Tuesday, March 28, 2023

Electric cars

This is Joseph.

This video is quite entertaining to those of us following the saga of Tesla:

This is also the company that tried offering a steering wheel as an upgrade to a default steering yoke and then ran out of steering wheels to sell. Not all electric cars are Teslas, but it is quite remarkable how far the stock price of Tesla can go on hype. Given the price differential between Tesla and other car companies, it is clear that the valuation is based on continued fast growth. 

In general, I see electric cars as a good idea but, like a lot of good ideas, it is amazing how pushing too hard on it can cause problems. The sort of fast growth that Tesla projects has some practical infrastructure hurdles that are outside of Tesla's control. Here is a Peter Zeihan video talking about some of the challenges that going fully electric with cars would cause:

Electric cars are also a very good solution to one type of problem (commuting) and a very poor solution for inter-city travel. The long charging times (and issues like people poaching the charger) make it a much less efficient method of long distance travel. Commuting 15 miles to work, everyday, easy. Driving from New York to Los Angeles -- you need to build a lot more charging stations. To date we have not even worked out a universal charging plug, which is crazy, In a dense urban area, this sort of network lock in might even be a sensible strategy but for a cross country trek, it makes no sense to have multiple stations in Wyoming. Imagine if gas pump handles were not universal? It would pay havoc with the long distance travel world.

So what backs the stock. I go back to the first video. 

UPDATE: After I wrote this, I realized that it meshes very well with a point that Mark likes to make -- that the majority of the benefit would actually come from hybrid cars. Hybrid cars have long ranges and can handle not being around a charging station, Emissions are a big improvement. 


and note that a Prius battery is a lot cheaper, has far lower storage capacity, and thus stresses things like lithium reserves less. It also is a lot less of a tragedy when it wears out. 

There is a huge opportunity to cut back on emissions here for commuter vehicles. Tesla gets you to zero, but maximizes costs to the grid and the need for a parallel infrastructure that is not yet even standardized. Driving a Prius for commuting halves the emissions of driving a normal sedan (and it has a longer range than a Corolla so it is actually a better cross country driver). The pick-up truck is even worse (let along the tank sized F350 where mpg is like 20% that of the Prius). 

Since less than 10% of sales are currently hybrid or electric, there is huge opportunity here for hybrids to massively impact emissions. And, I may be in trouble with my editor for this, if we taxed F350's to make then undesirable as commuter vehicles that would also help with emissions considerably. 

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