The Lunch With Elon Musk That Led To Tesla

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The lunch that led to Tesla is a story that Tesla CEO and co-founder Elon Musk and Tesla co-founder JB Straubel shared in their recent interview.

The two (of five) co-founders were interviewed by the Financial Times at their Future of the Car summit this week, and many of us tuned in live to watch it. Although Elon Musk’s comments about Twitter bans were prominently featured in the news yesterday (mixed in with some sensationalism as usual), Elon Musk and JB Straubel gave a phenomenal interview that covered various topics.

Peter Campbell, FT’s global motor industry correspondent, interviewed the two. He led the interview by asking both to share about a lunch that changed the world. This lunch is where Elon Musk and JB Straubel initially came up with a plan that led to Tesla. They have talked about it before, so longtime Tesla followers may already know the story.

Elon Musk explained that he received a call out of the blue from JB Straubel and another person about something space, airplane, or hydrogen-related, and when they got together for lunch, the conversation turned to electric cars.

The group began discussing EVs and Elon Musk shared that he was not only interested in EVs but thought they were the future of transport. Straubel invited Elon Musk to test drive the tzero prototype from AC Propulsion. Elon Musk shared his thoughts about test driving the tzero:

“I got a test drive in the tzero and I tried to convince them to commercialize the T-0. I tried very hard, actually, to commercialize the tzero electric sports car. And then after they said they really did not want to do that. I said, ‘Well do you mind if I do that? Do you mind if I create a commercial electric sports car?’ And they said ‘yeah, no problem.’ And so my intent was to basically create a company to commercialize the tzero with JB.”

Elon Musk then said that Tom Gage at AC Propulsion introduced him to similar groups of people that wanted to commercialize, which included Marc Tarpenning, Martin Eberhard, and Ian Wright. Elon Musk emphasized that when he met the two, there wasn’t an actual company that existed in any meaningful form.

“It was really just three guys and JB and me. We just decided to team up and create a commercial version of the tzero electric sports car.”

JB Straubel added that Elon’s perspective was how he remembered it. He said

“My perspective on the thing was us trying to chat with you about this electric hydrogen airplane concept that I was at the time trying to work on.”

JB Straubel added that Elon Musk wasn’t too excited about the hydrogen airplane. However, the conversation turned towards lithium-ion batteries and the possibility of stringing together large numbers of small lithium-ion batteries, which at the time were not mature yet as a product for EV-scale production. Those small consumer batteries could be potentially connected to larger battery packs used in an EV, giving it hundreds of miles of range.

Straubel added that today this is common, but in 2003 it was completely unheard of to the point that it would set world records. Straubel said to Elon Musk:

“You understood that concept, I think of the potential of it, better than anyone else that we’d ever talked to about it and were immediately enthused about it and excited. Shortly after, as you said, we met up with AC Propulsion and were kind of off to the races.”

The Challenges Of The Early Days

Campbell asked if there was any point between the lunch and getting the Tesla Roadster off the ground when they almost gave up or when they thought they couldn’t make it work from a commercial point of view. Straubel spoke of the challenges of the early days.

“The technology was not a sure thing, that all those pieces would work together, and some of the safety aspects around the battery were pretty thorny in the early days. It was before, I think, most people had figured out how to manage that and I think at Tesla we had an early chance to really figure that out in a very robust way. And make them far safer than an internal combustion actually has proved out to be through the statistics and through data.

“But that was not the common perception. So, that was hard and that was risky. Obviously, there were a lot of financial turns and tribulations. It wasn’t exactly smooth sailing from the idea of an electric roadster through to commercialization.”

Elon Musk also shared his thoughts.

“It was an insane nightmare, basically. And we screwed the pooch six ways to Sunday and made so many mistakes. It’s embarrassing. Basically, almost everything about the first design of the Tesla Roadster was wrong and wouldn’t work. First of all, we had no idea how to build a car. And then no one knew how to build a commercial lithium-ion battery car.

“No one had ever done it. So, the original idea — sort of sounds appealing, but was fundamentally flawed — was to use the Lotus Elise chassis and then combine that with AC Propulsion’s drivetrain technology, and boom, you’ve got the two pieces necessary to create a car. It should be straightforward and just do that, and great.

“Unfortunately, those were two fundamentally flawed premises. The Lotus Elise chassis did not work. The car ended up being 40% heavier and we couldn’t fit the battery pack in the Elise because it was a very tiny car. So, we had to change basically everything about the Elise. I think we kept maybe 6% of the parts were in common.”

Elon Musk added that all of the crash tests were invalidated and even the structure was invalidated due to the mass distribution being fundamentally different from a gas car.

“In retrospect, it would have actually been much smarter to start with a clean sheet design and not try to modify the Elise. Because we ended up with a lot of the limitations of the Elise but almost nothing to gain in terms of reuse of parts. So that was a staggeringly dumb decision.”

One key lesson to learn from this article is that not every lunch is the same. There’s lunch, and then there’s lunch over hydrogen airplanes and electric vehicles.

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Johnna Crider

Johnna owns less than one share of $TSLA currently and supports Tesla's mission. She also gardens, collects interesting minerals and can be found on TikTok

Johnna Crider has 1996 posts and counting. See all posts by Johnna Crider