The LA Times puts a name to Tesla’s previously reported pain: “Tesla Chairman and Chief Executive Elon Musk said Friday that Tesla would cut as many as 87 staff and full-time contract workers, or 24% of the 363-person total. The company also will attempt to raise $25 million, rather than the $100 million it had been seeking.” Displaying the talent for fostering corporate culture for which Musk is becoming famous, Musk said only some of the firings were related to the previously blamed economic downturn/downsizing. “Although some reductions were related to the decision to delay the Model S sedan, Musk said many were based on job performance… ‘There needs to be an excellence throughout the organization,’ said Musk, the co-founder of PayPal Inc., who also heads SpaceX, a rocket company in Hawthorne. ‘Somebody who is a good employee at a typical organization wouldn’t cut it at Tesla.'” That’s crazy talk, as in megalomaniacal meltdown. “Musk added that Tesla would model its hiring process on the stringent approaches used by companies such as Google Inc. and Apple Inc. Musk said he would personally interview all finalists for jobs.” $100 to any of the Best and Brightest who can secure and report on a little job-related face time with the man.
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I really wish they would go public already so I can short them
I bet there are lot of ex-Tesla employees and waiting list customers that would like to personally tell Musk where to put his little rocket.
If a manager requires such top quality employees I guess he has to compensate for something else missing on his part. If other managers can do just fine with their “good” employees, then a smarter manager should do at least the same.
Musk sounds like he’s out of his mind.
The people that he’s after simply won’t work for him. Employee’s with that level of “excellence” will simply choose to work for an employer that gives them much better job security.
I have worked for some world class technology megalomaniacs, and Musk sounds like the worst of his kind. One famous guy I worked for is a real P****, but at least he is right more often than he is wrong and the company he built has survived in a tough business for over two decades now.
Musk, on the other hand, got lucky once. Getting lucky is good, but it doesn’t mean you are good.
Launching an auto company is one of the most difficult challenges around. Look at DeLorean: He had all the right credentials yet he not only failed miserably but lost his credibility along the way.
Musk seems to suffer from the same naive arrogance of Henry Kaiser, who insisted that it would take an outsider to show the auto industry how things should be done. Kaiser then proceeded to make a truckload of really basic mistakes that quickly destroyed his grand dreams. Many of those mistakes were avoidable because Kaiser had partnered with veteran auto exec Joseph Frazer. Alas, Kaiser’s ego was too big to listen to Frazer at crucial moments.
I give Tesla credit for one thing: Farming out the production of its first vehicle to Lotus vastly reduced the cost and complexity of start up. By the same token, perhaps Tesla’s biggest failure to date has been attempting to launch the Model S well before the company had worked out the bugs in the design, production and distribution of the Lotus-based roadster. Even if the financial markets hadn’t collapsed I’m skeptical whether Tesla could have pulled off the Model S anytime soon.
Musk sounds like he desperately needs to bring in some auto industry professionals — and leave them alone. Alas, it may be too late to do so.
Musk sounds like he desperately needs to bring in some auto industry professionals — and leave them alone. Alas, it may be too late to do so.
One reason for opening their facility in Rochester Hills was that the sedan project needed many more experienced automotive engineers than the roadster, which as you pointed out was mostly jobbed out to Lotus.
Now, however, they are shuttering their Detroit area engineering shop.
One problem with “auto industry professionals” is that, for the most part, the domestic auto companies have been run by bean counters, not engineers and car guys. Many of those auto industry professionals are responsible for the missteps that have led to the collapse of the Big 3.
Thanks for revising the title from the perplexing “Death Watch 28: Musk Fire 87, Downsizes Cash Raise”. But I thought this story was #28: https://www.thetruthaboutcars.com/tesla-death-watch-28-tesla-lost-40k-per-roadster-reveals-whiteelephants-rump/
What’s harder, a car company or a rocket company? No matter what you say about the man, he certainly is ambitious.
Bozoer Rebbe: Sure, Detroit talent hasn’t exactly set the world on fire lately. But it isn’t like Tesla is trying to buy Chrysler — all they need are a few good people. And they don’t need to hire from the domestics.
Particularly during the start-up phase of an auto company it is important to get the cultural mix right between managers, bean counters, engineers, marketeers, etc. I don’t have an insider’s knowledge of Tesla, but it seems from afar that they may be weakest right now in basic corporate management. Like when you shut down your Michigan office do it with humanity . . . and good p.r. skills.
Musk needs to find someone he trusts who can take over the day-to-day management of the company. If he fails to do so I suspect that Tesla is a goner. (Well, it might be anyway.)
