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Comment by mephitix | Hacker News Reader

I was on this call. It was extremely cringey/embarrassing to hear Elon dismiss valid questions.

At the same time, it was fantastic to see a young, smart, retail investor (Gali from Hyperchange) get to ask so many questions directly to the leadership team. I thought before the call that Gali would get to ask only one question, like the other analysts. He was able to ask almost 10!

It was surreal. I was left feeling that the team overall did a great thing by allowing Gali but wished that Elon didn’t insult the institutional investors by (at least so harshly) dismissing valid questions.

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A little more context from the WSJ article (https://www.wsj.com/articles/teslas-elon-musk-turns-conferen...)

>“We’re going to go to YouTube, sorry. These questions are so dry. They’re killing me.” He directed the operator to take questions from Tesla investor Galileo Russell, whose HyperChange TV YouTube channel features a video titled, “Why I Bought Tesla Today at $255/Share.”

>Mr. Russell, who had campaigned to get on the call usually reserved for analysts, got more than 20 minutes from Mr. Musk. The first of his dozen or so questions: When will Tesla launch its own network of driverless cars?

>“Thank you for an interesting question,” Mr. Musk replied.

It's especially cringey because if Musk was honest about that interesting question he would say he has no idea and should really be focusing on ramping up production. Instead it's a softball question that lets Musk proselytize on the radical world changing work that Tesla is doing...

In the grand scheme of things figuring out how to make model3's faster than they can sell them is a boring problem for Musk and I could imagine how frustrating it must be to have all the banks freaking out as if they're going to miss a fleeting opportunity to sell a bunch of cars. It's like when Nikola Tesla was trying to build worldwide wireless telegraphy but J.P. Morgan just wanted him to make fluorescent lights. Hopefully things go better for Elon than they did for Nikola.

It may be a "boring" problem, but people aren't just paying for a reservation for nothing, ultimately they are expecting a car. And if there's no indication that they can meet the promises, that's a problem and he shouldn't be promising or giving wild production estimates in the first place.

Unless you believe that Musk is selling the ability for people to say they have a reservation. In which case there's no point to even bother building the cars in the first place.

but thousands of model3's are being produced and delivered every week. at this point it's just a matter of time for reservations to be filled and velocity will ramp up naturally as they improve their process. the investors panicking because velocity isn't doubled yesterday doesn't seem like long term thinking.

...that’s not what investors are panicking over? You know that right?

The investors are panicking because Elon didn’t answer two pointless questions.

Perhaps they need to ask better questions next time?

You can't focus on the long term at the expense of the short term if in between you're bankrupt.

This is a lot like the fallicious thinking surrounding poor people and why they so often remain in such shitty circumstances.

If they could afford long term planning and investment, by definition they wouldnt be poor.

For all that Musk is credited with versus what he actually invented he is not Tesla, he's Edison with worse business sense.

He’s building things other places won’t touch because of the economics

Everyone wants to sit and cross t’s and dot i’s because they are trained those matter more than net new

If those are the only conversations you have, only doing things you’re sure will be comfortable the economy and society stagnate

Economics are not the law of the land or reality. They’re a control mechanism for our output as a thinking, feeling, creative species

Let’s just make more banal phone apps I guess. The ones where the economics are well known to keep us safe

See stories about kids not playing outside or being allowed a quasi dangerous chemistry set

No one wants to be wrong so we take the safe route, which protects the status quo we all bitch about

Literally every industry he's involved in has competitors several of which pre-date his entrance in each.

And yet none of them are landing autonomous reusable rocket modules

Of all the 100% electric cars on road, he has two in the top 5

Who else has been pushing battery storage and solar systems that aren’t ugly af and simply made of old parts glued together in parallel?

All these other experts with experience can’t seem to hang with Johnny come lately.

