Why Google or Apple or anyone would be interested in the GF is not for consumer device batteries but for energy storage batteries for their data centers IMHO. Every tech company would like to go 100% green with self produced energy and the GF could pave the path for that.
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Tesla Gigafactory Investor Thread
- Thread starter teddyg
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Most of Apple's data centers are already running on 100% renewable energy.
Apple Says Data Centers Now Use 100% Renewable Energy - Bloomberg
Apple Says Data Centers Now Use 100% Renewable Energy - Bloomberg
This is from Apple - Environment - Renewable Energy :
"Our data center in Maiden, North Carolina, exemplifies our approach to environmental responsibility. It was designed from the ground up for energy efficiency, and it has earned the coveted LEED Platinum certification from the U.S. Green Building Council — to our knowledge, something no other data center of this size has achieved. In 2012, we completed construction on the nation’s largest end user–owned, onsite solar photovoltaic array on land surrounding the data center. This 100-acre, 20-megawatt (MW) facility has an annual production capacity of 42 million kWh of clean, low-carbon, renewable energy. And we built a second 20-MW solar photovoltaic facility on nearby land that became operational in October 2013. In addition, we’ve built an onsite 10-MW fuel cell installation that uses directed biogas and provides more than 83 million kWh of 24/7 baseload renewable energy annually — it’s the largest non‑utility fuel cell installation operating anywhere in the country. All told, Apple will be producing enough onsite renewable energy — 167 million kWh — to power the equivalent of 13,600 homes per year. These power sources are connected to the local energy grid and not only displace other dirtier forms of electricity that otherwise would have been used, but their environmental benefits are used only by Apple and are in addition to any locally mandated renewable energy requirements."
So for their NC data center, it looks like solar provides 84 million kWh per year and full cells provide 83 million kWh per year. While it appears they're connected to the grid, I'm guessing that Apple probably uses a lot of the power themselves - solar during the day and fuel cells at night.
I see where DaveT is coming from as to the limited benefit to Apple of GFactory involvement when you look at the iphone, macs, and ipads.
while I wouldn't bank on this, there is another dimension to the story. according to Apple board member (and J Crew CEO), Mickey Drexler, "Steve's dream before he died was to build an icar."
Steve Jobs Wanted to build an icar - Business Insider
John Markoff of the New York Times was reported as saying that Jobs told him he'd wanted to take on Detroit before he died and create an icar.
Steve Jobs Said He Wanted Apple To Eventually Make A Car - Business Insider
this came from 5 minutes of googling, there's likely more out there about Job's interest in making a car, and maybe this is already widely known among many of you. does 2014 Apple want to build a car? who knows. but if this really was a dream of Steve Jobs, and one he shared with some of those around him, it's hard to imagine that it does not cross the minds of some at Apple today in positions of influence. these are the very people he likely shared the idea with. I'd have to imagine at times it gets discussed... given the past year of focus on Tesla, how could Tesla (I'd say the biggest tech story of 2013) not be discussed at Apple, and for whatever circle at Apple that knew this was Jobs' dream, how could "what if" about Apple not ever come up among them? seems quite likely designing and building a better car was already a dream for many of the engineers and designers at a place like Apple, without any need of factoring Jobs in. finally, seeing established automakers basically blowing off EVs, I think would only make people at Apple more motivated. in addition to the disruptive, creative, visionary Silicon Valley DNA, at some level they must have an awareness that if the incumbent automakers don't go for EVs, who other than Apple has a big enough pile of cash to startup an auto venture with a real chance of success so more EVs get out on the road? What do they have, $160 billion in cash? for what?
well, I guess Google also has enough cash. I didn't really look into whether they've talked about making a car at this hour, but we're all aware of their interest in self-driving cars.
for Google or Apple, just the idea that the other might make this move (or Samsung for that matter), brings more motivation to not be "outmaneuvered".
either of these giants deciding to enter the EV space fits with Elon's fundamental goal, accelerating the advent of EVs (especially given the lack of movement of the incumbent automakers), and his short term need... partnership in the Giga Factory.
so, sure, totally speculative, but if Apple (or Google) dreams of doing a car, Tesla definitely has something to offer. not fighting over Gigafactory #1's limited capacity, but getting in on attractive licensing of Tesla's IP, and in partnership with Tesla pushing forward battery technology with a talent rich battery joint venture, and accelerating the timeline to Gigafactory #2, 3,... FWIW, as I understand it, it would be decades before Tesla and a big player like Apple would be supplying EVs to a level that they'd be competing with each other rather than together replacing ICE marketshare with EVs.
so while I'm not trying to say this is the most likely outcome, if Panasonic isn't working out the way Elon had hoped, he's done pretty well at turning challenges into opportunities.
while I wouldn't bank on this, there is another dimension to the story. according to Apple board member (and J Crew CEO), Mickey Drexler, "Steve's dream before he died was to build an icar."
