E-Boat Startup Takes a Page from Tesla

And its CTO from Space X

4 min read

two people sitting in a white and black boat on the water
Arc Boats

Mitch Lee can tick off the many environmental advantages of electric boats versus ICE counterparts that rule the waves: No exhaust fumes and pollution. No oil slicks trailing in the wake. No guzzling of pricey marine fuel at 2 kilometers-per-liter or less.

But with all respect to the Sierra Club, Arc Boats isn’t in business to save the planet.

“The climate benefits are certainly there. But our goal is to deliver better boats, period,” says Lee, the CEO and former Boeing engineer whose cofounder and CTO, Ryan Cook, is the former lead engineer of Space X.

As Tesla did for landlubbers, Arc Boats seeks to do on the water, beginning with its Arc One. The 7.3-meter (24-foot), aluminum-hulled beauty packs a water-sports punch with a 368-kilowatt (500 horsepower) electric motor and a hair-mussing top speed of 64 kilometers per hour (40 miles per hour).

A major hurdle for electric boats is the amount of power they need to move through the water, “which translates to very big battery packs,” Lee acknowledges.

interior of a boat with white seats and a black floorThe Arc One’s dash is simple, yet elegant.Arc Boats

To deliver an “iPhone-style experience”—using the boat all day, plugging in overnight and having it ready to go again—the Los Angeles–based Arc targeted a massive 220-kilowatt-hour pack, assembled in-house from preexisting modules from an as-yet-unnamed supplier. That battery nearly matches the forthcoming Ram 1500 REV, the roughly 805-kilometer-range (500-mile) pickup truck whose optional 229 kWh pack will be the largest of any EV in history. So equipped, the Arc One targets 3 to 5 hours of operation at a brisk clip (meaning wakeboarding or water-skiing speeds) but more if users are just pleasure cruising.

“If you’re in the middle of Lake Tahoe with a 5 percent battery, you can still get anywhere you want; it’ll just take longer.” Lee says “Especially for lake and river boats, a big day on the water might be 5 hours; that leaves 19 hours in a day to recharge.”

The Arc One can charge at 11-KW Level 2 rates, with DC fast-charge capability in the works. Most marinas are already equipped with dockside “shore power” to run boat lighting, bilge pumps, refrigerators, or other gear, making electrical upgrades easier. Since boats tend to run “point A to point A,” Lee says—starting from and returning to the same dock or slip each day—there’s less concern with developing a sprawling public infrastructure.

The startup company’s staff experience in aerospace, software, and EVs—aside from Boeing and Space X, some employees worked at Tesla and Rivian—informed the design process: A bit like a rocket, Lee says, an electric boat is also a sealed, pressurized vehicle. Here, a strong, yet-lightweight, aluminum hull helps counter the weight of the battery. That pack is a structural component that supports the floor above, saving more material mass. Lee says the Arc One weighs about 6,500 pounds, only about 1,500 more pounds than some comparable internal combustion engine (ICE) models.

“It’s just a more enjoyable experience. You’re no longer inhaling fumes, and there’s the punchy throttle to tow someone out of the water. The operating costs plummet, and the anxiety of whether the boat is going to turn on disappears.”—Mitchell Lee, CEO of Arc Boats

With the boat bobbing in cool water, the hull acts as a convenient heat sink, dissipating battery and motor heat, with liquid cooling channels for battery thermal management. That closed-loop cooling channel compares with an internal-combustion boat engine that must constantly draw and pump fresh- or saltwater for cooling. That brings maintenance issues and hassles, including the need to winterize a conventional boat. And where ICE vessels guzzle like drunken sailors—even modest-size cruisers often carry 300 liters (about 80 gallons) or more of gasoline—the Arc One’s gigantic battery holds the equivalent of about 25 liters (6.5 gallons) of gasoline energy.

Nor do passengers need to shout to hold a conversation at speed. Unlike in, say, a Ferrari V-12, no one would miss the high-decibel drone of a gasoline or diesel boat motor, especially at higher speeds.

“It’s just a more enjoyable experience. You’re no longer inhaling fumes, and there’s the punchy throttle to tow someone out of the water. The operating costs plummet, and the anxiety of whether the boat is going to turn on disappears,” Lee says.

Sophisticated software and firmware control every aspect of the power train, cooling and user interfaces, with over-the-air updates that have become a critical competitive feature in the EV world. Arc won’t reveal exact production numbers, but expects to deliver the last of “fewer than 20” Arc Ones in months to come, priced from US $300,000. The boat’s R&D and intellectual property will now be poured into a more-affordable Arc aimed at the heart of the lucrative wake-sports market, where high-quality wake surfing and wakeboarding boats cost roughly $150,000 to $250,000. Now comes a hard part: Scaling up production, with Arc just moving into a new 150,000 square-foot facility in Torrance, Calif.

“That’s the intense focus for the next phase of company growth,” Lee says. He adds none of this would have been possible without the EV revolution, and its billions of dollars in investment in batteries, motors, software and electronic controls.

“We’re standing on the back of all that R&D,” Lee says. “This would not have been possible even three or five years ago, and we’re building on best practices and adapting them to our needs.”

As for moving quickly, Arc Boats has gone from startup to design and Arc One production in a remarkable two and a half years, aided by serious financial backing. The company just announced $70 million in new Series B funding, with investors including Eclipse, Andreessen Horowitz, and now Menlo Ventures. Engineers and executives, take note: Arc Boats has about 70 employees, but Lee said they’re hiring across-the-board for multiple positions. And where fresh-faced engineers in, say, the auto industry “might have to work on a rearview mirror for two and a half years,” Lee says, Arc employees can take more ownership over interesting, challenging projects and get in on the ground floor, or deck as it were.

“We want everything on the water to be electric,” Lee says. “We’re shaping the future of the marine industry today, and it’s fun to be a part of that.”

This article appears in the December 2023 print issue.

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