"Ya got a purty mouth boy"
Lol, wow, that's teslas plan, you and your hottie tottie friends pile into Todds regular cab pickup and he'll drive you back to the burbs.
So the boutique folks in their electric car have to be rescued by a highschool dropout in a F250.
Ain't that full circle.
That been the norm in the supercar scene for a long time now, it’s not particularly new. That crap breaks down constantly. Difference might be that they call the tow truck for the car, and call the butler to bust out the Rolls to come get them instead of piling into the tow truck cab with Bubba, though.
There's nothing wrong with selling a vision, raising a bunch of money and swinging for the fences even though that will incur staggering losses. As others have pointed out, it worked well for Amazon.
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The future of cars is electric. It's just a better solution for everything but a road trip. However today it's not economical. When that day comes, the change will happen fast. Until that day electric vehicles only work for rich people or with a bunch of subsidies or for really niche mission cases.
A lot of people use Amazon as an example, but they forget a few key things.
Number one, is that when Amazon was running up massive debt, they were doing it during the dot com bubble run up and they looked a LOT better than the crappy businesses that were all getting investor money with no real business plans. The investors after 9/11 called in a lot of loans but not Amazon’s, because they were actually on a steep upward profitability trajectory, and I would have to go look but may even have been at least EBIDTA positive in gross revenues. They were clearly sticking around.
In comparison, Tesla is a cash burning cow.
Additionally at that time in Amazon’s history they were selling books, CDs and DVDs. And everyone wanted those shipped to their door. They were stealing a market with better service and convenience as well as lower prices than brick and mortar could do. Waldenbooks and others with expensive mall space couldn’t compete with a warehouse and some web servers, and nearly every book store out there had to die to make Amazon go. B&N bought up the remnants and somehow managed to survive as the last chain anyone can go to buy a book in person at.
Again, in comparison, Tesla is making a niche vehicle (even the Model 3 is a niche car) that only does a few things well. It’s not an entire car market killer like home shopping for books and media was. Without a killer product they have to play by a slightly different set of rules than Amazon did.
And finally the biggest overlooked thing about Amazon burning cash was this, and most people don’t understand it at all. They were burning that cash to invest in huge internal tech. What we now know today as Amazon Web Services is the result of their INTERNAL IT projects that built a massively scaleable server farm and their own very secretive data centers so they wouldn’t be relying on any outside real estate, leasing server hardware, none of that. They own everything but the bandwidth from he carriers.
Then they realized what they had built and decided to start selling THAT too. Why not, most small businesses couldn’t afford to do servers at that scale.
They were the first customer ever to approach server manufacturers and ask for systems that would be outfitted with (back then) 16 processors (only Sun, HP, and IBM were playing at that size back then) and they’d normally run 8 of them. They wanted a way to RENT CPUs for just their busy season (Thanksgiving through Christmas) and then turn them back off, until they got big enough to use all the processors full-time. HP obliged and made a mid-size server that did just that. Pop in an encrypted signed file into HP-UX and 8 processors come online without any downtime. That was a BIG deal back then.
Amazon could only even KNOW they needed that because Bezos (at the time) was insanely intense about metrics. They measure EVERYTHING. In their IT they know down to the hundredth of a second how efficient or non-efficient their code is, in the warehouses they measure getting a product from a shelf to a truck in seconds and try to beat it constantly with tech. Things like that.
Final comparison: Musk does no such thing nor has anywhere near the level of focus on the bottom line performance numbers as Bezos did. Apologists for him will just say he hires people for that and blame those people but that’s never the correct answer for a true leader.
Bezos drove a 15 year old Honda for even more years after Amazon was profitable and loaded with cash, because it started and got him where he needed to go without any fuss. Only his “image” people finally made him buy a new car.
In contrast, Musk is all about image and sizzle and the meat is always undercooked. He just picks more “exciting” projects to the masses.
Nobody thought Bezos working off of a desk he made out of a few pine 2x4s and and old door, obsessing over the hard numbers of online retail sales, was going anywhere. Certainly nobody thought he would kill all the other booksellers except B&N doing it. That kind of obsession and passion about details is BORING to those who don’t know business.
I think it’s also boring to Musk. He wants to play “public visionary” and if the company fails? Oh well. It was the team I hired. They couldn’t figure it out.
As the video points out the current CEO is in “production hell” at Tesla and has even said so in public. In all the manufacturing companies I’ve worked at, those words would be avoided by the execs because the market repercussions would be massive. But if you pretend you’re making something revolutionary, you get away with it for a while.
The video pointed this pattern out:
Make one car, and announce the first one won’t be profitable. The second one will make a profit.
Make second car, no profit, announce the third one will make a profit.
Make third car, no profit, announce the fourth, and fifth ones will make a profit. (Isn’t that literally doubling down on your own BS?)
But now you’re not capitalized enough to even start building the plant to build them in, so you’re absolutely guaranteed not to hit the announced sales date.
And people are still buying that story. It’s on round four. A realist would say, “that doesn’t look good at all”.
But a realist never met the crowd of believers in the myth. The myth being that “the future of cars is electric”. Why? Hybrid tech makes much more sense. Orders of magnitude more sense.
Take the best of any one particular tech and add it to tech that’s already a known quantity, and each piece does what that component does best.
Why limit the engineers at all? If this is about “vision” why force electric only with all the major problems it brings? It’s not solving any particular problem, and where it does, it’s creating multiple more problems. That’s not a solution, that’s an interim tech mess.
