Musk has last laugh with impossible electric truck
Soaring crude oil prices and new selective market targets help Tesla’s electric trucks boost sales
When Elon Musk announced plans to upend the long-haul trucking industry five years ago, it was hard to suppress the urge to laugh.
Well before he was developing flamethrowers and humanoid robots, and haggling with Stephen King over Twitter subscription fees, the announcement of the semi long-distance truck saw the Tesla Inc. chief executive officer picking a fight not just with the established auto industry, but with basic economics and physics.
Batteries have many virtues, but density isn’t one of them. That’s not a problem for passenger cars, but once you get into truly power-hungry applications like long-distance trucking, shipping and aviation, electric vehicles start to be overwhelmed by the weight of their own power plants.
A Class 8 semi-trailer with half a metric tonne of diesel in its tank can haul a 20-tonne load for 1,000 miles between refueling stops. There’s no way that lithium-ion can compete. The three tonne, 540 kilowatt-hour battery on a fully equipped Volvo AB electric truck weighs as much as a rhinoceros. Tesla is more cagey about its battery specifications, but comparisons with Volvo’s numbers, teardowns of its passenger cars, and details of its Powerwall battery suggest the 1,000kWh power plant alone on its biggest Semi would tip the scales at nearly six tonnes. That’s similar to an adult male elephant, or an empty school bus.
Even with a lighter power train, such a massive battery pack would make it hard for the Tesla Semi to undercut diesel while staying within the roughly 40-tonne overall weight limits that trucks must observe to prevent damage to roads and bridges.
Logistics is an extremely low-margin industry. Make the payload smaller to accommodate a pachydermic battery, or reduce range to allow a smaller power plant, or spend more of the day hooked up to a Megacharger, and those meager profits start looking even thinner.
For all the scepticism (including mine) aimed at the Tesla Semi, an infuriating possibility has emerged, though: Musk may end up getting the last laugh.
The first working models of the Semi were delivered last week to PepsiCo Inc., part of an order of 100 vehicles. That’s three years behind schedule, but it still happened. More sober carmakers are getting in on the act, too. Alongside Volvo, Daimler Truck Holding AG has had orders for 1,280 zero-emission trucks and buses in the first half of this year, and unveiled a prototype long-haul model in September.
What’s changed? If Tesla had made dramatic breakthroughs in battery density, Musk would be boasting about it, so that’s not the answer. There’s one huge difference in 2022 compared to 2017, however: the cost of diesel.
The decline of domestic oil refining and 2022’s squeeze in energy prices have conspired to drive US truck fuel costs up to almost double what they were five years ago. Plug the current prices of Californian diesel and commercial electricity into the trucking expenditure calculator made by logistics-data company ACT Research Co., and even an electric rig that’s twice as pricey to buy as a conventional vehicle is getting 12 per cent cost savings every mile, equivalent to nearly $17,000 a year at typical usage levels.
That might not last as diesel prices fall back to earth, but it’s close enough to put electric trucking firmly in the game.
It’s telling, too, that one of its first customers will be a Frito-Lays plant. If you’re worried about the challenges of hauling heavy loads as well as your massive batteries, few types of cargo will be more forgiving than feather-light pallets of potato chips.