Instead Of Becoming Detroit, Silicon Valley Is Re-Inventing Detroit

from the so-if-michael-dell-was-the-henry-ford-of-computers... dept

There’s been a lot of hype lately about a new Silicon Valley automotive startup called Tesla Motors, which is producing a powerful, electricity-powered sportscar. Considering the high level of VC activity in green technology, it makes sense for a company to tackle one of the chief polluters, the automobile. But while it remains to be seen whether this attempt at an electric vehicle actually goes beyond the failed efforts in the past, Tesla Motors may already be re-inventing the auto industry. In recent years, the big automakers have slowly moved to procure more of their parts from independent parts suppliers. Still, they remain highly integrated manufacturers. Tesla’s business model more closely resembles that of the tech industry. It focuses on engineering and design, while acquiring many of its components from the niche, high-tech parts manufacturers that have sprouted up to service the big automakers. In the past, comparisons have been made between Silicon Valley and Detroit, suggesting that the former is as dependent on a single industry as the latter. But the case of Tesla demosntrates the flaw in this comparison. The tech industry isn’t about selling a specific product, it’s about applying ingenuity to solving problems in any industry, something that will always be needed. Even if Tesla fails, it likely marks the beginning of a likely shift in the automotive industry, towards a method of production more familiar to electronics companies, and the markers of their components.

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Comments on “Instead Of Becoming Detroit, Silicon Valley Is Re-Inventing Detroit”

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Anonymous Coward says:

Re: Re: failed efforts in the past?

I think blind opinions without thought are pointless. Just because something might be a conspiracy doesn’t mean it isn’t true.

If you have any evidence to back up that it isn’t feel free to present it.


What’s your point? You’ve got an opinion not backed-up by any data – yay.

Sanguine Dream says:

Antique cars...

In 50 years the only gasoline cars we’ll be able to see will be in a museum or the garage of some collector. Cool. If the big oil companies get their heads out of their wallets (as opposed to their asses) they could capitalize on this. Instead of trying to fight it they should be at the frontlines trying to bring these new automotive technologies to light.

Chris Maresca (user link) says:

Re: Antique cars...

What, you mean like this?
BP Solar

or perhaps this?
Chevron Technology Ventures

or maybe this?
Shell Renewables.

Companies are motivated by profits, period. If there is a good profit to be made (better than what they currently make), then they will do it. Judging from the amount of money they are spending on renewables (hint – it’s in the billions over the last 10 or so years), they believe that there will be profit in this and are aligning their businesses to take advantage of it.

I hardly see how any of this is ‘head in the sand’. It would be stupid not to take advantage of the current markets to accumulate as much $$$$ as possible to invest in other areas.

Rather, I think the head in the sand is on the other side of the table…. You can’t demand that everyone everywhere just stop doing what they are doing RIGHT NOW and switch to something that’s only barely working.

Anonymous of Course says:

failed efforts in the past?

Nah, they failed because gasoline has better energy

density and it is cheap. It’s still pretty cheap compared

to alternatives.

In the late 70’s one of my co-workers bought a City Car.

It is an electric vehicle that was fairly successful for a

while. He ws allowed to plug it in at work… hey, free


Once gasoline was cheap and available again the EV

market collapsed, except for a few die hards.

Also the feds allowing the energy tax credits to expire

that supported the fledgling alternative energy manufacturers

(producing windmills, photovoltaics and the like)

knocked the legs right out from under them at a

critical time.

The oil companies suck but the stories of them

supressing EV’s the 200mpg carburator and a host

of free energy devices is pure BS.

JustMe says:

The other reason why oil will still be around

Responding to the ’50 years’ comment…

In addition to the high energy density, gas comes with a built-in benefit: we have mastered the ability to transport and distribute gas. Look at it like this, gas lets you drive as much as you need to without a measurable interruption of service to refill the tank.

What about people who need to drive a roundtrip distance where the midpoint is farther than a half-charge? Are they expected to pull over in the middle of the trip and charge their car for a couple of hours? What about running out of juice (poor planning, too much A/C, too many movies in the back seat? How is Mr. Towtruck going to refill their battery? Well, he could use a portable gas generator, but that’s again burning fuel and it will take … a … long … time. Hours.

Many people don’t have the luxury of being able to plug their vehicle in at night because they use on-street or public parking. Do you think it’s reasonable to run extension cords everywhere? Will public parking lots wire every space for juice? What will these people charge for the electricity? It is a lot easier, and safer, to run a cord from you neighbor’s outside outlet than it is to siphon gas, especially from newer cars.

Have you ever needed a jump start because you left the lights on? Hey, that’s pretty easy because once you get the engine turning it becomes a self-sustaining action, and you even get enough juice to recharge the battery.

Moving on to the negative social effects of electric cars:

Finally, where do you think this energy will come from? We don’t have enough electricity as it is. Solar doesn’t provide high enough conversion rates, Wind is good, but unreliable and nobody seems to want them in their backyard (close enough to town so that the loss of energy during transmission doesn’t break the cost/benefit model).

Have you not heard of the summer brown-outs every summer? What happens when 10 million people are trying to charge their vehicles at work during the day (peak time) so they have enough juice to drive home.

What about the power blackout during winter storms, or substation fires (East coast of the US, 2003; Miami just last weekend)?