Humans don’t have a history of being petty over others not being the same as them, or worse, outperforming them. We’d never cherry pick facts, and ignore the whole story. Why that would make us no better than animals

>>And yet none of them are landing autonomous reusable rocket modules

I watched Armadillo do that in 2005

>Of all the 100% electric cars on road, he has two in the top 5

And neither invented the category nor managed to turn a profit on it

>Who else has been pushing battery storage and solar systems that aren’t ugly af and simply made of old parts glued together in parallel?

For batteries: Panasonic, LG but also literally every battery company and chemistry department in the world.

For solar panels: also every chemistry department and dozens of companies, "China" as a vague term.

And these other experts: they're making money instead of losing it.

But even then this whole post buys into the idea that I some how have to disprove that Elon Musk does these things. He doesn't. Companies that Elon Musk is CEO of do those things.

When people are talking about SpaceX’s accomplishments, you can assume an implied “* from orbit”

I guarantee you John Carmack would not say he did anything close to what Musk did.

Yeah but they 'didn't do anything close' to what SpaceX (not Musk) did, 12.5 years ago. That nobody bothered to do it in the (presumably) 20 years that it was viable is probably an indication that while aesthetically cool it's probably not all that economically practical.

i suspect the space industrial complex had built up a great deal of inefficiency, creating an economically practical exploitable opportunity for anyone with the gumption to face down the status quo. Heck, the heat shield on the dragon capsule is in the NASA database, practically free tech invented and tested in the 70's and dismissed by possibly dozens of programs except for a tiny few. SpaceX did a little appropriate tweaking and made it commercially viable and probably more suitable than everything else, despite industry groupthink...

> In the grand scheme of things figuring out how to make model3's faster than they can sell them is a boring problem for Musk

It's the gateway problem to any of the ones he might find more interesting, and if he isn't willing to engage with that problem enough to satisfy investors, he should be “Chief Ivory Tower Visionary” and let someone else be CEO. Or, at least, get a COO and gracefully hand off boring operational questions to them.

The CEO role is Chief Ivory Tower Visionary. As CEO, your #1 job is to set the vision and strategy for the company, and your #2 is to get the right people on the bus and the wrong people off, which is dramatically easier with a strong vision.

He does desperately need a good COO though to make sure Tesla can actually deliver on its promises.

> The CEO role is Chief Ivory Tower Visionary.

No, the CEO role is turning abstract vision into concrete strategy and communicating that strategy especially to investoes, because money people always want to hear things from the horse's mouth. It's a good thing for the CEO to be the visionary rather than channel someone else's vision, if they can do the rest of the job, but they can't be stuck in an ivory tower and think that addressing the path from present reality to distant vision is beneath their dignity.

Is it really ideal doing things this way ? Or is it just part of an ego trip, and deciding on such complex things as vision an strategy for a company are better done in a collaborative fashion, maybe with the CEO as the final arbitrer ?

And how much of that image of a all knowing visionary CEO is just a manufactured image ?

It's pretty difficult to generate a coherent vision by committee - you usually end up with something that nobody finds compelling, not even the people who collaborated on it.

And of course the image of an all-knowing visionary CEO is a manufactured image! It's not like people can actually predict the future. Rather, it's selection bias at work. Those CEOs whose vision doesn't resonate end up getting replaced, or their company goes bankrupt, and then they get written out of the history books. The thing is, you need to have a vision to get people excited and actually rowing in the same direction (nevermind the right direction), so without that you're dead in the water anyway.

Sure visions aren't usually created by committee. But aren't visions usually starting very raw, and not really that valuable or unique("let's build a computer for every pocket") - and to get to a coherent and unique vision, you need some research and exploration, which is usually a team effort ?

No argument there (and I think that the success of Musk's companies is largely because of the faceless engineers he hires that toil away to make it a reality).

My point is that left to their own devices, most of those engineers would rather toil away on their own startups or hobby projects, and that convincing them to all work on a tiny piece of a big project requires someone who's both charismatic and has a finger on the pulse of what problems can excite people. Musk has been uniquely successful in aligning people to work on big, hairy, audacious goals.

