cvalue13
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The numbers are in, and with time to think/drink about it, here's the TLDR:
I've been occasionally noodling over the Cybertruck's 2,500lb payload, and separately the range extender. Then I thought about them simultaneously. And I thought back to a day-of-reveal comment by @JBee, and a pet hypothesis developed.
Inviting the more agile to weigh in here (esp if agile with carbon trading under ZEV etc.), as the pet hypothesis is about how (if only in part) Tesla landed on its approach to the range extender, and is possibly already sandbagging its 2,50lb stated payload. This hypothesis suggests the specs we've been given were ... surprise ... motivated by money. But not money from customers, so much as money from state and federal goverment CARB and carbon-trading programs.
Basically, the extender approach to range, plus possibly some sandbagging of payload, was required in order for Tesla to continue collecting carbon credits and other key regulatory dollars at both the Federal (and State) levels.
THE EXTENDER AND CLASS 3 GVWR
CLASS 3 TRUCKS AND ZEV / CARBON TRADING
IS CURRENT PAYLOAD RATING ALREADY GAMING THE ZEV / REGULATORY CONDITIONS HURDLES?
- the current Cybertruck payload of 2,500lb is possibly sandbagged to keep the GVWR below 10K lb / Class 3 designation
- the range extender is possibly a $16,000 option in order to ensure that not too many are sold, avoiding a required homologation of that configuration as a Class 3 truck
- for the same reasons, the range extender is an accessory because a Cybertruck with that additional pack incorporated natively would be a Class 3 truck
- there are a lot of reasons to avoid having the Cybertruck be a Class 3 truck, but possibly a main reason is that it would materially impact Tesla's carbon credit trading revenue stream, and Tesla's business model depends heavily on that revenue stream
- all of the above effects likely are the result of Tesla being unable or unwilling to build the 2019 vision of a 3,500lb/500mi truck that had a GVWR below Class 3
I've been occasionally noodling over the Cybertruck's 2,500lb payload, and separately the range extender. Then I thought about them simultaneously. And I thought back to a day-of-reveal comment by @JBee, and a pet hypothesis developed.
Inviting the more agile to weigh in here (esp if agile with carbon trading under ZEV etc.), as the pet hypothesis is about how (if only in part) Tesla landed on its approach to the range extender, and is possibly already sandbagging its 2,50lb stated payload. This hypothesis suggests the specs we've been given were ... surprise ... motivated by money. But not money from customers, so much as money from state and federal goverment CARB and carbon-trading programs.
Basically, the extender approach to range, plus possibly some sandbagging of payload, was required in order for Tesla to continue collecting carbon credits and other key regulatory dollars at both the Federal (and State) levels.
THE EXTENDER AND CLASS 3 GVWR
The extender on all accounts likely weighs something like 700lbs, give-or take.
Regardless of this error band, given the curb weight of the Cybertruck (let's call it 6,900lbs), plus the payload for the Cybertruck (2,500lbs), the Truck's GVWR is just shy of becoming a Class 3 medium duty truck (anything over 10K pounds). If you were to instead add the weight of the extender battery guts to the main Cybertruck pack itself, alongside structural improvements needed, etc., the GVWR would be sure to exceed the Class 3, 10L lb, threshold.
But because the extender is an option, which if sold in low enough quantities, it doesn't require homologating the vehicle through regulatory scrutiny. So, with the extender, you can get to the beast+extender range of ~450mi, without having to do crashworthiness and other regulatory certifications.
But also, you get to ~450mi without the regulatory effects on either payload or GVWR.
if you add the weight of the extender (or instead including that weight in native existing pack), now Tesla is put to the decision of either (A) sandbagging your payload down to ~nothing, or (B) own up to your payload, but have a truck that is over a 10,000lb GVWR
now you're a class 3 medium-duty truck. Plus, if not a low-volume option, you'd have to homologate that vehicle and engineer it to pass (to your preferred standards) all the regulatory hurdles imparted on that truck.
CLASS 3 TRUCKS AND ZEV / CARBON TRADING
Basically, Class 3 trucks are hamstrung for earning the most valuable carbon credits under programs like the California's Zero Emissions Vehicle (ZEV) and similar programs in other states and at the Federal level.
Tesla's carbon trading strategy is a core component of its business model. In 2022, Tesla's carbon credit sales reached a record high of $1.78 billion - a significant role in the company's revenue stream.
Through programs such as the ZEV program, Tesla earns credits for vehicles it produces and sells, which it sells to other automakers who fall short of their own emissions targets.
The details and calculations here, in terms of what Tesla might stand to lose were the CT a Class 3 vs a Class 2b, are complicated and beyond my expertise. But doing anything to lower the optimization of earning these credits is antithetical to a core of Tesla's business in recent years. Tesla has been actively and efficiently optimizing the policies set by CARB to maximize its ZEV credit earning potential.
"For instance, in October 2021, Tesla submitted its review for the 2022 Model 3 RWD, which comes in two different types of batteries: LFP and NCA. The LFP model reported about 376 UDDS miles, while the NCA model had about 352 UDDS miles. Despite the slight difference in range, both models were able to earn Tesla the maximum cap of 4.00 ZEV credits. The Tesla 2022 Model Y has a UDDS range of about 324 miles, which was still able to earn Tesla 3.74 ZEV credits. Through such optimizations, Tesla can ensure its compliance with CARB policies while also maximizing its ZEV credit earning potential. These regulations are set to continue up to the 2025 model year, and Tesla's ability to optimize its ZEV credit calculations will be a key factor in its continued success in the carbon trading market."
