Will Elon Musk License Tesla’s Technology To Other Automakers?

Audi’s CEO “willingly admits that Tesla is two years ahead of the industry in some critical areas of building electric vehicles,” reports Electrek. But where will that lead? “Earlier this week, Musk made a subtle comment on Twitter that could majorly upend the auto industry,” reports Inc. magazine: In response to an article in Teslarati highlighting German automakers’ attempts to bridge the gap between Tesla’s technology and their own, Musk tweeted the following: “Tesla is open to licensing software and supplying powertrains & batteries,” tweeted Musk. “We’re just trying to accelerate sustainable energy, not crush competitors!” Consider for just a moment the brilliant potential of Musk’s statement. In addition to leading its rivals in electric vehicle production (and the larger style batteries needed to support these), Tesla is also at the forefront of utilizing modern technology in its vehicles. In fact, many have described Tesla as “a tech company that happens to make cars.” In contrast, though, Musk has repeatedly spoken on the challenges of actually manufacturing cars at consistent quality, as well as delivering them. At one point, he described Tesla’s journey as going from “production hell to delivery logistics hell….” [L]egacy automakers excel where Tesla is weak: namely, manufacturing and delivery. Since they’ve been making cars so long, they’ve developed huge factories, along with consistent and refined processes. But what if Tesla could reach a deal with automakers to license its strength — software and battery technology? Then everyone benefits… If you’re surprised by Musk’s tweet, you shouldn’t be. In fact, for years Musk has insisted that his primary goal is not to compete with larger automakers but rather to win them over…. If the legacy automakers are smart, they’ll jump at the opportunity to negotiate a licensing deal. The article cites a 2014 blog post in which Musk promised Tesla wouldn’t initiate patent lawsuits against companies who wanted to use its technology, “in the spirit of the open-source movement, for the advancement of electric vehicle technology…” “Our true competition is not the small trickle of non-Tesla electric cars being produced, but rather the enormous flood of gasoline cars pouring out of the world’s factories every day.”