What if Tesla made a Slate-like EV as a substitute of the Cybertruck?

Eventually month’s rapturously received Slate debut, it took an govt’s quip that “Slate” and “Tesla” use the identical 5 letters to shift my mind into excessive gear. I’ve coated the EV world for 15-plus years, and I just about by no means spend time on counterfactuals. There’s fairly sufficient to cowl in the true world.

However … I’m of the opinion Tesla may, and may, have launched a small, easy, low cost compact pickup truck—in different phrases, what Slate debuted—relatively than the pickup it did produce, the Cybertruck. That costly and polarizing automobile has been, to place it bluntly, a sales disaster. Over 18 months, Tesla has offered solely about 50,000, versus projections of many occasions that quantity. Worse, whereas EV crossover utilities promote tens of 1000’s a month, the costlier EV pickup vehicles to this point haven’t.

The corporate that led the world in EV manufacturing for greater than a decade may have launched a reasonable small pickup that may have democratized EVs to an entire new class of consumers. Tesla probably may have supplied extra vary on the similar worth resulting from its in-house battery cell manufacturing. And it will have been a worldwide product, prone to be offered in Europe and China from launch.

Most essential, it will have given Tesla the $25,000 EV that CEO Elon Musk had promised since 2020—and concurrently pioneered a brand new automobile in a “white area” out there the place no different entry existed. Now, Tesla is now not focusing on a $25,000 EV: Musk abruptly mentioned in October 2024 the corporate had walked away from the ”$25,000 Tesla” thought fully. He went on to counsel the thought of promoting any $25,000 Tesla that wasn’t a robotaxi was each “pointless” and “foolish.”

Why precisely ought to Tesla have carried out a Slate? I see 4 components: in the beginning, the massively interesting thought of a very inexpensive EV. Tesla may properly have made a small, low cost EV pickup an enormous hit, given its present meeting crops, lower-cost batteries, plus the possibility to promote globally proper out of the field.

A “$25,000 EV” to catapult Tesla into the key leagues

The joy over an surprising product from an unknown maker probably reflects intense market desire for truly affordable EVs. That was traditionally what Tesla meant to do, over time: develop its quantity by producing greater numbers of more cost effective EVs by way of economies of scale.

In 2024, Tesla delivered roughly 1.789 million vehicles globally—20,000 fewer than its 2023 whole of 1.808 million. That makes the corporate bigger than Mitsubishi (945,000) Subaru (976,000), and Mazda (1.170 million), however smaller than BMW (2.45 million) and BYD (4 million-plus).

With Musk’s hopes to promote tons of of 1000’s of Cybertruck a yr dashed for good, Tesla’s quantity mainstays at the moment are of their sixth and ninth mannequin years (the Mannequin Y and Mannequin 3 respectively). These automobiles now face opponents in all their essential markets, which definitely wasn’t the case in 2020 or 2017 when these vehicles launched. Greater than 20 new EVs, each from present automakers and startups like Lucid and Rivian, have hit the market since these years

The basic strategy to enhance quantity is to supply new merchandise in new segments—and from 2020, the long-promised “$25,000 Tesla” was to be that product. Even earlier than tariffs, the U.S. automobile market suffered from an affordability disaster: the sales-weighted common transaction worth of a brand new automobile has stayed at $47,000 to $48,000 because the pandemic. If EVs are to take off, their costs need to be equal to—or cheaper than—their nearest gasoline counterparts. A very inexpensive EV may promote like gangbusters. And if any firm had been well-placed to ship it, it will be Tesla.

As an alternative, Musk has doubled down on his imaginative and prescient of Tesla changing into an organization whose merchandise are robotaxis and humanoid robots. Quickly we’ll know extra concerning the substitutes for that $25,000 mannequin, the promised “lower-cost Teslas.” They’re extensively anticipated to be “decontented” (stripped-down) variations of immediately’s compact Mannequin 3 sedan and Mannequin Y crossover. They in all probability received’t begin at $25,000, however we’ll discover out quickly sufficient. And, to be sincere, they hardly appear prone to generate the identical pleasure and buzz because the Slate unveiling produced.

Slate is now the place Tesla was in 2011 and 2012, because it struggled to get the Mannequin S into manufacturing in its newly-acquired former GM-Toyota plant in Fremont, California. Greater than a decade later, Tesla has realized an awesome deal about constructing automobiles in quantity. The corporate now has 4 crops: Fremont; Austin; Shanghai, China; and outdoors Berlin in Germany. That have is one thing Slate’s manufacturing execs, with expertise everywhere in the auto trade, should impart to the brand new workers they rent to construct vehicles in its personal manufacturing facility, a 1.4-million-square-foot former printing plant in Warsaw, Indiana.

With that have, a Tesla Slate may need used typical stamped-steel building. Slate selected a nonstandard building approach: molded gray polypropylene panels bolted onto a steel substructure. That saves Slate a number of hundred million {dollars} on the steel-stamping presses and paint store it doesn’t need to construct. Need a Slate in a unique colour? Merely wrap it—simply as Tesla used to supply to do for the Cybertruck.

