A Better Mousetrap

For Tesla Motors, reinventing the wheel doesn’t just involve a new car.


The past two decades have borne witness to fantastical leaps in technology we now consider invaluable: smartphones, GPS guidance systems, tablet computers. It’s also provided its fair share of clunkers: the Segway, non-iPod MP3 players, MySpace. One innovation that appeared to straddle the hot-or-not fence several times since its introduction almost a decade ago: Tesla Motors’ luxury electric vehicles (EVs). In recent months, however, much of the doubt about Tesla’s viability and even its historic importance seems to have been erased through a flurry of investments, new products and innovative sales and intellectual property rights management.

Though founded by computer engineers Martin Eberhard and Marc Tarpenning in 2003, it was big thinker Elon Musk who got Tesla rolling. (He’s also a driving force behind much of the commercial space travel industry and a proposed Hyperloop high-speed magnetic rail in California.) The world got its first taste of the future with the Tesla Roadster in 2006. Musk argued that the nascent electronic car industry needn’t be restricted to boxy, utilitarian vehicles. He envisioned luxury roadsters and even high-performance racecars (the Tesla Roadster was the first EV to top 200 MPH, and was soon participating in eco-races in Australia). He made a point of investing personally in American manufacturing and dropping a significant amount of his and other people’s (including the U.S. DOE’s) money into manufacturing. Soon pundits speculated each $128,000 car rolling off the line actually cost millions more based on investments vs. actual production. Various delays, along with a 2009 Roadster recall and battery pack fires in the Model S in 2013, made it seem as if the Tesla might be another rich kid’s vanity toy destined to be tossed aside. (Remember the DeLorean?)

Flash forward to 2014, and Musk’s vision is very nearly rock solid. The company posted profits in 2013. Buliding vertically, Tesla offers a growing range of cars. The full-sized, five-door Model S, with a remarkable 97 MPG highway, expanded sales in the U.K. and Europe significantly during the first part of the year, while the falcon-winged, dual-motor, all-wheel drive Model X is expected to reach buyers by 2015. Just as importantly, the company opened its 100th charging station in Hamilton, New Jersey (also the 22nd state to approve Tesla’s unusual direct sales approach: you can scope the models on a showroom floor, but you must buy online). The most unusual aspect of the Supercharger stations? Topping off your batteries doesn’t cost a cent. With enough stations, you can now theoretically cross the country for free.

Even more mind-boggling to the traditional Carnegie-era capitalist: in a blog post dated June 12, 2014, Musk made waves by announcing that all of Tesla’s hard-earned (and expensive) patents would be released into the public domain. In an era when the concept of open-sourcing headbutts against the lucrative intellectual property universe (think patented human DNA), the announcement was a potentially world-changing one. “If we clear a path to the creation of compelling electronic vehicles,” Musk wrote, “but then lay intellectual property landmines behind us to inhibit others, we are acting in a manner contrary to that goal.” All of this adds up to a rosy future for Tesla, which claims to have more orders than they can possibly fill. Though he’s no longer associated with the company, Tarpenning is convinced of the significant role luxury EVs play. At a 2012 Silicon Valley Band of Angels lunch, he noted that in 10 years, “all the supercars will be electric or electric assisted.”