Chris Maresca (user link) says:

Tesla is not the first

In the middle of the .com boom, there was a company located in Alameda that built a drop in replacement for the internal combustion engine that revolved around a high-performance multi-fuel turbine and a flywheel energy storage device. It could run any burnable liquid fuel and was very, very efficient. They built a prototype around a Saturn Coupe, IRC.

They were financed by a lot of VC’s and high-profile angels, much like Tesla, and hoped to sell their powertrain to car manufacturers. Sadly, car manufacturers showed little interest and the company tanked.

The lessons from that experiment for Tesla were that you have to build the whole product, not just a component. And before Tesla, there was AC Propulsion’s T-Zero electric sports car, and the world’s highest performance electric vehicle controllers were originally designed in Palo Alto by Cafe Electric (they’ve since moved).

On a similar note, Kjell Qvale, who owns British Motor Cars in San Francisco, has owned and started a number of limited production exotic car manufacturers over the years, starting by buying Jensen in the mid-1970’s to the creating and producing the Qvale Mangusta with his son Bruce a couple of years ago. The Qvale production infrastructure was located in Italy and was eventually sold to MG (before they tanked) to become the MG SV supercar. And the Bay Area has two of the most famous custom car builders in the country, Roy Brizio and Steve Moal.

Also, suprisingly enough, not many people know that Silicon Valley has a car production factory owned jointly by GM and Toyota. If you own a Toyota Matrix or a Pontiac Vibe, chances are it was built in Fremont.

Finally, one should remember that a critical and very large component of electric cars is electronics, something at which the Bay Area excels.

I guess it’s easy to see the Bay Area as only ‘Silicon Valley’, but there is a lot of general engineering and business skill here outside of software and electronics. Northern California has been innovating in technology for a long time (starting with the world’s first long distance telephone line in French Corral in 1878, among other things) and I doubt it’s going to stop anytime soon.

Mike (profile) says:

Re: Tesla is not the first

Also, suprisingly enough, not many people know that Silicon Valley has a car production factory owned jointly by GM and Toyota. If you own a Toyota Matrix or a Pontiac Vibe, chances are it was built in Fremont.

Is it really that unknown? NUMMI was a story I’ve heard about multiple times, well before I ever moved to the area. The famed GM/Toyota partnership on the plant was a classic case study that I saw at least five times as both an undergrad and grad student…

Chris Maresca (user link) says:

Re: Re: Tesla is not the first

Well, I’m basing that on the fact that 80% of the people in the Bay Area (and around 98% of the ones outside the Bay Area) I mention it to say “Really?” and it’s not in jest.

And I didn’t know about it before I moved to California (and I’m a car nut pretty much). I knew GM & Toyota had a successfull partnership and it was in Fremont, CA, but I always assumed Fremont was near LA somewhere.

I can’t say that I’m surprised that an uber-geek like you would know about it 😉



Sick of hearing about this says:

To sum up what JustMe was saying:

Gasoline is practical, and electricity isn’t, plain and simple.

An alternative energy source must be practical before it can be implemented in widespread use (keyword: widespread). Electricity in and of itself is just not practical enough for everybody to start driving electric cars around. I think that while it may be time for a fuel source other than gasoline, the answer will not be electricity, at least not alone. Gas-electric hybrids are a good start, and I wish there were a lot more of them on the road. We also need to give our ethanol programs a major overhaul so that we can start increasing ethanol usage and decreasing oil usage. For diesel engines, right now there are very inexpensive processes available to turn used cooking oil from fast food restaurants (liquid oil, not solid grease) into high-grade bio-diesel fuel, which costs about 20 cents per gallon. How’s that for economy? There’s also stuff in development out there like liquid hydrogen vehicles, which emit no harmful gasses of any sort, just water. To me, that sounds like a much more viable energy source than electricity. However, at this point in the game, there is no practical energy source that can produce the power output of an internal-combustion engine, and there just isn’t gonna be a quick fix to the problem. Let me know when they start bringing out hovercars, and I’ll consider leaving my gas engine behind. Speaking of hovercars, I wonder if people will need to get pilot’s licenses…..

Anonymous Coward says:

Re: Let me know when they start bringing out hover

Wait, you were considering switching to a flying vehicle that uses a energy source that is LESS reliable than gas, as opposed to one that will not crash if/when it runs out of fuel?

Anyway, I think people are a little confused.

The power behind Electric cars is not, in fact, the “battery” method. It is the fact that an electric car can use almost any fuel source possible(from a theoretical perspective.)

Almost any fuel source can be converted to electricity. Hydrogen, Ethanol, Oil. As we develop greater/cheaper/more powerfull technologies(Fusion, Fission, etc) in the future, we won’t need to overhaul the basic premise of the engine, just the metod of turning the fuel into electricity.

Anonymous of Course says:

Re: Re: Let me know when they start bringing out h

Hydrogen is an energy storage mechanism like a battery.

It takes electrcity to make hydrogen in practical

quantities without a lot of nasty chemical stuff as a

by product.

The hydrogen is a substitute for a battery but it still

required a coal, natural gas, oil, nuke electrcity generating

plant to make the hydrogen.

Hydrogen has better energy density (as a metal hydride)

than a battery and it burns clean.

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