Originally published on EV Obsession.
Elon Musk is a great communicator. He often digs into the depths of important matters, unveiling underlying key points that too many people pass over or don’t see at all. And he summarizes complex matters in succinct and clever ways to help others see points that are not immediately obvious to them but seemingly are to him. Regarding the recent Volkswagen scandal (aka dieselgate), Elon had this concise and insightful response to a question from a reporter in the Netherlands regarding potential “green skepticism” that could come from dieselgate:
“What the Volkswagen [scandal] is really showing is that we’ve reached the limit of what is possible with diesel and gasoline.”
Indeed. Dieselgate, very simply, was Volkswagen cheating the system to make its diesel cars pass emissions tests in the USA. But Volkswagen didn’t just do this out of a corporate drive to be evil. It did this because it couldn’t offer diesel cars in the USA that were both clean enough to comply with regulations and had the performance that buyers desired. I’m not taking away from the point that this is completely immoral and offenders probably deserve a decent prison sentence (the deaths caused by this are very real). But for some broader auto industry perspective, the point is that it’s time to move beyond these antiquated and inefficient methods of propelling large plastic + metal containers forward at high speeds. Remember, diesel cars aren’t the only ones that are trying to sneak through tests by cheating the public — tests electric vehicles can pass with their eyes closed.
Elon expectedly but rightly (imho) noted that this scandal should lead automakers and consumers to move faster toward truly clean and high-performing electric vehicles. Tesla has already shown it is more than possible. Its Model S has won just about every major auto award out there. It is the quickest sedan ever produced. It has been named “car of the century” by Car & Driver. It has been named a “Top 10 American Car of All Time” by Motor Trend. It broke the Consumer Reports rating scale for cars, scoring 103/100. And Tesla is now releasing an electric SUV that drives like a sports car, seats 7, and is likely to blow open the whole automotive industry paradigm further. If Volkswagen or other large automakers had gotten serious about electric cars when Tesla did, imagine what else could have been on the market by now!
I think it’s important to understand that switching to electric vehicles goes against the majority of large automakers’ competitive advantages, strands huge sunk assets, and must be a very difficult decision to make. But ignoring the inevitable transition or trying to slow it down only sets these companies up for their own special “Kodak moment.” Developing and selling electric cars and fossil-burning cars is like trying to mix oil and water. Thus, I think what would be wise for these large automakers to do would be to follow in the footsteps of some German utilities, which have figured out (after much suffering) that the best approach is to have the two arms operating independently. Put a lot of cash into an electric spinoff and try to take control of the car industry of the future in a genuine and powerful way.
Some large automakers seem closer to doing this than others, but I’ve seen no actual indication that any of them are considering it. They better do so soon. Or they better be even braver and just get serious about EVs with everything they have to muster.
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