Tesla is Not “Sustainable”, or What People Get Wrong About Sustainability

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Tesla is widely viewed as one of the world’s most sustainable companies.

When someone tells me that Tesla is a sustainable company, I often must excuse myself from the room. The very suggestion is laughable.

Yes, Tesla produces electric cars. Yes, they are working toward a “sustainable energy future”. And electric cars generally are better for the environment than traditional gas-powered cars.


None of that makes Tesla a “sustainable” company. And certainly it doesn’t make it one of the world’s most sustainable companies.

To understand why, you have to first understand what sustainability is. Then you must understand what Tesla actually does, as opposed to what it says it does.

What is “sustainability”?

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“Sustainability” is a term used around the world to mean many different things. It always includes some aspect of environmental awareness. For some, it only means the more efficient use of natural resources.

The UN-sponsored Brundtland Commission was the first to talk about and create widespread awareness of “sustainability”. They did so in the context of discussing “sustainable development” which is development that meets the needs of the present without compromising the ability of future generation to meet their own needs.

The Commission spent a great deal of time coming up with the definition. they also discuss in detail what “development” and “needs” are.

“Development” is the human attempt to improve our social and economic achievements as a group within our environment. This definition recognizes that social, economic, and environmental aims are all interrelated.

“Needs” specifically referred to the world’s poorest. Those who are surviving with the least. Any conversation about sustainability must refer in some way to them.

When someone speaks of “sustainability”, they are often only talking about the environmental impacts. This misses the point entirely.

If you make solar panels using child slave labor, you are not being sustainable. Yes, those solar panels may be generating renewable energy, which is better than oil-, gas-, or coal-powered electricity factories.

But the way you are making them is not meeting the needs of the current generation.

Using child slave labor is, in fact, exploiting the current generation to meet the needs of the present, while compromising the ability of future generations to to meet their own needs by eliminating the educational opportunities for those children.

Again, not sustainable.

Similarly, if a company is not profitable in the long-term, it is also not sustainable. The company is taking money from investors on the express promise that the investors may make more money with the company than with another investment.

An unprofitable company is also susceptible to bankruptcy, which leads to widespread waste of physical materials and the unemployment of its workforce.

Long story short: “sustainable” companies are those that are profitable in the long-term, protect the environment and natural resources, and contribute to social equality and equity.

What does Tesla do?

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Forget for a second the pronouncements of their rightly-famous CEO for a second. Forget the hype. Forget the promises.

Stick with facts.

First about electric cars generally.

They pull electricity from the grid. What is the grid powered by? In almost all cases, by oil, gas, or coal. Some Scandinavian countries notwithstanding, this is the global norm.

So if you are driving your Tesla (or any other plug-in vehicle) in the US, 77.6% of the electricity you are using is from petroleum, natural gas, or coal. Not perfect, but certainly better than 100% from your gas-powered car.

Then there’s the waste.

In a gas-powered vehicle, 80% of parts are re-usable and recyclable. Teslas (and electric cars generally) incorporate 1,600 lbs or more of e-waste, yet global capacity for recycling e-waste is only about 5%. In the US, only about 30% is actually recycled.

Those numbers are without widespread adoption of electric cars and in spite of the fact that e-waste recovery is very economically lucrative. E-waste is also substantially more hazardous than general waste when not recycled.

Now, about Tesla specifically….

Tesla does not report enough details about the production of its vehicles or the sourcing of its products for consumers to have any idea about how sustainable that process is.

Tesla is remarkably inefficient in its use of raw materials, with 40% of their purchases raw materials being scrapped. To put this into perspective, Ford’s goal of all their facilities sending zero waste to landfill is close to being reality. GM has over 100 such facilities.

And last year, Tesla produced about 100,000 vehicles. Ford produced 6.6 million and GM almost 10 million.

Shall we get to the economic and social aspects?

Telsa have yet to turn a profit since their IPO in 2010. They sacrifice worker safety in the name of production speed, responded to them in a beautiful PR move, and then didn’t follow through. They bully their workers into not joining unions.

So if Tesla isn’t “sustainable”, what is it?

Maybe you are a Tesla true believer. If so I ask, what do you believe in? Do you believe in Tesla as is, or the the vision of what Tesla could be in a world that does not exist?

Because Tesla’s vision will only work with infrastructure — charging stations, better roads for autonomous vehicles, widespread car sharing, renewable energy grids with substantially more capacity, a battery recycling network, an expanded capacity for lithium mining — that does not exist and WILL NOT exist without billions of dollars for each of those projects.

All while there are better made, cheaper, and more sustainable electric car competitors (the Chevy Volt and Renault Zoe on the low end and the BMW chargeable 3 series on the other).

And the company isn’t profitable. And don’t tell me Tesla is like Amazon. It’s not and never will be. Amazon entered (repeatedly, aggressively, and strategically) markets that it could completely dominate in a short amount of time and that it had a related experience. It also did so with a pile of cash.

So what is Tesla?

A company. That makes electric cars. With a really well known and very bright CEO. That is trying to puff itself up to seem like it is bigger than it is.

Why would it try to puff itself up?

Your guess is as good as mine.

[A special thanks to Ali Khawaja for inspiring this one!]

Business Prof, Conflict & Sustainability Researcher, Lawyer, Runner. American, Greek, NY Rangers fan. Opinions my own. http://john-e-katsos.strikingly.com/

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