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

Ultimately 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 nearly by no means spend time on counterfactuals. There’s fairly sufficient to cowl in the true world.

However … I’m of the opinion Tesla might, and will, have launched a small, easy, low cost compact pickup truck—in different phrases, what Slate debuted—moderately 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 hundreds a month, the dearer EV pickup vans up to now haven’t.

The corporate that led the world in EV manufacturing for greater than a decade might have launched a reasonable small pickup that might have democratized EVs to a complete new class of consumers. Tesla probably might have provided extra vary on the identical value as a result of its in-house battery cell manufacturing. And it will have been a worldwide product, more likely to be offered in Europe and China from launch.

Most vital, 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” available in the market the place no different entry existed. Now, Tesla is not focusing on a $25,000 EV: Musk abruptly mentioned in October 2024 the corporate had walked away from the ”$25,000 Tesla” concept completely. 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 completed a Slate? I see 4 elements: at the start, the vastly interesting concept of a very inexpensive EV. Tesla might properly have made a small, low cost EV pickup an enormous hit, given its current meeting vegetation, lower-cost batteries, plus the prospect to promote globally proper out of the field.

A “$25,000 EV” to catapult Tesla into the main 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 less expensive EVs through 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 lots of of hundreds 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 autos now face rivals in all their most important markets, which definitely wasn’t the case in 2020 or 2017 when these vehicles launched. Greater than 20 new EVs, each from current automakers and startups like Lucid and Rivian, have hit the market since these years

The basic method to increase 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 value 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 might 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 broadly anticipated to be “decontented” (stripped-down) variations of immediately’s compact Mannequin 3 sedan and Mannequin Y crossover. They in all probability gained’t begin at $25,000, however we’ll discover out quickly sufficient. And, to be trustworthy, they hardly appear more likely 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 discovered an amazing deal about constructing autos in quantity. The corporate now has 4 vegetation: Fremont; Austin; Shanghai, China; and out of doors Berlin in Germany. That have is one thing Slate’s manufacturing execs, with expertise all around the auto trade, must impart to the brand new workers they rent to construct vehicles in its personal manufacturing unit, a 1.4-million-square-foot former printing plant in Warsaw, Indiana.

With that have, a Tesla Slate may need used typical stamped-steel development. Slate selected a nonstandard development method: 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. Desire a Slate in a distinct coloration? Merely wrap it—simply as Tesla used to supply to do for the Cybertruck.

To be truthful, the Cybertruck too makes use of nonstandard supplies, which contributed to a few of the vital 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 in addition the particular tooling for its flat, angular stainless-steel design and the extraordinary challenges of reaching acceptable ranges of high quality in a automobile in-built 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 accomplice, 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 by means of its Ultium Cells three way partnership than Tesla did— no less than 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 unit. Are they the identical 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 might have completed a Slate-style pickup with both extra vary (from extra battery capability on the identical value) or a good cheaper price if it caught with Slate’s projected ranges. Tesla could have provided 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 largest drawbacks of the Tesla Cybertruck is that, no less than for the second, it stays a North America-only automobile. It’s a few inches in need of 19 toes lengthy—greater than 2 toes 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.Ok. roads. Analysts specific doubts over the stainless steel truck’s means to adjust to European Union pedestrian-protection impression 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 acquired 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, could possibly be designed from scratch to promote in all three main markets — identical 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 underneath improvement to be used as a small van would put such a automobile immediately 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, plenty of explanation why a Slate-like automobile may need been precisely the fallacious factor for Tesla to launch as an alternative of the Cybertruck.

The primary and most vital is that, within the phrases of the outdated trade saying, “Low value equals low income.” 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 more likely 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 nearly 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 combination 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 might envision as a “Tesla.” It could require increasing the idea of what a Tesla is—although so did the Cybertruck. Facet notice: 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 path during which Musk was driving the corporate.

As famous, I virtually by no means deal in counterfactuals. I made an exception right here, contemplating the street not taken, as a result of it appears to me extra in step 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 might have been. Sic transit gloria mundi.