Tesla Update: How is the first IoT Smart-car Connected Car faring?

Telsa S’s at Supercharging stationTesla Supercharger

Here is my previous article on the Tesla IoT Case Study

How’s it going – a year later?

I have owned my Tesla for a year and it is a year since I published my first review of it as an IOT and published a list of 13 beefs with the Tesla on the Tesla forums.  I have 14,000 miles on the car which is a lot more than I planned.   I thought I would use my ICE car a lot more.  It has sat in the driveway unused collecting dust month after month as the Tesla is so much more fun to drive and cheaper.   My fiance has insisted on driving it whenever I don’t.

Tesla owners are pretty feisty and when I published my 13 small beefs in the Tesla forums, instead of getting a number of high-fives and people who felt similarly I got a lot of criticism.  I was only offering some helpful suggestions. I was just trying to help Tesla improve.  I was happy and continue to be ecstatic with the car.   They came down on me for the slightest criticism as if I was a foreign agent coming in with evil propaganda from the enemy.    The ferociousness of their criticism must be similar to the loyalty that Apple owners had in the early days of Apple.

Tesla fixed 12 of the 13 beefs through software upgrades over the last year! Now that is something you don’t see everyday.   The 13th beef was I didn’t like the placement of the turn signal lever. Everybody told me this is where Mercedes places their turn signal lever and I was wrong.  I still find it awkward to use but other than that I can say over the last 12 months I have had nothing short of an amazing car experience.

Besides fixing 12 of my 13 beefs they have provided service above the call I didn’t even imagine.   They installed titanium bars for free to prevent my car when driving low on the highway from being damaged, they replaced a windshield for free ($1800) when it was damaged by a rock.

So far the worries about hacking the Telsa, possibly corruption of apps have not emerged.   That’s obviously good.  Part of that is undoubtedly the low # of Teslas, that Tesla has not enabled a lot of apps to run in the car and limited the functions of the API and Mobile App.  I hope this year will allow some more capabilities and they will not experience any security issues.

Tesla’s Core Competence and Competitive Advantages

It is reported that Teslas workforce is about 60% software engineers.   The typical car company has 2% of its workforce software engineers.   You can imagine this results in a drastically different kind of car.   No wonder the car boasts incredible flexibility and upgradeability.

When you think about what is the core competence of Tesla the typical response is that the battery has been the most unique capability.   Surprisingly nobody has really replicated the Tesla battery capability.   Maybe there is more to this than meets the eye.   However, with 60% of the workforce software engineers the kind of things that Tesla cars can do and are doing is BEYOND THE CAPABILITY of other car manufacturers to compete in the near term or possibly ever.   If cars will be predominantly software in the future then car companies which are 98% mechanical workers and engineers will be hopeless against the integrated software powerhouse that Telsa is building.  Their true differentiation may not be their battery but the software.

Think about the clunky user interfaces of most cars.   Do you imagine anytime soon they are going to replicate the integrated experience of the Tesla?  The Tesla suspension system is linked to the GPS system so it knows when to raise or lower the suspension.   My calendar is integrated with the navigation, the heating and cooling systems to facilitate my comfort and convenience.     I think we are looking at a long term sustainable advantage that may be impossible for almost any car manufacturers to compete without a drastic change in focus.    In the end it will depend if the smart connected car really is what consumers want.   If so, then Tesla will be able to manufacture a wide variety of cars and win the market because of tremendous advantage in software integration not because it makes great electric car components.

Telsa is giving away its battery intellectual property.   This seems like a stupid move for a car company or any company but I have pointed out that IP is fleeting.   Most companies can replicate technology whatever it is.  There are lots of smart people if that is the main differentiator.   What will help Tesla sell 500,000 or more cars is if the rest of the car industry makes them and they get over the hump of being a “strange” thing to do and become a real option for most car buyers.   If electric cars achieve that disruption of the traditional ICE car then Tesla can take a small percentage and still do massively better than if they are never able to get beyond a miniscule market adoption.   Consider that today Tesla sells 35,000 cars a year maybe 50,000.   In the US alone over 16,000,000 cars are sold.   Tesla has at most a 1/3 of 1% market share in the US and maybe 0.03% worldwide.   If the electric car takes off and they get 3% of the car market that’s 10 times the size they are today.

One of Tesla’s software advantages is gathering information from the car to feedback into improving the cars serviceability.   They can fine tune performance much faster and better than regular car manufacturers.  It will depend on if Tesla can execute on the information but the fact that the car is basically only a few components (motor, steering system, braking, suspension system, heating cooling system) and these are composed of relatively few parts means that less is spent on engineering the cars parts to work together physically and more is spent on making them work together logically.

