Tesla trac­tion

Will Tesla dis­rupt long haul truck­ing? We take a look at the chal­lenges and chal­lengers from the US per­spec­tive

Australian Transport News - - Contents - WORDS R ANDY C ARLSON

A de­tailed look at whether Tesla’s elec­tric prime mover chal­lenge stacks up as a busi­ness case

Tesla says it will show us a world-beat­ing semi-truck, or prime mover as they say in Aus­tralia, this Septem­ber – some­thing the in­dus­try be­lieves im­pos­si­ble.

Com­mer­cial long haul truck­ing is all about eco­nomics. Lower cost per mile mat­ters, bling doesn’t count. Can Tesla pull this off ?

Tesla’s semi-truck will use Model 3 mo­tors, sug­gest­ing a rad­i­cal de­par­ture in truck de­sign. If suc­cess­ful, this could let Tesla win.

Tesla’s tech­nol­ogy and ex­pe­ri­ence with grid stor­age can en­able a strongly com­pet­i­tive elec­tric truck busi­ness model.

If Tesla’s truck is a suc­cess, very rapid, eco­nomics-driven truck in­dus­try tran­si­tion could fur­ther stress bat­tery sup­ply chains.

Tesla tells us that come Septem­ber, it will un­veil a pow­er­ful, long-range, all-elec­tric semi-truck. Tesla isn’t talk­ing about a short-range, spe­cialty truck for de­liv­er­ing feath­ery light crois­sants from the bak­ery to some Sil­i­con Val­ley Sun­day brunch.

This Tesla truck is sup­posed to haul heavy line-haul freight over long dis­tances, across moun­tain ranges from one end of Amer­ica to the other. Tesla’s elec­tric truck will sup­pos­edly com­pete with the best diesel rigs on the ba­sis of cost in an in­dus­try that looks at cost down to frac­tions of a cent per mile.

Truck­ing is a highly com­pet­i­tive in­dus­try, driven al­most en­tirely by cost, cost, and cost. Even the cof­fee truck­ers drink is a con­sid­er­a­tion. Tesla has sold a lot of elec­tric cars on the ba­sis of high per­for­mance and ‘ bling’, but can Tesla en­gi­neers sharpen their pen­cils, put on their green eye­shades, and com­pete on cost? If Tesla can build a world-beat­ing semi-truck that also de­liv­ers lower over­all per mile cost, it might dis­rupt an­other in­dus­try. And, that is some­thing in­vestors should care about.

There is just one thing. Ev­ery­one in the in­dus­try ‘ knows’ that a re­al­is­tic bat­tery-elec­tric truck isn’t pos­si­ble. Bat­ter­ies weigh too much. Bat­ter­ies cost too much. Bat­ter­ies take too long to recharge. While it might be pos­si­ble to make a fuel cell-elec­tric truck that could be re­fu­elled with hy­dro­gen, or a diesel truck that uses liq­ue­fied nat­u­ral gas, there is ab­so­lutely no way ever, ever that a bat­tery truck can do this job.

Seek­ing Al­pha au­thor John Peter­son re­cently ex­plained that an elec­tric semi-truck will nec­es­sar­ily weigh too much and, in any case, the pol­lu­tion from diesel trucks has been a solved prob­lem for a decade – so why bother? An­ton Wahlman sug­gests Toy­ota has beat Tesla to the green truck mar­ket with its 200-mile-range (322km) fuel cell-elec­tric demon­stra­tor truck. Donn Bai­ley be­lieves Tesla is reach­ing too far in its quest to change long-haul truck­ing. I have great re­spect for these au­thors, and each of them has made thought­ful and rea­soned ar­gu­ments.

Con­tacts in the in­dus­try tell me that sev­eral elec­tric truck projects are up against the very prob­lems these au­thors de­scribe.

None­the­less, I be­lieve Tesla can, and likely will, de­liver a world-beat­ing, long-range, all-elec­tric semi-truck. Tesla’s unique ap­proach to elec­tric propul­sion us­ing high-speed in­duc­tion mo­tors and in­te­grated ther­mal man­age­ment for bat­ter­ies, mo­tors, and power elec­tron­ics, com­bined with its high-vol­ume elec­tric car pro­duc­tion and ex­pe­ri­ence in grid stor­age will en­able it to achieve what oth­ers be­lieve im­pos­si­ble.

