Tesla 2018 Shareholder Meeting [Live]


(chiming) (upbeat music) – Hey, what is up, everyone. Thanks for joining me. Gonna get going here with the live stream from Tesla, once it begins. It looks like we’re kind of
in a holding pattern now. If you’re new to the channel,
thanks for joining me. I do a lot of these things every Monday, where we cover the latest Tesla news, and also answer questions and stuff. I use a separate platform
for that called Crowdcast, which I have going in
a separate window here. So, I’ll try to answer
questions on YouTube when I can. But if you guys are watching on Crowdcast, make sure that you go an ask your questions and vote on those. And if you’re new, and you
wanna get on that list, and get invited to these in the future, just go to Teslanomics.co/join and you’ll get that
invite for every Monday. So, without further ado, let me pull up the actual waiting screen. We’ll wait for the
shareholder’s meeting to start. Before I do that, though,
I wanna mention two things. One is this guy here. So, I have a new promo or a thing going which I wanna mention, because
you guys might be interested. And that is that this
Friday ends my giveaway for a Model 3 rental from Turo. So, if you live in an area where Turo is, and there’s a Model 3, you’ll be able to win a 24 hour rental. So, you get to drive it, and
do whatever you want with it, take it grocery shopping,
whatever, for a full day. It’s free to enter, and you can do so at teslanomics.co/100k There’s also other prizes like a waterless wash system for your car, and other things, like
tickets to TeslaCon, Teslanomics t-shirts,
all kinds of good stuff. Go check it out, if
you’re interested in that. The giveaway ends this Friday. Every time you enter, you can
actually earn other entries. There’s all kinds of info there. Go check that out. But without further ado,
I will switch over now to the broadcast, and we’ll just wait for the meeting to begin. Actually, I’ll take that back. Let me see, I have a page here. So, some news already
coming out of the event, is that there is a white
new Tesla Roadster. That is outside of it, as
well as the Tesla Semi. Pretty cool stuff. It looks like they have
some cool photos here. This is coming to us from Teslarati. I’m not sure if I’m in
love with the white. I’m not sure what you
guys think about that. I am slated to get two Roadsters now, or I’m just about two free
Roadsters, so we’ll see. I’m not sure if I love the white. I think I’m either black or red, or some kind of bright color. There’s the Semi you have there. So, lots of cool stuff to come in. I’m excited to see what else
we have in store for today. So, let’s hop over to that now, and we’ll just wait for it to begin. And I’ll get the screen going full screen. And they have this kind
of Grimes music going. I’m not sure what that’s about. Make sure we’re in HD. Okay, here we go. (electronic music) – Everyone. We’re gonna get started
in about 10 minutes. But before we get started, Lisa Brenten. Are you around? Hello, Lisa. She is our Inspector of Elections, and if anyone needs a ballot, you should go find Lisa. And we’ll get started in
about 10 or 15 minutes. Thanks, everyone. So, there you have that. Now, one of the things that is interesting about today is that, apparently, on the
ballot is an actual vote on whether or not,
basically, to kick Elon out. That comes, I believe, from somebody that only had 12 shares. They were somehow able to
get that on the ballot, which is crazy to me. But one of the reasons I
bring that up is because I think that would be absurd. Not that there shouldn’t be
a separation between the two, but that having actual Elon leave would be kind of disastrous for the
company and for the brand. That’s my opinion. I’m curious what you guys think? Leave me a comment or something
down there, and we’ll see. Hi, Carol. “Are you allowed to ask
questions during the meeting?” You can ask questions of me. I’m not allowed to ask questions of them. I’m not at the event. So, there you have it. While we’re waiting on that, I can go through some
of these questions here. I’m looking at Crowdcast. Walt asks, “Not knowing
that much about batteries, “do you know if the
lower percent of cobalt “might have an effect on
the longevity of batteries.” I don’t, Walt. The idea, I believe, behind that, and this was JB’s comment
on the last earnings call, was that by reducing the amount of cobalt, they’ll be able to actually
make them more efficiently with a better supply chain. So, that was the idea there. I’m not sure if that has an effect on the longevity of the batteries. I will say the study I did, which had, I think, over 200,000 what
I call charging trips, showed that even up to,
I think, 300,000 miles, which is one of the vehicles
we had in our study, still retain something like
95% of the actual charge. And so, I have a bunch of data on that. All signs point to Tesla batteries lasting up to about 20 to 25 years. So, basically forever, like, longer than you’ll keep the car. And in 20 to 25 years, hopefully, we’ll have a much better solution. So, thanks for the question, Walt. Next we’re going over to Tesla Ken. “If a Model 3 is out of cellular coverage “and doesn’t receive an update, “then a second update comes out before “the Model 3 gets back
inside cellular coverage, “will the car have to install both updates “or only the newest update?” That’s an interesting question. I believe it would probably
go in sequential order, Ken. I’m not sure I’ve seen that happen. But that’s pretty interesting. I’m curious, if that ever
happens to you, let me know. Let’s see. Brent asks, “When will
powerwall reservations “be available on large
scale to general public? “I’m a day one reservation holder, “and so far it’s been nothing
but the sound of crickets.” Brent, JB did say he’d
make a comment on that, on the recent earnings call. So, hopefully, that’s a
sign of things to come. I’m with you. I’ve been waiting on mine
for quite a while now. Yeah, still nothing. I do know people that have gotten theirs. So, hopefully, that’s a good sign. Hopefully, you’ll get yours soon. Let me just double check. How are things looking on YouTube, guys? Give me a thumbs up and let me know how they’re looking. I’ll try to keep the chat up. Okay, hey, guys. Hey there, Jack Spa. Hey there, Maxine. Hey there, Kathy. All right, keep going
on the questions here, until the meeting begins. Jason asks, “Should you charge your Tesla “every day if you don’t drive a lot, “or let it run down to minimize
cycles on the battery?” I think he meant cycles, not circles. So, Jason, the answer is, there’s kind of a saying here that a happy Tesla is a plugged in Tesla. Overnight, it may run diagnostics, and it may upload data for, let’s say autopilot, things like that. So, it actually will be running things, as well as the battery management system, which keeps the battery at the optimal temperature to ensure longevity. All those things lead to you having it plugged in are just better for it. So, I would recommend doing that. I would recommend keeping it plugged in and not letting it drive down. ‘Cause more hard cycles you have, the zero to 100, it will
actually hurt the batteries, is what I understand. That’s what the data I’ve seen shows. So, if you keep it between 50% and 80%, you’re kind of in that golden spot. So, yeah, just come
home, when you get home, plug it in, good to go. Thanks for the question, Jason. Next, Johns asks, “What do you think of “the recent article about Tesla “being unwilling to give customers “detailed data from the vehicle memory?” I don’t know of that article, John. I’m not surprised that there are some bits which may be confidential. But I don’t know the
context of that question. Sorry. But it wouldn’t be surprising to me if there are certain things
that they’re allowed to share, if that make sense, and other
things which they can’t. So, there you have that. Also, let me go back and, while we wait for that, I’m going to actually go live
on here, on Facebook as well. And we’ll hit live. There we are. Okay, so now… That guy’s going. All these guys are going. Cool. Se should be good. Get back to our stream. Okay. So, again, if you have questions, and you’re in Crowdcast,
go ahead and ask them. Let me take a look at
YouTube here for a second and see what else we have going on. (electronic music) Skippy Manga asks, “Why do you think, “since the Model S and the Model X “are on the same platform, “that we can’t get a factory approved towing option for the Model S?” Hmm, and I assumed what you’re talking about is the tow hitch. I believe there are after market options. This may be more than just
a technical limitation. It may be that Tesla
wants to differentiate these vehicles for that reason. There may be some physical limitations or something like that as well. I certainly believe that
it’s capable of towing. But the question is whether
or not it makes sense, and whether or not they
want to allow that. So, there are other options there. Mark Masaya, Masella asked,
“Why aren’t you there?” Well, because I’d rather
be here with you, Mark. No, I’m actually not a shareholder. I think, personally, my
investment strategy is I don’t invest in any
individual companies. That’s just my personal
ideology, I guess, or strategy. This is not financial advice. I’m not a financial adviser. But that’s what I’ve settled on. So, I only invest in
index funds, essentially. And then for, you know, the hard drugs, I do cryptocurrency stuff. So, there you go. Let’s see, Chris Hughes, yeah, thank you. I hope you’re able to get your Model S. Tyson Edwards, “Do you think
that entry level Model 3 “will line up with the potential timing “of leasing line up?” That’s an interesting question. It may be, because the
question that Elon had asked or had mentioned about,
was the reason they weren’t doing leasing is ’cause it’s basically bad for Tesla and their margins and everything. And so, over time what will happen is, as those things improve,
as they achieve scale, then they will offer those options. So, yeah, it could be