Everything becomes adjustable virtually.   An example is the suspension system which can become smarter because it can know the experience of other drivers on the road.  This is the network effect applied to cars.  Watch out car industry.  If Tesla can scale it may be impossible to stop.

Elon Musk is disruptive individual

His strategy for business seems to be how can he throw the most monkey wrenches into the ways we have thought things “had to be”.    I mentioned some of the disruptive things he did with the Tesla.  (I won’t belabor SpaceX or SolarCity disruptive ideas or building a thousands of mph tunnel between LA and SF, etc…)

Tesla’s biggest problem is that with a battery production capacity limited to 30,000 or so cars a year and an annual consumption in the US alone of 16 MILLION ICE cars he’s not making the slightest dent in the car market or in challenging the ICE makers.   His new battery factory will allow him to hit 500,000 cars a year which still would be smaller than virtually any other car manufacturer in the world.   He also expects to be able to reduce battery cost for the 60KWH battery to below $3,000.

When you realize the scale of the ICE commitment the world has you realize this is not something that is going to happen overnight.   Even in the most optimistic scenario for Tesla it is a 1% car manufacturer for the next decade and cannot create disruption unless additional car manufacturers and additional battery capacity comes on board more quickly.

Let’s review those disruptive aspects of the Tesla and how successful they’ve been:

1) At 1/3 cost to operate due to efficiency of central electrical production and electric motor the car produces less ecological impact than other cars

green car

The move to electric cars and replicating Elon Musk’s Tesla has made waves but the ICE car manufacturers haven’t conceded defeat yet and they don’t seem to be quaking in their boots.   Other electric cars are not selling well at all.  Tesla seems to be the only electric car succeeding.

I think the problem is similar to the Steve Jobs effect.  Steve Jobs understood the problem was that you had to solve the holistic ecosystem problem.   When Apple came out with the iPod they also did the user interface, made it fast, simple and backed it up with service.   The result was 70% market share in the consumer electronics industry which is unheard of.   When I tried to buy an iPod competitor I was astonished how stupid they were.  The user interface consisted of 12 indecipherable buttons, a 2 line barely readable screen.  It took me 24 hours to upload a few songs to it.    Needless to say I returned it and just got the next model iPod.    I couldn’t fathom how when the competitors were shown the exact thing they needed to make they still produced crappy alternatives.

The cars cost of operation has met all my expectations and more.

Service costs:  $0

Energy Costs:  -$450/month

How could I be paying 450 dollars a month less?   I save $250/month on my electric bill because I could switch to a time based rate plan in california allowing me to move energy to evening hours and cutting my costs dramatically.  I save at least $200/month in gas costs I no longer have.   I charge my car only half the time at home which is about $20/month.  The other half is charged at garages and other places I can hook a charge for free.  I don’t know how long many places will let me charge for free but I expect corporations will provide free chargers more and more for employees.

It is clearly the most ecological full sized vehicle ever produced in any quantity and it is cheap to operate.  I understand that if the car doesn’t last, has serious service problems that this prognosis will change but so far it is virtually free to drive (other than the capital expenditure).

2) The size of the battery, the charge at home or in garages all over, superstations across the country for free and battery replacement options disrupts the gas service station business as well as other electric vehicles


Tesla is not only potentially disruptive to ICE’s but it is disrupting today the electric competition.  Sales are in decline for almost every other electric car.

Elon Musk solved the distance traveling problem, the lifetime problems, the time to charge problems.  He gave us a solution that is elegant, powerful, competitive in every aspect.  When these other companies put up 80 mile battery cars with slow charging options, poor performance, is it any wonder nobody wants to buy one of those?   My fiance was thinking of an electric car after seeing the Tesla.  We went through all the alternatives and concluded they were all crap.  We wanted to buy another Electric car but none of them met the simple requirements.   I’m sorry there is no comparison.   I don’t think they have a clue.   The European carmakers seem to be making the most effort to compete, but even they are coming up far short. Mercedes has licensed the Tesla battery.  It will be interesting to see how that evolves.

3) The low maintenance and maintenance at home and the ability to update the car remotely with new features and fix the car, the ability of Tesla to capture real time data to improve service is transformative and disrupts the entire service business for cars.

There has been zero maintenance costs or issues with the car.  (Unless you count a piece of the molding having to be glued back that became loose – also done gratis by Tesla as they looked over my car to adjust tire pressure and check it out electronically.)