In this ar­ti­cle, we will look at three things. First, the tech­ni­cal as­pects of long-haul trucks will be ex­plored, and a likely Tesla ap­proach that en­ables longer range, higher per­for­mance, and rea­son­able weight will be shown. Sec­ond,

op­er­a­tion of elec­tric semi-trucks will be ex­plored, and, from that, a busi­ness model and com­par­a­tive costs will be de­vel­oped. Fi­nally, im­pli­ca­tions of Tesla’s en­try into the heavy truck mar­ket will be an­a­lysed for ex­ist­ing mar­ket play­ers, for Tesla’s other busi­nesses, and for the in­creas­ingly crit­i­cal bat­tery and bat­tery ma­te­ri­als sup­ply chain.

Be­fore we do that, there is some­thing to say. The fol­low­ing pre­sen­ta­tion of a po­ten­tial Tesla semi-truck and op­er­at­ing busi­ness model is un­der­taken to as­sess whether or not Tesla could sur­prise tech­nol­o­gists and the mar­ket with their elec­tric semi-truck.

The un­der­ly­ing sup­po­si­tion is that, be­ing smarter than I am, and work­ing harder than I do, Mr Musk and his team can be ex­pected to do as well, and prob­a­bly a good deal bet­ter, than what is pre­sented here. And no, I have no il­lu­sion that Tesla en­gi­neers will tack this ar­ti­cle to their cu­bi­cles.

TECH­NOL­OGY IS­SUES

Heavy Class 8 semi-trucks are a wellestab­lished, com­mod­ity product de­liv­ered by a ma­ture in­dus­try us­ing diesel en­gine tech­nol­ogy. These semi-trucks are re­ally more ‘trac­tor’ than ‘truck’ – in fact, semi-trucks are of­ten re­ferred to as ‘trac­tor-trail­ers’, which is ex­actly what they are.

The trac­tor is not much more than a huge diesel en­gine, trans­mis­sion and driv­e­train at­tached to a fift h wheel (the

thing the trailer hooks on to) and some wheels to let it roll along. The body is just there to keep rain and bird poop off the ma­chin­ery, give the driver a place to sit, and to push air out of the way as the con­trap­tion drives down the road.

What is im­por­tant for our dis­cus­sion of a likely Tesla elec­tric semi-truck (trac­tor) is that these trucks are crammed with lots of big, heavy ma­chin­ery.

Any so­lu­tion that doesn’t get rid of that ma­chin­ery will not have the room or the weight-car­ry­ing ca­pac­ity for a large bat­tery. And, with­out a large bat­tery, an all-elec­tric truck isn’t go­ing very far – down the road or in the mar­ket­place.

The il­lus­tra­tions [pre­vi­ous page] of Daim­ler’s Freight­liner and Nikola Mo­tors’ Nikola One chas­sis il­lus­trate this sit­u­a­tion.

With both the diesel truck and the fuel cell-elec­tric truck, much of the cen­tral frame area gets filled up with heavy ma­chin­ery: diesel en­gine, trans­mis­sion, driv­e­line, dif­fer­en­tials, and axles in the case of the diesel and elec­tric mo­tors, gear­boxes, half-shafts and in­de­pen­dent suspension in the fuel cell-elec­tric truck.

The Nikola One does have room for a 320 kilo­watt hours (kWh) bat­tery, good for 100+ miles (160km) of elec­tric range, but it had to be length­ened to ac­com­mo­date a fuel cell ‘range ex­ten­der’ to get use­ful range. It is not prac­ti­cal to pile bat­ter­ies higher to fit more within the avail­able frame length be­cause that would make the truck too heavy. The pic­tures, right, give an idea of how much ma­chin­ery gets loaded into the cen­tral frame for a con­ven­tional elec­tric or fuel cell-elec­tric truck.

