Tesla is riding high these days, but two developments could create reputational risks for the world’s most valuable car company.
Driving the news: Tesla is beginning to face criticism over the climate effects of its big new investment in bitcoin and the decision to accept it as payment — even though electric vehicles are lower-CO2 alternatives to gasoline vehicles.
Why it matters: Bitcoin “mining” to process transactions is very energy-intensive, so promotion of its use could add to its carbon footprint.
- Though it’s worth noting that some estimates of bitcoin energy use are probably way too high and there are ways to make mining cleaner too.
What they’re saying: Ben Dear, CEO of the sustainable investment firm Osmosis Investment Management, tells Reuters: “We are of course very concerned about the level of carbon dioxide emissions generated from bitcoin mining.”
- He said Tesla should disclose energy consumption associated with its bitcoin ventures.
- More broadly, some analysts see Tesla’s decision to accept bitcoin as potentially widening its use in transactions more broadly.
- Reuters says Tesla’s bitcoin backing could “turbo-charge global use of a currency.”
- The Verge is also reporting on the climate angle.
Driving the news, part 2: New research from Edmunds finds that five Tesla models they tested showed less range per charge than the vehicles’ EPA estimates.
- The analysis, which Edmunds notes is designed as a “real-world complement to the EPA’s laboratory-based process,” found the vehicles had 2.5%-17.4% less range.
- The one with 17.4% less was a 2018 Model 3 Performance edition, which had 256 miles of range instead of 310 in the EPA estimate.
But, but, but: Tesla still had two of the five longest-range vehicles among the 15 models Edmunds tested.
- The biggest difference between the EPA and Edmunds findings was with the 2020 Porsche Taycan 4S, which went 59% further in the Edmunds test at 323 miles.
Of note: Gasoline-powered vehicles can also underperform their EPA estimates, and in general, mileage and range are influenced by all sorts of conditions and driving styles.
The bottom line: Tesla’s on a good run, having become consistently profitable. But the EV market is getting more competitive, so these topics are worth keeping an eye on.
