Having noting to do with my preference for Apple's devices, I do have some knowledge about Lutz's rather impressive accomplishments earlier in his career and what a clown, with the media's help, he has made of himself over the last six or seven years.
Earlier in his career, he was a very astute and accomplished auto exec who spearheaded many extremely successful and innovative projects. More recently, he has made himself the object of ridicule and jokes by saying a lot a very uniformed things reflecting his expertise is long gone. He's a great foible for the press. He is very opinionated and easily provoked. He makes a lot of demonstrative and specific statements, very few of which are proven out by the facts or events that follow. He does deserve respect, but he makes it hard when he keeps making a fool of himself and keeps allowing the press to use him like they do. It's as if an editor says call Lutz. He'll give us something colorful and somewhat ridiculous that will generate a lot of response and pump up the comments and page views. Most of the more astute auto tech sites regard him with raised eyebrows as if to say, "Oy vey, what is Lutz going to say now."
The more he makes public statements, the more he does to weaken his legacy. I wish he had just retired gracefully. Some of the old airline CEOs have the same problem. The press calls and they bite the bait despite the fact the current industry bears little or no resemblance to the industry when they were on top. More than anything else, it is sad.
I think you just called him the Woz of the auto industry! (Or maybe Woz is the Lutz of the computer industry).
Because it wasn't just a cell phone. Is Apple going to make something that's more than a car? Something vastly different than what already exists?
Who says the thing itself has to be vastly different?
What if they make a car as good or slightly better quality wise, but because of a new approach in production can sell it half as much as everyone else?
Or sell for a comparable price but greater profit share?
Yeah, there's no precedent of them doing that at all.
Frankly I really think Apple needs to place investments in nuclear technologies. If we can get small fusion reactors online by the middle of the next decade it would do wonders for distribution of power to support electric cars. The so called Green approaches are environmentally disgusting and too temperamental to rely upon.
Fusion is still around the corner. But thorium, on the other hand....
You do realize that fusion power has the possibility of transforming the next decade. There are so many approaches that show promise right now that it is highly unlikely that they will all fail. Fusion could very well be the tech that replaces semiconductors when it comes to sucking up skilled technologists.
I guess where we part ways is that I believe it is possible for an industry to exist that Apple is not equipped to excel at. All the evidence posted here of Apple's successes is at the same time indisputable, and confined to a single industry; and, even in computer h/w and s/w it isn't a perfect record. As to automobiles specifically, I don't think the profit margin is there, especially if BMW is providing the chassis or the body (not because it's BMW, but because they need their cut), and I am somewhat dubious about the efficacy of hiring a bunch of Tesla guys to play catch-up to the established players.
Sure internal combustion engines have lots of parts, but the tolerances with which they are built today allow it to go 100K miles before a tuneup. I doubt an electric car will go that far before the batteries will need to be replaced. Even average American cars can easily go 200-300K before stuff starts wearing out
As someone who pretty much only buys used cars, I can authoritatively say - the majority of people don't care about driving a car past 100K miles. They want to move on to a newer, flashier car every 2-4 years.
Very interesting read. The author glossed over the environmental impact of making an EV, which mstone mentions earlier. Those high-power magnets in the electric motor take rare-earth materials to make. A lot of those materials come from China.
Which is a strategic issue for us - our military, for one is seriously concerned about it, as we all should be. Much like Shale Oil was far to expensive to extract until the per barrel cost of Oil exceeded a threshold, extracting rare earths in an environmentally friendly way will happen when the right economics appear. More demand will make that happen more quickly which is a good thing.
My long view is that EVs are the future. A well-designed electric motor can last many decades, so that offsets the environmental cost. Lithium can be recycled, I believe, so that lessens their impact. The electric motor controllers continue to get better and better (being more than 90% efficient). The article's "long tail pipe" issue is real, at least in the US, but this can change (via government regulations). I'd like to see more use of nuclear power to replace oil and coal for electrical generation. And solar/photovoltaic panels continue their (slow) pace of improvement.
Exactly. EVs are the future - the economics are far too compelling. And even if our base electric load is still served by coal, what's easier to clean - millions of tailpipes or thousands of power plants?
