Heard On The Street: Overheard
Jun 2 at 19:23
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(FROM THE WALL STREET JOURNAL 6/3/13)
[Financial Analysis and Commentary]
Silicon Valley may have found another Steve Jobs -- and this one comes
with an even more impressive "reality distortion field."
That evocative phrase, according to Walter Issacson's biography, described
Mr. Jobs' unusual ability to determine the future, no matter how implausible it
seemed in the present. It helped him deliver revolutionary changes to how we
listen to music and use phones and computers.
Elon Musk's ambitions soar even higher, as was on full display during an
interview at the recent All Things D conference.
His electric-car company Tesla Motors aims to remake the way we drive,
while the ultimate goal of his rocket company SpaceX, he said, is to travel to
Mars and help build a self-sustaining base there.
Skepticism is the natural response. But each time Mr. Musk delivers a
better, less-expensive electric car or launches another rocket successfully, he
proves his doubters wrong.
Oh, and he co-founded a multibillion-dollar company called PayPal.
But there is more to Mr. Musk than cars and Mars. He also spends time
thinking about warp-speed travel, which he says is "theoretically possible"
because, while humans can't travel faster than light, they could warp space
itself "such that space is moving." So there is that.
He also has an idea for faster terrestrial travel he calls the
"hyperloop," which could slash the commute from Los Angeles to San Francisco
from six hours to fraction of that. He described the hyperloop as a combination
of Concorde, a rail gun and an air-hockey table.
There is no shortage of big dreamers in tech land. Mr. Jobs stood out
because he had accomplishments to match. For Mr. Musk, there is a lot more
reality to distort before his more-fanciful visions get realized.
Still, there is no denying the gravitational pull of his visions.
Disclosure: Long TSLA
Technology: All Things Digital Special Report: Tesla's Elon
Musk Lays Out His Vision For Two Vehicles For The Future
Jun 2 at 21:03
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By Kara Swisher and Walt Mossberg
(FROM THE WALL STREET JOURNAL 6/3/13)
For Elon Musk, the South African inventor and entrepreneur, it may not be
a giant leap to go from founder of an electric-car company to space-rocket
engineer. He's had success with innovation before, as co-creator of the well-
known Web-based payment system, PayPal.
He sat down with All Things Digital's Kara Swisher and Walt Mossberg to
discuss recent developments at Tesla Motors and Space Exploration Technologies.
MR. MOSSBERG: Do you worry that a lot of electricity used by the cars is
generated from coal?
MR. MUSK: There are two obvious rebuttals.
One, if you take the same source fuel and burn it at the power-plant
level, you will get two to three times the efficiency than if you burned it in
the car itself. At the power-plant level, you're not constrained by mass and
volume, and you can take the waste heat and use it to run a steam turbine. The
other factor is we have to find sustainable means of electricity production
anyway, and the obvious mode for transport is electric.
MR. MOSSBERG: What does it cost, your most successful one?
MR. MUSK: Before tax credits, it's about $70,000. After tax credits,
it's like $60,000.
MR. MOSSBERG: There's a federal tax credit for a pure electric car?
MR. MUSK: That's right, $7,500. But they're receiving less of a subsidy
than gasoline cars. If you look at the subsidy of gasoline cars and if you're
pricing the environmental damages, every time you buy a gasoline car there are
huge subsidies occurring. And you can actually tell that these subsidies are
higher than the subsidies for electric cars because people are not buying
electric cars except ours.
MR. MOSSBERG: You also get federal and state subsidies, right?
MR. MUSK: Yes.
MR. MOSSBERG: When will you be at a point where even if you didn't have
subsidies and credit sales you would be profitable?
MR. MUSK: We're anticipating being profitable, even better than slightly
profitable, in the fourth quarter of this year. We're projecting 25% gross
margins, absent of credits.
MR. MOSSBERG: But not absent the tax subsidies?
MR. MUSK: Right. There's a consumer tax credit, which is effectively
something that improves the level of demand. But Tesla doesn't get the tax
credit, the consumer does.
MR. MOSSBERG: What is your ultimate goal for SpaceX?
MR. MUSK: The goal is to improve rocket technology and spacecraft
technology and keep improving it every year until ultimately we are able to send
people to Mars and establish a self-sustaining base on Mars.
MR. MOSSBERG: What got you into space?
MR. MUSK: The future of humanity, it's going to fundamentally bifurcate in
two directions, or life as we know it. Either it's going to become
multiplanetary, or it's going to be confined to one planet until some eventual
extinction event.
MS. SWISHER: What's happening now with SpaceX?
MR. MUSK: The big breakthrough that's needed in rocketry is to achieve
fully rapidly reusable rockets. If you think about any other mode of transport,
like a plane, bike, car, anything, of course, they are reusable quickly.
MR. MOSSBERG: And the only one we have, the U.S. at least built, or
anybody built, I think, was the shuttle.
MR. MUSK: Right. And it was only partly reusable. So in order to have a
breakthrough, you have to have a fully reusable rocket. We're making progress in
that direction. I'm hopeful that in the next couple of years we'll be able to
achieve full and operable usability of the first stage, which is about three-
quarters of the cost of the rocket. And then with a future design architecture
achieve full reusability.
MS. SWISHER: Your rockets now are for doing payloads, and it's a business,
correct?
MR. MUSK: SpaceX launches satellites for commercial customers and does
space- station servicing for NASA. We run the primary contract to do
space-station cargo to and from the station. We're the only craft capable of
bringing significant cargo back from the space station.
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