that those things line up. I’m kinda curious though whether or not they offer it within a year even. So, I think it will be a little while. (chuckles) “Ew, crypto.” All right, back to Crowdcast, see what kind of questions we have there. And tell me what you guys
think of this set up here. This is kind of a new
set up I have going on, where I’m trying to do
the different stream on different platforms and stuff. And so, looks like everything
is going good on my side. I just wanna make sure that
you guys have it all set up. Okay. Let’s see, Daniel on Crowdcast asks, “Now that Elon’s stated that the Model 3 “Performance version will
be used for test driving, “when do you think they
will reach the East Coast?” Some time this year? (chuckles) It’s hard to say. You know, I don’t even know
if they’re making them yet, is the question, right? When will they make them? And once they make them, they’ll have to QA them
and test them and all. They’ve probably been doing
a lot behind the scenes. But then, from there, you’ll actually have to ship them out, and
do those kind of things. We’ll see. Six months, maybe? Yeah, hopefully, before
the end of the year. Thanks for the question, Daniel. And thanks for the feedback, everyone, on the set up. I have a new lens on my camera. I’m streaming in 1080. I’ve got a lot of
different pieces going on. But I think it’s going well. Everything appears to be good. YouTube likes to complain though. Bob asks, “I have a couple questions “regarding charging installation. “Where should I direct my questions?” Bob, you can try here,
hit me up on Twitter. I’ve answered a lot of this, if you just go search
through the videos there. I’ll give you my short spiel on charging and what I believe. It’s that if you have a nice garage, get a wall charger. It’s 500 bucks more. You get to charge a little bit faster. It’s actually significantly
percent faster, but I don’t think that really matters. To me, it’s just more about aesthetics. Otherwise, you can use a NEMA 1450 outlet. And then, if all else fails, you can use a regular just
110, 120 volt wall outlet. And I’m actually doing a
test on that right now. So, we’ll see how that goes. But yeah, I think is charging
is something interesting, as well as EVannex has, I think, a EV University thing that talks about it. At TeslaCon last year, we actually went through a whole thing on what they call your personal charging infrastructure. It talks you through all the
different scenarios there. Yeah, I think there’s lot of options, lots of good information out there. I have it, everyone else
there has it as well. Thanks for the question. Carol, “When can we expect
European deliveries?” I believe Elon has
alluded to mid next year. So, it’ll be a while. And then if you want right hand, it might be even later than that. There you have that. Donovan asks, “Good afternoon, Ben. “Have you heard any
issues with the batteries “when they have been fully discharged. “A coworker’s friend said
he fully discharged his “and had to replace the battery.” I’m not sure about that. I’ve driven mine down to
zero, and it was fine. I just got towed to a
Supercharger and it worked. My friends Erik and Sean, out in Colorado, just did this on their
Hypermile world record, and they actually had some issues with it. So, go check out their channel. If you just look up
Hypermile world record, you’ll find it. Thanks for the question, Donovan. Okay, done with questions
on Crowdcast for now. Let’s hop on over to YouTube again, see how you guys are doing. “Does Tesla have heat pump AC battery?” There is a 12 volt battery, but there actually is
something there about it. (chuckles) Doc Tesla, “Fund Ben enough
to buy one Tesla share.” Thanks. Yeah, “Keep up the great content, man.” I don’t think, yeah. (chuckles) Now you got other people doing it. Yeah, thanks for the donations guys. I don’t buy the stock out of principle, not really a financial thing. But I appreciate the contributions. MG asks, “I’m sorry but the red link “on the screen is kind of annoying. “Can you make it smaller?” No, sorry. “Ben, are you going to
have HyperChange on again?” Yeah. I mean, Gali’s a friend. I’m really supportive of him
and all the other TeslaTubers doing what they do and what they can to really just help spread the joy and the knowledge and everything, so we can really kind of change the world. That’s really what this is about, is helping us really shift towards a more sustainable form of
transportation and energy. Notice I changed the slogan from something directly Tesla related to
exploring sustainable tech. Because I hope to do a lot
more videos in that regard. I hope to do a lot more clean energy analysis and things like that. And you’ve seen Wonder
Capital’s a sponsor, and we’ve got some cool
videos we’re working on where I get to go visit
these facilities and things. I think there’s a really broad story here. And over time, what we’ll come to realize is that Tesla is not just an auto maker, they’re an energy company. And so, our thinking of
them competing with Ford, or maybe that’s a bad example, someone like Jaguar or BMW, will shift towards Tesla more compared to a Chevron, or a BP, or a
Exxon, or somebody like that. So, I think there you go. (electronic music) “Will Model Y introduce today?” No, there’s not gonna be
any unveilings like that. This is gonna be kind of a Q&A thing. And so, it’s just gonna
be one of those things. It’s gonna be less interesting than one of the unveilings. Elon did respond to one of my tweets about when we’ll actually
be able to see the Model Y, and it looks like that may be close to the end of this year or next year. I’m just checking, okay, still streaming. Looks good on my end. Hope you guys are doing well. Let’s go back over. Waiting for it to begin. Let’s see, if you have
any other questions, we can go through them now. Whoa, six more just popped up. Yeah, guys, make sure to vote
on the questions in Crowdcast. Otherwise, I’m not sure which
ones you want me to answer. So, I’ll look for those with votes. All right. Patrick asks, “Have you ever looked at “the demographics of Tesla buyers? “Is it older people with assets saved up “who can afford the tech, “and the safety, not to
mention drive assist. “Or is it more aspiring young buyers, “a mix of those and more?” You know, I’ve seen studies on this, and they kind of match the stereotypes, the typical things that you would expect from Tesla owners, Tesla buyers. One is, they’re mostly white
people, and from San Francisco, mostly white men that are
either younger with money or older that have stuff. So, I’m gonna pause on questions, and we’ll go over to the meeting. – We’re glad you could join us today. My name is Todd Maron, and I am Tesla’s General Council
and Corporate Secretary. Following the formal part of the meeting, I’ll be introducing Tesla’s Co-founder, CEO, and Chairman, Elon Musk to the stage. In addition, I’d also like to introduce several other people. – Also, let me know
how the audio is, guys, if you guys can hear it okay. – Board of Directors. We have our CEO, Deepak Ahuja, and Martin Viecha from our
Investor Relations team. We also have several other members of our management team. We have Larry Westall and David Humphreys from PwC, Tesla’s independent auditor. There are gonna be two
parts to today’s meeting. First, the formal part of the meting. Also known as the very boring part. That will cover the four items that stockholders have been
asked to vote on today. After the voting, Elon
will answer questions about Tesla, both from those that were submitted on Twitter,
before this meeting, and from those in attendance today. Okay, let’s get started by calling the annual meeting of
stockholders to order. Please refer to the agenda and rules of the meeting that were
provided to you today. The time is now 2:36
PM, and I declare that the polls are now open. We have already received,
over the past few weeks, voting proxies from our stockholders. Meaning that, almost all of the votes that will be counted were already submitted before this meeting. However, as I mentioned earlier, if you wish to submit a
ballot to vote your shares or change your prior vote, you can do so today by picking up a ballot at the table in the corner and handing it to Lisa Brenten from Computershare. Lisa, if you could just raise
your hand one more time. There she is. Tesla’s board of directors has appointed Lisa of Computershare to serve as the inspector of
election for this meeting. Lisa has taken and signed an oath as inspector of election. Computershare has certified that, starting on April 26th, 2018, the proxy materials or a notice of internet availability
of the proxy materials, were mailed or provided to all
Tesla stockholders of record as of April 12, 2018. We have a majority of the outstanding shares represented today. So, I declare that there
is a quorum present, and that we may proceed with the meeting. The items on the agenda are as follows. Number one, the election of
three Class II directors, Antonio Gracias, James
Murdoch, and Kimbal Musk, to serve for a term of three years or until their respective successors are duly elected and qualified. Number two, to ratify the appointment of PricewaterhouseCoopers as Tesla’s independent
registered public accounting firm for the fiscal year
ending December 31, 2018. Tesla’s board has recommended that our stockholders vote for each of the director nominees
and for the ratification of the appointment of our accounting firm. I know we have one stockholder today who would like to make a brief comment on the director proposal, and now would be the time to do so. – [Steve] Thank you, Phil. Thank you, Todd. My name is Steve Diamond. I represent the CTW Investment Group, shareholders in Tesla, who work with union
sponsored pension funds, which are also shareholders in Tesla. For several years, we
have engaged with Tesla about our corporate governance concerns. We want to see Tesla succeed in providing energy efficient transportation and generating sustainable, high skill, high wage, industrial employment. But the current board is an obstacle, not an aid, to these goals. We urge shareholders to
vote no to the reelection of Mr. Gracias, Mr. Musk, and Mr. Murdoch. – Wow.
