Why there's no Tesla racing team

Hey y'all, it's Austin. I've analyzed Tesla's strategy on the professional racetrack, but first…

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Earlier this month, Tesla Inc. sent its high-end Model S Plaid whooshing around the Nürburgring's Nordschleife, a brutal racetrack in Germany that's often a proving ground for automakers testing their latest models and technology. Driven by a professional racer, the Plaid, which Tesla Chief Executive Officer Elon Musk has been touting as the quickest production car ever made, scorched the twisty 12.9-mile loop in 7 minutes and 35 seconds, scoring a lap record for electric vehicles.

The milestone wasn't just a personal victory for Musk, who tweeted out the results, but a marketing milestone for Tesla, which has been warring for electric-speed supremacy with rival Porsche Taycan, the Nürburgring's previous EV record holder. Yet the showing was a rare official entry for Musk and company, who have generally trumpeted their technical breakthroughs at controlled product events or with splashy YouTube videos. If Tesla's cars are truly best in class, why doesn't Musk prove it in Formula E, the all-electric version of Formula One, or other motorsport leagues?

Musk himself gets that question all the time online. Auto brands, after all, from Chevrolet to Ferrari have long benefited from the halo effect of their association with racing. So, as one Twitter user asked last year, would Tesla ever consider building an official racing team? "No, we're focused on developing new products & scaling production," Musk responded. The implication is that an investment in an EV racing program would not translate to better passenger cars or manufacturing improvements, a lack of technology transfer that Audi AG and BMW AG have cited as a rationale for quitting Formula E.

Blake Fuller, a battery developer and professional driver who races Teslas independently, says Musk's reasoning is likely more complicated. Despite not having any formal Tesla backing or sponsorship, Fuller has still competitively zoomed up Colorado's Pikes Peak in a Model 3 and just last month raced a Tesla against Fords, Nissans and Subarus in New Hampshire at Mount Washington's famous, century-old hill climb.

While he'd love if Musk got into racing, he acknowledges that there are tons of risks associated with "corporate-tied" motorsport, especially for a company under as much public scrutiny as Tesla. If a Tesla crashed at a high-profile competition and injured the driver or caused the battery to ignite, would their safety credentials come under question? "The biggest concerns come down to the 'what if' factors," Fuller says.

Another reason is that the company already gets endless organic publicity from Tesla enthusiasts, without the risks inherent in corporate sponsorship. Fuller, of course, is a prime example of this dynamic, but social media is full of the Tesla faithful drag-racing against Lamborghinis and other ultra-luxe cars in videos that amass millions of views for free. As a result, Fuller says, Tesla likely doesn't need "as much marketing help launching their EVs, because they're already known to be fast and superior."

In that sense, perhaps the most obvious reason Musk will not enter Formula E or some formal head-to-head race against the likes of Porsche: He doesn't want to be in a position to potentially lose. Tesla is already synonymous with speed, whereas other EV newcomers must prove their technical bona fides. Why would Musk give that chance to Porsche or another archenemy such as Lucid Motors, which supplies batteries to Formula E? Outside Tesla's strategic sprint at Nürburgring or a few other circuit appearances over the years, the company gets far more mileage out of its in-house, choreographed competitions, like when it held a tug-of-war battle between the new Cybertruck and Ford's F-150 (which a Ford exec called misleading).

Still, Fuller says official racing could give Tesla more legitimate bragging rights—and he firmly disagrees with the notion that professional competitions wouldn't enhance their tech performance, citing braking and steering issues he believes require improvements to keep up with Porsche and other rivals. "Elon can reach out and we can make Track Mode better 'cause there are things that suck about it," says Fuller says, laughing, referring to Tesla's racetrack setting. "But they're all fixable." —Austin Carr