Potential Pinto? Tesla Battery Risk

Tesla Motors plans to launch its $100,000 electric sports car next year.  The car is getting great reviews for its Ferrari-like performance, powered by Lithium Ion batteries.

Yes, that is the same technology used in laptops including laptops made by Dell, which issued one of the consumer electronics sector's largest product recalls due to fire risk from the batteries.

Technology Review pointed out the risk earlier this month, including details on how Tesla will deal with the risk:

<<(Tesla) has done a lot to keep its battery-powered system safe -- much more than is done in laptops, says CEO Martin Eberhard.

To keep temperatures under control, Tesla's engineers have developed an electronically controlled liquid cooling system. They have also included overcharging protection, three layers of fuses, and sensors that will trigger the batteries to disconnect in the case of high-temperatures, a sudden impact, or a roll-over. In fact, the decision to use many small batteries rather than a few very large ones was in part a safety consideration -- each battery and its relatively small amount of stored energy compared with the entire system is isolated and protected within its own steel case. And the entire system is also encased for protection in the case of an accident.>>

From a disruptive innovation perspective, the battery issue raises some questions:

• Is the safety performance of Lithium Ion batteries in large configurations improving over time?
• Can Tesla use this same battery technology with the same level of safety, cooling, sensors and shielding for its next-model of mass-market electric cars, or are these technologies less likely to give better price performance as volume scales?
• Is there a simpler power technology available for mass-market priced cars?

Lastly, a risk question:

• Can any car company take on the risk of producing the next Ford Pinto?

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** Other Views **
Ford confronted a similar safety issue in 2001 due to tire problems on Ford Explorers. Ford recalled 6.5M cars. Firestone almost went bankrupt.  BusinessWeek looked at the blame game between the two companies.

Jalopnik says your Tesla probably won't explode: "We're very impressed with the safety precautions the company has taken. But figure we don't know ten million people, and we've known more than one who've had an internal-combustion car catch fire...but to us, the Tesla doesn't seem any more dangerous than the Lotus Elise upon which it's based."

Comments

[Lee Huntley]

I drove over a speed bump in my Pinto and it blew up and unfortunatley incinerated my cat Muffy! I still miss poor Mr. Fluffy

[Paul]

A speculative battery risk doesn't matter at all to whether Tesla is disruptive. It is a known risk unlikely to concern niche consumers (unlike the exploding Pinto gas tank), and the company has taken several steps and invested in mitigating the risk (Ford did the opposite, calculating that the cost of settling possible lawsuits was less than installing a part that would increase the production cost of each car by a couple of dollars).

If anything, this possible risk is enough to deter the big companies and have them pooh-pooh the Tesla as not-ready-for-prime-time, which is precisely one of the attributes of disruptive products.

I suspect that people who want a car that can accelerate that fast relish risk, and are willing to take a calculated one for the cachet of owning one of the world's coolest cars.