Tesla Master Plan 3 is Global Domination and Tesla Semi is the Key

There has been great concern for Tesla shareholders that there are problems with Tesla’s future growth. There has also been a large drop in share price from the peak share value early this year. The whole stock market is down. Technology and growth stocks have been sold off more than other stocks.

In a global recession, Tesla will have delivery growth of about 45% instead of over 50% from 2021 to 2022. There has “only” been an increase in net income trailing 12 months from $3.5 billion to over $11 billion. Just a triple in net income.

NOTE: I am clearly a Tesla bull, Tesla share owner, co-author of a book on Elon Musk and his companies and maker of Youtube videos. However, I am also a futurist with a public prediction track record that is top 56 out of thousands of people. Prediction accuracy about 80% correct.

People are distracted and ignoring how the Semi delivery will enable Master Plan 3.

I discuss and simplify this analysis and conclusions with Randy Kirk in this video.

This is a follow up to this video.

2006 Tesla Master Plan

Create a low volume car, which would necessarily be expensive [first Roadster]
Use that money to develop a medium volume car at a lower price [Model S]
Use that money to create an affordable, high volume car [Model 3]
And…
Provide solar power.

2017 Tesla Master Plan
Integrate Energy Generation and Storage
Expand to Cover the Major Forms of Terrestrial Transport [Add Model Y, Cybertruck, Semi, $25-30k car]
Autonomy [robotaxi]

Create stunning solar roofs with seamlessly integrated battery storage
Expand the electric vehicle product line to address all major segments
Develop a self-driving capability that is 10X safer than manual via massive fleet learning
Enable your car to make money for you when you aren’t using it

Master Plan 3

Master Plan 3 – Make Tesla Semi an economic offer that can’t be refused. Have it require Megapack everywhere and still be an economic must have. Scale to 4 terawatt hours per year with all Semi and truck domination and another 4-6 from Megapack.

Master plan 3 is all about scaling from 150 gWH of batteries today and 1.4 million cars per year to 20+ million cars and 3-15 terawatt hours of batteries per year. This is 20 to 100X growth in the scale of business.

All of trucking is 4 million Semi per year and 14 million light trucks and 2 million medium trucks. 80% of which are in Asia. 50% in China.

Electrify all of trucking and that saves 17 million barrels per day of oil. 17% of the global oil industry.

Why is Semi the key? It will save costs of $50,000 to 80,000 per year. This is a huge economic signal. It converts a $3 billion per year cost for Pepsi with 44000 trucks into $600 million per year in electricity costs.

Semi Key to Selling Megapacks at 5+ Terawatt hours per Year

The Tesla Semi was released and it showed over 500 miles of fully loaded range. Over 44 tons of payload. This compares to the electric Freightliner semi truck with a maximum range of 230 miles.

Tesla has solved the efficient towing of large payloads with 30-40% more efficiency than its nearest competitors. This is a huge advantage. Mercedes and others said this would be impossible. How many years does it take to double heavy truck range and catch up to what you said was impossible?

This says to me that Tesla is all alone with powerful large, medium and even powerful pickup trucks and will be all alone for a decade.

Domination of medium and heavy trucks is a $1 trillion a year business using 3 terawatt-hours per year in batteries and requiring 4-6 terawatts of megapacks for reinforcing and buffering the electrical grid means Tesla goes from 150 GWh/year of batteries to 8-10 terawatt-hours per year in 15-20 years and it is 50X growth. Getting to 2-3 terawatt-hours per year by 2030 is 15-20X from today.

Charging Advantage Numbers

People say waiting 4+ hours to charge a semi truck is a big disadvantage vs 20 minutes for diesel refueling. Some say that means fewer runs and worse economics for the trucking company. Tesla introduced megacharging that can charge 70% of a 900 kWh pack in 30 minutes. This requires the megapack to step up the 300 kilowatts from the grid. The megapack outputs at 1 megawatt and two megapacks at 2 megawatts.

Tesla Semi Versus Competing Electric Trucks

Tesla Semi 530 mile . 1.7 kwh per mile. 900 kwh pack likely
Tesla Semi 300 mile. 1.7 kwh per mile. 510 kwh pack likely

Freightliner has its eCascadia 230 miles at best with its 438 kWh battery.
Freightliner ECascadia Price in USA is USD 139,000 (unclear which model, they also have shorter ranges).

Volvo%E2%80%99s%20VNR%20Electric%20can%20go%20275%20miles%20with%20its%20565%20kWh%20battery.

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And%20the%20rest%20of%20the%20competition%20doesn%E2%80%99t%20even%20come%20close.

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Diesel%20Semisget%20%206-7%20mpg%20depending%20upon%20model.

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Tesla%20executing%20on%20increasing%20production%20is%20the%20main%20uncertainty%20and%20it%20is%20why%20Elon%20Musk%20and%20Tesla%20is%20talking%20about%20Master%20Plan%203.%20

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I%20have%20done%20the%20analysis%20that%20shows%20the%20Pepsi%20delivery%20day%20was%20the%20real%20start%20of%20Tesla%20Master%20Plan%203.

