Betting Tesla's Elon Musk $1 Million, Dan Neil Hopes To Lose

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'Revenge of the Electric Car' premiere: Tesla Motors CEO Elon Musk on red carpet

'Revenge of the Electric Car' premiere: Tesla Motors CEO Elon Musk on red carpet

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Elon Musk, CEO of electric-car startup Tesla Motors, sometimes says things that later prove not to be quite true.

In that, he's like many entrepreneurs, who spend a portion of their time persuading the unconvinced and painting pictures of the rosy future, despite inconvenient facts that may contradict that vision of the future.

And in the case of the 2012 Tesla Model S all-electric sports sedan, which Tesla says it will launch before the end of next year, skeptics abound.

One of the most prominent may be Dan Neil, the Pulitzer Prize-winning automotive journalist who now writes about cars for the Wall Street Journal.

'Revenge of the Electric Car' premiere: Journalist Dan Neil on the red carpet with his wife, Tina

'Revenge of the Electric Car' premiere: Journalist Dan Neil on the red carpet with his wife, Tina

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When Tesla gave out brief rides in a prototype Model S in April 2009, Neil called the car "a far more ambitious--some would say unlikely--project" than Tesla's Roadster in his Los Angeles Times writeup.

Neil said the schedule promised by Musk was "an audacious timeline that makes many in the car industry roll their eyes." And, he added, "Even people inside Tesla are leery." The implication was clear: Neil didn't believe Tesla would be able to deliver on Musk's promises.

A week later, Musk e-mailed Neil and told him--in no uncertain terms--that he was wrong. After several lively rounds of e-mail (which Neil no longer has, he says), he challenged Musk to a bet on the outcome.

The two discussed the bet again at a panel this spring following the premiere of the movie Revenge of the Electric Car, in which Musk is a main character and Neil narrates.

Tesla Model S Alpha build

Tesla Model S Alpha build

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As Neil recalls them, the requirements for Musk to win the bet are as follows:

(1) Series production models of the Tesla Model S have to be delivered to paying customers before the end of 2012. (It was originally 2011, but Neil concedes that Tesla said it wouldn't make that date fairly early, and has since stuck to its 2012 date.)

(2) The Model S has to have seven passenger seats, certified as such by the National Highway Traffic Safety Administration, and earn a 4- or 5-star safety rating from the NHTSA.

(3) It has to have a battery pack that allows en-route swapping at a highway roadside station, similar to the Better Place battery swapping scheme.

(4) Model S prices must remain at the levels Tesla and Musk announced: $57,400 for the version with 160 miles of range, $67,400 for the 230-mile version, and $77,400 (was $87,400, corrected) for the top-of-the-line 300-mile version (which will comprise the bulk of early production). All prices are before any Federal or other incentives.

If Tesla misses any one of those targets, Neil says, he wins the bet and Musk must donate $1 million to Médecins Sans Frontières (Doctors Without Borders).

But if Tesla does what it said it will, Neil loses, and--being a journalist, not a multimillionaire entrepreneur--he will donate $1,000 to the same group.

We reached out to Tesla for a comment from Musk, but had not heard back by publication time. If Musk does comment, we'll update our story.

Tesla Model S Alpha build

Tesla Model S Alpha build

Enlarge Photo

Neil takes pains to underscore that he bears Musk no personal animus.

"I like, respect, and admire Musk," he stressed to GreenCarReports. "And I want desperately to lose this bet."

So why make it, then? "It doesn't do anyone any good for Tesla to overpromise--and Elon has a habit of overpromising," Neil said.

"I know what it takes to start up a car company. Credibility is the most important thing in the green-car climate; if you don't deliver what people expect, it tends to discredit the technology in general."

Later, though, Neil alluded to Tesla in quoting the old saying: "If you shoot for the moon, and miss, you still wind up among the stars." And he admits he's torn; he really does want the Model S to come out on time, as promised, so that he loses the bet.

What do you think? Will the 2012 Tesla Model S be delivered on schedule, with all the promised features, letting Elon Musk win the bet?

Let us know what you think in the Comments below.


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Comments (23)
  1. The roadside battery swapping is new to me. Guess I have not paid enough attention to the Model S. Also interesting that he is holding Musk to 7-seat capacity (which, in itself, seems innovative for a car to this size.)

    Best guess, is that Musk will lose. I think he will fail to met one or more of the requirements, even if he ships by end of 2012, the price might creep up, or the number of seats creep down.

    But I agree with the sentiment that even if Musk falls a little short, he may still pull off something truly amazing.

  2. There are two things in the bet I don't even want on my Model S, I don't want the seats in the trunk they should be optional so only those who want them will get them.I don't want and will never need children's seats in my trunk. And I do not want battery swapping, I don't want to be swapping a major component of my car out at a station where the installation could damage parts if done incorrectly or receive a damaged battery, my luck I'd get a bad battery causing my car to suddenly shut down five miles away from where I swapped. As for the bet Neil is just trying to call Musk's bluff I don't really care if the Model S is delayed, Tesla seems to be on schedule so far but it's not like a delay would be unheard of in the EV world, it happens.

  3. I agree about the battery swapping idea. With DC fast charging and many other options for going long distance, this scheme, made popular by Shai Agassi's Better Place, is not needed and only delays the release of this great car. I'm disappointed Musk is still going down the road on this idea.