To be honest, the Cybertruck too makes use of nonstandard supplies, which contributed to a few of the important manufacturing delays earlier than deliveries began in late November 2023. They had been due not solely to its brand-new meeting plant in Austin, Texas, but additionally the particular tooling for its flat, angular stainless-steel design and the extraordinary challenges of reaching acceptable ranges of high quality in a automobile inbuilt that steel. We’ll see how Slate does in flip.

Elon Musk recognized the necessity for what he dubbed a “gigafactory” to provide enormous volumes of battery cells as early as 2013. Tesla introduced its cell associate, Panasonic, into the Reno gigafactory whereas each different automaker was nonetheless shopping for cells shipped from battery suppliers. Reno began supplying 2170 cells for Mannequin 3 manufacturing in January 2017.

Tesla is now rumored to have the bottom battery value per kilowatt-hour of any non-Chinese language maker. Globally, it produces cells for roughly 1.8 million EVs a yr in addition to extra for its rising energy-storage enterprise. (Although it’s value noting that final yr, GM produced cells with greater whole vitality via its Ultium Cells three way partnership than Tesla did— at the very least in North America.)

Slate, then again, will purchase assembled battery modules from Korean maker SK-On, which additionally provides batteries to Ford for its F-150 Lightning electrical pickup, and assemble them into battery packs in its manufacturing facility. Are they the similar module? A spokesperson for Slate didn’t reply to a request for remark.

We’d wager Slate’s cost-per-kWh is greater than Tesla’s. So Tesla may have carried out a Slate-style pickup with both extra vary (from extra battery capability on the similar worth) or a good cheaper price if it caught with Slate’s projected ranges. Tesla could have supplied solely the higher-range (240-mile) mannequin, after all; from the beginning it has mentioned its EVs needed to have 200 miles.

One of many greatest drawbacks of the Tesla Cybertruck is that, at the very least for the second, it stays a North America-only automobile. It’s a few inches wanting 19 ft lengthy—greater than 2 ft longer than a Mannequin S—and weighs 6,600 kilos. That’s simply too massive to make use of comfortably on many European and U.Okay. roads. Analysts specific doubts over the chrome steel truck’s potential to adjust to European Union pedestrian-protection affect and crush requirements.

As for China, Tesla mentioned in December it had no plans to sell the truck there “for now”. So the Cybertruck now seems restricted to North America. For a much-touted new product that supposedly obtained 1 million or extra reservations from throughout the globe, that may solely be a missed alternative.

A Slate-alike compact or C-segment two-door pickup from Tesla, then again, might be designed from scratch to promote in all three main markets — similar to each Tesla mannequin was earlier than the Cybertruck. Small pickups are a identified and accepted amount there, and the information that Slate has a cargo-box accent package below growth to be used as a small van would put such a automobile instantly into competitors with the European makers now launching electrical compact vans. Besides this one would have had the cachet Tesla loved until quite recently.

Causes this concept is idiotic

There are, after all, a lot of explanation why a Slate-like automobile may need been precisely the fallacious factor for Tesla to launch as a substitute of the Cybertruck.

The primary and most essential is that, within the phrases of the outdated trade saying, “Low worth equals low earnings.” After 2020, when the corporate turned worthwhile for the primary time, its margins on Mannequin 3 and Mannequin Y gross sales grew to spectacular percentages. Even at excessive volumes, a lower-priced automobile with a battery of 80 kWh is prone to have slim margins regardless of Tesla’s low cell prices. The Cybertruck, offered within the volumes claimed, could not have posed that problem.

Second, any Tesla just about has to have a central touchscreen and superior telematics. It’s a part of the model DNA. That clearly provides value, as would a digicam suite to let Tesla proceed to mixture visible knowledge for its hopes of a self-driving future.

Third, once more to the model picture, a small, low cost, sq., very fundamental pickup is hardly what we’d envision as a “Tesla.” It will require increasing the idea of what a Tesla is—although so did the Cybertruck. Aspect be aware: a Slate-like pickup won’t do properly in China, the place a small pickup is considered as a business automobile for low-wage laborers.

Lastly, a Slatelike truck–or any two-door automobile–is an impractical automobile to show right into a robotaxi, even assuming it had been fitted with the suitable digicam and sensor suite. So long as 5 years in the past, that was clearly the course through which Musk was driving the corporate.

As famous, I nearly by no means deal in counterfactuals. I made an exception right here, contemplating the highway not taken, as a result of it appears to me extra consistent with what the world anticipated of Tesla from 2012 to 2020. To not point out much more aligned with The Secret Tesla Motors Master Plan of 2006, particularly its third level: “Use that cash [from building affordable cars] to construct an much more inexpensive automobile.”Nonetheless, inexpensive vehicles need to be fascinating to make a distinction; the Cybertruck is neither, because the market has proven. However a Slate-like Tesla small pickup may have been. Sic transit gloria mundi.