TESLA TECH­NI­CAL AD­VAN­TAGE

Here is where Tesla’s tech­nol­ogy ad­van­tages and elec­tric car man­u­fac­tur­ing and de­sign ex­pe­ri­ence be­come im­por­tant. Tesla does three things dif­fer­ently in its elec­tric cars that trans­late di­rectly to the so­lu­tion for get­ting a big bat­tery into a truck with­out mak­ing the truck too big or too heavy. • Tesla uses in­duc­tion mo­tors rather than per­ma­nent mag­net mo­tors. In­duc­tion mo­tors can op­er­ate ef­fi­ciently at higher speed and over wider range of speeds, re­duc­ing weight while in­creas­ing power • Tesla uses in­te­grated ther­mal man­age­ment and liq­uid cool­ing for its bat­tery, power elec­tron­ics, mo­tors, and pas­sen­ger com­part­ment. Liq­uid cool­ing and ac­tive cool­ing (i.e. use of re­frig­er­a­tion to re­duce coolant tem­per­a­ture be­low am­bi­ent.) al­low mo­tors to op­er­ate con­tin­u­ously at higher power lev­els than al­lowed by other cool­ing ap­proaches – some­thing that is im­por­tant for trucks that must pull heavy loads up long moun­tain grades • Tesla will be us­ing a new in­duc­tion mo­tor for its high-vol­ume Model 3 elec­tric car. Sev­eral of these mo­tors used to­gether will match nicely the power and torque re­quire­ments for a long-range, line-haul truck. And, Elon Musk has said that is ex­actly what Tesla will do. The en­gi­neer­ing bot­tom line from com­bin­ing high-speed in­duc­tion mo­tors, ac­tive liq­uid cool­ing, and a vol­ume pro­duc­tion mo­tor de­sign is that Tesla will be able to move both mo­tors and gear­boxes into the wheel hubs and out of the cen­tral frame. This will save weight and open up space for a very large bat­tery and give Tesla’s elec­tric truck very long range.

To be­gin this tech­ni­cal dis­cus­sion,

we need to ap­pre­ci­ate the dif­fer­ences be­tween ‘con­ven­tional re­duc­tion gears’ like Tesla uses in Model S and Model X and ‘plan­e­tary re­duc­tion gears’, which are reg­u­larly used in au­to­matic trans­mis­sions and tur­bo­prop air­craft en­gines. I know this is a bit geeky, but bear with me.

Tesla is likely to shift to a plan­e­tary re­duc­tion gear­box for Model 3. The side load on the high-speed mo­tor shaft bear­ings in the Model S and Model X is likely the sig­nif­i­cant bear­ing life-lim­it­ing fac­tor, and a plan­e­tary re­duc­tion gear elim­i­nates this side load. A plan­e­tary re­duc­tion gear will also be a lot smaller and lighter – and cheaper. The draw­back is that a plan­e­tary gear­box re­quires in­te­grat­ing de­sign of mo­tor and gears to­gether, mak­ing it a more dif­fi­cult de­sign and de­vel­op­ment prob­lem. A Model 3 mo­tor and plan­e­tary re­duc­tion gear might look some­thing like this.

In the sketch (pic­tured bot­tom left), the elec­tric mo­tor has been scaled based on a sim­i­lar but smaller Astron­ics air­craft in­duc­tion starter-gen­er­a­tor. The out­side di­am­e­ter of the mo­tor is less than 10 inches (25cm), the di­am­e­ter of a heavy truck hub re­duc­tion drive axle.

The scal­ing re­la­tion­ship is that the vol­ume and weight of an in­duc­tion mo­tor vary as the 3/5th power of the rated mo­tor torque.

For ex­am­ple, this fig­ure com­pares weight and torque of a se­ries of sim­i­lar de­sign in­duc­tion mo­tors to this the­o­ret­i­cal 3/5th power scal­ing re­la­tion­ship.

Com­bin­ing the mo­tor and first plan­e­tary re­duc­tion gear from the Model 3 with a 6:1

plan­e­tary hub re­duc­tion gear sim­i­lar to the Arvin-Mer­i­tor axle linked above re­sults in a ‘ hub mo­tor’, some­thing like this [pic­tured right].

