Tesla Files Lawsuit Against Michigan’s Top Officials

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Electric car manufacturer Tesla is filing a lawsuit against the state of Michigan for refusing to allow the company to sell directly to consumers. The automotive maker named Michigan Governor Rick Snyder, Michigan Secretary of State Ruth Johnson, and Michigan Attorney General Bill Schuette in its official court proceedings. The lawsuit comes after Secretary of State Ruth Johnson denied Tesla’s application for dealership and service provisions in Grand Rapids.

“Tesla Motors brings this lawsuit to vindicate its rights under the United States Constitution to sell and service its critically-acclaimed, all-electric vehicles at Tesla owned facilities in the State of Michigan,” the car company stated.

Tesla’s recent litigation comes after years of legal battles between the car manufacturer and the state of Michigan. In 2014, Governor Rick Snyder signed a bill that banned the automotive company from selling without a dealership network.

A spokesperson for Governor Rick Snyder declined to comment on the current charges brought forth. A spokeswoman for Attorney General Bill Schuette said they are currently reviewing the case. Secretary of State Ruth Johnson published a press release, stating that, “The license was denied because state law explicitly requires a dealer to have a bona fide contract with an auto manufacturer to sell its vehicles.”

For Tesla, the stakes couldn’t be higher, with their much-anticipated Tesla Model 3 scheduled for production late next year. The Model 3 is set to be Tesla’s most affordable vehicle yet, set at $35,000 before tax incentives. The company has already received about 400,000 deposits of $1,000 each from buyers who want to purchase their vehicles in advance.

Tesla currently owns 100 stores in 23 states. For Michigan residents, the closest stores are in Chicago, Cleveland, Columbus, Cincinnati, and Indianapolis. Tesla argues that using a dealership would corrupt their business model. The automotive manufacturer strongly opposes commission-based salaries, and doesn’t want consumers to feel pressured into buying a vehicle.

Tesla Earns $7.5 Billion in One Day

 

This week, people lined up around the country or online to preorder Tesla’s new Model 3 car, placing $1,000 deposits on the vehicle. Preorders became available on Thursday, and in the 24 hours since then, the company has received more than 200,000 orders for the Model 3. That means Tesla will make that many cars and at about $42,000 per car, the profits are incredible.

The Model 3 comes with a base price of $35,000, making it Tesla’s most affordable offering and provides a nice offering for car shoppers on a budget. Versions of the car with more bells and whistles are to follow with higher price tags to attract more customers who can’t afford their pricier Roadsters, which click in at about $101,000.

As of this morning, Tesla’s shares were up by 7% after the sale began. The new vehicles should be available starting in late 2017, though previous auto sales have fallen behind by several months. Adam Jonas of Morgan Stanley predicts that the Model 3 will also arrive late, suggesting that Tesla won’t sell 249,000 cars until about 2020, though the company hopes to sell 500,000.

This time last year, Tesla’s shares hit a low mark of $141.05; they’re currently sitting at a comfortable $230 a piece, a number subject to change based on how many more vehicles Tesla sells—and how many potential buyers will actually keep their bid for a Model 3. It’s worth noting that deposits for the car are entirely refundable, meaning that sale expectations are indeed likely to change.

These changes are “important to the industry because [they] will signal whether or not Tesla Motors is a major threat to the status quo or just another wannabe care company with a fleeting chance for long-term success,” cautioned Jack Nerad of Kelley Blue Book.

GM is currently on track to defeat Tesla’s numbers with a Chevrolet Bolt electric car, launching later this year, which will offer about 200 miles of electric driving range. That car will also cost about $35,000, making it potentially a very fierce competitor for the Model 3.

Power Underfoot

Paved roads and sidewalks are, generally speaking, intended to be among the more mundane and reliable inventions in modern life. Built to be solid, simple, and easily repaired, they’re meant to be a straightforward means of getting from one place to another with little to no obstacles or impediments. The trouble is, American roads — once the forefront of automotive mediums — have fallen into disrepair. The American Society of Civil Engineers, the United States’ oldest national engineering society, gave American roads a grade of “D” in 2013. In the same report, they noted the Federal Highway Administration’s estimate that $170 billion in annual capital investments would be needed to achieve a marked improvement. With plummeting quality, changing infrastructure needs, and automobile technology moving away from fossil fuels, the question arises: should taxpayer funds be spent restoring roads to their former functionality, or toward a whole new mode?

