Sakura 2016

We have been really lucky this year with the timing of our trip to Japan. The cherry blossoms, or Sakura, are exactly reaching full bloom, and we are surrounded by a sea of fluffy pink clouds at every street corner.

Today we went to the Shinjuku Park, reputed as the best Sakura spot in Tokyo. The weather was perfect, and we were not disappointed. Here is a selection of some of the wonderful blossoms we saw.

Don't Let the Door Hit You On the Way Out!

I was watching the other day a brief video online that has been doing the rounds recently. This was at the Geneva International Motorshow, and took place in one of the new Tesla Model X cars. As a TV station was conducting an interview with the head of Tesla Germany sitting in the rear seat of a Model X, the CEO of BMW slid in next to him. The reporter soon realized who it was, and asked him what he thought of the new Tesla, and he responded something about it being a prototype. Upon saying this, he moved to exit the car, and ended up banging his head on the not fully opened Falcon Wing doors. Obviously many of the Tesla fan boys have been having a field day about this, saying things like “don’t let the door hit you…oops, too late!”.

As funny as the scene may appear, and I can agree that there is a level of ironic humour there, I do feel that the video actually shows plainly one of the many flaws of these falcon wing doors. Seriously, I fail to see why Tesla decided to have this very complex technological gadget put on what is otherwise a great car. There are actually so many reasons why I wonder about this, and I feel it ultimately is a decision that will come back and bite Tesla a lot more than that little bang on the head of BMW’s CEO.

For starters, it has proven to be very complicated to actually get these doors to the specifications required by Tesla, and after having outsourced the development, they ended up doing it themselves. This has caused considerable delay on the completion of the car, something which is obviously not a good thing when you are in the business of getting products to the market. Apart from delaying potential income from sales, it has also hurt the image of Tesla as the Model S was also late to the market. Potential buyers will certainly be concerned about such a delay, and actual paying customers are beginning to lose patience as their long awaited and expensive cars are not being delivered.

Next is the added weight such a design brings to the car. Just the mechanism required for the door is added weight not normally found on a car. Furthermore, this sort of design then also needs further strengthening of the chassis which also adds weight. Given that one of the primary selling points of the Tesla is the considerable range it provides for an EV, the added weight will negatively impact this as pushing all that extra weight around requires additional power that could have been better spent in extending the range.

We can then look at the practicality of these doors. Sure, they are being put forward as making entering and exiting the vehicle easier on the passenger, and yes I can see this as true. However, how difficult is it really to exit a car with a normal reasonably sized door? On the other hand, it seems obvious that there will be issues when the roof is covered in snow, or even just when it is raining. There are big gaping holes on the roof that are bound to let the elements just fall in to the car. So, in case of snow, it will mean that the user must first fully clear all the snow from the roof from what is a pretty tall car. I’m also wondering how they will behave in case of strong winds etc., or in places with a low roof. Sure, you will say that in a tight parking spot it is hard to get out with normal car doors, but in those cases it really only takes a few seconds to let the passenger out of the car before parking it in the actual spot. With the Model X in a low roof parking, one would have to let the passenger out before actually entering the building. Oh, and even though the speed of opening and closing of the doors is fast, it is nevertheless much slower than a normal door, and I can imagine it very quickly becoming annoying. If it is once in a while like when you forget to close your windows it is not a problem, but every time?

There is more! With such a complex hydraulic and electronic door opening system, there are quite a lot of small elements that can go wrong or break down completely blocking the doors from either opening or closing. Imagine you open the doors to let somebody in, and then they refuse to close perhaps due to a blown fuse. The car will be rendered useless. With normal doors there is never such an issue, even if a mechanical failure in a door lock might have the same effect. However such a mechanical failure can happen in both cases.

As much as the technological complication has added delays and weight to the final car, one can also add a hefty increase in the actual price. This added price will be considerable, even if one might think that if you are paying $130’000 for a car, who cares if it costs $10’000 more or less. I believe that had they gone for a conventional design from the beginning, a much quicker time to market, lower development cost, and a lower production costs would have allowed them to price the car below $100’000. 

And finally, even if the Tesla fans are laughing at the BMW CEO, that video clearly shows what is likely to happen on several occasions with every day customers of the car. Something interferes with the opening, or the passenger decides to get out just a tad too soon, and they bang their head against the door. Those edges, although not knife sharp, do look sharp enough to cause some damage, and I can very well imagine a disgruntled client trying to sue Tesla in the not too distant future for just such an incident.

The Model X began being delivered to clients back in December 2015. Now even though the actual numbers are not huge, that means models have been available for the public for some three months. Yet, I have not seen a single proper review of the car conducted by any market specialists. Sure, there have been some test drives reported, but these have all been either in a closed-off parking lot, or just an around the block drive with the car. No in depth test, and certainly no long-term test. I find this both frustrating and strange. I do believe in Tesla products, and even though the Model X is certainly not the type of car I personally would be interested in, I really want to know what it is like. Pretty much any other new car will be fully tested and reported on even before it is released to the public. Sure, such tests are always organized by the producers as they see it as publicity, and perhaps Tesla feel they do not need this sort of publicity, but I also feel these tests allow the public to get a proper opinion of a new product.

