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Published on June 24th, 2016 | by Guest Contributor


Tesla’s SolarCity Bid: No-Brainer, Or No-Brainer?

June 24th, 2016 by  

Originally published on TeslaMondo.

It will take a while for investors, journalists and stock analysts to see it that way. But this isn’t the first time Tesla overestimated the public’s vision. You might remember the double-unveiling of the dual motor powertrain and Autopilot. O the letdown. The stock tanked because everyone had expected something really big. Nobody could see the potential of the “D” in Tesla’s product line, and everyone pooh-poohed Autopilot. Bah! Yet imagine Tesla without them today.

Here are the benefits of this potential buyout:

Green cred. We’re sick of reading headlines about dirty electric cars. True? We’re sick of reminding people that Musk pushes clean energy production as well as consumption. True? We’re sick of waiting for the day when zero-emissions cars routinely pull from a zero-emissions source, or at least are paired that way the public mind. True?

Completion. Tesla Energy’s batteries were billed as the missing link for renewable power, cutting the umbilical cord to the dirty grid. Well, now that whole picture “links” to personal transportation. The Tesla name will bespeak a complete suite of nonpolluting solutions of which cars are just one component. Tesla is simply putting its money where its mouth is, by moving to own both ends of clean transport. In hindsight, this will look like pairing bread with butter, or maybe chocolate with peanut butter. Tesla will own the junction of solar and battery technology  just as both achieve mass adoption as a ticket off the grid.

Scale. We’ll see bigger-scale, lower-cost terms with lenders and suppliers, plus an influx of already-trained customer-facing employees ready to talk solar-powered electric cars just as Model III calls for more company reps. TeslaMondo envisions mall kiosks pitching both products hand-in-hand.

What won’t we see? Embarrassing headlines that seem to put Tesla at strategic odds with SolarCity, because the latter won’t exist.

So let the stock market be confused for a while. Let flaccid analysts succumb to peer pressure and downgrade TSLA. Let Tesla car enthusiasts who don’t give a hoot about green energy complain about this alleged “distraction” from Model III, despite zero evidence of any distraction. It may take a few weeks or a few months for this buyout to morph from crazy to obvious, but it will happen. Solar power, battery storage and electric cars will roll off the  tongue together.

TeslaMondo never liked the name SolarCity. The word “city” doesn’t belong. But wait. Now “motors” doesn’t belong in Tesla Motors, unless it means just the auto division of a company that will have Tesla Motors, Tesla Energy and Tesla Solar, each offered through a master Tesla.com site that gives equal weight to all three.

Some kneejerk headlines say this acquisition defies “common sense.” But actually, it simply precedes it. Common sense once dictated that cool cars go “vroom,” rockets don’t come back intact, you can’t sell cars without dealerships, all-wheel-drive powertrains use more fuel than two-wheel-drive ones, and about 96 percent of a factory’s spacial volume should be wasted. Common sense is permanently locked in an incestuous love pretzel with the status quo. Given too much rein, common sense will strangle us all.

Reprinted with permission. 

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