Wednesday, August 27, 2014

Tesla's Image Management
A couple of weeks ago, Elon Musk announced that the Tesla’s drive unit warranty would be extended to 8 years and unlimited mileage. This was generally seen as a reaction to Consumer Reports’ one year review of the Model S, in which it stated the car had “more than its share of problems.” Tesla has been quick to respond to anything that might damage its reputation as a high quality vehicle – remember when it added the titanium underbody shield after a couple of cars caught fire after a crash? These are all wise moves and I applaud Tesla for making them. Electric cars are still at a critical time in their development. If they get the reputation, deserved or not, of being unsafe, temperamental, or a pain to own, the whole electric car industry will collapse. Musk is making shrewd moves to prevent consumers from forming negative opinions about electric cars.

But I’m concerned about the future, specifically when the Model X and Model 3 hit the stores. Their lower price will mean more and more people will start driving electric cars. In general, this is a good thing. But the increase in drivers also means we should expect an increase in the number of news stories about people getting stranded because they ran their cars out of power. If this happens to people, they will get an experience that is quite different than running out of gas in an internal combustion engine vehicle. When the Tesla Model S runs out of power, the car shuts down. Hard. There will still be enough power to operate the emergency flashers and door locks, but the console and dashboard will turn off. Additionally, you will need to put the car into neutral or Tow Mode before everything shuts down. Once this is done, you’ll need to block the wheels so the car doesn’t roll away. Failure to get the car into tow mode before the power is completely gone will mean a tow truck operator will have to drag the car onto a flatbed without the wheels turning. Ouch.

Once lower priced Tesla models are for sale, I fully expect to see a slew of news stories about people being stranded in their Teslas because they ran out of juice. The news agencies will probably play up stories about how people had a hard time getting the car towed or how they supposedly had enough charge to get to their destination, but they still mysteriously ran out of power. These stories could feed into the range anxiety people feel, and hinder the widespread adoption of electric cars. The bad thing is there is no action Musk and Tesla can take to counter these stories (short of building more supercharger stations). There is no quick fix Tesla can implement or additional warranty coverage they can provide to counter these stories. Further, Tesla will need to walk a fine line in their responses to such stories to not come off sounding like they are calling their customers stupid for failing to properly plan their trips. But in reality, that’s the problem – people are stupid. And the more Tesla owners you have, the greater the chances that many of them will not understand battery power levels and range.

It’s too bad. You have the exact same problems with ICE vehicles. People run out of gas every day and it’s not a news story.


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