That much hubris signals desperation. The only real difference between Google, Apple and Tesla is profit (and tangible products and achievable metrics and vision focused leadership and usable technology and products to sell and customer responsiveness, and doing what you’ll say you’ll do, etc.)
Tesla’s only real hope was the cash infusion an IPO would have provided them. Musk’s job was exactly that: pump the company for an eventual public offering. You could see it in how the pieces were being moved: getting the product out to key, visible people, have a plan (however nebuluous) for future growth, be the hot name on everyone’s lips.
And then the economy cratered. Credit dried up and, suddenly, discretionary toys like Tesla’s product don’t look so appealing customers, and Tesla’s stock looks less than appealing to potential investors. Six or eight months ago there was a chance. Now, they’re a dead company walking.
And now, the original investors are circling, there’s no product, and the media façade is cracking. And Musk in panicking. Very soon, you’ll see anxious investors putting the screws to Tesla, and whatever assets there are will be “maximized” out the door.
You could argue this started under Eberhard’s reign, and is a result of Tesla’s early tendencies as an engineer’s plaything and the resulting inability to focus on the final product. Musk was supposed to enforce some discipline on Tesla, but I think he got rather too caught up in his own glowing media treatment, becoming part of the problem.
So how did that work out?
Tesla was founded on a flawed premise, that premise being:
“With a quick and easy mash-up of existing technologies we can bring compelling automobiles to market. The only reason the existing auto companies aren’t getting the job done is that they are dinosaurs unable and unwilling to dance as fast as we brilliant Silicon Valley Masters are able to.”
LOL, Flawed? They seem to be doing well 10 years later.
“There needs to be an excellence throughout the organization,” except when it comes to me and my loyal non-performers at the top who say yes to my every whim. I can be a non-leader with no experience who can’t spell quality, see no need for verification testing, and have no metrics to manage by; but people will separate with their money in perpetuity due to my uncanny ability to keep their attention away from the man behind the curtain called Mr. Business case. No one in the valley knows we really had a 4X budget overrun on the Roadster and can’t fund the Whitestar. Gosh, I’m so awesome. Smart money, come rock the world with me as we fail to deliver but collect magazine covers for our mantle. We will pity the fools who lose their deposits as we console them with the phrase “If it weren’t for that untimely credit crunch…” How convenient for the excellent few, but excellent at what?
In fact, Elon and his company are sounding more and more like John DeLorean. Here is an amazing quote found on Google when searching “Why did Delorean fail”:
“If he wanted to, he could turn on the charm offensive, but at other times he could be very abrasive and unpleasant.”
Dick Mulholland, a former worker at DeLorean’s factory in Dunmurry, said he inspired the workforce when he first brought the company to the province.
“He was a guy who brought a dream, we all lived that dream, we all felt part of that dream, it was our dream,” he said.
“But when you found out what had really gone on, you had to say to yourself that a lot of the blame (for the company’s failure) must lie with John DeLorean.”
History repeats itself…
Not so easy to make that perfect electric car the greenheads are always harping on about, is it?
I’ve read about a dozen articles in the last few years about supposedly viable electric car designs. The common thread in all those (completely untenable) proposals are “cheap, efficient, safe, and could be built tomorrow from fairy dust and elf droppings!”. They were never featured in mainstream automotive periodicals, usually lifestyle or pop culture rags that didn’t know the first thing about auto design and fell head over heels for some bright eyed borderline scammer (who must have been credible because he wanted to save the planet, as intelligent people know all things green are 1000% selfless service to the good of humanity without any thought of financial gain, ahem). I think Musk read a few too many of those articles and began to take them seriously.
The fact he runs PayPal is enough to make me spew bile and vitriol. I hate that company with an almighty passion.
‘Somebody who is a good employee at a typical organization wouldn’t cut it at Tesla.’
Maybe Elon should start at the top, then?
Tesla’s offering was a no-show from the start, as it just didn’t compute. Looked good on paper.
As JEC writes above, the perfect electric car remains a rare thing. The other day, management at THINK was asked to make room for some professionals, as the investors and about 500 “here’s my deposit” were getting impatient.
Too bad it’s so often the wrong people who have the right idea. :-)
So, all those people who put money down on one of these things years ago, do they get that back with interest now? I have a feeling some of them would rather have their $50k then a ticket stub for this vaporware toy that might never come.
The sad thing is that when Tesla inevitably goes under and fades into obscurity, most people will lovingly don the rose-tinted lenses and talk about what could have been, how the oil-mad economy killed the perfect electric car, how poor Musk was trying to save the world, etc etc.