As I mentioned above Cost of service:  $0.  However, because there are only 30,000 cars on the road the ability to disrupt the service business is ZERO at the scale he can achieve in the next decade.   However, aspects of what he has done is having an impact on car makers and consumers who have adopted 100% the connected car concept.   Over the next few years I believe Tesla will have succeeded 100% in proving that connected car is a better car, a cheaper and safer car.

Items 5 and 6 below Tesla has been successful in 2 years in disrupting the industry beyond expectations and I think that partly he is succeeding in his disruption on service on this point because most car manufacturers seem to be acknowledging that the ability to gather information from the car during operation rather than simply at service calls can provide valuable input that allows them to improve their cars faster.   We will see if other manufacturers use the connected options below to actually improve their service as well as Tesla has done.

4) The user interface design, big screen with apps and ability to control the car with an app is precedent setting including the smartness of the car, anticipating your schedule, finding alternate routes, raising and lowering suspension based on experience demonstrate a smart car.  Future upgrades include self-driving capabilities all of which is precedent setting

tesla screen2 tesla screen1

No other car manufacturer has implemented the user interface, nor have I seen other car manufacturers commit to such a digital version of a car, large screen full control user interface concept.  No disruption yet.

5) The IOT capabilities including the ability to manage, find, operate the car remotely is precedent setting

tesla app

I believe TESLA has achieved disruption with the connected IOT car

I love the IoT aspects of the car.   I love checking in to see how charging is going, I love being able to remotely turn on the air or heating before I get to the car.   I love being able to find my car anytime.  I love tracking when it is being driven by other people and knowing how fast they are driving or when it is about to meet me.   I love knowing I could operate the car without the key.

Virtually every manufacturer has agreed and is committed to full time internet in cars.  Some have committed their entire fleets to the idea in the next year.   The biggest problem will be how much of the car is available for IoT operation or viewing, how much is actually useful?  Is this simply a matter of making it easier to browse the web in your car or about the car itself? If they are just making internet connectivity in your car more available I think they will find this is not necessarily a big winner.   Connectivity costs money and if you have it on your phone already it is not clear everybody will sign up for this alone.

I believe that part of the success of the connected car is the obvious benefits of these features and the upgrades I talk about in the next point.

tesla software update

6) The ability to upgrade the car over the air or fix it is precedent setting

These are some of the improvements they have downloaded to my car in the last 12 months:

1) Better support for starting and stopping on hills

2) Smart suspension that seems to magically figure out when my suspension should be lower or higher based on experience

3) Smart Calendar, Phone and Car integration which makes it easier to get to appointments and interact with my calendar, destination, conference call support, notes from the big screen

4) Smart commute pre-planning and pre-conditioning (figuring out the best route to work or back even when I didn’t ask it to saving me from stupidly taking the route with the accident on it.), pre-heating/cooling my car automatically before my commute

5) Better backup guide lines and backup camera integration, better support for parallel parking and object detection around the car

6) Improved bluetooth functionality

7) Expanded Media Options, Better Media Buffering for Internet Media, Improved USB playing

8) Improved route planning, traffic integration, telling me how much “gas” i’ll have at my destination and how much if I return to my start point, better ways to see how much “fuel” i was using during a trip compared to estimated

9) automatically remembering charge stations I’ve used and finding Tesla charge stations easily

10) Traffic aware cruise control

11) The key fob can now also open the charge port remotely – super cool

12) Improvements in controlling the screen layout

13) Improvements in the Tesla app to allow operating the car without the key and controlling more car functions remotely

Is it any wonder that Tesla Owner satisfaction is at 98-99% for 2 years in a row?

I can’t imagine living with a car that didn’t constantly improve itself.  I believe other car manufacturers will implement this feature albeit with a lot less utility since the cars aren’t fully digital.

7. Self-driving car

tesla google self driving car

This wasn’t on my original list.   At the time a year ago I didn’t know Tesla was so committed to self-driving features.

Everybody talks about Google self-driving cars.  Everybody talks about how Europeans are ahead of us in self-driving regulation and self-driving features.   The fact is Tesla is implementing these things in part this year and is delivering in every car today the ability to be self-driving.

Google says they will have self-driving out for production in 2017.  People say that in the US this means US car manufacturers will start delivering self-driving features in 2020.

Tesla is delivering many of those features this year and next.

Telsa X due mid-year 2015 4-wheel drive 7-person crossover


(okay, it’s an S with 4-wheel drive, a little taller roof and cool doors)

My laundry list for Tesla for 2015

1) Tesla has promised app integration with Android and support for Chrome browser.

facebook  waze_logo-1skype_logo-580x367 fandango

Star-Chart_1 thescore

I hope this year it comes and with it the following apps supported:  Pandora, Waze, Chargepoint, StarChart, Yelp, Weather (along my route), Fandango, theScore, Camera Recording or photo taking from the car, RecorderPro, youtube, audible, audio read google news, facebook audio check in with camera, audio SMS both receipt and send, audio banking, clock with timer alarm etc…, skype, email, chrome, contacts.