In this de­sign, a car­bon ro­tor disc brake is fit­ted to the in­ter­me­di­ate drive shaft , re­plac­ing the heavy-duty disk or drum brake nor­mally used. This is a prac­ti­cal size and weight-sav­ing ap­proach for a Tesla all-elec­tric truck be­cause the mo­tors and bat­tery sys­tem are sized for high torque/power and can ab­sorb (re­gen­er­ate) en­ergy on long, steep down­grades at high speed, leav­ing the brakes used only for fi­nal stop­ping or emer­gency sit­u­a­tions.

So, while the small, high-speed disc brake will have much higher wear and shorter pad life than a large ‘truck-size’ brake, this is not a prob­lem be­cause these brakes are only rarely used. Where all this ef­fort to ap­ply Model 3 mo­tors to an in-wheel or ‘ hub mo­tor’ de­sign pays off is shown in the sketch be­low.

By com­bin­ing likely Model 3 mo­tor and gear­box el­e­ments with con­ven­tional heavy truck hub re­duc­tion gears, a small, com­pact elec­tric driv­e­line re­sults.

At the same time, the cen­tral spine of the truck is made avail­able to house a very large bat­tery.

The drive ap­proach, us­ing a solid axle, al­lows for a par­tic­u­larly sim­ple and ro­bust trail­ing arm and air-spring suspension sim­i­lar to that used on many of to­day’s diesel trucks. Sim­plic­ity and ro­bust­ness of a truck suspension is im­por­tant be­cause sus­pen­sions ex­pe­ri­ence ex­treme forces when haul­ing heavy loads and be­cause main­te­nance re­quire­ments for a com­plex suspension and driv­e­line can drive up per-mile op­er­at­ing cost.

In­ter­est­ingly, each solid axle – hub mo­tors – disc brake com­bi­na­tion shown here weighs some­what less than a cor­re­spond­ing diesel truck dif­fer­en­tial, axle, and brake equiv­a­lent.

The im­por­tance of plac­ing the drive mo­tors and their re­duc­tion gears in the wheel hubs is that the cen­tre frame of the truck be­comes avail­able to hold a re­ally large bat­tery. As il­lus­trated, the frame rails of a con­ven­tional truck are re­placed by a sim­ple, large cross-sec­tion, hol­low rec­tan­gu­lar beam run­ning the length of the truck. Mod­ules con­tain­ing Tesla’s new 21-70 cells fi ll the in­te­rior of this struc­tural beam.

Each bat­tery mod­ule used in the cur­rent Model S and Model X 100kWh bat­ter­ies has a vol­ume en­ve­lope (ex­te­rior pris­matic en­ve­lope in­clud­ing mount­ing lugs) of about 15.4 litres and con­tains 516 18650 form fac­tor cells, the vol­ume of the cells oc­cu­py­ing about 55 per cent to the en­ve­lope vol­ume.

Us­ing this same 55 per cent vol­ume pack­ag­ing fac­tor, the box-beam frame as shown holds 76,800 21-70 cells. Tak­ing the den­sity of these 21-70 cells to be the same as Tesla’s 18,650 cells, each 21-70 cell weighs 67.4 grams and the 76,800 cells to­gether weigh 11,393 pounds (5178kg).

Al­low­ing an ad­di­tional 25 per cent weight for the mod­ule con­tain­ers, wiring, coolant tubes, etc., to­tal weight of the bat­tery mod­ules, not in­clud­ing the weight of the struc­tural box-beam it­self, is 14,241 pounds (6473kg). Yes, the bat­tery is heavy, but as we shall see in a bit, this isn’t the last word on bat­tery weight.

The sim­plic­ity and pack­ag­ing ef­fi­ciency of the Tesla truck is a key el­e­ment that will make Tesla suc­cess­ful. Com­par­ing the lay­out of the Tesla truck to that of the Nikola One shows how much sim­pler this ap­proach is com­pared to a tra­di­tion­ally pack­aged truck with driv­e­line com­po­nents mounted to the frame.