  4. The pack will be swappable but will not be compatible with Better Place. It will just be relatively easy to remove and replace, maybe a 10 minute job or something. The 7 seat requirement is pointless and only exists because Musk has 5 kids.

  5. I don't think 7 seats is a bad idea since it will widen the appeal of this car to people who currently are forced to get SUVs with third rows. There's a lot of us that need it from time to time even if we don't have five kids. I think it's a great "option" to have on a car that allows it. The way I understand the solution, the seats disappear to accommodate the "trunk" when not needed. Brilliant.

  6. I mostly meant it's pointless to add it as criteria for the bet. If the S has 5 seats or 7 when it launches has no material impact on the success of the vehicle. I'd hate to see Musk drop 1 mil because the S didn't have two jump seats it really didn't need in the first place.

  7. It is slated to be a less than 5 min job. I think the wait is to let SAE set the new J1772 standard. Under the new standard there will be and additional 2 pins on the current J1772 plug/outlet to allow for LV 3 charging at 440v 3 phase AC or 440v DC.

  8. One million dollars on a pointless bet he will almost certainly loose? Seems over the top even by Musk standards. I hope he wins though.

  9. I think you need to back up your first statement a little better. The article link to describes a situation in which Elon claimed he was expecting DOE loans soon although they hadn't been approved yet. Soon before the approval was given and the loan was distributed. If that's the basis for a reputation of being overly optimistic I think that's a bit of a stretch.

    Not saying that Elon doesn't promise too much, just that you need to back up your statements better.

  10. I hope Niel relaxes the terms, I do not believe Tesla ever claimed quick swap of the battery, only that it could be removed in the shop relatively easily, that is maybe an hour or two.

    The rear facing child seats are only an option, and may be a problem for NHTSA safety, this too should be dropped from the condition.

  11. Check out some week old footage of a couple Palo Alto guys trailing a country road test of a Model S last week. Its amazing footage and shows the cars ability to power through turns and even pass slow cars in the opposite lane!

  12. A title for all this :
    "Much to do about nothing."

  13. Neil has the bet in his pocket, right now! Elon is arrogant and ignorant about the details in automotive. He is a software programmer. There is far too much Elon does not know, he does not know. These surprises will cost him dearly as he tries to move to production. What does Musk need a 7 million sq ft plant for? I think Dan should have extended the bet and have it double every year Musk is late. Musk is all talk and has little knowledge of automotive. Toyota and Mercedes are using him as a short cut while they develop their own technology. Tesla may go bankrupt before Neil collects his due. I do wish Tesla had the right OEM experiences in his top management to deliver.

  14. As far as I can tell, Musk has made good on all aspects of the bet, or if he hasn't he's not off by much. He's certainly close enough to make claim chowder of Richard's comments here.

  15. what is it aboiut BS that you can't discover by reading what he has done to and with the real inventors and investors of his mindless schemes

  16. Every article ever has stated the 300-mile variant will be $10,000 more than the 230-mile variant and $20,000 more than the 160-mile one, or ~$77K. Yet here this comes along claiming you'll be able to add the first 70 miles for $10K (to get to 230) and the next 70 miles will cost you $20k more??. This sounds very wrong.

  17. Not to be rude, but Dan Neil’s bet is inconsequential. This publicity stunt plays into the hands of the gas/automotive alliance’s negative publicity agenda. Yes, the media should be diligent and report missed delivery dates, but If I were Musk, I would not spend time responding to distracting bets. Musk needs to be more concerned about delivering on time and in bringing the price down on the Tesla Model S. If for some good reason he doesn’t deliver on time due to uncontrollable roadblocks, then so be it. It is all part of running a business. The important thing is that he not be sidetracked and eventually deliver.

  18. I recently saw the Tesla, here in Orlando and dreamt of one day owning such a vehicle. I have been holding off from buying a reasonably priced electric car for over two years. So far the closest available is the Leaf, but its body style pales in comparison to the Tesla Model S. Personally I hope Musk comes through with his plans and becomes known as the modern day “Henry Ford” delivering the Model T, I mean, the Model S to the masses.

  19. Thanks to all those who pointed out my typo on the price of the 300-mile version, which George Blankenship says will be only $20,000 pricier than the 160-mile version, here:

    I've corrected the copy now.

  20. My money is on Elon and Tesla! They still have more than a year to get from a near production "beta" version to the production vehicle. The 7 seats and battery swap technology design is already done. The big question mark is cost/price.

  21. I bet Elon will win, and then proceed to donate the money anyway as a media stunt. I am attending the Factory Tour and Ride event.

  22. Firstly Dan Neil is a bit of a pratt. Secondly who cares when the car is debuted?

  23. Betting against Tesla is something I would not do, just because I am a big Tesla fan, but because they seem to be very conservative with their comments and publicity. According to the US Government, there are roughly 102.9 MILLION commuters and 92% of those commute LESS THAN 35 miles to work (78% are at 20 miles or less!), which mean they could EASILY use an electric car rather for their commute. Charging at night is EASY, would occur when the grid is LEAST UTILIZED and therefore has SPARE CAPACITY. Increasing the utilization at night could potentially REDUCE electric rates by making the utilities more efficient (i.e. their structural costs that are not affected by usage would now be speard over a larger utilization base).

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