Elon Musk $41B offer for Twitter

I think this from TroyTeslike is probably indicative of the problem. Musk has taken his eye off the ball at Tesla and it has grown a bit fat. That's fine when they have 50% CAGR but not so good with flat-lining sales.

Plus they are committed to spend $10bn this year on AI (solving FSD) so underlying margin will be squeezed. Musk will need to show good cost control for the Q2 earnings call.

Having said that, there is a lack of compassion and a brutality to the layoffs, which I personally dislike and wouldn't do, even if it cost me money.

The sales problem needs interest rates to start coming down, the new battery factory to come online (so Model 3 gets the US tax credit) and cheaper models to continue adoption rates. Then there is the curved ball on whether they 'solve' FSD. If not, share price will get battered. If they can show continued improvement in edge cases and interventions, the share price growth could be astronomical (we saw a hint of that yesterday with FSD getting past the first milestone for being 'approved' in China).



https://twitter.com/TroyTeslike/status/17853193478...

I know what you mean. I suppose Musk would argue this is just his compensation plan from 2018 which he is trying to obtain. Also, I don't think it would save any cash - I believe Musk's compensation plan is 'paid' by just creating more shares. So it is existing shareholders who get diluted, rather than it being a cash expenditure.

Actually no - well about the Supercharging team that is. It came up on my Twitter feed the other day, but was confirmed today (but I cant find the tweet). The rumor was yesterday and the head of the Supercharger team posted to the world that he was being let go as well as his entire team! Yikes. Not just cutting back, but killing the whole team. WTF. Why would you do that? This isnt just a couple of senior leaders, this is the whole team responsible for the development, standardization and future of the Supercharger network. Its certainly great news for everyone else, who will no doubt snap them up for their own projects.

Oh, and they also laid off their entire marketing team. 50 people dropped who were recently recruited to build a better brand and awareness for the products. And the typical response was that "Musk didnt think they needed any marketing".

I may be incorrect here, but wasnt it a commitment to spend this over time? I could be wrong of course. What do not know is how this maps with the Dojo supercomputer systems. They have been at this a few times already and spent a lot of money so far.

Yeah, its brutal. I get it, US companies can cut on a whim, but there are some protections in place. Tesla moved to Texas which has fewer protections than California, but in general it can be a nasty experience. However, Tesla seems to be taking it to a new level. The big layoff was communicated with a days notice and then they screwed up the severance pay too - seems to be a common tactic from Musk as he did the same at Twitter before. People just discovered that they no longer had access to systems and that was it.

I, thankfully, havent been laid off here, but I have worked for companies who have had layoffs. All of them have not treated their employees this way. As a manager I had to layoff a few people in my team and I was coached, guided and supported by HR through the whole process. We even setup various systems and services in advance for the individuals impacted. Its not a nice experience, but as an employer you have a duty to at least make it slightly softer for the employee. Tesla (and Twitter) just crash through these things and hope that no one sues them - which hasnt gone well for them in the past.

Musk wants to save humanity (in his words), but he's doing a damn good job of screwing up a load of people on the way. Though, he's a billionaire doing billionaire things.

There is an opportunity there for sure. License various parts of their technology for example. Or provide engineering assistance to others through a consultancy. I dont know, I dont run a business.... But yes, there is an opportunity. But i do think that Tesla as a share is still massively overpriced. This does need to be corrected at some point and I believe that 2024 is the year that this will happen. Will it get a massive cut? I dont think so, but the heady heights of $350 a share are long gone I think.

However, the have a bigger problem - new models. The Model 3 was introduced in 2017 (thats a 7 year old model and only just had some small changes). The Model Y was introduced in 2020 (so 4 years old and it isnt getting the updates that the 3 just had - weird!). And it seems that the X and S have been dropped effectively. High price models bring high profit margins, so why just do nothing? And with no replacements or updates on the X and S illustrate this - and the slowing sales for them too.

They need some big updates and new models. Who knows what is happening with the new low priced Tesla (Musk says its happening, but with the layoffs and the heads of engineering and new vehicles being let go, its not clear what is happening). Actually, that leads to a bigger question - Musk said end of 2024 or start of 2025 for the new model, and robotaxi in August this year - yet there has been no involvement with their supply chain. No building out new production lines (or changing exiting ones) and no planning for a new product. It takes around 6-8 months to just get the production line setup and operating, assuming you have everything engineered. Meh, what do I know, Musk knows more about manufacturing than anyone else on the planet.....

I am very sure the fact the US forced Elon to open up the supercharger network to all is linked to Elon dropping the team.

The supercharger network was a big differentiator for Tesla. At one time it looked like Elon was building Tesla so he could own/control charging in the US. With every Tom, Dick, and Ford being able to use them they stopped having value.

I know it is not that simple because Tesla are not playing entirely nice with opening up their network but I think Elon has a simple view and cut the workforce.

Tesla wanted those sweet sweet Federal dollars.....

There was a standard available for Tesla to use when they launched the S, but it didnt have the capability to negotiate charging rates and identify the vehicle (all essential for a trouble-free charging experience, something that Tesla got right and built upon). For a while, Tesla claimed that it couldnt use anything other than their connector, but then were forced to provide J1772 connectors in Europe.... mmmm weird one.

