Here’s something that’s simply mind-boggling: By the end of this year, electric vehicle (EV) maker Tesla, Inc. (NASDAQ: TSLA) will have burned through more than $10 billion without ever having made $0.10 in profit. Yet, companies around the world are still lining up to compete with it.
Tesla CEO Elon Musk often says that he and his company welcome all newcomers in the EV market in the hopes of combating a larger problem than market share: pollution and climate change.
Dyson Sucks! (in a Good Way)
Dyson — yes, the British vacuum cleaner maker — is working to build an electric vehicle and bring it to market by 2020.
Presumably, it won’t suck. At least, not in the uncomplimentary sense.
Company Founder and Chief Engineer Sir James Dyson is well-known for revolutionizing vacuum cleaners and also hand dryers in restrooms. He has also recently promised an electric car that is “radically different” from anything we’ve seen so far.
The British billionaire said back in September that the company would be investing $2.7 billion in building an electric vehicle and admits that 400 of his employees have actually been working on this project since 2015.
No prototype has been built yet, but Dyson says the car’s electric motor is ready and two different battery types are under development, which he’s claiming are already more efficient than those in existing electric cars.
Dyson also states that consumers will have to “wait and see” what the car will look like: “We don’t have an existing chassis … We’re starting from scratch. What we’re doing is quite radical.”
However, he also says the design is “all about the technology” and warned that it would be an expensive vehicle to purchase.
Dyson has long been concerned with current vehicle engines and has long believed that electric vehicles were the best way to progress: “I’m not a Johnny-come-lately to electric cars. It’s been my ambition since 1998 when I was rejected by the industry that has happily been creating dirty vehicles, and governments have kept on allowing it.”
Dyson has proven himself as a dogged inventor. His technological savvy gives him and his innovative company a chance at scoring a hit in the complex and costly global car industry.
Other Silicon Valley giants, like Apple (NASDAQ: AAPL) and Google (NASDAQ: GOOGL), have abandoned their plans for making their own cars. And that’s their problem…
But it seems like there’s no deterrent to Dyson’s ambitious leap from vacuums to its own Earth-saving electric vehicle.
Not a War… But an Alliance
By jumping headfirst into electric cars, Dyson is forging a de facto alliance with Musk.
Neither billionaire is motivated primarily by the competition of selling more cars. Rather, they see the automobile market as a large-scale design problem that’s embedded in far larger problems: pollution and climate change.
Both men recognize that in modern capitalist economies, where consumer spending makes up 70% of a country’s gross domestic product, the best way to effect major change is to propose major changes in what consumers buy.
Automobiles are a multitrillion-dollar business. But 99% of the market runs on finite fossil fuels, and the emissions are one of the largest contributors to worsening climate change.
If Tesla and Dyson can alter the situation with electric cars that are largely powered by renewable energy, consumers could help curtail climate change.
But those consumers need compelling products.
With Tesla, Musk has given the world a sexy electric car and has been rewarded with a market cap of $60 billion and with 500,000 preorders for its Model 3 sedan.
If Dyson can offer something similar — or even better — the world will be moving toward an exciting EV ecosystem that’s supported not by government mandates for other automakers to comply with emissions and fuel-economy regulations but instead by the save-the-Earth mission that everyone can get behind.
Others Entering the EV Ring
Other carmakers are following Tesla’s and Dyson’s leads and will present some 50 new EV models to market globally between now and 2022.
Daimler AG (OTC: DDAIF), Volkswagen (OTC: VLKAY), and General Motors Company (NYSE: GM) raised the competitive stakes on October 2nd by pledging to sell 20 all-electric vehicles by 2023 and also by launching two new EV models in the next 18 months.
Here are some of the most significant new models coming to market:
- VW’s Audi brand is going to be starting to build the e-tron quattro, a luxury SUV, in 2018, followed by the Sportback coupe in 2019, and then a third, unnamed vehicle by 2020.
- Porsche (OTC: POAHY) is going to be selling a production version of its Mission E sports sedan concept car starting in 2019.
- In addition to BMW’s current electric i3 compact and i8 sports car, the German automaker is going to have an electric Mini Cooper in 2019, an X3 compact SUV in 2020, and 10 others by 2025.
- Daimler’s Mercedes-Benz brand is planning to release 10 battery-powered vehicles in its EQ sub-brand through 2022, including all-electric models and batteries that are going to be produced at its Alabama plant.
- Volvo, owned by China’s Geely Automobile Holdings Limited, has said any new models launching in 2019 or later are going to only be offered as hybrid, plug-in hybrid, or all-electric versions.
But the prospect of a crowded field doesn’t seem to bother the likes of Dyson and Musk.
Their goal is reducing pollution and climate change. So, basically, the attitude is the more, the merrier.
The Bottom Line
With its own electric car, Dyson is planning to skip technology to curb emissions and to provide the world with a vehicle that doesn’t produce any emissions at all.
And with a warm welcome from the leader in EVs (Musk) and the rest of the automobile industry following suit…
It’s all progress.
That’s all for now.
Until next time,
John Peterson
Pro Trader Today