Tesla Allows Others To Use Patent Portfolio

By Joseph Mandour on June 26, 2014

teslaOrange County – In what has been hailed as a bold and unprecedented move, Tesla Motors is opening its patent portfolio in hopes of encouraging other automakers to create new electric vehicles. The company’s CEO, Elon Musk, said Tesla will not pursue patent lawsuits against anyone who wants to use its electric car technology “in good faith.” Musk says the “wall of patents” has been removed “in the spirit of the open source movement, for the advancement of electric vehicle technology.” Musk made the announcement at the Palo Alto-based company’s annual shareholder meeting this month.

Musk seems to feel strongly about this decision. He said during the announcement that he did not want to “lay intellectual property landmines to inhibit others” who are motivated to create electric vehicles, which could pave the way to a sustainable, energy-efficient future. By giving up its patents, Tesla is hoping that electric vehicles hit the road at a faster pace. That has not been the case so far.

Automakers have only been producing electric cars with limited range because they do not have the technology to do so. Plug-in vehicles constitute less than 1 percent of new car sales in 2013 despite automakers rolling out new models. The higher price of these vehicles and their limited range is discouraging consumers. Musk says competition will not be an issue because the main competition for electric vehicles comes from the millions of gasoline vehicles manufactured each year, not the trickle of electric cars being produced.

The times have been turbulent for Tesla recently with wild stock swings and a recent announcement by the company that it will spend $5 billion to build a factory that will make batteries to power electric vehicles. Musk has claimed that the factory will increase sales by bringing down the cost to manufacture electric vehicles, while others are concerned it may be a bet the company type of decision if it doesn’t work out. There have also been delays on the much anticipated Model X Tesla SUV which was originally expected to go on sale this year.

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