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Tesla Isn’t Just a Car Industry Disruptor, Here is What Else it Disrupts

Tesla is working on technologies which will disrupt industries ranging from cars to energy production and storage, to taxis and buses. How will your brave new world look in twenty to thirty years?

Displaced workers in the automobile industry
Take a look at a picture of a Tesla S production line. Robbie the Robot would feel completely at home here. There are still humans on the line doing high content work that requires thinking. This is not your great grandfather’s assembly line. Henry Ford didn’t create the $5 workday, (very high salary for that day), out of the goodness of his heart. He did it because the work was so deadening, that he had to pay high to get his workers to stop quitting him so quickly, causing him very high training and absenteeism costs.

Lest you cast aspersions on Tesla for causing worker displacement, look at the auto industry generally. In 1965 11,114,000 cars were produced. In 2014, 11,661,000 cars were produced . One and a half million workers in the UAW in the ’60’s have declined to 339,000 in 2014. Globalization, transplants, and automation were all factors, but the trend is clear, more cars, fewer workers.

The future is robots, with a few humans here and there to keep them working at higher and higher efficiencies. Elon Musk made the telling remark that he thought he could increase the output of a factory designed for 500,000 cars a year, (the old NUMMI plant which is now the new Tesla plant in Fremont), to 5 million to 10 million a year. What was necessary was to remove “human speed” from the equation and let the machines do it. Human work will be transferred to keeping the robots humming.

Displaced workers in the taxi industry
Uber is a key disruptor in the taxi industry. For now. What many people don’t realize is that the only special characteristic that taxis have is that only they can accept riders from the street. Uber has you call them through the use of an app. The highest cost of running a cab is the human driving it, maintenance and GAS!

What happens when you have an autonomous taxi, dispatched by an Uber like app, which has radically lower cost of repair, and even with the present unprecedented low costs of fuel, will cut that cost by at least 50%? A lot of unemployed taxi drivers.

Impact on productivity
We all know about the number of hours that people put in at their jobs. In the USA it is horrendously high. It is said that Europeans work to live, Americans live to work. If you can take the average hour and a half commute to work and the hour and half commute home and make that productive time, what does that do to your work day? It should give you three more hours with the spouse and kids. This could also be a major stress reducer as well as improving productivity. The car will have no steering wheel or pedals once we achieve level 5 autonomy. You get useful work done in a car which is outfitted with everything you would have in your office. Computer, phone, printer, and reference material all at your finger tips. If you work eight hours a day at the office, you might be able to get the same work done in five hours. Oh, and Pandora will have your music list for background music, not your boss's.

Energy Production and Storage
Tesla is now absorbing Solar City, so they are getting into the energy production business. They are working like the dickens to reduce the cost of both solar cells and home storage units like PowerWall. How will this affect utilities? Again, the consumer will benefit from not worrying about outages and lower cost due to the lack of transmission lines and all that infrastructure, but what does this mean for utilities? Will employment increase or decline. Line workers, out, solar installers and repairmen, in.

It’s a brave new world out there, full of questions, opportunities and threats. Tesla is well placed to be causing a lot of disruption. In other words, you ain’t seen nothing yet.


Fahr Sicher (not verified)    September 21, 2016 - 11:42AM

In reply to by MichFin (not verified)

But their efficiency drops by as much as 50% when they get dusty and they are only maximally efficient when exactly perpendicular to the sun. Develop a self-cleaning, self-aligning system and make yourself rich!

Allan Honeyman    September 21, 2016 - 5:03PM

In reply to by Fahr Sicher (not verified)

We live in the great Northeast. Neighbors have put up systems as long as five years ago. (I'm waiting for the new Solar City collectors which are way more efficient.) I check one neighbor's collectors on the way to the P.O. every day. They look dang clean to me.

We also have a natural set of cleaners...wind and rain. There are already self-aligning collectors, but the payback on them is not significant enough to make them worthwhile.