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There%20are%20terawatt%20hours%20of%20batteries%20coming%20from%20China.%202%20TWh%20by%202025.%20There%20is%20a%20massive%20buildup%20with%20the%20huge%20tax%20incentives%20in%20the%20US.%20

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Batteries%20and%20Factories%20Ready%20to%20Go

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Tesla%20is%20using%20150%20gWh%20of%20batteries%20in%202022%20and%20putting%20them%20into%20cars%20and%20storage%20products.%20BYD%20is%20using%20about%20half%20as%20many%20batteries%20in%20sellable%20products.%20Most%20of%20the%20%E2%80%9Ccompetition%E2%80%9D%20is%20ten%20times%20smaller%20or%20less%20in%20terms%20of%20battery%20and%20manufacturing%20electric%20cars%20or%20storage.%20A%20theoretical%20competitor%20has%20to%20make%20the%20competitive%20truck%20and%20storage%20technology%20and%20then%20scale%20up%20factories%20and%20get%20battery%20supply.%20How%20long%20to%20go%20from%20ten%20times%20smaller%20to%20equal%20Tesla%20size%20today?%20How%20fast%20does%20Tesla%20grow?%20Tesla%20can%20repurpose%2040%20gWh%20of%20Panasonic%20Nevada%202170%20cells%20for%20the%20first%2050,000%20Tesla%20Semi.%20Tesla%20makes%20up%20for%20the%20Model%203%20and%20Model%20Y%20batteries%20with%20CATL%20LFP%20batteries.%20CATL%20has%20an%2080%20gWh%20battery%20plant%20dedicated%20to%20Tesla.%20

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Tesla%20has%20its%20first%2040%20gWh%20megapack%20factory%20in%20Lathrop%20California.%20The%20factory%20is%20completed%20and%20ramping%20up%20production.

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50,000%20per%20year%20in%202024%20is%20Tesla%20first%20Semi%20production%20target.%20This%20is%20the%20Nevada%20production.%20This%20would%20put%20Tesla%20behind%20only%20Freightliner%20in%20US%20Semi%20production%20of%20any%20kind.%20Tesla%20doubles%20up%20the%20US,%20adds%20two%20such%20factories%20and%20battery%20supply%20in%20Europe%20and%20eight%20times%20as%20much%20in%20China%20and%20Asia.%20By%202028,%20this%20would%20be%20650,000%20Semi%20per%20year.%20

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Economic%20Superiority%20of%20Tesla%20Semi%20and%20Megapack

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One%20megapack%20%242.6%20million.%20Five%20megapacks%20%242.1%20million%20each.
%0A5%20Semi%20trucks.%20Assume%20price%20increased%20to%20%24250k%20each%20with%20%2440k%20tax%20credit.
%0A%242.1%20million%20for%205%20trucks%20after%20credit.
%0AOne%20megapack%20assuming%20part%20of%20multiple%20pack%20and%20larger%20truck%20order.%20%242.1%20million.
%0AMegapack%20gets%2050%%20tax%20incentive%20with%20inflation%20reduction%20act.%20%24400k%20reduction%20in%20taxes%20depending%20on%20state%20tax%20rates%20and%20company%20taxes%20making
%0Athe%20claim.%20%243.8M%20cost%20after%20tax%20benefits%20and%20incentives.

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%2417k%20per%20year%20in%20electricity%20for%20100k%20per%20year.%20Assuming%2010%20cents%20per%20kwh%20wholesale%20electricity%20pricing.
%0AMegapack%20insures%20wholesale%20pricing.%20Use%20case%20one%20install%20at%20plant%20200%20miles%20out%20and%20back.
%0AIf%20no%20Megapack%20electricity%20pricing%20could%20spike%20to%2050%20cents%20per%20kwh%20or%20more.
%0APlus%20needed%20for%2030-60%20minute%20charging%20otherwise%203%20hours%20or%20more.

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5%20trucks%20diesel%2016000%20gallon%20each.%2080,000%20gallons.%20%245%20per%20gallon.%20%24400k%20per%20year.
%0ADiesel%20prices%20ranging%20from%20$4.5 to $5.50 around the US. Oil Price was higher in prior months.

Plus $3000 per truck for brake pads. Replaced every 30k miles. 5 pairs each. $15000 per year.
$415,000 fuel and brake pads.

5 Tesla Semi and megapack. $17000 per truck electricity. $85000 per year. $330,000 energy and brake savings per year.

Megapack can also load balance and time shift facility and get autobidder revenue. If worked with solar installation then can front load capex and operating costs become free in years 6-25.

In December 2019, Tesla delivered a 1.25 MW / 2.5 MWh Megapack to the Millidgeville Substation in Saint John, Canada. Saint John Energy, the owner of the Megapack, stated that it will be used for peak shaving. The battery is estimated to save Saint John Energy CA$200,000 per year. Saint John Energy planned to integrate the battery to work with its grid management software. It became operational on April 3, 2020, and is being used for peak-shaving. This is a smaller megapack before sizes were increased. There are Tesla charges for annual maintenance of the Megapacks but more money can be saved or earned from the larger pack.

Combined with some level of solar say $400k, then Megapack and solar can earn/save $150k per year or more.

$480,000 in annual revenue/savings.

9.8% IRR for trucks and megapack and 13.7% for just trucks But this is on top of the utility and justification for the trucks in the first place. ie. Pepsi has trucks to deliver bottles of product to customers. This is the incremental gains over the diesel scenario. It is above and beyond that you had already justified getting Semi trucks of some form to begin with.