Tesla Empire: Elon Musk's sense of mission and ambition

Source: Content from Tencent Technology ,Thanks.

Tesla Motors has become one of the most innovative and controversial technology companies in the world. Tesla's bold mission and how its CEO Elon Musk built the brand have always attracted a scuffle between supporters and critics. Tech media TechRepublic recently wrote an article revealing the secrets of Musk's building the Tesla empire, which is a combination of mission and ambition.

On a Friday morning in September 2016, I, Hope Reese, was standing on a sidewalk in a St. Louis neighborhood when James Majerus, a 26-year-old Tesla investor and board member of the St. Louis Tesla Enthusiast Meetup, drove up to pick me up in a white Tesla Model S85. We were heading to Michael's Bar and Grill for dinner and an internal gathering.

There were six people in total, all of whom were Tesla enthusiasts like me. There are many similar Enthusiast Meetup organizations in other parts of the United States, but the one in St. Louis is the largest. It was founded by Elizabeth Gattra in December 2012, and the first meeting attracted 8 people. Today, the organization has 380 "Tesla enthusiasts", of which 50 to 100 are active participants. I wanted to understand what inspired the creativity of this organization and why they are working so hard to help promote Tesla.

Jatra recalled: "When we first created this organization, those of us waiting for Tesla to deliver cars were eager to get as much information as possible from those who already had cars. In this way, we indirectly experienced the completely different lives of Tesla owners. We organized many discussions to exchange our experiences, tips and tricks, etc." After that, the organization began to print business cards, and Jatra was responsible for handwritten notes. Jim Versey, another member of the Enthusiast Meetup organization, said: "If someone sees a Tesla car, we will immediately leave a business card on its windshield, and also hand out business cards at auto shows."

In fact, the Enthusiast Meetup organization is Tesla's cheerleading team, but its members are not all Tesla owners. Guy Vils, a member of the organization, said: "Anyone who appreciates Tesla or hopes to buy a Tesla car in the future is welcome, and we do our best to let them know this. Due to the high price of Tesla cars, many people think that this organization is exclusive and choose to retreat, but in fact we are very open."

Members of the Tesla Enthusiast Meetup in St. Louis held a dinner to discuss issues related to the driver-assistance technology Autopilot.

"When I first joined the organization, I thought it was all rich guys, like a golf club," said Fossey. But at the first meeting, these people walked around the room, introducing different ways to make a living, most of them from the IT industry. And this kind of enthusiasm and grassroots marketing is exactly what most companies desire. Having such energy, technology and marketing methods can help companies get more forward-looking and cultivate better customer relationships. Tesla's approach can be attributed to tying the brand mission to a larger vision, developing one-to-one relationships with customers, and doing things that competitors are afraid to do.

A grassroots movement is born

In 2003, two engineers from San Carlos, California, Martin Eberhard and Marc Tarpenning, founded a company that wanted to sell electric cars as luxury cars. They named the company Tesla Motors after Serbian inventor Nikola Tesla. Like many Silicon Valley startups, Tesla has a bold mission to help the world accelerate its transition to sustainable energy.

By 2008, billionaire and former PayPal founder Musk was appointed as Tesla's CEO, and the company introduced its first sports car, the Roadster. In the following years, Tesla became a leader in the field of luxury electric vehicles and began to venture into unknown territory. By 2016, Tesla had earned a huge reputation in the automotive field for providing cutting-edge technology, an outstanding driving experience, and a cool and stylish appearance.

Tesla sold fewer than 80,000 vehicles worldwide in 2016, less than 0.1% of all cars sold worldwide. The electric car market is also small, accounting for only about 2% of total car sales. Electric cars are also too expensive for the general public, with the 2017 Model S costing between $68,000 and $134,500. But for Tesla and its many customers, success is not measured by sales alone, but by whether it can change the world.

Part of Tesla's mission depends on its conception of the company, which is not just a car manufacturer. Since November 2016, in addition to producing cars, Tesla has also begun to produce batteries, solar panels, etc. In addition to Tesla, Musk is also the founder of SpaceX, a rocket company dedicated to landing on Mars. In March 2017, Musk announced a new entrepreneurial plan. The new company is called Neuralink, and its goal is to merge the human brain with computers.