However, Tesla still continued to build out their Supercharger network and improve coverage, which is still excellent. I would point out that the social media pictures of the queue to use a Supercharger location in the past were specific scenarios and while it makes a good post, doesnt reflect 95% of the charging experience. All good.

But, the Biden administration wants to continue to push a shift to EV's. But other manufacturers were on the game too, so argued that the new program should be simpler and easier to obtain (up to $7500 and you get the discount at purchase time, not in your tax return). All good, but it had to have provisions for US built cars, including the battery etc. VW is a good example where they built out a complete production line and batteries in the US. Tesla wanted a seat at the table but wouldnt play ball, to were pushed to open up their network - again, after they opened it up in Europe when they came under pressure there. Claimed it wasnt possible, but of course it is....

They wanted those Federal incentives and it meant they had to play ball.

As for the charging experience now - its mixed. Some locations can be a lot busier due to other manufacturers using the Superchargers, but its limited to certain sites. Also, Supercharging for non Tesla's is expensive and based on demand. So expect to pay double than a Tesla owner does, and even more if its busy.

Is there no value in the Supercharger network now anyone can use it? Absolutely not. Tesla still have a massive advantage in the seamless behavior, efficiency in charging and cheaper prices. The convenience cannot be overlooked and its still a benefit that most buyers of Tesla see and understand. Rivian and Ford can now use the network, but only through adaptors But the manufacturers here are switching to the Tesla plugs because its a better system - so a win for Tesla anyway!

Again I still think that getting rid of their Supercharger team is dumb. Maybe Musk has a simple view and thinks that there is nothing in it, but that is a short sighted view. I saw a comment on social media about this and it was weird. They compared it with Starlink and what happened there. The deployment of the satellites was slowing and the team responsible for this was being realistic. So Musk fired the lot and gave the responsibility to other people who made it happen in a short timeframe. I guess you can call that a win, but you cant just cycle through people like this! But then again, he doesnt care about anyone, just himself so I guess this is normal behavior.

The problem with this approach is that it opens up the opportunity to do the wrong thing. Placing people under such pressure and scrutiny means mistakes are made and corners are cust - just to please the notoriously thin-skinned narcissist who has the attention span of a gnat. This is when you end up with the list of issues with the Cybertruck. Cut corners, do it faster and cheaper and hope that you caught everything. That is certainly not what I want to hear in a 3 tonne truck!

There is more to it politically of course. Biden has good support from the unions, including the auto unions. All of the other manufacturers, especially the US ones, are union shops. Tesla is infamously anti-union and has been pulled up multiple times for this.

On top of this the big three want to ensure their survival so put pressure on Biden for this. Unions supported the manufacturers and you have a perfect storm - if Tesla wants a seat at the table to discuss the future of EV's and how the Federal government can help, well.....

Free step up for the others and political support going forward. Of course thats an oversimplification, but yes, the decision to open up the Supercharging network was a push. I am all for the free market, but sometimes the government needs to step in, though this is a borderline one for me. Over reach and controlling behavior from the Federal government? The EV market here in the US is still 6.5% or so. The other manufacturers dominate the market, yet felt they needed to influence things to get this? Mmmm, I can be anti-Musk most of the time, but on this one I might have to concede that it wasnt his or Tesla's fault.

The big complaint against EV's was the charging network not keeping up with EV ambition. Tesla had the technical advantage with this, especially at the start with the free charging plan, but again if they took Federal money, than it's easy to see they might be asked to open their network to allow more chargers for all users. Easy win for the Govt

Quite suporised here how many Instavolt 150Kw chargers are popping up now in retail parks etc.

They had the advantage also with the motors and battery tech, but not anymore. Then a lack of investment in updating the models, compared to how the new brands models are coming out, how many are now being offered, and then they really haven't address the build quality.

There's cheaper models with the same or better capabilities, features (if we exclude self drive), range. There's models from major manufacturers like Ford, with same range and better build quality backed by a large dealer network.

Cybertruck looks awful and has issues, the Testla truck isn't shipping? I think the S model still looks good, but thats more 'normal' looking, the other models look like they need an update to keep up with the competition but doesn't look like there's money to do that?

It used to be a Testla was a no brainer, accept the build quality flaws and they were great solutions, but theres so many alternatives now.

Why would anyone need to reverse engineer someone else's electric motor? They are fundamentally simple and efficient. You would simply buy or build a motor that suits your needs.

Regardless of how good you think his tech may be...

Regardless of what advances you may or may not think he had achieved...

Regardless of whether you believe his claims regarding new products and timelines to market...

I don't know how you can support the man who operates like this.

https://www.marketwatch.com/story/my-boss-didnt-ev...

The man who fires people overnight by e-mail to 'save' his company and at the same time demand a $45 BILLION pay out.

How can ANYONE think he is someone to be respected and admired?

Even if he gave the required 60 days, does it make it any better?

Not in my eyes?

Even if the average salary of those 14,000 Tesla employees was $100,000P/A, he's saving the company $1.4billion a year but at the same time wanting to take 30 times that out of the company in one chunk to give himself money he doesn't even need.