So, now the announced presentation of the Model 3 is only weeks away. I really hope Tesla will not screw this one up, and we get to see an intelligently and well-designed compact EV that will revolutionize the car industry. And please Elon, no gull or falcon wing doors!

Tesla

Well, I have sort of been trying to avoid writing about this one, but following the announcement of their results yesterday I really need to put something down. 

Tesla is a company that I really like. I love their products so far, and I think that Elon Musk’s enthusiasm is great. They are really the first company to produce a successful EV, and I truly hope that they will continue to be successful and bring us more great products. To be honest, I would have bought a Model S in a heartbeat if I was in the market for a large luxury saloon, but since that is just not the case I still have to continue to drive an old car with a regular combustion engine. Perhaps one day…

So, if I am so positive about the company and their products, why am I writing about it here? Generally this place is to criticize things, or to just get my frustration out. Well, unfortunately it is not all good news about Tesla, and their results presented yesterday unfortunately can’t really hide reality anymore. The ship has certainly sprung a leak, and they better do something about it soon. My fear is that whatever they do will be too little too late.

Let’s step back for a bit. I am sure many will think that I am exaggerating things, and things will turn around. Perhaps it actually will this time, but part of my frustration comes from the fact that they are consistently missing targets and self-imposed delivery objectives. Following the early Roadster, which as a first effort was really good, the Model S was a very successful launch. Yes, there had been some delays, and there may have been some quality issues early on, although I believe any of those were more the work of overzealous critics who just wanted to find something wrong. They have continued to deliver improvements on that car, and today it is quite astonishing. I still am amazed at the fact that no other manufacturer has even come close to this. The Fisker looked good, but it lacked the quality and performance to be a match for the Tesla. As for the traditional car manufacturers, I can only assume that they have been controlled by the oil lobbies for so long that they have forgotten that there are alternatives out there. Well it looks like GM has finally caught on, but the others like the BMW i3 really are far from the mark.

However, since the Model S, things seem to have gone a bit downhill. The initial business plan was then to follow up with a compact car at a much more affordable price. Instead of this, they set off developing the Model X. Now I can actually understand that change in strategy as they are a small manufacturer, and so making a luxury SUV certainly does make more sense. Logic would have it that there is a much bigger profit margin on such a car, and the market seems to be starving for these judging by the sales figures of other big luxury SUVs like the BMW X5, Porsche Cayenne etc. Unfortunately they then kept missing delivery dates. Granted they had perhaps decided to make it too complex, especially with those gull-wing like rear doors. Honestly, I still don’t see the point of those, but I suppose they may seem attractive to some buyers. I’m still waiting to see how they work when the car is covered in snow. Now they have finally begun delivering the Model X to actual customers, but by the end of 2015 only a few hundred had been delivered. I have yet to see a single proper review of one, something that I find very strange.

Now this is spilling over to the Model 3. They delays have already begun, and after having announced a presentation of the finished product in March, the statement from yesterday was a lot more unclear. My gut tells me that at best we will see some sort of mock-up, but certainly not a finished car. Some critics seem to think this might be a good thing as they are concerned about the Model 3 announcement cannibalizing sales from the other models. I don’t actually think that would be the case as they really do not target the same client. Somebody who is looking to buy a $130’000 SUV is not going to replace that with a $35’000 compact. Instead, but not presenting a finished car in March I am afraid they will instead further lose credibility in the market. Potential buyers will begin to doubt that Tesla can actually deliver, and if GM is successful with their Bolt then they will quickly turn to that instead.

The other thing that really bothers me is how the stock has been overvalued. Through a general hype and a market infatuation with Elon Musk, the stock price soared. It has now come down considerably, but I still believe it to be far too high. There are some very simple figures we can look at to illustrated this.

First of all, Tesla continue to lose money on every car they sell. In December this figure was $18’331, and that is an amount that has been on the rise as in Q4 2014 that figure was $10’945. This would show that they are actually going the wrong way as normally one would expect them to improve their efficiency, not reduce it. This also then begs the question how they would expect to make money on the Model 3 given a sales price of $35’000 as opposed to the $75’000 price for the Model S.

Today, with a market price around $150, Tesla has a market capitalization of some $22 billion. This is actually more than the $20 billion of Volvo, a successful smaller manufacturer that produces some 500’000 cars per year, which is ten times as many as Tesla. When the Tesla stock was at its peak of $280, that calculated in to a market capitalization of $44 billion, which can be compared to GM and BMW respectively at $44 billion and $46 billion. That, in my opinion, is just absurd! Granted, the Tesla market price would be high due to their potential growth, but I think at this point such enormous growth as would be required is simply not possible. Realistically the market price should be something below $50.

