The black swan we are talking about here isn’t a car but a power train and probably more specifically a battery technology. All that’s required for electric car to really break out is a way to make cheaper batteries and I am sure that’s coming.

Elon Musk of Tesla says he is going to make that happen by building a $5 billion lithium-ion battery factory, driving down the cost of manufacturing. This will work, I’m sure, and I applaud Elon for his commitment. But I strongly suspect that it will end up being a $5 billion boondoggle. The better approach would be to abandon lithium-ion for a superior battery technology.

There are dozens of startups working today on alternative battery chemistries intended to dramatically increase the range and decrease the cost of electric cars. I don’t know which of these will ultimately dominate but I am sure one will which is why I can be so confident in predicting a black swan. With dozens of groups working on the problem and an eventual market worth probably $1 trillion I have no doubt there will be a solution within the next couple of years.