What we are really seeing is all the futures of the buggy whip makers protesting going harshly into that good night.
The Indians are doing some major research too, since thorium is abundantly available in the country. But many people believe that China's approach (liquid fuel thorium) is superior to India's (solid fuel thorium). It could be a game-changer if a couple of demonstration projects could be built. Although it won't be inexpensive, it's a pittance compared to how much we spend on energy research and investments globally.
As an aside -- and you're probably aware of this -- there was a fork in the road between uranium and thorium many decades ago, but the DOD shut down thorium because.... you guessed it, it couldn't be easily weaponized.
Which is a strategic issue for us - our military, for one is seriously concerned about it, as we all should be. Much like Shale Oil was far to expensive to extract until the per barrel cost of Oil exceeded a threshold, extracting rare earths in an environmentally friendly way will happen when the right economics appear. More demand will make that happen more quickly which is a good thing.
Makes me wonder if China's "land grab" of the Spratly Islands is for gold or rare materials on or under the sea floor (besides the obvious military strategic importance).
Makes me wonder if China's "land grab" of the Spratly Islands is for gold or rare materials on or under the sea floor (besides the obvious military strategic importance).
The sad part is, even if we were to find such rare earth minerals in the West, we probably could not mine it.
Hey! I like the Volt! It was very innovative. And, I have always like the Corvette, especially the new, retro Stingray model. And Hummer? It was just a one-off whose time has come and gone fortunately, seeing how much of a gas-guzzler and bad for the environment it is.
Actually, Lutz has a very strong track record, and deserves more respect than he's likely to be shown here.
The thinking of "Apple has been successful in most stuff since 1998, therefore everything they do will be a huge success" is dangerous and wrong.
Yeah, there's a big leap into something with this many moving parts. Suspension, brakes, drivetrain, wipers, mirrors, etc. They can certainly buy parts from the same OEM parts companies as other auto mfgrs. (Bosch, Denso, Continental, etc.). Certainly there have been unsuccessful products in Apple's past, including entry into new industries like mobile devices and console games.
I can see them doing something successful with a partnership though. When Honda got into SUVs, they were successful by designing the interior for an established Isuzu platform, and off they went. The issue here is that there are two major hurdles to get over: new industry, and no current profits for electric vehicles. Going in with two major risks seems a bit much to me.
That said, Apple can throw a bunch of cash at this, fail, and still be killing it.
People keep making comparisons to iPhone in 2007. Steve Jobs stood up on the stage and showed us an iPhone. When Cooks drives an Apple car on stage, then I'll get excited.
The Indians are doing some major research too, since thorium is abundantly available in the country. But many people believe that China's approach (liquid fuel thorium) is superior to India's (solid fuel thorium). It could be a game-changer if a couple of demonstration projects could be built. Although it won't be inexpensive, it's a pittance compared to how much we spend on energy research and investments globally.
As an aside -- and you're probably aware of this -- there was a fork in the road between uranium and thorium many decades ago, but the DOD shut down thorium because.... you guessed it, it couldn't be easily weaponized.
So as someone that actually worked in the industry, and has a nuclear plant right outside his window (literally), let me tell what is actually going on.
Nuclear power plants consist largely of two parts. Even the buildings reflect this. On one side you have the "nuclear island" with the reactor and the first cooling loop. On the other is the turbine hall with the 2nd (and sometimes 3rd) cooling loop and all the non-nuclear bits and parts. Inside that hall is there the power actually comes from, the heat from the first loop boils water in the second, which spins a turbine which powers a generator who's power flows into the switchyard and out to the grid.
Now that non-nuclear side is almost identical to the one in a coal plant, heavy oil plant or even some CSP plants. The thing is, the nuclear side is inherently more complex than the one in the coal plant. The coal plant, for instance, probably doesn't even have separate cooling loops, which makes it a lot simpler. And then there's the lack of radiation and such, which makes it all easier to build. So basically, there is no way, even in theory, that a nuclear plant can ever cost less to build than a coal plant. Ever.
Never ever ever.
