Tesla removes EV patents in bid to open up market

By Siobhan Lismore-Scott, Laura Syrett
Published: Friday, 27 June 2014

Move seeks to overcome barriers to EV adoption; Blink to integrate Tesla into charging network

US electric vehicle (EV) manufacturer Tesla Motors Inc. has removed all patents covering its technology, in what it termed the “spirit of open source movement for the advancement of EV technology”.

“Tesla Motors was created to accelerate the advent of sustainable transport,” Tesla’s CEO, Elon Musk, said on announcing the move in June.

“If we clear a path to the creation of compelling EVs, but then lay intellectual property landmines behind us to inhibit others, we are acting in a manner contrary to that goal,” Musk added.

The patents were originally created “out of concern that the big car companies would copy our technology,” Musk said, adding that “the unfortunate reality is the opposite: electric car programmes (or programmes for any vehicle that doesn’t burn hydrocarbons) at the major manufacturers are small to non-existent, constituting an average of far less than 1% of their total vehicle sales.”

He also reassured car makers that “Tesla will not initiate patent lawsuits against anyone who, in good faith, wants to use our technology”.

Unlocking innovation

By revealing the secrets behind its EV designs, Tesla hopes to accelerate innovation within the EV industry and overcome technology limitations such as battery capacity, which at present only allows an EV to travel around 312 miles (502km) on a single charge.

This, combined with a lack of charging infrastructure and the high cost of purchasing an electric car - Tesla’s Model S currently retails at around $70,000 - have been blamed for slower than expected take-up of EVs by consumers.

Sluggish growth has disappointed many in the lithium and graphite mining industries, both of which supply key mineral inputs for EV batteries, who had pinned their project economics on a projected explosion in electric car demand in the first half of this decade.

A year ago, US lithium producer FMC Corp. admitted that it did not expect growth in EVs to take off until after 2015.

“We are seeing the growth for EVs - if it takes off - to take off post 2015. And it’s a bit slower than what most companies would have said one or two years ago,” CEO Pierre Brondeau said at the time, adding that “there is no significant change or increase in pace in this market today”.

Growth in EV demand

Despite growth being slower than many EV enthusiasts had hoped, the long term outlook for clean-tech automotives remains positive, according to revised market estimates.

A report released by Navigant Research late last year predicted that more than 35m EVs will be on roads worldwide by 2022 and sales of EVs and alternative fuel vehicles will approach 12.4m annually.

Tesla’s Musk has also highlighted that the real enemy to widespread EV adoption is not rival green car manufacturers, but rather the existing hydrocarbon-fuelled vehicle market.

“Given that annual new vehicle production is approaching 100m per year and the global fleet is approximately 2bn cars, it is impossible for Tesla to build electric cars fast enough to address the carbon crisis,” Musk wrote in his blog in June.

“The market is enormous. 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,” he added.

In February, the company announced plans to build a ‘Gigafactory’ in North America to supply up to half a million EV batteries by 2020*.

Tesla can also be encouraged by steps being taken to improve charging infrastructure for its cars.

On 19 June, US-based Car Charging Group Inc. (CarCharging), the largest owner and operator of EV charging services in the world, including the Blink charging network, announced its intention to integrate Tesla’s models into Blink EV charging stations.

CarCharging’s statement quoted Tesla’s announcement regarding the lifting of patents and said that it too would work to support increased take-up of EVs.

“Like Tesla Motors, CarCharging believes that the market potential for electric vehicles is vast and we are dedicated to doing all that we can to assist in its acceleration,” said CarCharging Founder and CEO, Michael Farkas.

“By sharing its technologies, Tesla Motors provides CarCharging with the ability to leverage all of the locations in its portfolio and offer a solution that is compatible for all EV drivers, which is a win-win for the drivers and the industry,” he added.

*IM Data has released a free report on how Tesla’s Gigafactory will affect the demand for critical minerals: graphite, lithium and cobalt. To download your copy, visit data.indmin.com/tesla.