Innovation-minded entrepreneurs argue the latter, and they’re putting their money and research where their mouths are. One such case involves start-up company Pavegen. Founded in 2009, the company has crowdfunded over $2.5 million for its signature technological development: sidewalk tiles that absorb the kinetic energy of pedestrian footsteps. Pavegen boasts that a network of these devices would harvest potential energy that would otherwise go unused, powering everything from advertising displays, street lights, traffic signals, or even electric vehicles. On that last note, the company has partnered with Tesla to experiment with car charging. While a few steps wouldn’t move a Model S very far, implementing a wide array of tiles in a major urban area could yield impressive results.

Solar Roadways is the product of another successful crowdfunding venture, and intends to apply renewable energy collection to streets rather than sidewalks. The technology consists of glass-topped hexagonal tiles, each one absorbing solar energy. And while part of that energy would be returned to the grid, a lot of it would go toward improving the driving experience as well. Although the project is still in development, the minds behind it claim that each tile would be capable of heating up enough to disperse snow and ice, emitting customizable LED road markings and traffic warnings, and funneling off water deposits. And like Pavegen’s project, Solar Roadways hope to contribute to electric vehicle charging as well.

Tesla’s Bold Move is Starting to Pay Off

Apparently Tesla’s recent risky  move is paying off.

CEO Elon Musk stated that the car company would not sue anyone who uses Tesla’s patented technology “in good faith,” in hopes of cultivating a bigger industry for rechargeable vehicles.

“If we clear a path to the creation of electric vehicles, but then lay intellectual property landmines behind us to inhibit others, we are acting in a manner contrary to that goal,” Musk wrote in a blog post. “Tesla will not initiate patent lawsuits against anyone who, in good faith, wants to use our technology.”

Four days after this announcement, Musk offered most of his company’s patents to rivals such as Nissan and BMW. It seems that Tesla is trying to make its superchargers become the industry standard. Tesla currently has 97 charging stations in the US, but with more companies using their technology, this can only grow.

Tesla charging stations in the U.S.

 

“It makes natural sense,” Carter Driscoll, senior analyst of clean technology at MLV & Co., told The Huffington Post. “BMW and Nissan see that you have a company here that’s dedicated to electric vehicles.”

Most likely due to this announcement, Tesla’s stock price rallied to its highest point in months on Monday.

This is a bold move, especially since Tesla is located in the Silicon Valley. So many companies, especially in this area, profit by suing entrepreneurs who violate patents often registered to companies that don’t really do anything but have that patent. Intellectual property laws also fail to protect companies from international competitors.

What are your thoughts on this bold move? Do you think it will continue to pay off?

Tesla Distributes New Charging Adapters And Struggles With “Recall” Label

IMG: niallkennedy via Flickr

Tesla Motors Inc. is issuing a recall involving 29,000 charging adapters for its 2013 Model S electric cars. Tesla informed the National Highway Traffic Safety Administration in a letter that the charging adapters might be a potential fire hazard.

In the letter, Tesla says that the NEMA 14-50 adapters used for 240-volt recharging of the Model S electric car can overheat, leading to melted adapters or start a fire. The adapter connects the car’s charging plug to the household receptacle.

Since 2012, about 2.7 percent of the adapters were returned because they ceased charging. In late 2013, Tesla learned of several cases in which there was damage outside the adapter itself, including a fire in a garage in Irvine, Calif.

The fire controversy started to heat up when three Tesla Model S’s caught on fire within 6 weeks. However, 1 was due to a horrendous high-speed collision

The electric car company has described the recall as voluntary. Once a manufacturer is aware of a safety problem, they must inform the safety agency within five days if a recall is called.

Elon Musk, co-founder of Tesla Motors Inc., has found problems with this system, unhappy with the charger problem being labeled a recall.  “Because Tesla gets so much attention, NHTSA rides us pretty hard. People are going to think our car has a greater propensity for fire than a gasoline car, which is simply untrue,” said Musk in an interview with Bloomberg. No cars have been recalled; however identifying a safety issue and issuing a component to fix it warrants the recall attention

Tesla has since engineered a new adapter for owners that include an internal thermal fuse. Although the safety controversy, there is no danger to profits for the electric car manufacturer. Tesla sold 18,000 brand new cars last year; the bestselling full-size luxury sedan nationwide was the Mercedes S-Class, selling sold 12,000.