“LIKE”

I say the wrong time because after 2008 the world assumed correctly we’d reached the point of conventional peak oil production (Brent crude skyrocked north of $147p/b) triggering the 2008 crash, QE/ZIRP and relentless fracking. Many assumed in 2008 that sustainability (including Shai) would therefore be in immediate focus. That actually happened, but what was underestimated was America’s ability to quite literally “scrape the barrel” re: uncoventional energy (shale, fracking, deep sea etc.) for a few more years out of desperation.

Conventional since 2006 has been declining by a massive 5% per year but relentless unconventional extraction rates of all liquid fuels has been offsetting that decline. In other words, we’ve plateaued in terms of total liquid fuel production since 2006. Projections show and therefore estimate the real downturn will actually start between 2015 & 2020. This is exactly what Elon has bet on with the building of the new mega EV manufacturing facility in CA. He expects sales of his Teslas to increase by 22 times during the next 6 years. One hell of a bet but then good luck betting against him. He’s working closely with the Pentagon and they need to know exactly what can be done not what they’d like to do operationally. The Pentagon knows Peak Oil is coming right around the corner and so do the politicians.

So Elon rather wisely decided to build a truly inspiring (Applesqeu) like product and thus target the luxury end of the market first. He knew it was highly likely no matter how good the engineering would be, the final costs of the car would be high, too high for the mass market to afford given energy costs are still relatively cheap for the reasons I’ve outlined in brief above.

Shai had the right idea based on solid fundamentals but his strategy was deeply flawed and his timing to target the mass market was wrong. If Shai was to do what he did today, I believe he could possibly succeed given the massive shift we’re about to face as a society.

Yes and I think the market bias towards short-term profitability almost demands a few years the kind of of magic snake-oil profits only pyramid pros like Madoff can supply. Its interesting that one of Shai’s more recent Ted talks highlights the long-term inevitability of solar and other green technology because it will become cost competitive. But that’s not something that will happen overnight. I think the 100k car order was the biggest blunder. A GM executive said that the Prius took years to get up to 1.5% marketshare and it was considered successful.

Wouldn’t it be weird if eco were considered to be too big to fail like GM, Chrysler and the banking industry?