– We do not think these individuals are a credible– – So, this is the (mumbles) fighting him. – [Steve] Their lack of significant auto industry experience and human capital management experience are only their most obvious deficits. We are also concerned about whether these highly paid
directors can help the CEO focus on solving the serious financial, production, and labor relations problems now facing Tesla. Before we vote today, we
believe it is important that each of these candidates personally explain to us how they can contribute to finding solutions to these problems. Thank you. – Bold request.
– Thanks. Obviously, we’ve put forward a different presentation in our proxy. And the board recommends that shareholders vote for the election of
each of the directors. We also received two
stockholder proposals, as described in our proxy statement. The first proposal is to require that the Chair of the Board of Directors be an independent director. Our board has recommended
that our stockholders vote against this stockholder proposal. That proposal is proposed
by Mr. Jing Zhao, who is here to present
this proposal today. Mr. Zhao?
– This is the one to get rid of Elon. – [Jing] Is that okay? Oh, hi, good afternoon. There’s no need to repeat
the contents of the proposal, and assume that you can read it. I don’t want to spend too much time. I just want to point it out, first as a opposition statement as a number, as a leader in this meeting, in fact, only 49% S&P 500 combined, CEO and the Chairman (mumbles). And the second, just actually, as the gentleman pointed out, our board is not fully independent. For example, R&D Director
is not fully independent, and some board members
are not independent. So, combined, these factors, and the other factors listed in my proposal, it’s just time for our to change coarse have an independent chairman. Thank you very much. – Okay, thanks. Finally, we received one
last stockholder proposal regarding proxy access, which is also described
in our proxy statement. And our board has recommended that our stockholders vote against
that proposal as well. This proposal’s being presented by Mr. James McRitchie. Go ahead, Mr. McRitchie. – [James] Tesla shooting
for the moon and beyond, and we love it. But shouldn’t we have a little insurance? A cost benefit analysis by CFA Institute found proxy access would benefit both the markets and corporate board rooms with little cost or disruption, raising US market
capitalization by 140 billion. In other words, a vote
in favor of this proposal is likely to raise the value of our stock. Two of our directors hold
no stock in our company. Why do they have such little confidence? Proxy advisor, Institutional
Shareholder Services, considers three of our
directors not to be independent. Whatever you think of our current board, isn’t it good to have
just a little insurance? In a time of crisis, and I don’t just mean our ongoing production crisis, we could place two nominees on the proxy without going through an
expensive proxy contest. Based on my proposal, any
group putting forth nominees would have to have held 1.5 billion in Tesla stock continuously
for three years. Between 2015 and 2017, a total of 206 proxy access proposals were voted. Average support exceeded 53%. More than 60% of S&P 500 companies have adopted proxy access. In its statement of opposition, the board points to a lack of safeguards, such as the ability of investors to use proxy access, even if
they have lent out shares, hold a short position, or
intend a change of control. However, this proposal simply offers advise to the board,
subject to a 500 word limit. The board is free to adopt proxy access bylaw that includes restrictions on the use of proxy access, just as every other
adopting company has done. Furthermore, the ability to
include a director nominee in the company proxy does
not guarantee election, even if a, quote, special
interest shareholder were to be placed on the ballot, that nominee would still need to win broad support to be elected. Keep in mind, the current
officers and directors who presumably would vote
against any such nominee, own nearly 25% of outstanding shares. No shareholder nominee would win without the support of
our largest investors, such as Fidelity, T Rowe
Price, Baillie Gifford, Tencent, Vanguard, and BlackRock. Vote for proxy access, item number four. Vote for insurance. Thank you. – Okay, thank you, Mr. McRitchie. Before we conclude, are
there any proxies remaining in the audience that
have not been submitted. This would be the time. I see one here. Keep them up high, and we’ll have people come by and grab them from you. – That sounded like the
most intelligent one, but it also was confusing. So, that means, to me, it
might actually make sense. It’s one of those where you probably have to unpack it for hours, in order to, at least,
have years and years of industry experience to understand what the implications of that would be. It also sounded to me like he was trying to put himself on the board by suggesting only certain very select few people could actually do it, in which case he might be one of them. I’m not sure. That was an interesting one. The other one seemed kind of like stuff to get the media’s attention. This one seemed more like… – Anyone else? – A real thing.
– One up here. – Let’s see what else. Let’s go to YouTube. – Last call. Okay. All right, I declare that
the polls are now closed. Based on the proxies that we
received before the meeting, I can announce that our shareholders approve the recommendations of the Tesla Board of Directors
on all four agenda items, and they did so by a wide margin. Each of the items passed in
line with the recommendations by more than a supermajority vote. – So, Elon’s staying. Everyone else is staying. – Announce the results
of the voting by filing a form 8-K within four business
days of today’s meeting. That concludes the official
business of today’s meeting, also known as the boring part, which is not adjourned. I welcome you to now
stay for the Q&A session and Elon’s presentation. In addition to–
– Boring part. – Questions from the audience– – Buy the boring (mumbles).
– Elon will answer questions that you have and that you submitted on Twitter
before the meeting. During the course of the Q&A session, we may discuss our business outlook and make other forward looking statements. Such statements are predictions based on our current expectations. Actual events our results
could differ materially, due to a number of
risks and uncertainties, including those disclosed
in our most recent form 10-Q filed with the FCC. Such forward looking statements represent our views as of today, should not be relied on thereafter, and we disclaim any obligation to update them after today. With that, please welcome Elon Musk. (audience applauds) – They just turned the volume down. That wasn’t me, promise. (machine whirring) Oh, hey. This video looks familiar. Here comes the copyright, guys. (upbeat music) – [Elon] Welcome. Welcome. Welcome, I love you guys too.
– We can’t view in this video. In case you guys (mumbles).
