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Part Deux of Tesla’s Big Plan Could Cost Over $10 Billion to Implement

More excitement comes to the technology industry with the announcement of Tesla’s part deux plan.  Tesla’s first plan in 2006, was a master plan that included introducing affordable electric cars to the market for the average consumer, and most would say that Elon Musk has achieved that goal quite successfully.  But, this did not come without a significant amount of cash invested being invested into it and estimates confirm that the cost of Tesla’s original plan has been around $6 billion to date.  So, what are the financial implications of part deux going to bring?




Part of the new plan will involve the introduction of several more models to Tesla’s current range of electric vehicles.  These will include a pickup, a bus, and an automated ride-hailing service that will utilize privately owned self-driving Tesla’s.  But at what cost are these new editions to the Tesla family going to be?  Expert auto industry analyst, Brian Johnson, revealed just recently that so far part one of the master plan is already in around $4 billion deficit, and part deux is estimated to cost much, much more.

Being able to offer consumers a line of five different types of vehicles is one of the goals set out in Tesla’s master plan.  These will be the Model S big sedan, the Model X SUV, the new Model 3 small sedan, a small SUV, and a new kind of pickup truck and that will be on top of the bus and semi-truck that are being produced currently.  If Tesla is trying to build their fleet as economically as possible, then perhaps the small SUV will be based largely on the Model 3 and use some of its architecture to save costs.  However, this is just the tip of the iceberg in manufacturing vehicles, and costs are still likely to go over $250 million before this model is completed.

Next, there is Tesla’s “new kind of pickup truck” to consider.  If it is going to compete with other heavy-duty full-size pickups that are on the market now, then it will need a design and engineering completely different to anything Tesla currently has to offer.  Introducing a whole new way of designing, testing, and manufacturing into a company does not come cheap and could easily cost over $1 billion to get this truck on the road.  The semi-truck will also cost a lot for Tesla to implement within their organization as much of the tools and expertise needed for the job will first need to be acquired.

Along with the design and production costs of the individual models, there is also the cost of building a factory in which to make the trucks and semi-trucks as would not be feasible to produce them alongside Tesla’s sports cars, so that is an easy $1 billion.  Add to this to the design and production costs of the bus and that is probably another $250 million there.  Obviously, research and development costs, in general, will remain constant as continuous work is needed, and that can be estimated at a cost of around $3 billion.




So, even with just these costs considered (and there are more), Tesla’s master plan part deux is already likely to cost well over $10 billion to implement, and if the plan is going to stretch over a decade as the last one did, then Tesla will need to devise a plan to cover the rise in ongoing costs here too.  But, quite how that will work yet remains to be seen, and we can only sit and wait in anticipation to see what the next installment of Tesla will bring.


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