customers were great enough that it was much more important to provide a face to face forum rather than a blog. Last, I don't think that customer drives and first drives with the car companies is marketing propaganda. It is a very important and serious milestone and one that I think people are very interested in hearing. Im the first to admit that there has been less communication in recent months and I'll take the blame for that, but we have had our hands full with leadership changes and a very intense focus on the issues at hand, and I have been loathe to fill the void with anything but the most meningful types of updates, which in recent times has been reports of meaningful progress on the transmission and the status of the roadster program.

Darryl

tonybelding · 12-12-2007, 04:22 PM

Quote:

Originally Posted by TEG

Promises of a free transmission upgrade with purchase are definitely a bit odd, but perhaps the best attempt to salvage this situation.

But what about the terms... Do you get it in writing? Do they replace your gen 1 trans if it is still working a year later at 10,000 miles? Do they automatically retrofit everyone even if a particular car hasn't developed problems? This is a like a pro-active recall notice before they start shipping!

Wouldn't there be some sort of safety liability question if you ship a vehicle knowing full well the transmission may fail soon? Couldn't transmission failures lead to possible accidents?

Some of this was discussed actually.

My understanding is that the current transmission isn't considered durable or safe enough to ship to regular customers. They will at least make it safe (so it won't seize up) before doing that.

The early transmission would be an option for those near the beginning of the waiting list. In other words, if you prefer to wait for it to be perfected, then you can wait (and presumably still get your Founder's Series or "Signature 100" car). Those who get the early transmission will know what they are getting.

The cars with early transmissions will be programmed for slightly less performance in order to "baby" the transmission. Elon clearly promised that everybody will end up with a full-performance car. In order for that to happen, everybody has to end up with the final production transmission.