And, through 2025, these credit sales are poised to become even more valuable to Tesla as other manufacturers fall increasingly short of the noose-tightening emissions targets, increasing the demand side.
"The demand and supply dynamics for Tesla's carbon credits are poised to undergo significant shifts in the coming years. On the demand side, the minimum ZEV credit percentage requirement for each manufacturer is set to increase from 17% in 2023 to 19.5% in 2024 and 22% in 2025. This means that automakers who fall short of their emissions targets will have to purchase an increasing number of carbon credits to comply with these regulations. This trend bodes well for Tesla, as it is expected to result in higher demand for its carbon credits in the coming years."
At the same time, on the credit supply side, as more manufacturers shift to producing electric vehicles, it may lead to lower prices and potentially impact Tesla's carbon credit revenue.
All-in-all, whether because the demand side is increasing or the supply side decreasing, between now and 2025 is no time for Tesla to begin losing focus on optimizing it's vehicles ranges and stats in a way that leaves this carbon credit money on the table.
SO, A CYBERTRUCK WITH NATIVE ~450MI RANGE WOULD MATERIALLY IMPACT TESLA'S ZEV (AND SIMILAR) CARBON CREDIT REVENUE STREAMS So, you can't just build a Cybertruck with native ~450mi range pack and also optimize carbon credit revenue streams unless you can keep a ~450mi Cybertruck under a GVWR of 10,000lbs. It would seem that Tesla was unwilling or unable, on an all-things-considered basis, to engineer such a vehicle.
Did the 2019 tri-motor Cybertruck stats assume that the "exoskelton" and other aspirational design features would be able to bend physics towards Tesla's simultaneous desire for a 500mi/3,500lb payload truck that came in below a GVWR of 10K lbs?
IS CURRENT PAYLOAD RATING ALREADY GAMING THE ZEV / REGULATORY CONDITIONS HURDLES?
Put simply, the currently released Cybertruck with a payload rating of 3,500lbs would push the truck from a Class 2b to a Class 3 truck, and have the above-described impacts on Tesla's carbon credit trading revenues. I'd been noodling on this since a delivery day comment by @JBee
So, did Tesla sandbag it's payload rating to 2,500lbs in order to stay below the 10Klb GVWR, effectively gaming the ZEV carbon credit system?
Several folks noticed that during the Cybertruck delivery event Musk recounted the 2,500lb payload stat, then said something along the lines of "but in actuality it can hold a lot more than that."
During the delivery event this raised my eyebrow, because it seems a precarious statement to be making if only from a regulatory compliance standpoint, as well as a product liability standpoint.
But now having connected the above dots, I'm wondering if that statement was unadvisable for further reasons. Specifically, I'm not certain that California and other ZEV program states, etc., would appreciate an open and blatant gaming of its regulations by having OEM's merely sandbag their payload ratings.
It's perhaps one thing if a company 'rounds down' to just avoid the Class 3 rating. It's potentially another thing when a company sandbags by potentially, hypothetically, ~1/3 of its true payload rating in order to game the ZEV program. It's not like California is exactly friendly towards Tesla's antics these days, and even more level-headed states and ZEV-like programs may do more than frown at it.
AT THE END OF THE DAY, WHILE LIKELY MULTI-FACTORIAL, IT SEEMS LIKE THE CYBERTRUCK'S 2,500LB PAYLOAD RATING AND THE OPTIONAL (IF IN LOW VOLUME) EXTENDER ACCESSORY, POINTS TOWARDS TESLA GAMING BOTH THE NUMBERS (IN CASE OF PAYLOAD) AND THE CONFIGURATION (IN TERMS OF EXTENDER) TO AVOID CLASS 3 DESIGNATION.There are likely a host of reasons an auto manufacturer may avoid Class B designations in the vehicles it offers. It can effect insurance rates. In certain applications the DOT requires DOT numbers be printed on both sides of the vehicles. Etc.
These things alone may not have been enough to cause Tesla to orchestrate a gaming of its GVWR classification.
But these things plus the potential impact on Tesla's carbon credit revenue streams, begins to smell of sufficiency for all manner of antics.
Including Tesla being willing to accept the disappointment of customers who see a 2,500lb payload, or who are upset to find that the ~450mi Cybertruck variant requires $16,000 option that eats 1/3 of the bed volume.
Speaking of a $16,000 option: remember that if Tesla were to sell too many of these accessories, the regulations can kick in and cause it to homologate that configuration as a trim. This would not only cause that trim to be Class B in terms of GVWR, but to have to undergo range testing, crashworthiness testing, automotive electromagnetic compatibility (EMC) certification, etc.
But if you price the extender at $16,000, you may have split the baby. For folks who *really* need more range, and can spend $100K on the AWD or $120K on the Cyberbeast, Tesla will oblige. But they won't build or sell enough of them to homologate that trim, and the $16K price tag helps to ensure that.
Meanwhile, Tesla is having its Cybertruck cake and eating its carbon credit revenues too.
Which has sort of always been the Tesla way, and precisely how it's kept the business afloat, and it's MSRP's down for customers.
But in this instance, if Tesla has indeed sandbagged its payload by ~1/3 to game the ZEV score of the current Cybertruck configuration, I'd be a little more careful than Musk to basically admit it during the delivery event.
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