Steve Jobs Wanted to build an icar - Business Insider
John Markoff of the New York Times was reported as saying that Jobs told him he'd wanted to take on Detroit before he died and create an icar.
Steve Jobs Said He Wanted Apple To Eventually Make A Car - Business Insider
this came from 5 minutes of googling, there's likely more out there about Job's interest in making a car, and maybe this is already widely known among many of you. does 2014 Apple want to build a car? who knows. but if this really was a dream of Steve Jobs, and one he shared with some of those around him, it's hard to imagine that it does not cross the minds of some at Apple today in positions of influence. these are the very people he likely shared the idea with. I'd have to imagine at times it gets discussed... given the past year of focus on Tesla, how could Tesla (I'd say the biggest tech story of 2013) not be discussed at Apple, and for whatever circle at Apple that knew this was Jobs' dream, how could "what if" about Apple not ever come up among them? seems quite likely designing and building a better car was already a dream for many of the engineers and designers at a place like Apple, without any need of factoring Jobs in. finally, seeing established automakers basically blowing off EVs, I think would only make people at Apple more motivated. in addition to the disruptive, creative, visionary Silicon Valley DNA, at some level they must have an awareness that if the incumbent automakers don't go for EVs, who other than Apple has a big enough pile of cash to startup an auto venture with a real chance of success so more EVs get out on the road? What do they have, $160 billion in cash? for what?
well, I guess Google also has enough cash. I didn't really look into whether they've talked about making a car at this hour, but we're all aware of their interest in self-driving cars.
for Google or Apple, just the idea that the other might make this move (or Samsung for that matter), brings more motivation to not be "outmaneuvered".
either of these giants deciding to enter the EV space fits with Elon's fundamental goal, accelerating the advent of EVs (especially given the lack of movement of the incumbent automakers), and his short term need... partnership in the Giga Factory.
so, sure, totally speculative, but if Apple (or Google) dreams of doing a car, Tesla definitely has something to offer. not fighting over Gigafactory #1's limited capacity, but getting in on attractive licensing of Tesla's IP, and in partnership with Tesla pushing forward battery technology with a talent rich battery joint venture, and accelerating the timeline to Gigafactory #2, 3,... FWIW, as I understand it, it would be decades before Tesla and a big player like Apple would be supplying EVs to a level that they'd be competing with each other rather than together replacing ICE marketshare with EVs.
so while I'm not trying to say this is the most likely outcome, if Panasonic isn't working out the way Elon had hoped, he's done pretty well at turning challenges into opportunities.
Thanks for your thoughts, SteveG3.
I've been an avid follower of Apple and Steve Jobs over the years and was aware of his wish to build a car (it was in his biography). Last year, I thought several times that if Steve Jobs was around he might have made an acquisition of Tesla a reality (ie., when TSLA was under $100). But I don't think their current leadership has the same boldness as Steve Jobs. Tim Cook is much more calculated and predictable IMO.
I personally think that Google and Apple missed their opportunity with Tesla. Back in late 2012 and early 2013, I think there were two huge opportunities:
1. Apple or Google could have bought 30% of TSLA by investing $1 billion (or maybe a bit more) to buy TSLA stock (at that time TSLA at $30 had a market cap of $3.5 billion).
I remember back when Tesla was at $3.5 billion, I was telling my wife that Apple or Google or Berkshire Hathaway ought to buy up $1 billion of TSLA stock. Google's founders (Larry and Sergey) even owned Tesla Roadsters and Model S's (they were early Tesla investors as well). They were privy to information and knew very well the potential of Tesla. It was confusing to me why they wouldn't invest some of Google's money into Tesla to own a big part of the future of the auto industry. But when I think about it now, I don't think Google (or Apple) is very interested in actually building cars. Google is more interested in building the operating system of the future car (ie., autonomous driving operating system) and they're more than willing to work with existing auto manufacturers. Apple, on the other hand, IMO doesn't have the ambition to go into cars. Steve Jobs left them a legacy of Apple being a "mobile devices company" and I think that's where they're headed (ie., phones, tablets, wearables, etc). For Apple to build cars would be a huge transformation in their DNA/mission/focus, that it would require a huge visionary leader to pull that off. Again, I don't think Apple has that kind of leadership currently.