But in general, Tesla is a technology company. Similar to early adopters of Apple products, Tesla's loyal fans have become its publicity "backbone". With the support of these loyal fans, Tesla is becoming the first startup to challenge the traditional auto industry in 50 years.

Analyzing Tesla users

Who are the Tesla owners who pay more than $100,000? They paid a lot of money to buy Tesla cars, which is enough for them to buy luxury cars such as high-end Porsche or Maserati, so why do they choose Tesla? In addition to the $35,000 Model 3, the average price of Tesla's other cars is also not cheap, which is not affordable for the rich. Michael Ramsey, research director of market research firm Gartner, pointed out: "These people are very different from traditional luxury car owners. They really like Tesla cars and feel as if it can prove their value because they don't have to spend money on fuel and this car has many cool features. They never want to prove their wealth by buying a car."

This sounds similar to the principles of the Tesla Enthusiast Meetup group in St. Louis. When I asked them about their motivations for buying a Tesla, I was surprised to find that many people would not normally buy such an expensive car, but they thought Tesla was different. "Many people may be able to afford a Tesla, but they don't want to buy other high-end cars," said Fuss. "I personally have never considered buying a luxury car like a Lexus, BMW or Audi."

Jeffrey Miller, associate professor of engineering at the University of Southern California and member of the Institute of Electrical and Electronics Engineers (IEEE), agrees with this view. He said: "I don't think Tesla only serves luxury car owners. It can attract different groups, including technicians, early technology adopters and environmentalists." From the perspective of brand loyalty, using the word "fanaticism" seems to better describe car owners' obsession with Tesla.

Alexander Edwards, president of research firm Strategic Vision, has spent years studying the makeup of electric car owners and why they buy them. For example, 92% of new Tesla buyers say the car is fun to drive, compared with 56% of traditional car buyers.

What other characteristics do Tesla owners have? Edwards said that most of them are white and tend to be fairly wealthy or very wealthy, with a median income of around $250,000. In addition, many Tesla owners are people who like sports cars but don't like to buy high-quality luxury sports cars. Edwards said: "Many people believe that electric cars are perfect cars when they discover the performance of electric cars at low speeds and low torque. They start to love it and see all the good things about it."

Edwards also said that what Tesla did, and the main reason for its huge success, was that it created a whole new user base. He said: "Our data shows that Musk has created the most beloved car in the United States."

Atypical car manufacturer

Ramsey believes: "It can be said that Tesla is the first truly successful American startup car company since Chrysler. Tesla attracts customer attention and admiration in a completely different way. It obtains the full commitment and support of its car owners. All of these are things that other automakers desire but cannot reach." Other automakers are subject to too many constraints that prevent them from achieving this status, and Tesla has found a unique way to solve this problem.

First, when you want to buy a Tesla car, you don't need to go to a car dealer, and there is no need to bargain for it. All customers pay the same price for the same car. Second, these cars are customized to order, and Ramsey also sees this as part of Tesla's enhanced appeal. He said: "Tesla is creating a certain degree of equality, which everyone likes." Third, Tesla cars are not simple electric cars. They are very beautiful, capable, and have huge space. Why are they so spacious? Because it does not require a traditional engine, which can save a lot of space. Ramsey said: "In short, Tesla cars are fun to drive and have all kinds of cool features that other vehicles cannot offer."

For Tesla, the key to success is those high-tech features. While other cars have impressive batteries, attractive features, and gorgeous interiors, Tesla's support for "over-the-air updates" allows owners to download and use new software updates in real time, which makes Tesla stand out. Essentially, Tesla's "over-the-air update" capability is centralized computing. While many cars have distributed computing capabilities that connect specific parts through a central portal, this portal has no "brain", just like there are many power outlets without plugs. Tesla has a more coordinated platform to support software updates. Through cooperation with operators such as AT&T, all Tesla cars are equipped with modems and built-in SIM cards to support prepaid Internet functions. This means that Tesla cars can transmit real-time data, including safety diagnostics and other information related to driver behavior, via radio signals.

