Tesla Master Plan 3 is Global Domination and Tesla Semi is the Key

There has been great concern for Tesla shareholders that there are problems with Tesla’s future growth. There has also been a large drop in share price from the peak share value early this year. The whole stock market is down. Technology and growth stocks have been sold off more than other stocks.

In a global recession, Tesla will have delivery growth of about 45% instead of over 50% from 2021 to 2022. There has “only” been an increase in net income trailing 12 months from $3.5 billion to over $11 billion. Just a triple in net income.

NOTE: I am clearly a Tesla bull, Tesla share owner, co-author of a book on Elon Musk and his companies and maker of Youtube videos. However, I am also a futurist with a public prediction track record that is top 56 out of thousands of people. Prediction accuracy about 80% correct.

People are distracted and ignoring how the Semi delivery will enable Master Plan 3.

I discuss and simplify this analysis and conclusions with Randy Kirk in this video.

This is a follow up to this video.

2006 Tesla Master Plan

Create a low volume car, which would necessarily be expensive [first Roadster]
Use that money to develop a medium volume car at a lower price [Model S]
Use that money to create an affordable, high volume car [Model 3]
Provide solar power.

2017 Tesla Master Plan
Integrate Energy Generation and Storage
Expand to Cover the Major Forms of Terrestrial Transport [Add Model Y, Cybertruck, Semi, $25-30k car]
Autonomy [robotaxi]

Create stunning solar roofs with seamlessly integrated battery storage
Expand the electric vehicle product line to address all major segments
Develop a self-driving capability that is 10X safer than manual via massive fleet learning
Enable your car to make money for you when you aren’t using it

Master Plan 3

Master Plan 3 – Make Tesla Semi an economic offer that can’t be refused. Have it require Megapack everywhere and still be an economic must have. Scale to 4 terawatt hours per year with all Semi and truck domination and another 4-6 from Megapack.

Master plan 3 is all about scaling from 150 gWH of batteries today and 1.4 million cars per year to 20+ million cars and 3-15 terawatt hours of batteries per year. This is 20 to 100X growth in the scale of business.

All of trucking is 4 million Semi per year and 14 million light trucks and 2 million medium trucks. 80% of which are in Asia. 50% in China.

Electrify all of trucking and that saves 17 million barrels per day of oil. 17% of the global oil industry.

Why is Semi the key? It will save costs of $50,000 to 80,000 per year. This is a huge economic signal. It converts a $3 billion per year cost for Pepsi with 44000 trucks into $600 million per year in electricity costs.

Semi Key to Selling Megapacks at 5+ Terawatt hours per Year

The Tesla Semi was released and it showed over 500 miles of fully loaded range. Over 44 tons of payload. This compares to the electric Freightliner semi truck with a maximum range of 230 miles.

Tesla has solved the efficient towing of large payloads with 30-40% more efficiency than its nearest competitors. This is a huge advantage. Mercedes and others said this would be impossible. How many years does it take to double heavy truck range and catch up to what you said was impossible?

This says to me that Tesla is all alone with powerful large, medium and even powerful pickup trucks and will be all alone for a decade.

Domination of medium and heavy trucks is a $1 trillion a year business using 3 terawatt-hours per year in batteries and requiring 4-6 terawatts of megapacks for reinforcing and buffering the electrical grid means Tesla goes from 150 GWh/year of batteries to 8-10 terawatt-hours per year in 15-20 years and it is 50X growth. Getting to 2-3 terawatt-hours per year by 2030 is 15-20X from today.

Charging Advantage Numbers

People say waiting 4+ hours to charge a semi truck is a big disadvantage vs 20 minutes for diesel refueling. Some say that means fewer runs and worse economics for the trucking company. Tesla introduced megacharging that can charge 70% of a 900 kWh pack in 30 minutes. This requires the megapack to step up the 300 kilowatts from the grid. The megapack outputs at 1 megawatt and two megapacks at 2 megawatts.

Tesla Semi Versus Competing Electric Trucks

Tesla Semi 530 mile . 1.7 kwh per mile. 900 kwh pack likely
Tesla Semi 300 mile. 1.7 kwh per mile. 510 kwh pack likely

Freightliner has its eCascadia 230 miles at best with its 438 kWh battery.
Freightliner ECascadia Price in USA is USD 139,000 (unclear which model, they also have shorter ranges).

$4.5 to $5.50 around the US. Oil Price was higher in prior months.

Plus $3000 per truck for brake pads. Replaced every 30k miles. 5 pairs each. $15000 per year.
$415,000 fuel and brake pads.

5 Tesla Semi and megapack. $17000 per truck electricity. $85000 per year. $330,000 energy and brake savings per year.

Megapack can also load balance and time shift facility and get autobidder revenue. If worked with solar installation then can front load capex and operating costs become free in years 6-25.

In December 2019, Tesla delivered a 1.25 MW / 2.5 MWh Megapack to the Millidgeville Substation in Saint John, Canada. Saint John Energy, the owner of the Megapack, stated that it will be used for peak shaving. The battery is estimated to save Saint John Energy CA$200,000 per year. Saint John Energy planned to integrate the battery to work with its grid management software. It became operational on April 3, 2020, and is being used for peak-shaving. This is a smaller megapack before sizes were increased. There are Tesla charges for annual maintenance of the Megapacks but more money can be saved or earned from the larger pack.

Combined with some level of solar say $400k, then Megapack and solar can earn/save $150k per year or more.

$480,000 in annual revenue/savings.

9.8% IRR for trucks and megapack and 13.7% for just trucks But this is on top of the utility and justification for the trucks in the first place. ie. Pepsi has trucks to deliver bottles of product to customers. This is the incremental gains over the diesel scenario. It is above and beyond that you had already justified getting Semi trucks of some form to begin with.

