Elon Musk, CEO and founder of Tesla Motors and SpaceX
This whole transit system would be impossible to crash, always available on demand, way less expensive than current travel options and, ideally, solar-powered.
Tesla Motors (TSLA) CEO and co-founder Elon Musk started off his week on Monday by tweeting an announcement that, from anyone else, would have sounded like a tease for a bad sci-fi movie:
“Will publish Hyperloop alpha design by Aug 12. Critical feedback for improvements would be much appreciated.”
If you still think electric cars or rocket ships are cool, you haven’t been keeping up with Musk. His “hyperloop” is a proposed “really rapid transit system” that he says will be able to get a passenger from San Francisco to Los Angeles in a half-hour. That would mean travel at 800 miles per hour, or about twice the speed of conventional aircraft.
Artists concept of a futuristic ET3 high-speed pneumatic tube transportation system might look like (Click Image To Enlarge)
He has been a little vague on how this works, except to say recently that the concept is “a cross between a Concorde, a railgun, and an air-hockey table.”
Also, he says it will be impossible to crash, always available on demand, way less expensive than current travel options and, ideally, solar-powered.
Artists conception of an underground passenger terminal for the futuristic ET3 highspeed pneumatic tube transportation system (Click Image To Enlarge)
Remember, this isn’t Donald Trump talking trash. This is Elon Musk, who has already changed the nature of money, as a co-founder of PayPal, the electronic payments system.
Since selling PayPal to eBay (EBAY), Musk has served as CEO of SpaceX, which is in the business of building rocket ships and spacecraft. The company, which he co-founded, is now under contract with NASA to service the International Space Station.
Of greater interest to today’s investors, though, is Musk’s role as co-founder, CEO, and CTO of Tesla Motors, the venture that is proving that building all-electric vehicles can be a profitable business.
We’ll find out how profitable it is right now on July 22, when Tesla announces its earnings results for the second quarter. The stock, which just made a splashy debut on the Nasdaq-100 Index (INDEXNASDAQ:NDX), has zoomed from $25.52 to $133.26 in a bit less than a year.
That’s the kind of price increase that makes for warnings about a bubble market.
But Musk says Tesla is just getting started. His real goal is to produce electric cars at an increasingly economical price. The first Tesla model, launched in 2008, was a roadster with a base price of about $70,000.
At an event for Tesla owners over the weekend, Musk said the company hopes to ship 800 Model S vehicles per week by the end of 2014. It has added a third model, the Model X, a crossover between a sedan and an SUV, and has plans to produce a minivan to appeal to the masses in a couple of years.
If you think this is sufficient innovation for an entrepreneur who is, after all, only 42 years old, wait until he unveils his plans for what he calls “the fifth mode of transportation,” alongside trains, planes, cars and boats.
Speculation is rife about what exactly this mode of transportation could be. Blogger Brian Dodson, who really is a rocket scientist, explains how he thinks it might work, based on the sparse information available.
In short, it sounds like the hyperloop might be a kind of pneumatic tube for people. Musk has to be one of the few people on Earth who could suggest such an idea without getting laughed at.
Ironically, the concept, like that of an electric car, isn’t new. Pneumatic tube systems, which use compressed air to move objects through a tube connecting fixed points, are still in use in some industries, but were more common in the late 19th century. In their early years, there was speculation that the technology could be used to transport people, but nobody ever proved it.
Musk hasn’t promised proof at this point, just an “alpha design.” But he has said that he will make the design available as “open source,” and that he will not seek any patents for it.
COMMENTARY: Elon Musk has incredible entrepreneurial vision which I have often compared to Apple co-founder Steve Jobs. Tesla Motors, a producer of technologically advanced, brilliantly designed and award-winning all-electric cars he founded in 2003, and Space Exploration Technologies Corporation or SpaceX, which he founded in 2002, has achieved incredible success by being the first commercial space company to build a fully-recoverable, multi-stage space rocket, the Falcon 9, and cargo and passenger carrying spacecraft, the Dragon spacecraft. In 2012, NASA awarded SpaceX a contract to develop and demonstrate a human-rated Dragon as part of its Commercial Crew Development (CCDev) program to transport crew to the ISS. SpaceX is planning its first crewed Dragon/Falcon 9 flight in 2015, when it expects to have a fully certified, human-rated launch escape system incorporated into the spacecraft.
So far, both companies are doing very well and achieving much success. The Tesla Model S all-electric luxury sedan has received rave reviews from car experts, received Trend's 2013 Car of the Year, 2013 World Green Car of the Year, Automobile Magazine's 2013 Automobile of the Year and in May 2013 achieved the highest score awarded to an automobile by Consumer Reports in 2013. Consumer Reports said.
"It performs better than the entries from any other car company."
With all these accolades, Tesla Motors, in spite of racking up record operating losses, is loved by Wall Street. Tesla Motors Inc. (NASDAQ:TSLA) stock has skyrockted from $33.87 at the end of 2012 to its current price of $116.16 as of 10:17 a.m., July 17, 2013. Yes, Tesla Motors stock has risen to bubble-making proportions, but interest in the stock has not waned. So far today, TSLA has risen +7.29 or +6.29% since the opening.
Elon Musk appears to be making all the right moves at both Tesla Motors and SpaceX. Clearly, Tesla's all-electric vehicle technology is proven beyond a shadow of a doubt, but the Company has been criticized for producing vehicles appealing only to celebrities and snobbish affluent buyers. Elon Musk knows that in order to achieve higher revenues and justify its lofty stock price, his cars have to appeal to larger audiences. In a blog post dated February 14, 2013, Elon Musk unveiled the Model X, a electric crossover between a sedan and SUV. The Model X will compete in the high-end mainstream SUV market. Prices will be in the Model S territory, or about $49,000. A fourth model, aimed at a lower price point and wider audience, would likely be announced in 18 to 24 months says Musk. That vehicle will compete in the mid-to-highend electric vehicle market against models from Nissan, Toyota, and the Big 3 Detroit automakers.
SpaceX is racking up one success after another. Its Dragon spacecraft recently delivered its first shipment of cargo to the International Space Station, and appears to be on schedule to begin delivering NASA space astronuts to and from the ISS within two years.
Elon Musk has already boisted that SpaceX could be sending astronauts to the planet Mars within 10 to 15 years, and this new idea of a pneumatic tube to shuttle passengers between Northern and Southern California at faster than commercial jets is another example of this.
Elon Musk is very flamboyant and boisterous, but I would not crossout any of these ideas. Who would've thought that SpaceX would eventually replace the Space Shuttle, and transport payloads at 30% lower than the Shuttle. These ideas are going to take a lot of capital, so I have a feeling that a SpaceX IPO is not out of the question withint two or three years. Stay tuned.
Courtesy of an article dated July 16, 2013 appearing in Minyanville and an article dated June 3, 2013 appearing in Core77
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