Now consider a natural gas plant. It consists solely of the turbine and the generator. All the rest is gone, because it generates its moving fluid from the fuel itself. Presto, all the complexity disappears. And so, NG generators cost about $1 a watt to build, while coal plants are $3 to $6, and nuclear is $8 to $10.
It wasn't always this way, of course. It took a while for people to get good at building turbines, just like it took time to get good at building reactors. But the reactor people had others sources of income, the government and military, that the NG guys didn't. So it took longer. But now we're here, and from about 2005 on, NG power plants will always, always, cost less than nukes. Forever.
Now you might say, hey, maybe we'll invent some sort of thing that will make nukes cost less. That is entirely possible. Here's the problem though... the non-nuclear part of the plant already costs more than the entire gas plant. So even if you reduce the price of the reactor to zero, it's still more expensive than a gas plant. Ok, you say, so we come up with some way to make the non-nuclear side cheaper too. Ahhh, there's the rub right there. You see, you've just make NG plants cheaper too.
And this is why coal and nuclear plants are shutting down and NG is taking over the US grid. The money just works that way. And let me assure you as someone that worked there, that's all anyone cares about. You might want clear power, but you're not a bank, and the bank is paying for it.
Ok, now for the fun part. Consider a wind turbine. A wind turbine consists of a pole, the blades, maybe a gearbox in some designs, and the generator. Everything else is gone. There's no piping, no stream, no cooling, no pumps, no turbine. It's basically 1/8th of a coal plant. And that's why they cost $1.50 a watt to build, in spite of having such low power density. And a PV panel has no moving parts at all, you just put it in the sun and out comes electrons.
And that's why for everyone outside the US, wind and solar are the fastest growing power sources. And I don't mean a little - more wind will be put in this year alone that the peak of reactor construction ever. And it's accelerating.
So the Indians and Chinese can work all they want on thorium, but we know how it's going to play out already. And that's true for anything that is based on the Rankin cycle... if you have a working fusion reactor and it uses a turbine, it's already all over but the crying.
And that's why for everyone outside the US, wind and solar are the fastest growing power sources. And I don't mean a little - more wind will be put in this year alone that the peak of reactor construction ever. And it's accelerating.
Wind and solar only work where there is wind and sunshine. It is not 24/7 anywhere. They can add power to the grid when possible but for reliability you really need to burn something. Sure, you can store the wind and solar in batteries but batteries are expensive, big, heavy, non-environmental to produce, direct current which needs to be inverted to AC with a 10-20% loss of energy for transmission and you need a lot more of them for redundancy because the energy source is not consistent. Don't get me wrong, I am planning to completely power my new house with solar, but that is just a house, not a factory, football stadium, railroad or any sort of mission critical heavy industry.
I would be willing to bet even Apple with all of their solar arrays only feeds it back into the grid and then picks up their power off the grid just like everyone else except when they have to go on emergency generators where they burn either natural gas or diesel, which is probably delivered by trucks with big diesel engines.
There are lots of energy sources but none of them are ideal for every situation.
Comments
Because it wasn't just a cell phone. Is Apple going to make something that's more than a car? Something vastly different than what already exists?
I think you just called him the Woz of the auto industry! (Or maybe Woz is the Lutz of the computer industry).
:-D
(Saw that iggypop beat me to it, after I posted).
Who says the thing itself has to be vastly different?
What if they make a car as good or slightly better quality wise, but because of a new approach in production can sell it half as much as everyone else?
Or sell for a comparable price but greater profit share?
Yeah, there's no precedent of them doing that at all.
Fusion is still around the corner. But thorium, on the other hand....
I guess where we part ways is that I believe it is possible for an industry to exist that Apple is not equipped to excel at. All the evidence posted here of Apple's successes is at the same time indisputable, and confined to a single industry; and, even in computer h/w and s/w it isn't a perfect record. As to automobiles specifically, I don't think the profit margin is there, especially if BMW is providing the chassis or the body (not because it's BMW, but because they need their cut), and I am somewhat dubious about the efficacy of hiring a bunch of Tesla guys to play catch-up to the established players.
As someone who pretty much only buys used cars, I can authoritatively say - the majority of people don't care about driving a car past 100K miles. They want to move on to a newer, flashier car every 2-4 years.
