In its relentless pursuit of a brighter future — especially through the design, production, and delivery of mass-market electric vehicles — Tesla has put its vehicle delivery process under the microscope, as revealed in new tweets from CEO Elon Musk.
Ditching Rail For Trucks
Rail has long been held up as the gold standard for low-emission shipping, but that efficiency comes at a brutal cost in terms of longer, less predictable delivery times. As Tesla has continued to drill into the cost of its in transit vehicle inventory, it has realized that, while it may be cheaper on the surface to move cars around the world via rail, tying up millions (if not billions) of dollars in inventory with thousands of cars in transit on the rail lines is simply not a good use of its capital.
“Skipping rail saves over a month for East Coast deliveries. All things considered, it’s better to use trucks. Single load/unload & direct to owner location,” Musk said on Twitter. Combine that with the fact that Tesla is working on bringing its own Tesla Semi to market and there’s a path forward to eliminate the emissions associated with getting its vehicle into the hands of customers as well.
To eke out every last penny from the shipping supply chain, and more likely to ensure it is as optimized as possible, Tesla went out and acquired a few trucking companies. Because that’s apparently no big deal, right?
The move comes as Tesla works to put systems in place to avoid the delivery pains it went through in Q3 as it sought to push as many Model 3s out the door and into the hands of customers as possible. “We bought some trucking companies & secured contracts with major haulers to avoid trucking shortage mistake of last quarter,” Musk said.
As a special bonus, Tesla will be able to use its new companies to vet its own fleet of electric semi trucks internally before rolling them out to customers. That’s one more huge chunk of emissions it can eliminate in its never-ending quest to build and ship zero-emissions vehicles without producing any emissions.
From Tesla, With Love
Looking past the near-term challenge of putting its vehicles onto larger vehicles to take them to customers, Musk believes that they are about a year away from being able to just have the cars deliver themselves to customers via its Full Self Driving capability. “Probably technically able to do so in about a year. Then up to regulators,” he said.
The addendum on his comment about waiting for regulatory approval should be noted, but this has not been an issue to date. The sheer amount of data that it collects from its vehicles has given it a solid platform from which to discuss any accidents to date with regulators like the National Highway Traffic Safety Administration.
Looking at autonomous driving more broadly, regulators have been surprisingly receptive to it, which makes sense when the actual safety of even existing systems is taken into account. Musk has repeatedly stated that he believes an improvement in safety of 10× over human drivers is achievable with the system and that its data to date supports that claim.
Tesla recently released its safety statistics for the third quarter, which revealed that its vehicles are 4 times less likely to be in an accident and 7 times less likely to be in an accident when using its Enhanced Autopilot solution, versus the national average based on NHTSA statistics.
The prospect of ordering a vehicle in Arkansas and having it drive itself to your house from the Tesla factory in Fremont, California, is exciting, and will surely prove to be another differentiator for Tesla, both in terms of cost and customer satisfaction.
As with many of Tesla’s ventures, its deep dive into the world of long-haul shipping is likely to have ramifications across not just the automotive industry, but across the entire world of long-haul shipping. Innovations in reducing the time to get goods from the factory to the customer have the potential to free up billions of dollars in in-transit inventory for companies around the world.