(audience member whoops) (upbeat music) – All right. I think we’ve got quite a lot
of good news to talk about, and look forward to sharing that with you, and then taking questions
from the audience. Yeah, I’m just really
proud of the Tesla team for accomplishing so much against incredible headwinds, and I’d just like to express a note of appreciation
for all our customers who bought our cars. Thanks for buying our product. We’re doing everything we can to make it as good as possible as fast as possible. This is gonna sound maybe a little cheesy, but at Tesla, we build our cars with love. We really care. A lot of other companies, they’re built by the marketing department and the finance department,
and there’s no soul. (audience laughs)
You know? – Wow. I’m getting teary eyed. – We’re not perfect, but we pour our heart and soul into the product,
and we really care. (audience applauds) – How could not love him. He’s not the best speaker,
but he’s (mumbles). – The dedication of the Tesla
team has been incredible. They’ve really been
working incredibly hard to make the cars. It’s very difficult to become a mass made factory car company. No one has succeeded in doing this in a very long time in the United States. Even the ones that have,
Ford’s the only one that hasn’t gone bankrupt,
so it’s super difficult. In fact, yeah. In the history of the
American auto industry, it’s always worth bearing in mind that only two have not gone bankrupt, and that’s Ford and Tesla. (audience applauds) It’s insanely hard just staying alive. I just wanna be clear,
it’s really difficult. You know, we’ve had people at Tesla who’ve worked 60 days straight. We had to basically force them to go home, like, “You gotta go home, man. “You’re gonna keel over,” and
then stuck back in to work. You’re like, “Dammit, we said go home.” But the net result is,
despite a lot of difficulties, all parts of the Model 3 production system have demonstrated a 500
car per day capability, or a 3,500 car per week capability. – Wow, 3,500 per week. – We just did a big set up upgrades, and we’re spooling out the
production lines again. And I think it’s quite likely that we’ll achieve a 5,000 car a
week by the end of this month. (audience applauds) – Wow, wow. – It’s like, phew. This is like, I’ll tell
you, the most excruciating, hellish several months
I’ve, maybe, ever had. – That’s saying something. – But I think we’re getting there. We’re doing well on market share. The blue line is the Tesla Model 3. We just became, in May, the best selling mid-sized premiums in the
United States of any kind. (audience applauds) – To be clear, those
aren’t mid-sized sedans. – That’s of any kind. It’s meaning all internal
combustion engine cars, not just battery or hybrid,
or anything like that. And that’s despite the fact that we still offer only one version of the car. All wheel drive is coming out next month. And then we’ll have the
shorter range battery lower class car around
the end of this year, is when we’re expecting to do it. – End of the year, $35,000 model. There you go. – We also made huge progress
in the reliability of the car. So, in the beginning it was a bit bumpy. Now, as deliveries have risen, the quality and reliability of the car has improved dramatically. So, it’s improved by a factor of, maybe, four or five cents,
start of production. And we’re working on
making that even better. Employee safety is a big deal for us. It’s always tougher to achieve safety when you’re building a
new manufacturing line. So, if you’ve got a manufacturing line that’s in steady state, then
you’ve got an opportunity to iron our the processes and make it a lot easier to build the car. As you’re figuring things out, it takes a while to get there. So, thus far, in 2018,
our injuries per person are at 6% below the industry
average, which is great. Because last year we
were a little bit above, and now we’re a little bit below. – Interesting. – And that trend is continuing downward. I think we’ve got a shot at being maybe half the injuries per
person of the auto industry. You know, that’s the
goal we’re striving for, is to be half injuries per person. When you’re building cars, and you’ve got a huge number of people, it’s impossible to be zero. We wish it could be zero. But we think being twice as good as the average in the auto industry is a very achievable number, and that’s what we’re
working hard to achieve. It’s worth noting that when the injuries, if the vast majority of the injuries are repetitive stress injuries. So, back strain or wrist strain are, by far, the most common thing. And the way to address that is with better tooling and fixtures and rotating people
through different roles, so they’re not always
doing the same action. – That makes sense. – And it’s also boring to do the same action over and over again. So, we’re making good progress on that. And it’s also worth noting,
even our current injury rate is half that of what it was when Toyota and GM were operating with client. So, that is often lost in a
lot of the media articles. So, if we achieve our goal, we’ll be a quarter of the injuries
of when it was near me. We really want to emphasize
this is a super important thing to me because we owe a great debt to the people who are building a car. I really care about this issue. – It’s hard to argue (speech
drowned out by applause) (audience applauding) – And Supercharger expansion
is going really well. We’re almost over 10,000
Superchargers worldwide. And our goal is to be able to go almost anywhere on earth using the
Tesla Supercharger system. We’re very excited about the
next generation Supercharger. It’s mostly finished in design, and we’ll go to production, hopefully, around the end of this year. So, the Supercharger generation three will be quite a dramatic improvement. But we wanna save that
announcement for when it deploys, which is, hopefully, later this year. And then once we have
that system in place, then we’re gonna accelerate the Supercharger expansion even more. (audience applauds)
– That’ll be great. I can’t wait to actually see. I’m just taking notes here, if you guys are wondering what I’m doing. I’m not playing on my phone. – We’ve managed to do now a gigawatt hour of energy storage deployment worldwide. This is all the way through from the reign of Ramses II
of Egypt through today. (audience laughs) Very impressive period of time. And in less than a year from now, we’ll do another gigawatt. So, it’s pretty massive. (audience applauds) The rate of stationary storage deployment is gonna grow exponentially. I mean it’s really, I think, for many years to come,
each incremental year will be about as much as
all of the preceding years. Which is a crazy, crazy growth rate. Also, it’s a production limited thing. We would actually be able to do more if we could produce more. And we are producing a lot of batteries. In fact, next quarter, at the Gigafactory, we expect to make more battery capacity than all other EVs combined
worldwide, including China. (audience applauds) I mean, this is a really
crazy amount of batteries. This one factory’s making, we make more than all the other batteries on earth. I think really deserving
the Gigafactory title. It’s really, really nutty. We’re gonna try to have, maybe, when things get calmed down a bit, have more tours available for Giga, because it’s like epic. (audience applauds) Yeah, it’s like at least two hours just to walk through all of
the parts of Gig at this point. Just to walk through
everything takes two hours. If you don’t pause a lot. (audience laughs) It’s good exercise. So, that’s, yeah, pretty well. We actually have a bunch
of non Tesla employee solar roof customers. The response has been very positive. That whole roof is solar,
and it just looks normal, in fact, looks better than
the roof that was there. And I have it on the little
house across the road that used to be owned by Gene Wilder, it’s sort of like the Willy Wonka house. I was trying to figure out
how to have that go solar without ruining the Gene Wilder aesthetic, which I really like. (chuckles) But it’s all to put these
on Gene Wilder’s old house, and it still has the same
character, which is great. – Trying not to sound like a billionaire that just has a lot of houses. – Validating the solar roof, because they need to
last at least 30 years, ideally, longer. And there’s only so much accelerated life testing you can do on a roof. So, before we can deploy it
to a large number of houses, we need to make sure that all elements of the roof are gonna last
for at least three decades, ideally, half a century or more. But this is gonna be a very big product. And it’s also gonna grow exponentially. Yeah. And I think you want
to have a thing where, if you look around at the neighborhood, adding solar actually
improved the aesthetics and feel of a neighborhood. I think that’s a really big deal. – Yeah, I don’t know if
people agree with Elon. – We’re not far from Q3. – This is huge. – My CFO and joint
council, you have to watch what words you use in these situations, but I think it’s really looking like we are gonna have positive
gap net income next quarter, as well as positive cashflow in Q3 and Q4. And we, as I said before, do not expect a need to raise any
incremental debt or equity. (audience applauds)
– That’s huge. That’s huge. We’ll see if that checks out, but… – And we’ve got some exciting
products in the works. The Model Y is really gonna
be something super special. – New image. – We’re aiming unveil the Model Y approximately March next year, and then go into production about, maybe, around two years from now. Maybe a little less than two years, but basically, first half of 2020 for production Model Y. Something similar for Semi and Roadster. So, these products are shaping up. I think Semi and Roadster are actually gonna be even better
than what was unveiled. – Yes! – We’ve figured out ways
to improve the range and overall functionality
of the Semi, in particular. The Roadster, what I
unveiled with Roadster was the base model performance. – Yes, give it to me! I want more. (audience chattering) – It’s gonna have a SpaceX option package. (audience applauds)
– What! Ho-ho-ho. I don’t know what that means, but okay. – It’s crazy.