SPEC­I­FI­CA­TIONS AND PER­FOR­MANCE

To un­der­stand how well or poorly the Tesla elec­tric truck will com­pete against cur­rent diesel and po­ten­tial fu­ture fuel cell-elec­tric trucks, we must know what its per­for­mance is. In cal­cu­lat­ing the Tesla truck per­for­mance, var­i­ous pa­ram­e­ters were used, and these are sum­marised in the ta­ble [right].

From these pa­ram­e­ters, the fol­low­ing truck per­for­mance char­ac­ter­is­tics were de­rived. In all cases, these char­ac­ter­is­tics are for a com­bi­na­tion of the truck and a trailer with GCW ( gross com­bi­na­tion weight) of ei­ther 60,000 pounds (27,516kg) or 80,000 pounds (36,287kg), as in­di­cated and op­er­at­ing un­der no wind, sea level con­di­tions.

Be­fore con­sid­er­ing weights and pay­loads, I need to point out that the bat­tery in the truck need not be a full 2 megawatt hours (mWh). There are many ap­pli­ca­tions where a smaller bat­tery that re­duces the weight of the truck, al­low­ing greater pay­load in ex­change for shorter range, is a more eco­nomic ar­range­ment.

For that rea­son, two con­fig­u­ra­tions with a 2mWh and a 1mWh bat­tery, re­spec­tively, are pre­sented. Aside from dif­fer­ent-size bat­ter­ies, both truck con­fig­u­ra­tions are the same.

The small 1mWh bat­tery con­fig­u­ra­tion will achieve the ac­cel­er­a­tion and grade­abil­ity per­for­mance of the large bat­tery con­fig­u­ra­tion at sim­i­lar weights.

OP­ER­A­TIONAL CON­SID­ER­A­TIONS

Be­fore we can un­der­stand the eco­nomics of op­er­at­ing a Tesla elec­tric truck, it is nec­es­sary to think about how these trucks will be used.

Two things are key to elec­tric truck eco­nomics: how fre­quently and for how long is the truck charg­ing, and how much does that charg­ing cost the truck­ing com­pany?

This brings us to the con­cept of ‘stage length’, the dis­tance over which an elec­tric truck in

line-haul ser­vice can reg­u­larly and rou­tinely op­er­ate. Vari­a­tions in trailer weights and in weather con­di­tions ne­ces­si­tate prac­ti­cal stage length less than the ‘ ideal’ range of the truck to as­sure suc­cess­ful op­er­a­tion un­der ad­verse con­di­tions.

As a re­sult, most of the time trucks ar­rive at the charg­ing sta­tion with sub­stan­tial re­main­ing charge. Over time, charg­ing sta­tions will pro­lif­er­ate so that truck­ers will choose where to recharge, more fully de­plet­ing the bat­tery and min­imis­ing to­tal num­ber of recharg­ing stops.

In the eco­nomic anal­y­sis that fol­lows, we use a stage length equal to 75 per of the ideal range at 65mph (105km/h) and 60,000 pounds (27,216kg) GCW.

Charg­ing time is crit­i­cal for elec­tric trucks. An elec­tric truck with a 2mWh bat­tery, charg­ing from a 15A 120V wall socket will re­quire about two months to fully charge. Even if this truck con­nects to all the charg­ing bays at a three-charger, six-charg­ing slot ‘su­per charger’, it would take six hours to recharge.

A ‘ lu­di­crous charger’ of, say, 3mW (the­o­ret­i­cally ca­pa­ble of recharg­ing a Model S100D in two min­utes, if the bat­tery could with­stand that charg­ing rate) would still need 40 min­utes to recharge most of a 2mWh truck bat­tery. Op­er­at­ing at 400 volts, the charg­ing ca­ble would need to carry 7500 amps. A small crane would be needed to lift the plug and charg­ing ca­ble. While such a charg­ing so­lu­tion could be built, it still re­quires 40 min­utes or more to recharge, and a sta­tion able to charge sev­eral trucks at once would re­quire a very ro­bust grid con­nec­tion and in­cur spec­tac­u­lar de­mand charges.