Fahr Sicher (not verified)    September 20, 2016 - 8:19PM

Autonomous cars (aka "autonoms") will create a level of "disruption" similar to what the automobile did to the horse and buggy - massive and total. Your article suggest that Joe Familyguy will have an extra 3 hours to work in the car while in reality, Joe will be riding along with Jane, Juan and Jngeun. In today's world Uber sets a ride for point A to B. In tomorrow's, people will subscribe for a ride from A to B and to make that efficient, the "cloud" will determine how best to pair up folks generally going in the same direction at the same time of day. And that's just the beginning. A car "subscription" (think utility bill) will eliminate ones' choice of product - just like the fast lane at the rental car lots. And - as autonoms from the few remaining manufacturers develop to the point they are truly like refrigerators (all pretty much the same shape, size, function and reliability) the brand value diminishes to zero - Whirlpool anyone? There will be no need for car dealerships as the Uber fleets will provide their own service operations (like taxi companies do today). There will be no more need for automobile magazines than there is for publications like "Refridgerator World" and "Refrigerator & Stove Weekly", body shops will fade away, tire centers will go flat, 30-minute oil change centers will go rancid, auto parts stores will be gone and a piece of our economy will be looking for new work and for new tenants - just like the buggy whip makers did 120 years ago and the guy who collected rent from him. And this is only the tip. The unintended consequences of autonoms will be huge - what happens in snow storms? What happens in floods? When your prego wife has to get to the hospital at a speed faster than the posted limit? With the family driving vacation? With the family dog? With trips to the hardware store for lumber or a Christmas tree or a new mattress? When you want to make an "entrance" in your beautiful A8L but instead arrive in a pod. In the horse & buggy days there were the lowly buckboards and the elegant phaetons and all sorts of fodder in between. Will tomorrow's depiction of "success" be conveyed in the type of autonom that shows up at your door? Will a solo ride be viewed as an act of conspicuous consumption? Will the fact that you have a minivan or an F150 in the driveway set you apart from the Jones? Will the driveway and garage go the way of the carriage house? Big, big changes are coming folks - and it's not just the promise of being able to spend more Q-time with little Sally...

Allan Honeyman    September 21, 2016 - 12:51AM

We still have people who buy and ride horses. I anticipate that there will be places where one can indulge the urge to be behind the wheel. You say that cars will become like refrigerators, with no value added. Are you saying that a plain vanilla refrigerator from home depot competes with a Sub-Zero? Really? Why do people buy Rolls Royces if they can rather than a Hyundai Accent? Will they cease to do so in an autonomous future?

My point is that there will always be a market for differentiation. I suspect this was the case in ancient Sumer and I expect it will be so until the Sun flames out or humanity snuffs itself out. Autonomy doesn't mean lack of differentiation, it means actually that everyone has a chauffeur of one's own. Private ownership won't be snuffed out, it may mean that private owners will use a Tesla app to "rent out" their autonomous Tesla and compete with Uber!

I rather think that your view of the future is rather dystopian. The logical outcome of the winnowing of car sales will be to free up income for toys we haven't thought of yet. Or maybe a trip to a space station for a week of zero-G! Who knows? I welcome the future. You should to.

Fahr Sicher (not verified)    September 21, 2016 - 11:38AM

In reply to by Allan Honeyman

Comparing a Sub-Zero to a basic white Kelvinator is like comparing a $30k Rolex to a $30 Timex. They both do exactly the same thing - keep your food cold or tell you the time. The delta in pricing is all about ego, consumption and display - be it jewelry for the kitchen or the wrist... This is a human need that transcends autos and even horses - a larger bone thru the lip or nose was apparently a status symbol that helped win over the prettier cave girl. That need will continue to be fulfilled so long as we have extra time to consume beyond searching for food and building/finding shelter. My point was that, as 99.9% of car owners MUST own a car to get to work, school, etc., the existing (and antique) infrastructure which supports this "need" cannot go on if 99.9% of the market changes course and simply apps an autonom when the urge to go hang out at the mall or buy groceries store strikes. (Yes- I know. There will be no malls thanks to Amazon or grocery stores thanks to the food delivery apps which will also rely on autonoms for rapid deliveries). I do not disagree with your point, in fact I support the idea that the automotive press should begin thinking harder about this direction and the social and economic impact it may have before the horse gets much further away from the barn. I assure you that it is far, far deeper than suddenly finding extra time to share with Sally.

Allan Honeyman    September 21, 2016 - 4:59PM

In reply to by Fahr Sicher (not verified)

That was my point. There will continue to be the equivalent of a Nissan Versa and a Bentley Mulsanne in the brave new world of autonomous cars. Conspicuous consumption will continue as long as we live in a society characterized by scarcity. In other words economy cars will only disappear when everyone can afford something nicer, more comfortable, with more whiz-bang accessories.

As for your point that this is far, far deeper than...finding ...time to share with Sally. I couldn't disagree with you more. Your children are all that you leave behind. To trivialize this is regrettable. My wife and my children are all that really matters. Everything else is secondary.