15 thoughts on “Tesla Master Plan 3 is Global Domination and Tesla Semi is the Key”

  1. Someone else commented on having a range extender.

    That’s actually not a bad idea as an aftermarket attachment.
    Tesla will never sell it of course, but maybe businesses will see the value of it.
    Although I wonder if 25kW will cut it: Semi uses about 100 kW at 60 miles / hour.

    But yeah maybe a lot of companies would opt for the 300 mile version reaching 80% of it’s use cases – and then add a range extender in the storage.

    If that mitigates a Megapack investment of 2.1M+ dollars because it’s not necessary to charge to 100%, that would seem very interesting for businesses.

    A 100kw generator is 10k$ on Alibaba, weighs about 1.5 ton and is about 2x1x1 meters in size.

  2. Global domination. Tesla is rapdly is rapidly loosing EV market share. BYD is expected to become EV biggest producer in the near future. A focus on high end features low quality and higher end cars is not a recipe for global domination!

  3. Hi Brian,
    While I appreciate that you point out that you own tesla stocks, this article lists as facts things that are not.
    -It is likely true that during the demonstration, the Tesla semi was fully loaded as Musk claimed a total weight very close to the legal limit. It is not necessarily true that the payload was 44 tons or more. We discussed it here on NBF in a post a couple of days ago. You do not know what the payload was because Tesla did not disclose it.
    -It is also not necessarily true that freight truck electrification will displace 17 million barrels per day of oil. This depends on the percentage of electricity produced by nonfossil fuels and the overall efficiency of the generators converting the fossil fuels into electricity. US has a good percentage of electricity generated by nuclear+reneawbles and in mid to optimal conditions moving electric trucks will lead to a reduction in fuel consumption. But the global percentage of electricity generated by nonfossil fuels is 10-12%. In many countries displacing diesel trucks with electric ones will increase fuel consumption (even more if the payload capacity of an electric truck is lower).
    -Tesla business plan requiring massive electrification, especially along the major highways has an enormous blind spot. The massive extension of the power grid to sustain the superchargers/mega chargers exposes tesla to competitors that might skip completely the battery part (that supposedly gives Tesla its advantage). Electrification of streets for trollybusses is nothing new: if you have the high voltage lines in place you can do it also on the highways and produce efficient semis with higher payload capacity and better performance (because they do not carry batteries) and no recharge time (because they are powered by the electric lines).

        • I agree it is unlikely to work,
          But the issue is that if you want to provide megachargers at distances that are convenient for the users and redundant enough to have multiple charging places if a substation is offline, you will still need to electrify the highways.

        • The european union has 208,211 km (not miles) of railways and 117,599 km are electrified. Obviously 161,000 miles equate to 259,000 km so US would require to do twice as much as the EU in term of electrification if it wanted to electrify all the highways, but this is not an absurd figure given US economic output, and considering that only the trusses and the cables would be required (and not laying down the rails).

          • There is also the Pareto principle that suggests that only 20% of highways will probably cover 80% of travel.
            Give the trucks some batteries and they will be able to cover most of the remaining distance without needing the overhead power.

    • How much oil is displaced by EVs does not depend on electricity being produced by non-fossil fuels.
      It depends on how much electricity is being produced by non-oil fuels.

      Replace diesel, made from oil, with electricity made from coal or natural gas, and that displaces a bunch of oil.

      If you care about carbon dioxide killing off the Dodo or something, then this isn’t a major improvement. But if you care about the geopolitics of oil, or the air pollution of city streets, then this is a huge change.

      • Sure, but electricity is not a source of energy. It is just a form of energy. Oil is a source of energy. If the world has the capability of extracting X barrels of oil per day and all of a sudden you do not use such oil in the automotive industry, the oil will lose value. But if simultaneously you need more electricity, you are just promoting the transfer of oil from the automotive industry to the power generation industry because the oil is already there, while expanding the production of energy from other sources takes a long time (you need to expand the gas extraction industry, build nuclear power plants and renewable power generation facilities…). And depending on the efficiency of electric generators, you might end up consuming as much oil as before and more fossil fuels in general.

  4. Tesla should partner with Winnebago on such Semi tech.
    With crashing cruises, vacay flights, and some portions of the Hotel/ Hospitality, sectors, The Great Road Trip could become the next hot industry.
    Some EV pop-tent combos are being developed by Others. Upscale EV trailer parks combined with ubiquitous sLink connectivity and MegaPaks could create great caravans of geezers, remote workers, and upscale drifters. Throw in FSD and your home/office on the road could show up at the next meeting or burning man or SpaceX launch in style.
    Miss my 20s free-roaming years on I5, I95, and that one from Tuscon to Jacksonvile with gas at 99c regular

    • Agreed. But only numbers.
      the bigger they are and higher they fly, the harder they fall.
      A hyper-opportunistic mind and obscene levels of resources combined with a divisive and abrasive character can only lead to mounting resentment, government attention, and the gathering forces of competitors seeking temporary alignment under a banner of ‘for the People’. The economy and prospects are not now in EM’s favour. To kick-start a noble industry or 2 is one thing, but to seek absolute market control is Bill Gates’ 90s madness.
      It is not enough to be an unstoppable, business Brute, you must be cumming and at least superficially likable and relatable. Musk vs the World will not work. Enemies accumulate easily. To seek such success that Musk may escape to Mars with the best of each of his advanced businesses/ industries for infrastructure is still doable, but not this decade – and most of these businesses as currently run will not last that long.
      Twitter, at most, and StarLink certainly, and to a lesser degree Tesla and SpaceX need a top notch PR company to re-establish optics.
      Even Gordon Gecko from Wall Street 1987, found successful ‘balance’.

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