Hav­ing looked at sev­eral recharg­ing schemes, I con­cluded that bat­tery swap­ping is a much more at­trac­tive ap­proach for a line-haul elec­tric truck. The en­vi­sioned Tesla truck with the bat­tery lo­cated within the cen­tral box-beam frame al­lows con­ve­nient swap­ping through the front of the truck with­out re­quir­ing spe­cialised ma­chin­ery op­er­at­ing from be­neath the truck, or large clear­ance space be­side the truck – both sig­nif­i­cant con­sid­er­a­tions in de­ter­min­ing the size and cost of truck recharg­ing (bat­tery swap) sta­tions.

An im­por­tant ad­van­tage of the bat­tery swap ap­proach is that the swap sta­tion op­er­a­tor can choose when to recharge in­com­ing bat­ter­ies and thus cap­ture the low­est time of day elec­tric rates. This is not pos­si­ble with a ‘su­per charger’ so­lu­tion un­less large amounts of grid con­nected stor­age is used at the charg­ing sta­tion.

Bat­tery swap­ping also sup­ports flex­i­bil­ity to match bat­tery size in the truck to the load

and range re­quire­ments of par­tic­u­lar routes and loads. Swap­ping en­ables an in­ter­est­ing busi­ness model wherein the truck op­er­a­tor never owns the bat­tery – mak­ing these trucks cheap to ini­tially pur­chase (bat­tery not in­cluded). The op­er­a­tor then rents a bat­tery of de­sired ca­pac­ity at an hourly rate that re­flects the equiv­a­lent leas­ing of the bat­tery, plus a fi xed fee each time the bat­tery is swapped for a fully charged bat­tery. En­ergy cost is in­cluded in the fi xed ‘swap fee’.

The bat­tery swap sta­tion must fi­nance an in­ven­tory of bat­ter­ies ready to be swapped from the swap fee, while the bat­ter­ies in trucks are fi­nanced by the hourly rental fee.

How this busi­ness model works with re­spect to the Tesla truck is il­lus­trated in the above sketch. At any time, the truck op­er­a­tor is pay­ing the bat­tery cap­i­tal cost (through the hourly rental) for only as much bat­tery as needed for the par­tic­u­lar route and load.

In­ter­est­ingly, Tesla is al­ready sell­ing mod­u­lar grid stor­age sys­tems that are ide­ally sized to per­form charg­ing of these 1mWh and 2mWh bat­tery packs.

Pow­er­pack grid stor­age tech­nol­ogy in­cor­po­rated into truck bat­tery swap sta­tions would even al­low sta­tions to use some of their in­ven­tory bat­ter­ies to pro­vide grid sta­bil­i­sa­tion ser­vices, gen­er­at­ing sub­stan­tial ad­di­tional rev­enue not in­cluded in this model.

Of course, when the eco­nomics of this model are as­sessed, both the truck op­er­a­tor and the swap sta­tion have to be prof­itable or the model is not sus­tain­able. This brings us to costs and the fun­da­men­tal com­pet­i­tive­ness – or un­com­pet­i­tive­ness – of a Tesla elec­tric truck.

COM­PAR­ING COSTS

The key re­sult from analysing the Tesla truck, Freight­liner truck and Nikola One truck is seen in the plot of op­er­at­ing cost per mile as a func­tion of util­i­sa­tion (pic­tured op­po­site top). The 1mWh Tesla truck has lower op­er­at­ing cost over the range of util­i­sa­tion rates seen in line-haul truck­ing. The 2mWh Tesla truck ex­cels at very high util­i­sa­tion rates, and when op­er­ated 1000 miles (1609km) per day or more (team driv­ers), is 15 cents a mile (24c/km) cheaper than a diesel truck to own and op­er­ate.

The eco­nomic case for swap sta­tion op­er­a­tions is as com­pelling as that for the truck it­self. The fol­low­ing chart shows the pre­sent value of swap sta­tion in­ven­tory bat­ter­ies as a func­tion of the num­ber of swaps each in­ven­tory bat­tery makes per day. The model ac­counts for cost of recharg­ing en­ergy, cost of per­form­ing the swaps, and over­head. Prof­its over a seven-year pe­riod and the as­sump­tion that bat­ter­ies re­tain 30 per cent of their cost ba­sis are dis­counted at 8 per cent to com­pute the net pre­sent value per kWh.