In a way this is like GoPro. A great product that deserves to be successful, but silly market speculators then drive the price to levels that have nothing to do with reality. It is this sort of behavior that then creates bubbles that end up driving down the whole economy, bringing along for the ride down other companies that are actually doing quite well and that have a initially had a market value in line with their financial figures and results.

At the end of the day though, if Tesla has been able to be the catalyst that has pushed regular car manufacturers to finally get serious about EVs, then they have been an outstanding success.

Oil, that Global Lubricant...

It may not be entirely clear on here, but I have some real issues with oil producers and the politics that goes with it. Being born in the 60’s, I have grown up in a society that is very closely linked with global oil production and all the politics related to this. Having just now entered 2016, I find it appalling that we have not yet been able to develop and produce a proper alternative to fossil fuel for all our energy needs. The oil lobbies have managed to ensure that very little is actually done about finding alternatives, and instead do what they can to push a high consumption and dependency of the black gold. The fact that it all spills over in to global geopolitics has been creating a devastation far greater than that of any major oil spill has throughout modern history.

I recently wrote an entry about how to resolve the CO2 emissions problem by taxing fuel sales in the US. As much as I believe this may very well be a possible step in the right direction, I also do not believe for an instant that it may work. Well here I wanted to look at a very interesting and current connection between oil and geopolitics.

2015 was particularly marked by the rather surprising rise of ISIS in Syria and Iraq. There is a very plausible theory how this has come about as a mixed result of US intervention in Iraq, and then a later desire for Qatar and Saudi Arabia to want to build a pipeline through Syria. The details of this theory can be discussed in another post, as here I wanted to look at one of the key elements of how ISIS finances themselves. It is a known fact that much of their money comes from oil extracted in Iraq and Syria. The actual amounts extracted is however open to quite some debate, but it does appear to be a fair amount. Certainly their potential daily production goes a long way to financing their current war, and it is furthermore suspected that they are also obtaining additional financing from Saudi and Qatar in an effort to overthrow Bashar el Assad in Syria. The big question however is how are they actually selling this oil?

Clearly it should be fairly easy to hinder this financial income by intervening in its sales. Certainly no European country would be purchasing oil from such a dubious origin regardless of the price. Turkey on the other hand does not seem to have any such scruples. We have recently heard about Putin accusing Turkey for being the primary place were the ISIS oil is being sold, but much of the world’s media is scoffing this off as being more of Putin’s anger at having one of his planes shot down by Turkey. Nevertheless, it does seem to make sense, and when you read a report produced by a Norwegian institute called Rystad Energy there appears to be more than Putin’s temper behind the accusations. Their findings clearly point to the majority of the ISIS oil being sold to Turkey at highly discounted prices. The truck “pipeline” described by the Russians does indeed seem to be a reality.

Turkey obviously refutes these claims completely. To me however the situation is particularly perverse, and it seems to be getting worse. I very much believe the oil trade to Turkey to be true, and this would then imply that the US is allowing for this to continue. Essentially the US, together with NATO, are allowing for ISIS to continue to finance themselves so that they can continue to fight Bashar in Syria. However this financing is then also finding its way to enabling all the recent terrorist attacks carried out in Europe and the US. Given how close Turkey is to the West, it should really be a very simple thing to fully put an end to ISIS financing, thus ultimately ending the war, yet nothing is happening. Instead the EU have now even revived talks of having Turkey join the union!

I suppose it would have been a lot easier to put an end to the financing if it was actually done with the help of Swiss banks. The US does not seem to have problem in attacking these institutions even in cases where they really have not done anything wrong. However here Turkey is enabling ISIS to grow stronger, and yet nobody but the Russians is trying to do something about it.

There was a major oil crisis in the 70’s. It hit the global economy hard at the time, and it started leading to researches trying to find alternative energy sources. Unfortunately the oil price was rapidly brought back down again, and with the help of OPEC was contained, controlled and manipulated. Most, if not all, efforts for alternative solutions were abandoned (or forced out of business). Had we then instead decided to stay that route, now 40 years later we would probably be more or less done with oil. Instead, as we saw a strong increase again in oil prices these last few years, efforts have always been to try and extract more oil. With the advent of fracking, there were suddenly huge untapped resources in the US (as well as elsewhere). This has since led to a sharp drop in oil price to levels that are downright silly. The alternative energy producers have yet again been discarded to the benefit of oil and gas. There are some people, such as Elon Musk, that are trying to break through the oil hegemony, and although he has obtain quite some fame as a result, it all remains very marginal in the grander scheme of things.

But learning from our past mistakes and finally getting rid of most fossil fuel, would not just help save the planet. It would also go a very long way in resolving most of the global conflicts as the focus around the world would finally shift away from oil. Much of the conflicts and terrorist activities that we have witnessed since that oil crisis in the 70’s are directly linked to oil, and so would probably never have existed if it was not for the oil lobbies. It may now be very late in the game, but there is still some time left to try and sort a couple of things out for there to actually be a future.