Comment by guywithahat
2 days ago
The business is doing fine, they’re profitable and regularly beating various targets. Honestly I think Elon is more level headed than people give him credit for, his companies are consistently profitable and generally produce competitive products.
Operating margin fell from 16% to ~2% over the last 10 years and will probably be negative in 2026 and 2027. They have a big cash pile to burn through but they’re spending it on ummm “a flying car,” humanoid robots, and an AI fab. They’re fucked.
Similar, to the time Tesla was fucked, because they wanted to sell EVs when there was neither demand nor charging infra. Or when SpaceX wanted to build a rocket that could land on legs, whereas every wannabe rocket scientists knew that to be impossible.
Or similar to the time Cybertruck was a giant success, FSD was ready in 2022, and Falcon 1 would launch 600kg for $7 million.
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I'd be very surprised if the roadster project was particularly expensive. That operating margin tells you they are spending all the cash they are earning on cars on the other stuff, not that the cars suddenly became more expensive to make.
I'm interested to meet someone online who's short both on-shore US silicon fabs and the market for humanoid robots. Can you say more about your thinking?
I'm short on an allegedly successful automotive company that has a rapidly deteriorating automotive business (due entirely to management's own decision-making) pivoting into the most hyped business ideas in the world. I'm bearish on the type of creative accounting and self-dealing we see between the Musk companies.
Musk is similar to Zuck in that they get some credit for sheer courage to turn the wheel on their massive businesses, but they also have to be right. Aside from his anticompetitive behavior, Zuck continues to miss. Musk's pattern has been that the more Musk is personally involved, the worse the outcomes. Cybertruck was his baby. Optimus is his baby.
If Tesla is doing so well as an automotive business, then why doesn't he just continue making it a great automotive business?
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If anything his companies are doing well despite of him, not because of him. There's level-headed and competent leadership in them resisting his bullshit.
The counterpoint of course is that he has demonstrated a consistent ability to build and run successful businesses, many of which are extremely high risk
The only new western car company in decades to not fail, based on a technology nobody believed in at the time, least of all other car companies
SpaceX being a private space company, which was completely unheard of. No experts though they could succeed
Smaller earlier businesses like Zip2, paypal, etc
These are gigantic high risk companies with high failure probabilities, the chance they they all happened to be successful despite Musk and not at least in part because of him is stretching reasonable doubt for me.
I'm absolutely no fan of his politics or personality, but the man can run a business that nobody else even dares try (at least until he demonstrates viability and the market starts to generate competitors)
> The counterpoint of course is that he has demonstrated a consistent ability to build and run successful businesses, many of which are extremely high risk
Three sucesses.
Not so successful: Solar City, Neuralink, TBC, X.
(X exists, but before it was valued-and-bought by one of Musk's other companies, it appeared to have lost about half its value).
Richard Branson he aint.
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paypal succeeded _despite_ musk and required a boardroom coup to remove him from leadership because he was about to tank the company. if he had is way nobody would remember paypal besides a couple people with merch for a long defunct company.
I'd still restrict this to an ability to pursue ideas that others find too risky with relentless persistence and a laser focus. He is able to get something off the ground and make others believe in it, but not good at actually running a stable business. And that's fine, mind you, I absolutely respect what has built. But the person who is responsible for turning SpaceX from an incredibly risky bet into a profit machine is Gwynne Shotwell, not Elon Musk.
Rivian, Polestar, Slate etc. Would like a word.
Of course it’s still early days for all these companies and they’re not exactly fiscally solid, but if Tesla had not made all those cars, someone else would have.
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