Some cool things would be 2-way easy integration with Waze to allow easy reporting of police and accidents.

Being able to see the names of the stars and planets around me at night while driving would be cool on the big screen.

Weather would be a cool integration allowing me to see how weather along my route will change as I drive.

Facebook integration with camera would be ultra cool.  I promise to use it very infrequently.

Using the camera for more than driving functions would be pretty cool.  How many times have you taken a lousy picture from your car through the window.

Many of the other functions above would come with Android integration promised.

2) More self-driving features

3) More ability to control the car from the app including opening or closing windows

4) Ability to stream video from the cameras or sensors to the app

5) I want the video cameras and sensors to detect cops in the vicinity

6) Calendar “driving” event the car prepares (warm or cool, sets destination up)

7) Better efficiency (Hey I can hope!)

8) Integration with iWatch or other personal devices


The Future of the Connected Car

These are things I think are reasonable to expect

1) High speed communications

There is talk lately of the connected car having a huge impact including possibly being the main motivation for the next generation cell phone communications speed improvements – what is called G5.  The reason for this is to be able to support self-driving capabilities and also to make communication between cars seamless and instant.

Cars need to sense their environment in order to self-drive but many believe that alone is not enough.  The idea is that if cars can communicate with each other instantly (very low delays) they can coordinate themselves better.  A car stopping ahead can notify cars behind it to slow down potentially much farther than can be sensed with sensors (or our eyes.)   If there is traffic the flow can be regulated to produce optimum throughput on freeways.

Many people don’t know that freeway stops are caused by a wave function.   When too many cars are on a freeway a simple slowdown by one car causes a wave backwards that can eventually cause a stop.   This is why you stop on the freeway for no apparent reason sometimes.    LA implemented stop lights at entrances of freeways to slow ingestion which reduces the waves.   However, feedback from cars could work much better.

I don’t know if this will be the motivation for next generation cell communications.  I think it will happen anyway because of other IoT needs and general needs but this could be helpful too.

Cars talking to each other could be cool and something people want or could be obtrusive and annoying,  privacy problem or even dangerous.

2) All Cars talking to the factory

It is obvious that cars sending real-time information back to manufacturers can help them provide better service, design cars better and prevent breakdowns.   It will allow us to build safer cars, easier to maintain cars, more efficient cars.   However, a lot of people might not like having their driving habits reported.

3) Cars being upgraded

I am sold on cars upgrading themselves.

4) Cars being smart

A lot of the features Tesla has added this year prove how a car can be integrated better into our lives and our technology.  The ability of the car to anticipate things or to remember things that happened at certain locations is very powerful and smart. Tesla is absolutely being disruptive in showing the way here.

a) the car plans a route knowing the altitude changes and the effect on consumption

b) the car knows your calendar and scheduled events making it easy to anticipate your destination and tell you about driving problems without having to ask

c) the car makes it easy to access and integrate phone and car so that you need to take your hands off the wheel less

d) the car knows when it needed to be at high suspension or can be in low suspension

e) it knows when to heat or cool itself as I’m about to get in the car to go someplace in my calendar

These are things Tesla has already done and point to the idea that “smart” is really useful.   I believe that other manufacturers will see the utility and start adding these things as well.

If a car has sensors and somebody knocks it or it senses a danger it could notify you and give you visual information to decide to call the police.  In the event of accident the sensors could definitively identify the driver who made the mistake or all the drivers mistakes.

5) Cars driving themselves

This is the biggie obviously that is talked about a lot.   I am a bit of a skeptic in that I don’t see completely self-driving cars being able to really work safely.  I see more and more driving assist features.   When cars are completely self-driving it will be a huge change.   Car design will probably radically change with it because what’s the point of even having a driver seat if the car drives itself?  I see this as still a decade away or more.   However, improvements to make cars drive on highways seems possible much shorter term.

Other articles:

At $18B, the Connected Car is an Ideal Market for the Internet of Things

Progressive Car Dongle creates IoT security and safety risk 

Tesla:  IOT Case Study

3 thoughts on “Tesla Update: How is the first IoT Smart-car Connected Car faring?

Leave a Reply

Fill in your details below or click an icon to log in:

WordPress.com Logo

You are commenting using your WordPress.com account. Log Out /  Change )

Facebook photo

You are commenting using your Facebook account. Log Out /  Change )

Connecting to %s