Why did Tesla succeed where GM failed? Timing

I like to joke that flying cars and the Internet were patented in the 1800s. The ideas were there, but they were far too early to be practical.

Inventor and futurist Ray Kurzweil has been a hero of mine since I read his book “Age of Spiritual Machines” when I was 12. He recognized that most R&D projects actually succeed in developing the technology, but then fail commercially, simply because of bad timing. Kurzweil compiled decades of data and found highly predictable exponential patterns in information technology price/performance over time.

Moore’s Law was first coined in 1965 after Intel co-founder Gordon Moore’s observation of transistor packing density but Kurzweil noticed the trend was broader to all IT. It’s difficult to know which product would win in a competitive market (Beta vs VHS?), but the improvement rate is remarkably smooth.

Understanding and predicting this price/performance curve is important because it can take years to develop a new product. The state of the world when it becomes commercially available is different from the one when development begins.

Tesla recognized and planned around this for example by releasing a small-volume expensive Roadster first, and then the high-end Model S. Only after 13 years of a predictably exponential decline in battery costs by 90% (16% per year), did they produce the mass-market Model 3. Had they tried to release the mass-market vehicle as their first product it would have certainly failed, as the cost of the components would have been insurmountably high.

A great TED talk by serial entrepreneur and Idealab incubator Bill Gross shows “timing” is 42% of the reason why startups succeed or fail. Unlike “market timing” the stock market to go up or down, which is a fool’s errand, this “timing” refers to the state of the broader market and the supporting technology components and ecosystem when the product is actually released.

That notion of something being ready before its time once held true for the switched reluctance motor (SRM), a more efficient and affordable alternative to today’s induction motors. The idea for this simple and magnet-free motor has been around since 1838 when the invention of electricity sparked a Cambrian-like explosion of electrical designs. People thought SRMs were the future, and “the future” it remained for decades as the supporting technologies weren’t ready.

It would take over 140 years before UK-based SR Drives Limited commercialized the first SRM, in the 1980s. Thanks to technological advances in power semiconductors and the invention of the microchip controller, they were able to produce the first working model. And while they did succeed at creating a commercial product, like GM’s first electric car EV-1, technical limitations kept the motor from going mainstream.

For SRM to be successful, it needs to break the barriers that have held it back from the mainstream. The availability of dependent technology and resources ultimately determine the viability and reception of an innovative product like this.

It has long been thought that SRM is the future of electric motors and in 2013, ChargedEV, a magazine about electric vehicles, asked Tesla’s chief motor engineer Konstantinos Laskaris about SRMs and how they might apply to EVs as traction motors. He replied:

An SRM is a very particular machine. It’s very simple to manufacture, but it’s difficult to control. It’s got some acoustic noise and vibration challenges… It could potentially work for this class of problems.

That year, the US Department of Energy also studied “Energy Savings Potential and Opportunities for High-Efficiency Electric Motors in Residential and Commercial Equipment.” Among its conclusions was that research efforts that could vastly improve motor and drive efficiency and reduce costs. And among those efforts should be the use of wide bandgap semiconductors in place of conventional semiconductor materials, identification of alternatives to rare-earth metals, and the commercialization of switched reluctance motor (SRM) technology.

A lot has happened since 2013. Today, advancement in IoT-based building automation technology is making it possible to bring SRMs to market at scale. The result is a less-expensive, optimal-performance motor that meets sustainability goals, saves money, and minimizes maintenance calls.

Here’s why many people are quickly realizing the potential SRMs have to disrupt the $100 billion motor industry that’s seen very little innovation over the last 40 years:

The right technology often fails due to the wrong timing.

When it comes to implementing new technology, timing is everything.

A great example of this maxim can be seen with General Magic, an early-90’s tech startup that envisioned today’s smartphone close to 20 years before Apple introduced the iPhone.

Despite its futuristic innovation, the company went bankrupt before it could get a product to market. Creating a phone with limitless connectivity was pointless at a time when wireless data technology and the consumer Web didn’t yet exist.

But when a concept and the technology to create it come together at the right time, you have the potential to make something great. That’s what is happening with Tesla, the first fully electric-powered car to use rechargeable lithium-ion battery technology.

While Tesla got the timing right, the idea failed for General Motors’ EV1, the first electric car on the market in the mid-’90s. Its heavy lead-acid battery, which limited range and made the vehicle inefficient, was the only technology available at the time. As a result, the EV1 occupied an unprofitable niche and was discontinued after three years. It was another great example of a good idea that happened before the development of technologies necessary to support it.

You may have seen a 2006 documentary about the EV1, called “Who Killed the Electric Car?” The thesis of the film was that Big Oil kneecapped electric cars to prop up demand for petroleum. But that’s incorrect. The car could never have worked economically, because the supporting battery technologies didn’t exist.

Three reasons why now is the time for SRMs.

While I was a director and later Executive Chairman at Sevcon, a designer of power electronics for EVs, I got a first-hand look at the company’s hybrid engine for a diesel truck. During the design process, they found induction motors would fail in the harsh environment next to a hot vibrating diesel engine. To remedy this, the engineers went with a high-torque, simple, and reliable SRM instead. It was a dramatically more robust design.

That’s when the “ah-ha” moment came. Thanks to their simplified construction, SRMs require fewer production steps, making them less expensive to manufacture when compared with analog motors. Not only are they more reliable — they save money, too.

Once I saw the potential cost savings, I began to look at SRMs as the future for all electric motor applications. The timing was finally right for several reasons.

First, supporting technologies like IoT are now available, making intelligent control software a reality. This improves motor efficiency, helps to reduce maintenance costs, and creates customizable settings that can be tailored to perform in almost any application.

Next, both corporate and government bodies are mandating — even incentivizing — sustainability efforts for environmentally-friendly, renewable energy sources. SRMs fit the bill with their simple design that eliminates gearboxes or belted power transmission equipment, greatly improving energy efficiency.

Last, Moore’s law, which states that computer processor speed and power will double every two years, continues to drive down the price of new technology. This will make SRM’s more affordable than traditional motors over time.

The combination of technology and timing is what prompted the team at Software Motor Company to build the first efficient SRM. It’s designed in a software-first world and is more reliable, efficient, and intelligent than any motor that has come before. The advanced control algorithms require more processing power than would be available in a $10,000 computer in 1990 but now can be purchased for $10 on a chip.

With this technology, it’s clear why SRMs will replace traditional motors. Moore’s Law is a one way ticket, it’s just a matter of when.

As a disruptive initiative, its success depends on an array of complementary elements — technology, consumers, industry support, and marketability — for the SRM to deliver its fullest value proposition. Luckily, the technology is available, and we have an ever-increasing need for a motor that can do more than our standard induction options.

With all their benefits, the SRM is capable of delivering the next generation of electric-powered vehicles, appliances, industrial equipment, and even generators. The future with SRM motors is within our grasp — we simply have to reach for it.

Turntide, Meson Capital, Belichka — working to bring sustainable energy and technology to the world to elevate humanity & grow individuals

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