(audience laughs) – I’ll have to call Tim. – I think it’s important for
us to show with the Roadster that an electric vehicle can outperform a gasoline car in ever way. Because gasoline cars still
have sort of a halo effect, and I think if we can
show the electric car can outperform gasoline car in every way, then we sort of get
rid of that halo effect of gasoline cars. And I think that’s quite a powerful thing, perceptually, for the general public. – Wow.
(audience applauds) SpaceX option package. Yes. And yes, I’m getting my
friend, Tim the Everyday Astronaut, to come by
and explain what that is. – I got some really insightful
questions on Twitter, as well as some strange ones. But, yeah, one of the first questions is, from Model 3 production line, as I said before, we’re really gonna focus on manufacturing
technology for Tesla, and we’ve made a lot of mistakes
with Model 3 production, that we recognize those mistakes and we’re confident we
know how to address them. In fact, we are addressing them. And long term, I think
the biggest competitor strength of Tesla is
gonna be manufacturing. This is sort of counterintuitive, but it is gonna be
quite dramatic, I think. The approach to automation
that we’re taking, I think in some cases has worked and some cases has not. But it’s clear that some
elements of production, which are really well
suited to people doing it, and some parts of production that are really well suited to robotics. And one of the biggest
mistakes we made was trying to automate things that are super easy for a person to do but super hard for a robot to do. And when you see it, it looks super dumb. You’re like, wow. (audience laughs) Why did we do that? – Humility. – It sort of makes sense to start off with initial production line, which has a relative bias towards people, and then you automate the parts of the production system that are the most painful and difficult for people to do. So, particularly ones that result in repetitive stress injuries
or mechanically difficult. That’s really a much better approach. And that’s what we’re gonna do for Gigafactories 1 and 2. It’s a much more sensible
way to do things. – Interesting, interesting. – Let me actually have some of the Tesla executive team come up. Guys, you wanna come up and hang out? (audience applauds) – I see JB and Deepak up there. (audience applauding) Bruns. – JB, do you want to talk about
the battery kind of stuff? – Sure. It’s difficult for us
– It’s JB Straubel. – To talk about specific cost number. That’s always a difficult topic. But we are still very confident that we have the best
price and performance of anything out there in the world. If there’s something better,
I don’t know about it, and we’ve looked as
hard as we possibly can. We try and talk to every
single battery startup, every lab, every large manufacturer. We get quotes from them,
we test cells from them. So, if there’s something
better, we’re all ears. We’d love to find it, but
we haven’t found it yet. So, generally, we’re
still pretty confident about that same direction. – Yeah, we think, at the cell level, probably, we can do better
than $100 per kilowatt hour, maybe later this year, depending upon commodity prices. If commodity prices are
roughly where they are today, then we’ll probably do better than $100 per kilowatt hour at the cell level. With further improvements to
– That’s huge. – The cell chemistry, production process, and more vertical
integration on the cell side, for example, integrating the production of materials at the Gigafactory, and improved design of
the module and pack, we think longterm, we can get below $100 kilowatt hour at the pack level, which is really the key
figure of merit for a car. But longterm, meaning
definitely less that two years. That’s as a longterm. (chuckles) Yeah. Yeah. We think we’ve come up with some pretty cool breakthroughs on this front, on energy density and
cost of the battery pack. Yeah, I think it’s gonna be pretty great. – Lots of details there. – When will the Gigafactory
be completely built? I think we’ll keep
building on the Gigafactory for at least four or five years. It will be, by far, the
biggest building in the world. It’s not that far from being the biggest building in the world already. Based on the plans that we know, it might be twice as big as
the next building in the world. Hence the interesting tour. – It’s not the size of the building, Elon. It’s how you use it. – Yeah, it’s about the
third down right now. Yeah, so, it’s really,
really, really enormous, and I think it’s going quite well. There will be more
gigafactories in the future. We’re close to announcing a combined vehicle and battery factory. So, future gigafactories will include vehicle and battery pack and powertrain, as a single integrated unit. And we’re close to announcing
something in China. – Yep, in Shanghai. – I don’t know, do want
to talk about that? I mean, we’re not making an announcement. (audience laughs) – Elon, too late. (chuckles) – Like the preamble or
something, I don’t know. (audience laughs) So, Robyn is head of
worldwide sales for Tesla. – Thanks, Elon.
– Robyn Denholm, I believe this is. (chuckles) – I didn’t expect to talk about this. So, we’re incredibly excited to build first Tesla Gigafactory
outside of the US, in China. Specifically, it’s gonna be in Shanghai. – It’s in Shanghai. We know that.
– We have been holding discussions with the government, various governments in China, really great discussions, great partners. We really look forward to working with them in the years to come. This is gonna be the next
generation of Tesla factory. We’re super excited. The stuff that we’re
gonna be putting there and the cars that we’re gonna
be building in that factory is gonna be incredible. So, we’re gonna announce
something, all the details, really, really soon. So, I won’t tell more, but this is enough. (audience applauds) – Somebody’s probably
gonna say, “No, no, no. “No, no.” (audience applauding) – Particularly, as we try to make cars more and more affordable, it’s gonna be important to, localize production, to at least the continent level. So, having the Gigafactory
and vehicle factory in North America, one in
China, and then one in Europe, those are the obvious three places for vehicle and battery gigafactories. So, probably, if things
go according to plan, we’ll probably be announcing details of the China Gigafactory
as soon as next month. And then, Europe Gigafactory,
end of this year. We need to figure out
where to put it exactly. But probably towards the end of this year for the European factory. – Confirmed, European Gigafactory. – 10 or 12 worldwide. – Wow, 10 or 12 worldwide. That’s amazing. (audience applauds) – I had questions on the Tesla Semi. We are gonna do another revision
of the Tesla Semi design. We’ve learned a lot, and we think we can actually make it even better
than what was unveiled. And really have a range that is way beyond what most people in
industry think is possible. It’s definitely gonna be a semi that works in Europe and in North America, in China, and the rest of the world. Yeah, one major factory in the works, an then another in the
works later this year. Yeah, do we wanna talk about cells? – Yeah, we’ve talked
about this a few times, but Tesla will, absolutely, recycle, and we do recycle all of our spent cells, modules, and battery packs. So, the discussion about this waste is ending up in landfills is not correct. We would not do that. These are valuable materials. In addition to, it’s just
the right thing to do. So, we have current partner companies on every major continent where we have cars operating, that we
work with, to do this today. And in addition, we’re
developing internally more processes, we’re doing R&D on how we can improve
this recycling process to get more of the active materials back. And ultimately, what we want is a closed loop right at the gigafactories that reuses the same recycled materials. This isn’t impossible. We see a pathway to do it. But that’s where we’re headed with this. Today, we’re on the way to do that. It’s definitely something that’ll be a huge benefit in the long term to cost as we’re able to reprocess more materials instead of actually having
to mine new materials. (audience applauds) – In terms of repairability of Model 3, including insurance costs, we’re working with insurance companies, and on some internal activities. We’re really confident of getting the cost of insurance for Model 3 to be, at least, 20% to 30% lower than, say, a BMW 3 series, or
equivalent mid-sized sedans. So, the safety is definitely better. Then we’re working on the repair costs. We’ve made a lot of
progress on that front. Bottom line is that the insurance costs, total cost of ownership of the Model 3 should be significantly
better than any other mid priced premium sedan. (audience applauds) Yes. We will definitely offer a
$35,000 version of the Model 3. I think, probably, at the end of this year is when we should be able to
make the smaller battery pack. And then get into volume production of 35K version in Q1 next year. We will definitely honor that obligation. We would do so right now if
it was physically possible. Yeah, we’re gonna, probably next month, offer a free trial for
those to try out autopilot and see how well it works. We’re also making rapid progress
on autopilot technology. So, there’s a new version of autopilot that’s rolling out, I think, this week, which I think is quite a
significant improvement. And I think what you’ll see is that the liability and capability of autopilot will increase exponentially
over the next six to 12 months. The improvements are very, very rapid. The length of time to wait for a Model 3, if you’re ordering one
now, will vary quite a bit depending on what part
of the world you’re in and what configuration. For the existing configuration,
if you were to order now in the US, you probably would be waiting, I’m guessing, about three or four months. On the other hand, if you want
the right hand drive version, you’re probably waiting for over a year. Because we need to get both the right hand drive version and
ship it to other countries, and homologate the car
for other countries. So, the wait is anywhere from three to 15 months, approximately. But for current
configuration, order it now. It’s maybe about three or four months. – I think that’s a bit more aggressive than you find on the website.