This cal­cu­la­tion shows that Tesla would see ap­prox­i­mately 100 per cent gross mar­gin over bat­tery mod­ule cost if bat­ter­ies are ‘turned’ just 1.3 times per day. And, as stated ear­lier, no al­lowance is in­cluded for rev­enue from grid-con­nected stor­age ser­vices such as spin­ning re­serve, fre­quency sta­bil­i­sa­tion, etc.

Just as was the case when es­ti­mat­ing per­for­mance, as­sump­tions were nec­es­sar­ily made when es­ti­mat­ing costs. The ta­ble on page 68 lists the as­sump­tions used.

The in­tent is that these costs and re­lated as­sump­tions ap­ply to the case of a Tesla truck first de­liv­ered in mid-2019, two years from now.

OVER­ALL COM­PET­I­TIVE­NESS

There are four (and per­haps more) ar­eas of cost and per­for­mance that mat­ter in line-haul trucks. The Eco­nomics chart [pic­tured op­po­site] com­pares the Tesla elec­tric truck to both cur­rent diesel trucks and po­ten­tial fu­ture fuel cell-elec­tric trucks.

The Tesla elec­tric truck has the low­est cost per mile (op­er­a­tion and own­er­ship) and the low­est ac­qui­si­tion cost. While the Tesla truck likely will fall short in ul­ti­mate range, range per charge is suf­fi­cient for prac­ti­cal line-haul ap­pli­ca­tions, and fast

“For Tesla, there will be signicant im­pact from en­ter­ing the heavy truck busi­ness”

bat­tery swap recharg­ing largely mit­i­gates any short­com­ing. For pay­load, the Tesla truck is com­pet­i­tive, with the added ad­van­tage of be­ing able to tai­lor the bat­tery size to trade pay­load against range.

IM­PLI­CA­TIONS

From the anal­y­sis, it ap­pears Tesla could de­liver a semi-truck that is com­pet­i­tive both in per­for­mance and eco­nom­i­cally. This does not mean Tesla will nec­es­sar­ily in­tro­duce an elec­tric semi-truck with the char­ac­ter­is­tics de­scribed. But it does show there is a path by which Tesla could of­fer a very com­pelling elec­tric truck. Come Septem­ber, we will see.

For other com­pa­nies in the heavy truck busi­ness, a com­pelling Tesla elec­tric truck could be very dis­rup­tive. If Tesla achieves a low cost of ac­qui­si­tion and low op­er­at­ing costs, as it ap­pears it may be able to, then the highly cost-sen­si­tive truck­ing in­dus­try can be ex­pected to switch to Tesla trucks, or to sim­i­lar of­fer­ings from oth­ers. How nice Tesla makes the truck look, how quickly the truck ac­cel­er­ates, how fast the truck hauls loads up steep hills will all make news. But how much it costs per mile to own and op­er­ate Tesla’s truck is what will mat­ter in the end.

The dif­fi­culty for es­tab­lished truck mak­ers should Tesla’s truck be a suc­cess will be sim­i­lar to the prob­lem legacy ICE car mak­ers are fac­ing with the ad­vent of prac­ti­cal, good-per­form­ing elec­tric cars. In the case of heavy trucks, how­ever, the shift in mar­ket de­mand – driven largely by eco­nomic con­sid­er­a­tions – could be much more abrupt. This could leave legacy truck mak­ers scram­bling for three things: high speed, com­pact, liq­uid-cooled in­duc­tion mo­tor driv­e­lines; suf­fi­cient cell sup­ply to build lots of trucks with huge bat­ter­ies; and charg­ing or bat­tery swap­ping in­fra­struc­ture to sup­port their elec­tric truck models in ser­vice.

All of the things legacy truck mak­ers need to com­pete in elec­tric line-haul heavy trucks are things Tesla is good at – things where Tesla holds a lead in tech­nol­ogy, man­u­fac­tur­ing or ca­pac­ity. And, when it comes to cell sup­ply and elec­tric driv­e­line en­gi­neers, car mak­ers scram­bling to en­ter the elec­tric car arena will be com­pet­ing for those as­sets, too.

