A Tesla Model 3.
Tesla executive Martin Viecha spoke at the invite-only Goldman Sachs tech conference on Monday.
He highlighted potential for falling manufacturing costs per vehicle.
Tesla wants to eventually put a cheaper vehicle on the road in time for its robotaxi service.
Tesla executive Martin Viecha just took investors through the company’s next 5 years, explaining which trends and metrics matter most, and what to expect when it comes to a cheaper electric vehicle, a robotaxi service, and other potential future products.
As Tesla’s head of investor relations, Viecha was speaking during the invite-only Goldman Sachs tech conference in San Francisco on Monday. A person who attended the event shared with Insider details of his wide-ranging talk.
The executive started by focusing on two big-picture topics that are crucial for Tesla and the EV industry over the next 5 years: battery supply and technology, and the cost of making vehicles.
He said the industry will ultimately grow as fast as battery supply. This will impact areas such as the building of cells and battery packs, but also battery design and the mining and refining of lithium, nickel and other raw materials.
‘A third revolution in automotive manufacturing’
Viecha stressed that the per-vehicle cost of manufacturing is the most important metric to monitor in coming years, saying this is the ultimate determinant of how many cars companies can make and how big you can become.
In 2017, it cost Tesla $84,000 to make each car. That’s down to $36,000 per vehicle in recent quarters, the VP noted. Almost none of those savings came from cheaper battery costs. Instead, Tesla benefitted from better vehicle design to make manufacturing as easy as possible, and new factory design.
Tesla’s first factory in Fremont, California, near Silicon Valley, is not a great place to build cars, Viecha added, noting that there are cheaper places including Shanghai and Berlin. Tesla has 2 new factories in those locations, along with another in Austin, Texas.
The company wants to continue this trajectory, pushing the boundaries of how much it costs to produce an electric vehicle.
The Fremont factory accounts for about half of Tesla’s production. As new facilities produce more cars, they will be able to manufacture each vehicle for less than $36,000, which should be good for Tesla’s profitability, Viecha said.
During 120 years of the automotive industry, he argued there’s only been 2 major revolutions in manufacturing. One was the Ford Model T and the other …read more
Source:: Business Insider