It had all the trappings of a Hollywood premiere: the red carpet entrance, the elaborate stage surrounded by open bars, thumping techno music, a throng of well-dressed onlookers.
The thousands of invited Tesla fanatics had been lured by two weeks of hype set off by a single, cryptic tweet from the electric-car maker’s enigmatic chief, Elon Musk. He would announce something called “the D” — finally, a new model? — and “something else.”
But Musk, borrowing the Steve Jobs playbook for dramatic product announcements, was much of the attraction at the Hawthorne Airport Thursday night.
The news — an all-wheel-drive system and some automated safety features for Tesla’s sole model — would have merited little more than a routine press release from Tesla’s competitors at Mercedes, BMW or Audi. Their cars have offered similar features for years. But Musk, a renowned media maestro, spared no superlative in his soaring stage act, widely covered by national media.
“Let’s release the Titan,” he said, as a massive robotic arm gripped an all-wheel-drive Model S and hoisted it onstage.
Telsa’s all-wheel-drive system, he assured, was unlike any ever invented: “The thing that makes this unique and special — and better than all-wheel-drive in the past — is because you can dynamically shift the power from front to rear at the millisecond level.”
Of the automated safety features that together offer an “autopilot” function: “The car can do almost anything.”
Of a new performance variant of the sedan, Musk gushed: “It’s like taking off from an aircraft carrier. It’s like having your own personal roller coaster. The target that we had for performance was to try to meet one of the greatest supercars of all time, the McLaren F1.”
The room went nuts, as Musk whipped his fans into a furor.
Investors, the next day, greeted the news with decidedly less excitement, pushing Tesla’s stock — normally a darling of Wall Street — down 7.8% on Friday, to $236.91 per share, its lowest point since August 1. Strip away the stage rhetoric, and what was left was a niche automaker playing catch-up to its more established competitors.
“Overall, we believe last night’s event and recent news may fail to impress investors and potentially take some wind out of the sails of the bulls,” noted Tesla skeptic John Lovallo II at Bank of America said in a report issued Friday.
Brian Johnson, a senior research analyst for autos at Barclays Capital, was similarly underwhelmed. “First off, we are struck by the enormous publicity Tesla is generating around the addition of an all-wheel drive variant of the Model S,” he said. “We don’t see the addition of AWD to the Model S as a game-changer.”
Thursday night, no one in the crowd seemed to care. Such is the powerful brand image that Musk has crafted the electric car maker. Similar to the late Jobs and Apple, the brand of the company and its CEO are sometimes hard to distinguish.
“Elon is Tesla, Tesla is Elon,” said Ed Kim, vice president of industry analysis at AutoPacific. “He comes across as being extremely hands-on in the development process. Who knows what the reality is, but he puts forth that impression.”
No other automaker is better than Tesla at baiting the public’s attention by dribbling out hints of an announcement weeks ahead of time, and then letting the media and Internet whip itself into a speculative frenzy.
The fuss around Thursday’s event started with Musk’s October 1 tweet — with a shadowy image of a car parked behind a semi-open garage door. “About time to unveil the D and something else,” the tweet teased.
Nine days later, it had 15,000 retweets. Speculation arose from nearly every Tesla owner and fan, and much of the tech and automotive media.
Yet the news itself was more evolution than revolution. Contrary to much speculation, no “Model D” debuted. Rather, the D refers to “dual motor,” which means Tesla is bolting a second, smaller electric motor to the front wheels. Deliveries of cars with this $4,000 upgrade will begin in February.
A new high-performance P85D will start at $120,000, and arrives in December. With 691 total horsepower from both motors combined, Tesla says the car will surge silently from 0-to-60 mph in 3.2 seconds.
The “something else” in his earlier tweet referred to a forthcoming “autopilot” system. This system is made up of four parts, and uses hardware already on cars coming out of the factory today. Software updates will start bringing much of this functionality online over the next several months, Tesla said.
The system includes forward-looking radar; a camera with image recognition that can read stop signs and identify objects before impact; 360-degree long-range sonar; and a system to integrate those features with navigation, GPS and real-time traffic data.
The new features will be available soon as part of a $4,250 technology package, which will include options already offered on the Model S.
But critics of Tesla point out that nearly all of Tesla’s competitors, including Mercedes-Benz, Audi, and BMW, already offer the features Elon announced so extravagantly on Thursday.
Johnson, of Barclay’s Capital, had predicted as much before the event: “Knowing Elon, it will sound like he’s the first guy to have thought about this stuff, even though it’s routinely done in luxury cars.”
Yet there were some salient details in Musk’s announcements that are indeed unique to the Model S.
It’s the first all-wheel-drive, all-electric vehicle on the market, and the system slightly increases the car’s range and efficiency. When engaged, the autopilot system can read speed limit signs and bring the car to that speed automatically. The car will also change lanes automatically (unless there’s another car in the way) when the driver puts on their blinker.
This gets at the core of what Tesla, led by Musk, has been able to do so well. As a company a fraction of the size of General Motors or Volkswagen Group, Tesla’s strength is more adaptation than innovation.
“Their own positioning as technology velociraptor is them promoting too much,” said Eric Noble, founder of The CarLab, an automotive product planning consulting group, and a professor of vehicle technology at Art Center College of Design. “But if Musk decides he wants to do something, as long as they think they have the resources to do it, they can make an announcement tomorrow.”