Tesla Inc will today unveil a prototype electric big-rig truck, which may be able to drive itself, throwing the company into a new market even as it struggles to roll out an affordable sedan central to the company’s future.
Chief Executive Elon Musk has described electric trucks as Tesla’s next effort to move the economy away from fossil fuels through projects including electric cars, solar roofs and power storage.
Some analysts fear the truck, named Tesla Semi, will be an expensive distraction for Tesla, which is burning cash, has never posted an annual profit, and is in self-described “manufacturing hell” starting up production of the $35,000 Model 3 sedan. Still, Tesla shares rose on Thursday.
The young market for electric cargo trucks is mostly focused on medium duty, not the heavy big rig market Tesla is after. The power capacity, weight and cost of batteries all limit a truck’s ability, analysts say.
Tesla arrives in a much more crowded field than when it developed electric cars. Manufacturers such as Daimler AG, Navistar International Corp and Volkswagen AG are joining a host of start-ups racing to overcome the challenges of substituting batteries for diesel engines as regulators crack down on carbon dioxide and soot pollution.
Reuters in August reported Tesla was working on self-driving technology for the truck. Several Silicon Valley companies see long-haul trucking as a prime early self-driving technology market, citing relatively consistent speeds, scarcity of cross-traffic on interstate highways and benefits of allowing drivers to rest while travelling.
The truck would have a working range of 200 to 300 miles (320 to 480 km), at the low end of what is considered “long-haul” trucking, Reuters reported. Diesel trucks are capable of travelling up to 1,000 miles (1,600 km) on a single tank of fuel.
Musk, who has pushed back the debut twice, said this week the truck would "blow your mind clear out of your skull" when it was introduced in a web-cast at Tesla website.
“Semi specs are better than anything I’ve seen reported so far. Semi eng/design team work is aces, but other needs are greater right now,” Musk tweeted in October, announcing the second delay.
“It can transform into a robot, fight aliens and make one hell of a latte,” he added on Wednesday, posting a picture of a backlit, shadowed Semi with trapezoidal blue headlights. He has forecast large-scale production within a couple of years.
Tesla would need to invest substantially to create a factory for those trucks. The company is currently spending about $1 billion per quarter, largely to set up the Model 3 factory, and is contemplating a factory in China to build cars. Charging and maintaining electric trucks that crisscross the country could be expensive and complex.
A Tesla truck with a range of 300 to 450 miles would be able to address less than half of the total semi-truck market, estimated Bernstein analyst Toni Sacconaghi in a note on Monday.
“It is somewhat unclear why the company needs another major initiative ... on its already full plate,” wrote Sacconaghi.
Shares of Tesla, which have risen 48 percent this year to make the company the No. 2 US automaker by market value, were up 1.7 percent to $316.66 in midday trade in New York.
The launch event can be seen live at https://livestream.tesla.com.
