Translation - our technology is not profitable now because large auto manufacturers won't adopt it and the installed infrastructure does not support it. We will try to increase adoption by donating technology to the public. Once adoption is increased, we will kick ourselves and our company will go out of business because we will be subjugated by those who can make and use our technology more efficiently and at lower cost. We might feel good that we brought the world closer to the electric car. But we will be out of business nonetheless.
Oh . . . and our investors will be pissed at us and may sue the Board of directors for recklessly endangering the financial future of the company in favor of a idealistic goal, which has no business driving the bottom line of a company.
I sense a big "DOH" from Elon in the future. And a huge drop in Tesla stock.
That was my first reaction from a business POV as well, but if you think about it a bit more, some points in their favor come to mind:
1. Tesla is the only one seriously pursuing the electric car market. Every other car is limited to 80 miles of range with non-insulated batteries (the Tesla doesn't have a range drop in winter; my buddy's Honda Fit EV drops down to 19 miles in the cold); Tesla hits 200 to 300 depending on the options you get. Sure there's the Leaf & other cars, and misc. stuff like the Volt & plug-in Prius, but nothing as serious as a replacement car as Tesla - Supercharging, infrastructure, realistic range, etc.
2. Tesla is building a $5 billion Gigafactory. And they're building it in the U.S (= jobs). That will enable them to cut costs by an estimated 30% eventually, and will help when their third vehicle, the "affordable" $35k "EV for everyone", comes out. They are going to have a HUGE jump-start on other car manufacturing companies, including the Big 3, because no one else has a $5 billion dollar battery factory, or the in-house experience of building nothing but electric cars for years.
3. Musk seems like a pretty smart dude - Zip2, Paypal, SpaceX, Tesla, SolarCity, etc. I'm sure he has a long-term gameplan & patent-usage stipulations all lined up to stay profitable. He's on the hook for Tesla for at least another 3 to 5 years as well.
I am curious as to how they're going to split the costs of the Supercharger. Right now they pay for them and Tesla owners use them for free (for life). And it still takes 20 or 30 minutes to do a quick charge, so if you suddenly have everyone in the neighborhood lining up, that's going to make for some long lines. So they're going to have to figure out something interesting for public chargers.
My main concern here is charging standards. Gas is gas, one nozzle fits all ICE cars. But battery technology is constantly evolving. The initial argument is that Musk wouldn't be investing in a $5 billion dollar battery factory if they had already found something better, so this will be the standard for the next few years, at least. But there's still a lot to be learned about batteries, efficiency, capacity, fast charging, etc. What if they figure out a new graphene battery that can charge to capacity in 2 minutes? Are they going to retrofit the existing chargers? Lots of questions to be answered, but we have to start somewhere, so this sounds good to me!