For Tesla, there will be sig­nif­i­cant im­pact from en­ter­ing the heavy truck busi­ness. Tesla build­ing, say, 10,000 heavy trucks of the kind de­scribed would re­quire the equiv­a­lent of 60,000 Model 3 mo­tors, in­vert­ers and driv­e­lines – some­thing sig­nif­i­cant but man­age­able.

A much more sig­nif­i­cant im­pact would be on the bat­tery side. If the 10,000 Tesla heavy trucks each use the 2mWh bat­tery, and swap­ping sta­tions av­er­age one in­ven­tory turn per day, then 4mWh of truck bat­ter­ies will be needed for each truck (one bat­tery in the truck + one bat­tery in in­ven­tory at a swap sta­tion). Ten thou­sand trucks a year on this ba­sis would re­quire 40 gi­gawatt hours (gWh) of ad­di­tional cell sup­ply. This is more than the en­tire de­sign ca­pac­ity of the fully built-out Ne­vada gi­gafac­tory. It is also more cells than Tesla will need to make 500,000 Model 3 cars. No won­der Elon Musk is talk­ing about build­ing many more gi­gafac­to­ries.

Other as­pects of Tesla’s busi­ness that could see im­pact from a suc­cess­ful en­try into heavy trucks in­clude grid stor­age and su­per­charg­ers. In the op­er­at­ing and busi­ness model de­scribed, trucks are sup­ported by bat­tery swap sta­tions at truck­ing ‘hubs’ and along ma­jor truck­ing routes.

These swap sta­tions will need charg­ing sys­tems for recharg­ing ex­changed bat­ter­ies, and, as pointed out, the in­verter/charger equip­ment Tesla cur­rently uses with their Pow­er­pack product is both nicely sized for charg­ing these big truck bat­ter­ies, and con­fig­ured to al­low some of the bat­ter­ies in swap sta­tion in­ven­tory to be used for

grid-con­nected stor­age ap­pli­ca­tions, in­creas­ing sta­tion rev­enue.

Stand­ing up swap sta­tions to sup­port 10,000 truck per year pro­duc­tion as de­scribed above is equiv­a­lent to in­stalling 20gWh of grid stor­age per year! That’s a huge in­cre­ment in Tesla’s grid stor­age busi­ness. Of course, if Tesla does stand up a ro­bust heavy truck bat­tery swap in­fra­struc­ture, there will be the op­por­tu­nity to sell ac­cess to that in­fra­struc­ture to other truck mak­ers/other truck­ing op­er­a­tors – though that would re­quire, for lo­gis­ti­cal rea­sons, that other truck mak­ers adopt Tesla’s phys­i­cal, elec­tri­cal, and cool­ing stan­dards for their bat­ter­ies.

The bot­tom line for Tesla is that suc­cess­ful en­try to the heavy truck mar­ket with an elec­tric truck of­fers an op­por­tu­nity to grow the busi­ness very sig­nif­i­cantly. Tesla in­vestors will want to pay close at­ten­tion in Septem­ber and as­sess how well or poorly Tesla’s elec­tric truck is likely to com­pete, and whether or not Tesla will dis­rupt an­other in­dus­try.

The like­li­hood that Tesla will in­tro­duce a com­pelling heavy truck and start the ball rolling to­ward widespread use of elec­tric heavy line-haul trucks is one more in­di­ca­tor we are look­ing at rapidly ramp­ing bat­tery de­mand. If Tesla ini­ti­ates dis­rup­tion of heavy trucks, that is one more huge in­cre­ment for the bat­tery and bat­tery ma­te­ri­als sup­ply chain that is al­ready ramp­ing to sup­port a switch to elec­tric cars and mass de­ploy­ment of grid stor­age sys­tems.

Top: The Freight­liner Cas­ca­dia

Above: Un­veil­ing the Nikola One

Randy Carl­son is a US en­gi­neer and com­men­ta­tor. This ar­ti­cle  rst ap­peared on in­vest­ment web­site Seek­ingAl­pha. It rep­re­sents the au­thor’s opin­ions and he has no busi­ness re­la­tion­ship with any com­pany men­tioned.

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