Musk's goal of 50% new sales to be EVs in 10 years challenged
Tesla Motors' new Model 3 is far from Elon Musk's final vision for electric vehicles (EVs). Firstly, Elon Musk's prediction that "probably in 10 years" over 50% of all new cars produced in the US will be electric, would require 4-16 additional gigafactories for the US alone. Public policy, charging infrastructure and consumer attitudes to EVs also remain an issue. Bloomberg New Energy Finance predicts mass-market EV adoption will only come when the technology reaches price parity with internal combustion engines, unlikely to occur without subsidies until 2025. Lastly, the US grid would need updating to manage the power demand from EVs.
On Friday, against all reasonable expectations a decade ago, the company will arrive at the final step of that initial plan. During a carefully staged event at its manufacturing facility in Fremont, California, Tesla will deliver the first of its long-awaited Model 3s to several dozen early customers. The four-door sedan starts at $35,000 before incentives, with a range of 215 miles per charge.

You can quibble over whether that's genuinely affordable (auto observers would generally call it “entry-level luxury”). But there's little doubt the vehicle will lure a wider mix of customers to electric vehicles—and no dispute that Tesla has already reshaped the automobile market. The company helped make plug-in vehicles appealing in a nation infatuated with brawny, gas-guzzling cars and trucks, forcing other manufacturers to initiate or accelerate their own EV plans.

But arriving at step three, of course, is very far from fulfilling Musk’s grander vision. For all the rapid recent growth, electric vehicles are still a tiny market, representing less than 1 percent of new sales globally.

Electric vehicles will almost certainly grab a swelling portion of the auto market in the years ahead. But it will be a long time before they tip into the truly mainstream, and longer still before they could meaningfully reduce the sector’s dependence on those hydrocarbons.

Many things still need to change in underlying infrastructure, consumer appetites, public policies, and battery prices before any of this can happen. And there is wide disagreement about how fast that’s likely to unfold, and where Tesla will stand once it does (see “Tesla’s Next Broken Promise”).

Tesla CEO Elon Musk unveiling the company's home battery in 2015.

A bevy of batteries

As ever, count Musk as the optimist on these scores.

Earlier this month, during an onstage interview at the 2017 National Governors Association Summer Meeting in Rhode Island, he predicted that more than half of all new cars produced in the United States will be electric “probably in 10 years.” That’s more than a decade ahead of most optimistic estimates.