2. Apple or Google could have acquired TSLA by paying $10-20 billion.
Back when TSLA was at $3.5 billion market cap, Apple and Google had a prime opportunity to acquire Tesla. They needed to pay a generous price (ie., much higher than the $3.5 billion market cap) and they needed to convince Elon that Tesla being acquired would speed up Tesla's trajectory and bring the EV revolution quicker than if Tesla was left independent. The way Apple or Google could have argued this is quite simple. They could have told Elon that Tesla would remain an independent subsidiary but would have full access to all the capital they ever required. In other words, Larry Page or Tim Cook could have told Elon he could have access to $100+ billion over the next decade if he wanted it (ie., current AAPL or GOOG cash hoard, plus the ability for those companies to raise money in secondary offerings or debt offerings). When TSLA was at $3.5 billion market cap, if Google offered $15 billion, allowed Tesla to remain an independent subsidiary, and gave them full access to their full cash hoard and potential future offerings (i.e.., $100b +), then I think it's possible a deal could have been struck. For Elon, the motivation would not be the money (he would want a good price for his investors sake) but rather the potential to usher in the EV revolution quicker than what would be possible if Tesla was left independent. (Note: personally I'm very glad that no deal was ever struck and Tesla was not acquired because as an investor I think Tesla is going to be worth a lot more than what most people think and I think they'll have access to large amounts of capital as long as the markets value Tesla fairly.)
Now, fast forward to today. Tesla is at a $25 billion market cap (recently was $30 billion). The chances of Apple or Google acquiring Tesla are very, very low. Tesla has found success in raising funds in the equity market and selling Tesla to have access to funds is not as appealing as before. Also, at $25-30 billion it's a tough company to acquire since the acquisition price would have to be significantly higher.
So what are Apple and Google's options then?
Personally I think if they were serious about building cars, they would have already made some bold moves (#1 or #2 option above) last year. At this point, their choices are limited. Personally, I don't think Apple will be building cars in the near or foreseeable future (unless their leadership changes). Google is more of a possibility, since Larry and Sergey are stronger risk-takers and tend to think outside the box (ie., moonshots). I don't think either company would be interested in licensing Tesla's IP as Apple and Google like to own their core technologies and understand the value of owning their own IP/tech.
- - - Updated - - -
Note, this is from Apple's mission statement | Apple business philosophy and mission statement | alvinalexander.com :
"We believe that we need to own and control the primary technologies behind the products we make, and participate only in markets where we can make a significant contribution."
This has been repeated many times by Tim Cook and is one of the reasons why I don't think Apple would be interested in licensing Tesla IP.
I've been an avid follower of Apple and Steve Jobs over the years and was aware of his wish to build a car (it was in his biography). Last year, I thought several times that if Steve Jobs was around he might have made an acquisition of Tesla a reality (ie., when TSLA was under $100). But I don't think their current leadership has the same boldness as Steve Jobs. Tim Cook is much more calculated and predictable IMO.
I personally think that Google and Apple missed their opportunity with Tesla. Back in late 2012 and early 2013, I think there were two huge opportunities:
1. Apple or Google could have bought 30% of TSLA by investing $1 billion (or maybe a bit more) to buy TSLA stock (at that time TSLA at $30 had a market cap of $3.5 billion).
I remember back when Tesla was at $3.5 billion, I was telling my wife that Apple or Google or Berkshire Hathaway ought to buy up $1 billion of TSLA stock. Google's founders (Larry and Sergey) even owned Tesla Roadsters and Model S's (they were early Tesla investors as well). They were privy to information and knew very well the potential of Tesla. It was confusing to me why they wouldn't invest some of Google's money into Tesla to own a big part of the future of the auto industry. But when I think about it now, I don't think Google (or Apple) is very interested in actually building cars. Google is more interested in building the operating system of the future car (ie., autonomous driving operating system) and they're more than willing to work with existing auto manufacturers. Apple, on the other hand, IMO doesn't have the ambition to go into cars. Steve Jobs left them a legacy of Apple being a "mobile devices company" and I think that's where they're headed (ie., phones, tablets, wearables, etc). For Apple to build cars would be a huge transformation in their DNA/mission/focus, that it would require a huge visionary leader to pull that off. Again, I don't think Apple has that kind of leadership currently.
2. Apple or Google could have acquired TSLA by paying $10-20 billion.
Back when TSLA was at $3.5 billion market cap, Apple and Google had a prime opportunity to acquire Tesla. They needed to pay a generous price (ie., much higher than the $3.5 billion market cap) and they needed to convince Elon that Tesla being acquired would speed up Tesla's trajectory and bring the EV revolution quicker than if Tesla was left independent. The way Apple or Google could have argued this is quite simple. They could have told Elon that Tesla would remain an independent subsidiary but would have full access to all the capital they ever required. In other words, Larry Page or Tim Cook could have told Elon he could have access to $100+ billion over the next decade if he wanted it (ie., current AAPL or GOOG cash hoard, plus the ability for those companies to raise money in secondary offerings or debt offerings). When TSLA was at $3.5 billion market cap, if Google offered $15 billion, allowed Tesla to remain an independent subsidiary, and gave them full access to their full cash hoard and potential future offerings (i.e.., $100b +), then I think it's possible a deal could have been struck. For Elon, the motivation would not be the money (he would want a good price for his investors sake) but rather the potential to usher in the EV revolution quicker than what would be possible if Tesla was left independent. (Note: personally I'm very glad that no deal was ever struck and Tesla was not acquired because as an investor I think Tesla is going to be worth a lot more than what most people think and I think they'll have access to large amounts of capital as long as the markets value Tesla fairly.)