– There’s actually quite a complicated answer. There are many lines to the Model 3. In some places there are several lines. In some places there’s just one line. And it kind of depends on what the capacity of that line is. So, for general assembly, which is putting the
parts together at the end, we currently have two lines
and are construction a third. The third line is, I
think, dramatically better than lines one and two. We started construction on that third line about to weeks ago, and we’re already putting the
first car through that line. So, it’s really crazy fast. And that’s part of what gives me confidence about the 5K
per week for Model 3. Currently, the biggest constraints on output is general assembly. I think we can probably
get to 5,000 a week with the current two
general assembly lines. But with the third one, I’m highly confident that we can exceed 5,000 units per week. Model 3 test drives, we should be able to offer the Model 3 test drives starting the end of this month. I think we should have
them in almost all stores in North America by the end of next month. We’re rapidly expanding service centers. I think, year over year we’ll probably see a doubling of service
center capacity for Tesla. We’re making major progress
on the body shop front. We’re also, this is quite a big deal, we’re creating Tesla body
shop repair locations, and we should have by
the end of this month, at least the top 10 metro areas in the US being able to be serviced
by a Tesla body shop. This will be a dramatic improvement in the cost and time of body repair. In fact, we think we might be able to do, for a lot of them, same day body repair. (audience applauds) It’s definitely possible. So, I think we wanna aim for, at least, some number of body
repairs to be same day. Whereas, if we go to third parties, best case, it’s about a week. In some cases it’s several weeks. So, this is pretty exciting, actually. We’re basically, just taking
our biggest service centers, adding an annex for body repair, and then pre-stocking the parts so you don’t have to wait for parts to come from the factory. Not yet. (audience laughs) But, March next year, I think we’ll have something very exciting to show. All right, so let’s take some
questions from the audience. I think, basically, just line
up at the mics, and go for it. – Hi, Elon. I wanted to ask, is there gonna be a time when Tesla is going to produce compact, and or subcompact vehicles. Such a huge segment, and it seems like that would be necessary to fulfill the Master Plan Part Due mandate. – Yeah, I think we’ll do a compact car in less than five years. Yeah. All right. – Wow, less than five, okay. – Yeah, great progress. You mentioned autopilot progress as well. So, when do you expect fully
enhanced autopilot officially. Follow navigation, switching freeways? Within the six month timeframe? (sighs) (audience laughs) – I was just testing last
night at about 1:00 AM. I think we might be able
to release something in a couple of months that could do that. We’ve been pursuing two paths, one really complicated path that I think isn’t working that great, and then a simple path that I
think will work pretty well. I mean, I was able to drive last night, go from highway on ramp
to highway off ramp using the simplified version
of the control system. I think with some further effort, we can get that out in
the next couple months. (chuckles) – As the team freaks out. – Is this on? There we go. So, as far as Tesla Inc is
concerned with the Model 3, and to what degree of certainty, will there be a consumer
or a fleet lease option within the next three
years on the Model 3. Is that something that you guys already have in plans, in the works? Or is there room for ancillary business? – We will offer leasing on Model 3, but probably end of
this year or early next. ‘Cause it does have a slight impact on the capital usage of Tesla. In turns of fleet stuff, yeah, I think people can certainly buy a lot of Model 3s and then
uprate them as a fleet like people do for Model
Ss and Xs for taxes. Yeah, I think we’ll, certainly, be happy to support that. (speaking away from mic) – Kind of a simple follow up to that, kind of the understood thing, if I purchase a whole fleet, and then Tesla comes in and says, “All right, we’re gonna
start leasing direct “to the consumer or having
a commercial option,” that might not work out so well for me. That’s why I’m asking. Anything commercial happening that you have in the works in
the next two years even? – Right now we’re just super focused on wrapping up manufacturing of Model 3 and making sure people can get their cars, ’cause they’ve been
waiting for a couple years. We’re not really thinking much about incremental demand generation because, as it is, even getting
to 5K cars per week, it would take us almost two years to produce enough cars to satisfy those that have put down a
thousand dollar deposit. So, yeah, we need to kind of ramp to 5K and then next year ramp to 10K a week, and get the right hand drive version done and homologate the car
for Europe and Asia. We’ll think about other things once we’ve done all those things. – Thank you.
– Thank you. – Hi. Gwynne Shotwell with SpaceX mentioned that Tesla automobiles might use, in some way, the Starlink satellite network. I was wondering if you
might elaborate on that opportunity and when
that might take place. – It’s possible. The Starlink thing is more meant for fixed terrestrial homes and businesses, and that kind of thing. For mobile, it might be possible to use the Starlink system effectively if you had a repeater,
ground based repeater system. But the Starlink user terminal is about the size of a small
to medium size pizza. So, I’m not sure you’d wanna put that on the roof, if it were a Tesla. Maybe, but…
(audience laughs) I think, probably, most likely we will continue to use just wifi and the cellular network. Yeah, most likely. – ‘Cause the receiver for Starlink is not like a typical receiver. So, the car couldn’t
immediately just receive. – My name is Steven Singleton. My question is, how’s Tesla engaging regarding virtual power stations with governments and territories and countries that may have
weak power infrastructures to provide clean energy to
more of the world’s citizens? – Yeah, I think we’ll have a lot more to say about that when we announce the generation three of the Superchargers. Because we’ll be doing much more of an integrated solar battery system with the Superchargers. So, today, only a few of
the Supercharger systems have solar and battery systems. But long term, we wanna have
almost all of them have that. And the nice thing is that if you got a solar powered carport
area and Tesla batteries, you don’t even need to
be connected to the grid. It’s like proof against
a zombie apocalypses. It should still work. As long as the zombies aren’t too near the Supercharger, I suppose. (audience laughs) But yeah, it’ll be able to work anywhere, even if there’s not good
power infrastructure. – Asking about networking
powerwalls together. And for a virtual power plant, if that’s also what you were alluding to, we do have a really cool
project in Australia, where we’re actually networking together up to 50,000 individual
homes with powerwalls. So, each one of those
homes has its own battery. It can still serve as
a backup power source if the utility totally goes
out, if there’s a storm. But when things are working normally, all those houses can talk together, and we can talk to the
utility and treat them as sort of one big distributed power plant. So, that’s a really cool project that has benefits across the whole grid, for the homeowners, for a lot of people. And we’re building that up right now, and we’ll probably be
expanding that same model. We have a small demo in the US, and we’ll be expanding it worldwide. – They also just did a project like this in Belgium with a power plant there. (audience applauds) – We’re also doing quite
a lot in Puerto Rico. I think Tesla’s more battery projects and solar project in Puerto Rico than everyone else combined. So, we’re making a big difference there, doing our best to. And I think there’s potential for a virtual grid in Puerto Rico as well, rather that rebuilding a legacy oil and gas based energy
generation system. (audience applauds) – Hey, Elon. I also think boring bonehead
questions are not cool. So, hopefully this is a
little more interesting. I’ve had a Model S since 2012, best purchase ever. Thank you.