And for their stupidity, I'm grateful
Which is a strategic issue for us - our military, for one is seriously concerned about it, as we all should be. Much like Shale Oil was far to expensive to extract until the per barrel cost of Oil exceeded a threshold, extracting rare earths in an environmentally friendly way will happen when the right economics appear. More demand will make that happen more quickly which is a good thing.
Exactly. EVs are the future - the economics are far too compelling. And even if our base electric load is still served by coal, what's easier to clean - millions of tailpipes or thousands of power plants?
What we are really seeing is all the futures of the buggy whip makers protesting going harshly into that good night.
Yes - the Chinese are picking up where we stopped in the 50's: http://blogs.telegraph.co.uk/finance/ambroseevans-pritchard/100026863/china-going-for-broke-on-thorium-nuclear-power-and-good-luck-to-them/
Yes, indeed.
The Indians are doing some major research too, since thorium is abundantly available in the country. But many people believe that China's approach (liquid fuel thorium) is superior to India's (solid fuel thorium). It could be a game-changer if a couple of demonstration projects could be built. Although it won't be inexpensive, it's a pittance compared to how much we spend on energy research and investments globally.
As an aside -- and you're probably aware of this -- there was a fork in the road between uranium and thorium many decades ago, but the DOD shut down thorium because.... you guessed it, it couldn't be easily weaponized.
Which is a strategic issue for us - our military, for one is seriously concerned about it, as we all should be. Much like Shale Oil was far to expensive to extract until the per barrel cost of Oil exceeded a threshold, extracting rare earths in an environmentally friendly way will happen when the right economics appear. More demand will make that happen more quickly which is a good thing.
Makes me wonder if China's "land grab" of the Spratly Islands is for gold or rare materials on or under the sea floor (besides the obvious military strategic importance).
isn't this the guy who was in charge of GM when our government bailed them out.
What would he know about how to make money building cars. I guess because he failed miserably he thinks everyone else will too.
The sad part is, even if we were to find such rare earth minerals in the West, we probably could not mine it.
You heard it here first.
You are yet another aged animal in the Sarengeti who is about to be eaten by a younger more formidable foe.
Here is why you will be proved wrong:
The Tesla Model S has a 30% profit margin
Apple will not be making dozens of vehicles, they will be making just one...
It will be a car that most of us want...
they will sell (tens of) millions of this car...
the same car you old fool...so minimal retooling every year.
small components will be made in China with no labor unions and controlled labor costs
robotic assembly lines will make the final product in North America and China
Apple will have no legacy pension and medical costs of retirees or injury prone workers do deal with...
Apple will not have to deal with paying old fools like you unjustified executive compensation for your old dying ways of thinking...
or large multi-hundred-million dollar fines levied by the government.
Apple doesn't need much expertise car-wise-- Electric vehicles are in many ways simpler...no complex drive trains or a transmission for instance.
No offense meant here, but I thought you were already dead.
Actually, Lutz has a very strong track record, and deserves more respect than he's likely to be shown here.
The thinking of "Apple has been successful in most stuff since 1998, therefore everything they do will be a huge success" is dangerous and wrong.
Yeah, there's a big leap into something with this many moving parts. Suspension, brakes, drivetrain, wipers, mirrors, etc. They can certainly buy parts from the same OEM parts companies as other auto mfgrs. (Bosch, Denso, Continental, etc.). Certainly there have been unsuccessful products in Apple's past, including entry into new industries like mobile devices and console games.
I can see them doing something successful with a partnership though. When Honda got into SUVs, they were successful by designing the interior for an established Isuzu platform, and off they went. The issue here is that there are two major hurdles to get over: new industry, and no current profits for electric vehicles. Going in with two major risks seems a bit much to me.
That said, Apple can throw a bunch of cash at this, fail, and still be killing it.
People keep making comparisons to iPhone in 2007. Steve Jobs stood up on the stage and showed us an iPhone. When Cooks drives an Apple car on stage, then I'll get excited.
This!
" 'a gigantic money pit'"
What, like your stock options?
Hey ho!
