Elon Musk: First Principles

00:00:00.000 | First principles is kind of a physics way of looking at the world.

00:00:03.280 | You boil things down to the most fundamental truths and say, "Okay, what are we sure is

00:00:09.820 | And then reason up from there.

00:00:11.840 | Somebody could say, in fact people do, that battery packs are really expensive and that's

00:00:16.520 | just the way they'll always be because that's the way they've been in the past.

00:00:19.520 | No, that's pretty dumb.

00:00:21.520 | If you apply that reasoning to anything new, you wouldn't be able to ever get to that new

00:00:29.120 | So first principles would be to say, "Okay, what are the material constituents of the

00:00:31.920 | batteries?

00:00:32.920 | What is the spot market value of the material constituents?"

00:00:35.040 | So you can say, "Okay, it's got cobalt, nickel, aluminum, carbon, and some polymers for separation

00:00:40.400 | and a steel can.

00:00:41.560 | If we bought that in London Metal Exchange, what would each of those things cost?"

00:00:45.160 | Like, "Oh, it's like $80 per kilowatt hour."

00:00:47.880 | So clearly you just need to think of clever ways to take those materials and combine them

00:00:53.160 | into the shape of a battery cell and you can have batteries that are much, much cheaper

00:00:58.240 | than anyone realizes.