Exploring SpaceX, Tesla and the Enigma of Elon Musk

Beyond the flamethrowers and whimsical tweets are facts and numbers

Someone asked a question about what people thought of Elon Musk. While most folks were rather positive, there were a few that said he ‘faffed’, was over-hyped and, as a darling of VCs, was doing whatever frivolous things he wanted to. Unfortunately, the derision for the excessive adulation and fawning over, that is reminiscent of how celebrities are treated, can be quite irritating. Often, it overshadows the significant impact that his companies have had over the years, something most folks tend to disregard, instead preferring the fluff.

To set the record straight, I thought I’d do a quick run-down of his work across SpaceX, Tesla and SolarCity. I believe these companies are radical and have the potential to change the world. For now, I will not talk about other projects: Hyperloop, Boring Company, Open.ai or Neuralink.

I will try to answer:

Are Elon Musk’s companies changing the world? He’s building solutions that seem more focused on the developed world. How does it help the poor?

How Tesla and SpaceX are changing the world

Electric Cars & Unlimited Energy

Tesla is not just an electric car maker, it’s a mass producing battery company. The Gigafactory-1, which is probably the world’s largest manufacturing facility, produces only Li-ion batteries primarily for the proposed annual delivery of 500,000 cars. Only partially operable, the factory is still under construction and at full capacity will have an annual production capacity of 35 GWh worth of lithium-ion batteries.

While the electric cars rid themselves of inefficient internal combustion engines in favor of utilizing a more efficient electrical distribution system, they are cleaner but still not green. Now add SolarCity to the mix and you’re looking at the potential to take houses off the grid and turn personal transportation green. They have already executed a project in South Australia installing a 139 MW back-up battery system with another deal to install solar roofs and Tesla Powerwalls on 50,000 houses. Picture Tesla cars charging on solar power produced by SolarCity roof panes feeding into a Tesla battery storage system.

I love the smell of clean energy in the morning!

Artists rendition of a solar rooftop and Tesla Powerwall. Credits: Tesla

Making space affordable

Prior to SpaceX, a majority of satellites were launched by United Launch Alliance (ULA), Arianespace and Russian rockets (operated by subsidiaries of Arianespace). Effectively, it was a duopoly with ULA also cornering most all of the US governmental satellite launch requirements while Arianespace took care of European government launches while maintaining close to a 50% market share of private launches. The starting price for a dedicated launch on an Arianespace Ariane 5 rocket (10 tons of payload to GTO) is around $140 million and a Soyuz (3.3 tons to GTO) would cost about $50 million — these figures are guesstimates.

Enter SpaceX with the Falcon 9 (8.3 tons to GTO) priced at $62 million effectively blowing the competition out of the park. Moreover, the Falcon 9 has a frequency of launch that is much higher than any other rocket in the world. The graph below says it all. In a span of 6 years, SpaceX is the market leader (by number of launches). Moreover, evident from the graph, it’s clear that other players haven’t seen a major drop in launches meaning that SpaceX has also expanded the market. In 2018, SpaceX will look to at doing a total of 30 launches including Falcon Heavy missions.

Satellites have changed the way we live. Read this piece by Will Marshall, CEO of Planet to understand how it has made our lives better. Try going about your week without using services that depend on GPS: Google Maps, Uber, food-ordering services etc. SpaceX has brought down the cost of launching a satellite drastically and will continue to lower the cost of access to space.

How does any of this benefit the poor in developing countries?

Space for weather prediction, remote sensing

Space technology has improved the lives millions of farmers across India. Having had the privilege of spending an hour interviewing a former Chairman of Indian Space Research Organization (ISRO), Dr. Kasturirangan, I could write a whole post about how ISRO’s satellites have been aiding in meteorology, Earth observation, communication and remote sensing — directly helping farmers, fisheries, surveying etc. While India has managed to build a robust space programme that is near self-reliant, most other countries, both developed and developing, do not have the capability to launch satellites.

With SpaceX opening up access to space by lowering costs, developing countries can now launch their satellites and harness space technology for the benefit of their people. The chart below indicates that this decade has seen 31 countries launch their first satellites aboard an existing launch service provider. At least a handful of these have been from developing countries that were secondary payload aboard a Falcon 9 — Mongolia, Ghana, Bangladesh, Turkmenistan. While most of the new satellites are experimental payloads, over time, they will progress to building larger satellites designed for specific use cases. Newer players like Rocket Lab are entering the market with small satellite launchers that can perform launches at a rapid rate with high affordability. The market is only set to grow.

Data Source: Wikipedia

Reducing carbon footprint and the growth of renewable energy

When it comes to renewable energy solutions being built by Tesla, there’s two things to look at. First, the technology is in a fairly early stage of commercialization. Hence the cost is quite high, but as more people adopt cleaner tech, the cost of production will decrease. Surging demand will allow for the building of more Gigafactories that produce clean-tech at unprecedented scale enabling, over time, affordable solutions for developing countries. Here’s something to ponder about. When Tesla began, Elon first built a car for the rich using the cash flow to then work on a premium car which was a little more affordable and followed that up with a mass production car. Building for the poor first, sadly, isn’t the easiest.

Second, the per-capita carbon footprint in developed countries is multiple times that of developing countries. Here’s a sample: Per-capita carbon footprint in US (19.8 tonnes), Australia (20.6 tonnes), UK (9.7 tonnes), China (4.6 tonnes), India (1.2 tonnes), Kenya (0.3 tonnes). It makes more sense getting people in developed countries to use cleaner energy sources.

Note: Figures mentioned above and in chart do not match as the chart data is from 2012. It is worth exploring the detailed data on economicshelp.com which has a list of most countries and their per capita CO2 emissions. Also, take a look at World Resources Institute’s study of the global top 10 emitters.