Tesla attracts many IT talents and engineers by integrating a lot of technology, such as large-size touch screen consoles.

“The real advantage that Tesla has is that it has built a strong brand and has access to an aerial platform that others are afraid to offer or can’t because of infrastructure limitations,” Ramsey said. “I always think that’s a big advantage that Tesla has over other car companies.”

Who is Musk?

But highlighting Tesla's innovation isn't enough; the company is also the target of widespread criticism. It's not that Tesla itself is criticized, but rather its leader. You could call Musk the "Kanye West of the automotive industry," who is equally flamboyant and arrogant, but also a genius in some ways. Like West, Musk has his loyal fans and critics. "Musk is a very unique CEO, and half of the attention Tesla gets is about Musk," Ramsey said. "He's also the founder of a rocket company and has a great mind. The personal cult of Musk by fans is not much different from that of Tesla cars."

Musk's flamboyant personality remains the subject of much debate. "There is a huge divide in opinion about Musk as a public figure, as an executive, and as a person," said Bryant Walker Smith, a professor at the University of South Carolina and an expert on self-driving cars. Despite this, people admire his unique vision. "Musk knows exactly what he wants and relies more on his intuition," said Edwards, president of Strategic Vision. "He believes in the next phase of our world's development or where humanity is going, rather than being told to do so by others."

Musk has always been considered the supporting force behind the Tesla brand

Ramsey agrees. It's not that other automakers can't develop electric car technology. They definitely can. But they don't do it the way Tesla does. Musk is a fearless person. He always makes others believe him. For example, he will say, "This is the vision I predict. Trust me! This is going to happen." Musk is not afraid to break the rules. This is another reason why people like Tesla: they don't need to get permission from others to do it themselves.

Tesla vs. Detroit

As the center of the U.S. auto industry, perhaps no place is Tesla's hostility more felt than in Detroit. There are many places to measure the friction between the two sides, such as the North American International Auto Show held in Detroit every January. Although Tesla has participated in the show in the past, it did not exhibit in 2017. Ramsey said that auto shows are a great place to show new cars, but ultimately auto shows are about selling cars. He said: "It's a dealer event, but you can't buy a Tesla in Michigan because there are no Tesla dealers here."

Tesla does not have a dealer there, because Michigan does not allow manufacturers to have their own dealers, which is a big problem for Tesla. In states across the United States, Tesla has been fighting legislatures that prohibit direct sales. Franchise dealers believe that if manufacturers start selling cars directly to consumers, their business model will be in jeopardy. But this friction is spreading beyond Detroit. "Tesla doesn't care about auto shows. They don't play by other people's rules," Ramsey said.

Tesla also has strained relations with other electric car makers. Although electric cars make up only a small percentage of the auto industry’s sales, Tesla had sold 186,000 electric cars worldwide by December 2016, making it the second-largest pure electric car maker after the Renault-Nissan Alliance. Electric cars have been around in some form for more than 20 years.

But electric car advocate and consultant Chelsea Sexton said Tesla takes a different approach. "From the beginning, Tesla had a super cold, arrogant attitude," she explained. "It called all previous electric cars 'punishment cars' and said everyone in Detroit had a stupid mentality. And Musk wasn't the only one who held this view, he promoted it."

There is widespread acknowledgement that Tesla and Detroit are at loggerheads. "Many people in Detroit have strong negative feelings about Tesla, including doubts about its technology or safety engineering," Ramsey said. "Some of the conversations were, 'We're waiting for the Tesla crash!'"

Challenges facing Tesla

Tesla's "move fast" mentality is both its strength and its biggest weakness. In fact, this mentality has led Tesla to release car technologies that other automakers are unwilling or unable to provide. The company has been sharply criticized for releasing its driver assistance technology Autopilot, which Tesla previously said was safe enough for public use.

I visited Tesla's headquarters in Palo Alto in May 2016 to experience its Autopilot technology for myself. After being warned that I needed to pay full attention and keep my hands on the wheel during semi-autonomous driving, I got into the driver's seat, drove down Highway 280 South, and put the car into autonomous driving mode. It felt like the car was moving on its own, which was exciting.