– You guys nailed design, nailed performance. The one thing I always get
from friends and family, ’cause I do the drive down to LA a lot, is the supercharging time. I know you mentioned
you guys were working on Supercharger 3. I assume it’s gonna be a bit faster. Just curious, do you guys see room for orders of magnitude
improvement in charging time, or are we kind of reaching a plateau with current battery
chemistry and technology? I wouldn’t say that there’s an order of magnitude improvement. But I think a factor of
three or four is possible. It won’t be applicable to
all battery chemistries. So, 2012 chemistry can’t
take the charge rate of current chemistry. I wish it could, but we just had to make a bunch of improvements
to increase charge rate. The key, I think, is that the ratio of drive time to charge time should be, at least, on the order of six to one, if not eight to one, or 10 to one. The point of which you’re driving, say 10 times as much as you’re charging, then the natural sort of
human need to take a break, unless you have an enormous bladder, it starts being unparamount. If you start a road trip at, say, 9:00 AM, typically, around noon, you want to stop, hit the restroom, grab a bite to eat, grab a coffee, and you want to get back to your car and have it be ready to go. If you say that that’s like half an hour, that’s kind of like the minimum threshold for the car to be ready to go when you come back from a break. And then if you get to the point where, say 10 to one, where maybe
it’s only 15, 20 minutes, say you’re on the road 15 minutes, then the car is ready to go way before you’re ready to go. And for some of the long distance, like if you get, say, a Model S 100D, you could drive nonstop from LA to San Francisco if you drive carefully. That’s a long drive. And we think there’s a potential, there’s certainly opportunity for range improvements down the road where we’ll be able to offer cars with ranges excess of 400 miles. – Hi, my name’s Dr. Katherine van Ekert, and I’m with People for the
Ethical Treatment of Animals. I have a question regarding
your use of leather in your gear shifter and steering wheel. – Gear shifter? (audience laughs)
– What gear shifter? – A gear shifter, I don’t
think it has anything. Steering wheel, maybe it does. Okay, steering wheel still does. – [Katherine] Are you still using leather in some of your components? – So, we do in Model
S, X, and 3 currently. The only leather is on
the steering wheel rim. And people have asked,
and kind of off menu, we do replace that for people
that need a fully vegan car. – Sure. So, our concern is, we’re obviously facing an environmental crisis, and the animal agriculture,
as we all know, is one of the main contributors, particularly leather production. We’re really pleased to see that you have introduced non leather seating options. That’s really fantastic
step towards your goal of– – Is there a question? Come on. – We would really like
you to take the next step an eliminate all leather components. – Yeah, I think S, X, and 3, we may be the first vehicles in production to kind of go non leather. And at least, in all of
our seating and our trim and we’re actively working on replacing the steering wheel as well. We just wanna make sure
that the experience is as good, if not better. – [Katherine] Sure. Yeah, just to add to that, so there are some existing premium vegan leather suppliers. Ultrasuede and Alcantara, if I’m pronouncing it correctly. They’re used by other
luxury cars, like Ferrari. So, yeah, we would really like to see Tesla step up as well. – Yeah, we’ll definitely be offering, technically, it won’t
say it on the website, but you can actually have a Tesla that has zero leather whatsoever,
including on the steering wheel. It’s a little difficult because we do it in small quantities
at the design studio. So, it’s challenging to do it at scale. Model Y, for example, will
not have any leather in it, including in the steering wheel. Even if it does have a steering wheel. (audience laughs) Thank you. – When do you expect
significant battery advances to allow Tesla to pack
twice as much energy into each of the batteries without increasing the size ore weight? – Twice as much is tricky, but we can certainly see a path to about a 30% improvement,
maybe a 40% improvement in energy in the same size battery pack. But that’s technology we
are confident does work, and it needs to be scaled
up and made very reliable. But 30% to 40% is definitely doable. Longterm, probably double, long term by other people’s standards. From a Tesla standpoint, meaning probably two to three years to get to about a 30% improvement in plyometric engine density. Yeah, maybe six years or something, six to eight years to get to doubling. It’s highly dependent on making, for that really big jump,
a lithium anode is the key. Just plating out pure
lithium on the anode. – I started a company
called Tesla Attractions. Tesla Attractions is, basically, a gamification version of
visiting Superchargers. And I know that you tweeted
about this a while ago, saying that it was a good idea. And if you ever decide
to go through with it, obviously, I do not
want to be in a position of competition with you. So, how could someone
like me help the mission? – Maybe you should interview
at Tesla. (chuckles) (audience laughs) Our focus right now is getting through the critical stuff, especially the Model 3 production ramp, and then smoothing out
the production process to make the car affordable, getting the lower class battery pack, or smaller battery pack into production. So, those are fundamental things to, really, the survival of the company. And then we do kind of like
the fun frivolous things, for the add joy to the experience, maybe later this year. We always like doing sort of
fun silly things in the car, like Easter eggs. There’s a lot of Easter
eggs in the Model S and X, and 3, that are quite fun. In fact, once they’re discovered, they’re put in the Easter egg box, which you can just tap the
Tesla logo on the screen, and then wait for about 30 seconds, and it opens the Easter egg box. – 30 sec, it’s like instant. – My name is Vance Gerber. I’m hooked into Tesla in multiple ways. Obviously, I’m a stockholder. I have a SolarCity panel on my roof, and also have a Model 3 reservation from March 31 of 2016
ready for configuring. But I would really, really, really like to have an all wheel drive. Can you give an order magnitude guess as to how long I’d have to wait for that? – You should receive a configuration email in the next week or so.
– Perfect. – Yeah. We start production of all wheel drive, actually, technically we’re starting on all wheel drive this month, and we expect to scale
that up in July and August, and begin high volume production of all wheel drive by September for sure. – So, I have a tour planned for September, a one month tour. – [Elon] All right, we’ll make sure you get your car.
