While investors have been eagerly watching Tesla Motors (TSLA), following CEO Elon Musk’s every last word, electric vehicle technology has been progressing elsewhere behind the scenes.
Co-Founder of Tesla, Ian Wright, has spread his wings from cars to trucks.
Garbage trucks, to be exact.
“It’s basically economics. Electric cars are wonderful things; people who own them, love them…but they’re not cheap. The technology, the batteries, the motors, the inverters, it all costs a lot more than a conventional power train. The coin the owner has to pay for that is the amount of fuel (he/she) can save. The fundamental problem with cars is that they don’t burn very much fuel.”
– Ian Wright: Founder, Wrightspeed; Co-Founder, Tesla
Rewind 10 years.
In 2005, Ian Wright proved electric vehicles need not compromise efficiency for performance when he built the X1, a concept car that is still to-date the fastest legal electric vehicle in the entire world.
Skeptical? Watch the X1 speed past a Tesla here.
From concept –> production, Ian Wright has expanded his vision.
At the Milken Global Conference in Los Angeles, Wright affirmed that a single garbage truck consumes an average of 14,000 gallons of fuel per year, in contrast to the 250 – 1,400 galloons used by more conventional vehicles, from cars to small pick-up trucks.
Wrightspeed is reducing both cost and noise – drastically.
The potential benefits for municipalities are multifarious.
Wrightspeed is not manufacturing its own electric garbage trucks; rather, the company is seeking to replace diesel fuel powertrains with electric hybrid powertrains. There are approximately 150,000 garbage trucks in the United States, every single one of which resides in Wrightspeed’s target market. It should be noted that Wrightspeed’s target market also includes the 2.2 million fleet of medium-sized delivery trucks in the U.S. Think FedEx, UPS, and DHL.
The company is solely focused on the United States – for now.
Why sell powertrains instead of vehicles?
“I’ve learned a lot from watching Tesla’s trials and tribulations from afar, and it was pretty clear that trying to build cars and car factories wasn’t as easy as we thought it was going to be. If you concentrate your effort on the powertrain only, then you can figure out a way to get the powertrain to market without having to build car factories and build cars. So, that convinced me to just do the powertrains, and do them for medium-duty trucks as repower kits.” – Ian Wright, Founder.
The average truck requires replacement of engine and transmission approximately 2-3 times over its life. Moreover, approximately 10% of Wrightspeed’s target market replaces its engine and transmission every single year. A truck owner could take out the transmission, the diesel engine, the fuel system, the instrument cluster, and the rear axle – and replace all components with one of Wrightspeed’s powertrains.
Wrightspeed has the potential to alter the future of trucks.
Moreover, analysts anticipate the company to create approximately 300 new jobs in the Bay Area, with room for growth as the company expands its footprint. It must not be forgotten that successful startups augment employment.
View here a video of Wrightspeed’s geared traction drive (GTD), simulating the following acceleration: stop –> first gear –> second gear –> back to first gear –> full torque stop. The software controlled, clutch-less shifting is so quiet, it cannot be heard by the human ear.
Earlier this year, electric bus manufacturer, Proterra, introduced to the world a novel zero-emission bus, a 40-foot electric vehicle capable of transporting 77 people at once. The bus can hypothetically remain in service continuously, due to its ability to recharge batteries at “FastFill” charging stations along passenger routes.
The speed of battery charge (approximately ten minutes) is a vital competitive advantage for Proterra, as the sluggish nature of conventional charging stations has been the topic of vast concern among electric vehicle drivers.
“Gone are the days of commercially-viable electric vehicles being limited to the realm of flashy sports roadsters and passenger cars. The work-a-day worlds of public transit buses and municipal garbage trucks are offering their own glimpses into a future of zero emissions vehicles.” – Greenbiz.
It’s no trivial coincidence that Proterra’s CEO, Ryan Popple, is also a former executive of Tesla Motors.
Michael Linse, Partner at Kleiner Perkins, who led the company’s near $30 million investment in Proterra, postulates:
“It is dramatically cheaper on a total cost of ownership basis for transit operators. I’m highly confident that within the next five to ten years, the majority of buses sold in the United States will be electric.”
FUNDAMENTALS TRUMP FLASH.
There is a fundamental difference between Tesla’s offering of attractive, yet expensive, hybrid cars and the disruptive change occurring as a result of companies like Wrightspeed and Proterra.
Thanks to plummeting battery prices, Wrightspeed and Proterra are offering low-cost solutions: garbage-truck drivers, truck drivers, and bus-drivers can drive a vehicle that is both friendly to the environment and their wallet. While Tesla has been striving to reduce costs, the car is not affordable by all. Moreover, echoing the words of Tesla’s Co-Founder Ian Wright, cars simply do not have enough fuel to burn.
To give credit where credit is due, Tesla Motors has proved instrumental in articulating a vision. Under the tenacious leadership of Elon Musk, the company has altered the public perception of electric vehicles. This is no simple task. The vision of the Wrightspeed’s and Proterra’s of the world is by no means superior to Teslas’, it is simply different.
Moreover, it is of utmost importance to note that Tesla, Wrightspeed, and Proterra are all targeting slightly different markets. It seems reasonable to conclude that very few people own a luxury car, a garbage truck, and a bus.
In the world of electric vehicles, the more the merrier.
In fact, The Sustainable Investor visited this very topic in a recent article: Elon Musk Invites Competitors Under the Hood.
Recognizing that patents have the potential to stunt innovation, Musk recently declared: “Tesla will not initiate patent lawsuits against anyone who, in good faith, wants to use our technology.”
“Do patents aid or stymie innovation?
This is the fundamental question that Musk is answering loud and clear.
Nine times out of ten, competition and innovation are positively correlated. As competition increases, so too does innovation, as companies are coerced to think outside the box in order to stay afloat. The implications are tremendous. The existence of a patent implicitly implies that business is zero-sum: one electric car company wins at the expense of another. Now, imagine the nascent electric vehicle market is not zero-sum. An electric vehicle tidal ride could increase the success of all electric cars. The simple truth is that the more people advocating electric vehicles, the better Tesla fares. If Tesla can change the conversation to electric vehicles, the company will gain more than its fair share.”
– The Sustainable Investor, 04-03-2015.
And indeed, the conversation seems to be concentrated on electric vehicles.
I hope to be writing a piece on zero-emission vehicles: version 3.0 in the near future.