A month later, Joshua Brown was driving a Model S in semi-autonomous mode on a Florida highway in the glare of the sun when it collided with a white truck. Brown and the system failed to brake in time, and Brown died, resulting in the first fatal crash involving Autopilot. Critics who are concerned about the technology have pointed to the accident as an example of their view that Tesla is moving too far, too fast. Although the accident made global headlines, it was not surprising. Smith and other self-driving experts have previously expressed concerns that accidents are inevitable and will hinder the adoption of self-driving cars.

3 things other companies can learn from Tesla

Missy Cummings, director of Duke University's Human and Autonomy Laboratory, said Tesla owners may not understand the limitations of Autopilot. "When you have a craze like Musk's, people who already own Teslas think their cars are more capable," she said. "We saw with Brown what that can lead to. I don't mind the way Musk does business, but what he's done is instill false confidence in people that doesn't exist."

Cummings has a "love-hate relationship" with Musk. She said: "I want him to be successful, but at the same time I worry that he over-promotes the power of technology. When he shows off the capabilities of Tesla's cars on Twitter, it can lead the entire community to cross the boundaries he sets."

But as the company faces angry criticism, the Tesla community and even Brown's family stand firm behind it. "You can't stop progress no matter what," Jatra said. "We're going to have self-driving cars, right? We're just having a temporary hiccup, right? We're going to continue to use Autopilot and people will have more confidence in it. Everybody who drives a Tesla should realize that they should pay attention, there are risks, and they have to decide how much risk they want to take."

Tesla's future

Whether Tesla fans stick with it or it continues to face criticism, the question is: Can Tesla's model be sustained? Can it be scaled? Tesla has promised to deliver its next major product, the Model 3, in 2018. It will be Tesla's first mainstream car, with a starting price of just $35,000. In addition, Musk has begun other bold claims: The Model 3 will have hardware that will eventually support full self-driving capabilities.

Tesla's Model 3 launch was a big deal, as the company believes it is getting closer to fulfilling its mission to bring electric cars to the masses. The response to the Model 3 has been so enthusiastic that orders for the car exceeded 100,000 within hours of the opening of pre-orders. By March 2017, orders were approaching 400,000. But whether Tesla can meet the demand, and whether other automakers can build similar cars first, are open questions.

Some experts still question whether Tesla can successfully maintain its current "full speed ahead" attitude. "Now that tweeting is no longer a sustainable and effective communication strategy, Tesla has to start actually making cars!" Morgan Stanley analyst Adam Jonas predicts that in the fall of 2016, Tesla may only produce 2,000 cars per week, rather than the 10,000 it claimed. "Looking closely at these overly optimistic statements, Musk's record of delivering on his promises, and the current state of work, it is clear that Musk is overstating the matter," said Saxington. But Saxington said that if Tesla wants to "move forward quickly," finding partners will be a key strategy. "Tesla needs to work with other automakers and open up its patents, such as collaborating on a network of superchargers," she said.

Jeremy Carlson, senior analyst at IHS Automotive, said Tesla's Model 3 will compete with other luxury car companies. He also sees another potential obstacle for Tesla, which is engaging in mobility services, such as car sharing. In July 2016, Tesla announced the "Master Plan, Part Deux" plan, including a shared car business. But Carlson said: "We don't know exactly how Tesla will deliver on these services. Tesla is looking for partners widely, but we must remain vigilant because this is a new field and it is unpredictable." Carlson said that there are many different business models in this field, but whether it is Waymo (which has not yet established a business model) or Uber, Lyft, and car2go, they all face extensive competition from outside the industry.

Given Musk's history of making bold claims, potential problems meeting demand for the Model 3, and the fierce competition it faces in developing fully autonomous cars, can Tesla maintain its lead? Ramsey said: "People love Musk's character for not being afraid of failure, and his ambitions, such as retiring on Mars and selling 2 million cars by 2025. Many Tesla supporters know that things may not happen as he says. But even if only 75% of his crazy vision can be realized, it will be a pretty amazing result. If he can sell 800,000 cars by 2025, that's crazy enough!"

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