As an aside -- and you're probably aware of this -- there was a fork in the road between uranium and thorium many decades ago, but the DOD shut down thorium because.... you guessed it, it couldn't be easily weaponized.
So as someone that actually worked in the industry, and has a nuclear plant right outside his window (literally), let me tell what is actually going on.
Nuclear power plants consist largely of two parts. Even the buildings reflect this. On one side you have the "nuclear island" with the reactor and the first cooling loop. On the other is the turbine hall with the 2nd (and sometimes 3rd) cooling loop and all the non-nuclear bits and parts. Inside that hall is there the power actually comes from, the heat from the first loop boils water in the second, which spins a turbine which powers a generator who's power flows into the switchyard and out to the grid.
Now that non-nuclear side is almost identical to the one in a coal plant, heavy oil plant or even some CSP plants. The thing is, the nuclear side is inherently more complex than the one in the coal plant. The coal plant, for instance, probably doesn't even have separate cooling loops, which makes it a lot simpler. And then there's the lack of radiation and such, which makes it all easier to build. So basically, there is no way, even in theory, that a nuclear plant can ever cost less to build than a coal plant. Ever.
Never ever ever.
Now consider a natural gas plant. It consists solely of the turbine and the generator. All the rest is gone, because it generates its moving fluid from the fuel itself. Presto, all the complexity disappears. And so, NG generators cost about $1 a watt to build, while coal plants are $3 to $6, and nuclear is $8 to $10.
It wasn't always this way, of course. It took a while for people to get good at building turbines, just like it took time to get good at building reactors. But the reactor people had others sources of income, the government and military, that the NG guys didn't. So it took longer. But now we're here, and from about 2005 on, NG power plants will always, always, cost less than nukes. Forever.
Now you might say, hey, maybe we'll invent some sort of thing that will make nukes cost less. That is entirely possible. Here's the problem though... the non-nuclear part of the plant already costs more than the entire gas plant. So even if you reduce the price of the reactor to zero, it's still more expensive than a gas plant. Ok, you say, so we come up with some way to make the non-nuclear side cheaper too. Ahhh, there's the rub right there. You see, you've just make NG plants cheaper too.
And this is why coal and nuclear plants are shutting down and NG is taking over the US grid. The money just works that way. And let me assure you as someone that worked there, that's all anyone cares about. You might want clear power, but you're not a bank, and the bank is paying for it.
Ok, now for the fun part. Consider a wind turbine. A wind turbine consists of a pole, the blades, maybe a gearbox in some designs, and the generator. Everything else is gone. There's no piping, no stream, no cooling, no pumps, no turbine. It's basically 1/8th of a coal plant. And that's why they cost $1.50 a watt to build, in spite of having such low power density. And a PV panel has no moving parts at all, you just put it in the sun and out comes electrons.
And that's why for everyone outside the US, wind and solar are the fastest growing power sources. And I don't mean a little - more wind will be put in this year alone that the peak of reactor construction ever. And it's accelerating.
So the Indians and Chinese can work all they want on thorium, but we know how it's going to play out already. And that's true for anything that is based on the Rankin cycle... if you have a working fusion reactor and it uses a turbine, it's already all over but the crying.
And that's why for everyone outside the US, wind and solar are the fastest growing power sources. And I don't mean a little - more wind will be put in this year alone that the peak of reactor construction ever. And it's accelerating.
Wind and solar only work where there is wind and sunshine. It is not 24/7 anywhere. They can add power to the grid when possible but for reliability you really need to burn something. Sure, you can store the wind and solar in batteries but batteries are expensive, big, heavy, non-environmental to produce, direct current which needs to be inverted to AC with a 10-20% loss of energy for transmission and you need a lot more of them for redundancy because the energy source is not consistent. Don't get me wrong, I am planning to completely power my new house with solar, but that is just a house, not a factory, football stadium, railroad or any sort of mission critical heavy industry.
I would be willing to bet even Apple with all of their solar arrays only feeds it back into the grid and then picks up their power off the grid just like everyone else except when they have to go on emergency generators where they burn either natural gas or diesel, which is probably delivered by trucks with big diesel engines.
There are lots of energy sources but none of them are ideal for every situation.