– Any chance I can make it? – Yes. We’ll make sure you get your car. – There you go. Become a shareholder,
ask Elon for your car. – Hi, I got my first Model S in 2013 and have an X and a 3 now. I love the product. I feel like I’ll always
be one of the first to try to try one of your new products. I was just wondering, is there any chance in the future that we’ll be able to text commands to our car like, heat my car to this temperature, come pick me up? You know, that type of stuff? – We’re gonna keep enhancing
the Tesla app on the phone, to be able to just tap the summon button, and your car will come
find you wherever you are. You can change the temperature
right now from the app. But we want the car to learn what you most likely would do. Basically, if there was a great chauffeur in charge of the car, what would that person do anticipating your needs and knowing what you’d want? So, it’s sort of like an
intuitive trusty steed, just always knows what you want, ideally. And then you can easily
adjust that as needed. So, you want it to be as close to like a mind meld with
the car as possible. – Hi, my name is Kevin. I have the Model S since 13. My question is about autopilot and the use of LiDar. As we all know that Tesla probably still the company alone, they’re not using LiDar, where all other vendors using it. So, as autonomous driving
is close to reality, I think inevitably,
there will be a showdown on which approach will be most superior. So, what do you think
when that time will be? (chuckles) – What LiDar tends to
drive companies to do is to go to a local maximum in terms of autopilot capability or
autonomous driving capability. And LiDar ends up being
some what of a crutch. It’s helpful to get almost there. But if you rely on it, you will never actually get there, is my thing. So, you have to make
vision work extremely well in order to achieve true self driving. Once you’ve made vision
work extremely well, LiDar is really unnecessary. It’s not really adding anything. We do have sophisticated sonar, ultrasonic sensors around
the vehicle for near field. And we do have a forward radar system which is useful for detecting objects, even in fog, snow, rain, low visibility conditions, where you can’t see what’s going on. And that’s also a case where LiDar, is ineffective because LiDar is an active photon generator
in the visible spectrum. This doesn’t make sense to me, because you have a massive amount of incoming photons in the
visible spectrum normally. So, if you’re gonna do
active photon generation, the 400 to 700 nanometers
is the wrong wavelength. You really wanna be aiming for something that’s around
4 millimeter wavelength, because that is occlusion penetrating. (audience applauds) – Good engineering response. – We’re two time Tesla Model S owners and also stockholders. Question about JB. Every SEC filing has always
included JB as a key man. And he was suddenly dropped
off in the Q1 filing. So, a little concerned about JB. – Oh, really? I didn’t know that. That was very accidental. Sorry. (laughing) I didn’t know that was the case. I have no idea why. – Just made it more generic. Yeah, the intent was to
make it more generic, the risk factor. There was no intended, or
unintended implication behind it. (audience laughs) JB, we love you. We want you. JB, there’s something we
need to talk to you about. – Sorry, and one last one, which is, the Tesla
energy storage business is still running double
digit gross margins negative, it looks like, even though you’ve managed to deliver a lot more megawatt hours. Can you talk about the pathway to getting a profit out of that business, please? – Yeah. Do you wanna talk about that? – Sure, yeah, definitely we expect our storage business to
doing significantly positive. And our goal is to have the same level of gross margin as the
automotive business. And as our volume scale and as we have more powerwalls out there, and our manufacturing
efficiencies come in, we definitely expect that you’ll see a big change in a positive trend in that, every quarter into 2019. – We’re aiming for, essentially, about the same gross margin
level as in the cars, which is 20% to 30% gross margin for all of the energy products. It’s necessarily, as
you ramp up production, it ends up being, it’s negative just as it was for the Model 3, and Model S and X, but
probably, later this year, or, certainly, early next, we should be in the 20% to 30% gross margin
level for energy storage. – Hi. Thanks for a shot on the
conference call, by the way. And my question was just surrounding, as a long term investor,
I hate to say this, but I feel like my trust
in Tesla’s timelines sort of eroded a little
bit with the Model 3 ramp. So, should I keep discounting
things on Elon time? Have you learned anything about this? – Yes, Gali. – I think I do have an issue with time. (audience laughs) Yeah. It’s been true since,
and my brother’s here, it was like I have a condition. My brother used to, when we
were catching the bus to school, he would lie to me about the time. (laughs) – I don’t blame him. – He’d say it was earlier
than it actually was, and I’d get there slightly after that, and then we’d actually
be able to catch the bus. This is something I’m
trying to get better at. I’m a naturally optimistic person, which I’ve not have probably done cars or rockets if I was not. But I’m trying to
recalibrate these estimates. Yeah. (chuckles) Try to recalibrate as much as possible. Yeah. I mean I’d probably put some
sandbag on future dates. That’s probably wise. I kind of say when I think it can occur, but then, I’m typically
optimistic about these things. But hopefully, less optimistic over time. So, yeah. (audience laughs) It pretty much always happens, but not exactly on the timeframe. (audience laughs) – [Moderator] Elon, we’re
about 50 minutes over one hour. You wanna take maybe a couple more? – Yeah, maybe, a couple
more questions form you. – [Moderator] Okay. – Hello, Mr. Musk. My name is Alex Perez. I really like your jacket today, and so it kinda got me thinking. Has Tesla ever thought about going into the motorcycle business? (audience chattering) – Yeah. I, actually, used to ride
motorcycles when I was a kid, and did dirt biking for
eight years or something. And then I had a road bike until I was 17 and was almost killed by a truck. So, we’re not gonna do motorcycles. (audience laughs) – Ho-ho-ho-ho. (audience applauds) – Hi, Mr. Musk. My name is Sonya. And my mom has a Model 3,
and My dad has a Model S, and I have one share. So, I’ve noticed that whenever my mom is kind of going a little bit too fast, like approaching a car at a stop sign, the Tesla beeps pretty
loudly to kind of warn like, hey, you’re gonna hit that. I was wondering, are
you guys thinking about developing mode where drivers
could choose to turn it on, and then if a Tesla
detected it was approaching something quickly or was going to crash, it would gradually slow down a little bit. So, best case scenario, if
the driver takes control, it doesn’t really matter. Worst case scenario, in the crash, it decelerates so it’s not as bad. – There’s a automatic emergency breaking. I think what you’re saying is, instead of last minute
kind of dramatic slowdown, maybe slowdown sooner,
but less dramatically. And that is something that will occur with the latest versions of autopilot. It will decrease speed proportionate to the confidence level. We wanna do that in a way
that’s not annoying to people, the car isn’t slowing down a lot. So, it’s really a delicate balance between not annoying people so that they wanna turn it off,
but also being safe. For autopilot, I think the improvements are gonna be really quite dramatic over the next several months. Yeah. The system is intended to change speed proportionate to its
confidence in going forward. But in order to do so, we had to improve the specification of
the autopilot neural net and the logistics that go with it, so it just didn’t annoy
the hell out of people. ‘Cause there may be times when the car thinks it should slow down, but actually, not really. And that would just drive people crazy. I do think what you’re getting at is something that you’ll see play out with versions of autopilot that are deploying later this year, including the one that’s
coming out this week. – Hi, guys. I just wanted to personally thank Elon, JB, Franz, Deepak,
good to have you back, Tim, Emily, Vinny, Andrew, the people at Tesla who
I don’t know by name. I’m the proud owner of
an early 2012 Model S. Very different than Model
3 that my dad recently got. His first new car, he’s pretty
perplexed and amazed by it. I actually drove that from
New Jersey to Richmond. Probably could’ve skipped
supercharging entirely. Charged the car for, I think it was, maybe, about 20 minutes,
and continued the trip. And the car was actually telling me that I was ready to go before I was done eating the sandwich that I picked up. I just wanted to ask a quick question. Is there a possibility to get a business card for the guy to your left, because I wanted to tell him about a company this man’s been working on disruptive technology that
you’re already indirectly using, and wanted an opportunity
to speak with you about it further. Thanks. – All right. Yeah, we’re certainly
take a business card, and we’re always looking investigate interesting opportunities
to improve a car. One thing we haven’t been good at educating people on is that the Model S and X, but
especially the Model S, has improved very dramatically from 2012. So, we’re arguably on
version three or four of the Model S right now. So, it’s really a gigantic improvement in Model S today versus Model S of 2012 when we first started production. I really encourage anyone who’s got an early Model S to test drive the current version. I think you’ll be blown away
by how much it’s improved. All right, I think that
might be the last question. – I will soon be driving
around in Model 3. I’m curious, you mentioned earlier that during production, it’s people first and automation later slowly. What kind of conservations
prompted to do otherwise when you started Model 3 production? Can you talk about that? – I think we were just overconfident about the degree of
automation that was possible. We did rely quite a bit on tier one manufacturing automation integrators. And a couple of those things
really didn’t work out at all. And now we’re really gonna internalize all tier one manufacturing
systems at Tesla. So, we’ll have a lot of suppliers, but they’ll be at the tier
two and tier three level. All right. Thanks very much for coming. (audience applauds) (machine whirring) (upbeat music) – All right, everyone. Thank you for joining me. I hope you guys enjoyed that. I’m going to be following up on some Q&A here on Crowdcast. If you guys aren’t subscribed, go ahead and do that for me, and then you’ll get an invite to this. Every week we do this on Monday. So, thank you, everyone, for joining me. And I’ll just give you
my quick takeaways here, ’cause I think there were a few. One is that the $35,000 Model 3 will be available later this year. There will be a free trial of
autopilot starting next month. That was very new and interesting. Also, there’s a new version of autopilot coming out this week. Stay tuned for some videos on that. Because I, as a Model 3 owner, hope I’ll be getting that. Also, we got more info about
the Gigafactory in China. We kinda knew it was already in Shanghai. But there’s that, as well as the Supercharger V3 looks like it’ll only be for newer cars, potentially not even those
that are already available. And the interesting thing
about the battery advances is that they didn’t really address any of the ideas around
solid state batteries or any of these other crazy technologies. So, that’s all for today. Again, do appreciate
you guys for joining me. Remember that you can get entered to win a 24 hour rental of a Model 3 by going to Teslanomics.co/100k. All right, until then, I.

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