Now, fast forward to today. Tesla is at a $25 billion market cap (recently was $30 billion). The chances of Apple or Google acquiring Tesla are very, very low. Tesla has found success in raising funds in the equity market and selling Tesla to have access to funds is not as appealing as before. Also, at $25-30 billion it's a tough company to acquire since the acquisition price would have to be significantly higher.
So what are Apple and Google's options then?
Personally I think if they were serious about building cars, they would have already made some bold moves (#1 or #2 option above) last year. At this point, their choices are limited. Personally, I don't think Apple will be building cars in the near or foreseeable future (unless their leadership changes). Google is more of a possibility, since Larry and Sergey are stronger risk-takers and tend to think outside the box (ie., moonshots). I don't think either company would be interested in licensing Tesla's IP as Apple and Google like to own their core technologies and understand the value of owning their own IP/tech.
- - - Updated - - -
Note, this is from Apple's mission statement | Apple business philosophy and mission statement | alvinalexander.com :
"We believe that we need to own and control the primary technologies behind the products we make, and participate only in markets where we can make a significant contribution."
This has been repeated many times by Tim Cook and is one of the reasons why I don't think Apple would be interested in licensing Tesla IP.
Yes, but they have other facilities that have additional requirements including the new headquarters. So I think that the tie up is unlikely, but certainly possible.
JRP3
Hyperactive Member
This should probably go in the Nonsense from Petersen thread but I see it as a good sign for the GF since Petersen is of course negative about it.
http://seekingalpha.com/article/2130663-is-teslas-gigafactory-becoming-a-gigafarce
His points for those who don't want to click:
http://seekingalpha.com/article/2130663-is-teslas-gigafactory-becoming-a-gigafarce
His points for those who don't want to click:
My take on potential gigafactory partners:
They must have cash, so both Google and Apple fit the requirement;
They may be interested in energy storage business 'per se', not as a consumer of gigafactory product.
Energy storage business has the potential to be much larger business than any electronic consumables, cars, etc. Gigafactory might be their vehicle for involvement in developing a better way of efficiently storing and retrieving energy. Google has a record of being very diversified regarding their businesses, Apple seems to be a bit less adventurous.
Benz
Active Member
In the case that Panasonic decides that they will not be a partner of Tesla Motors in the Gigafactory project, and therefore they willl not invest $1B:
Wouldn't it be possible for Tesla Motors to just buy that particular division of Panasonic that produces the 18650 battery cells?
Just asking.
I would like to know what you guys think of this scenario.
Wouldn't it be possible for Tesla Motors to just buy that particular division of Panasonic that produces the 18650 battery cells?
Just asking.
I would like to know what you guys think of this scenario.
JRP3
Hyperactive Member
Possible, but that doesn't give Tesla the needed extra capacity and it takes money away from building the GF. If they need IP from Panasonic and can't get it through a license or partnership then I suppose it might make sense.
Benz
Active Member
Yes indeed, that's what I meant, just to get the IP from Panasonic. This will cost a lot more money ($5B for Gigafactory + buying Panasonic battery cell division), but they then will not have to listen to anyone else, and they will not have to share any profit in the future.
I dont think this is a possibility because as I understand it Panasonic's battery division is the only thing holding the company up. Without their battery division (partnership with Tesla) The company would be in quite a bit of trouble. It seems highly likely that Panasonic will invest in the Gigafactory. They can not afford not to be.
Agree with the above.
When gigafactory announcement was made not many details were released, except that it will be in US and there will be partners. Not releasing information does not mean it does not exist (too many negatives here..). I would be surprised if the announcement was made with no clear path in place for both location and partners.
I would be surprised if Panasonic is not part of the picture in some creative way.
well Apple may or may-not be interested in buying batteries from the GF, but they sure are interested in Renewables for their own Data Centers- buying a Hydro-Electric plant for the Oregon Center
Apple buys hydroelectric green energy project near Oregon data center
Apple buys hydroelectric green energy project near Oregon data center
Benz
Active Member
Suppose that Panasonic decide to participate in the Gigafactory and to invest $1B, that would still not be enough, as more investment will be required (at least $4B, but $5B would be more likely). Which other company is most likely to be stepping forward as a partner of Tesla Motors, and to make an additional investment in the Gigafactory (for another $1B?)?
Krugerrand
Meow
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