Lol, my old startup had a great Ivory tower CEO. We ran out of runway after he continually chased any shiny ball that the wind brought him. No monetary plans, no concept of what a usable product could be, just lots and lots of vision, and vague descriptions of implementations to the team.

That doesn't disqualify your statement, but it does highlight that - if that is correct, a COO is needed to put some sanity on the Ivory goals.

Then again, I was working for a startup. I guess that was a success (~25M funding before fizzling), as far as startups are concerned.. lol.

Whether a problem is interesting is orthogonal to whether its important. This is an earnings call and scaling up production is actually an important issue to address for the company's long-term viability.

The question wasn’t about scaling up production. It was a very specific question about trees when Tesla doesn’t really know what the forest looks like yet.

If you're in the lumber business and giving estimates on how much wood you're going to deliver per month, then not knowing what the forest looks like might be considered something of an existential problem.

I get that Musk really enjoys thinking big and changing the world, and to such a person questions about capital expenditures might be dry and boring, but they're still important and need to be answered. If he doesn't want to do it then he should delegate.

"Sacconaghi pressed ahead with another query about Tesla lowering its 2018 capital expenditure projection to $3 billion, from $3.4 billion. Ahuja said the carmaker would spend less by simplifying its approach to automation and curtailing infrastructure outlays.

'And so where specifically will you be in terms of capital requirements?' Sacconaghi said.

'Excuse me. Next. Next,' Musk said to the call operator. 'Boring, bonehead questions are not cool. Next?'"

https://www.bloomberg.com/news/articles/2018-05-03/elon-musk...

To be fair, he's not entirely wrong. I guess people just don't expect this type of response. But then, acting within the confines of normality isn't really the trait that may bring the dawn of a new era of humanity.

Interestingly though, markets are reaction to this response emotionally.

But then, acting within the confines of normality isn't really the trait that may bring the dawn of a new era of humanity.

Truly, this sounds divorced from the reality of anything Elon Musk is involved in. He’s making electric cars, rockets, and solar panels, not fusion power or immortality pills. Let’s be realistic! I think it’s important to separate what he actually does from what you desperately hope he may someday do.

If colonizing a new planet isn't a new era of humanity, I'm not sure what is...

He hasn't colonised a new planet, and frankly my wager is that he never will.

>If colonizing a new planet isn't a new era of humanity, I'm not sure what is...

Do you credit Musk with coming up with the idea of getting to Mars?

He's never going to colonize mars. It's not possible with out current level of technology.

He might kill a bunch of people trying.

Tesla isn't doing that though.

> markets are reaction to this response emotionally

I don't think so. The material takeaway is Tesla will need to raise new capital in 2018. The numbers implied it. The market previously guessed Musk had some genius plan to avoid it. On this call, the lack of such a plan became evident. Dilution and/or increased default risks/interest costs are being priced in.

Er, why is asking for something fundamental to running a business (i.e. "How much money do you have/need?") a partly boring/boneheaded/uncool question?

Because he's Elon Musk and he doesn't care about investor returns, he wants to build rockets, cars, tunnels, and explore space.

No matter what he does he'll more than likely be fine on the money side.

> he's Elon Musk and he doesn't care about investor returns

Then he shouldn't be the CEO of a public company which continues to sell stock and debt to investors on the promise of a return.

Also, Elon Musk very much does care about returns. He has a great track record in that department. He's just learned it's not something that's healthy to focus on in the short-term. Unfortunately, running out of cash forces the compression of time horizons. The latter is what investors are rightfully worried about.

Was he not CEO when Tesla went public in 2010?

Guy has been instrumental in a couple hundred billion $$ in market value and you’re suggesting he doesn’t care about investor returns? Wow.

I'm not sure I'm following you. Creating market value and returning money to the investors as an ROI are not the same things. An earnings call is an opportunity to tell shareholders when - and if - they can expect some of their money back by giving them a more complete picture about how the company is doing. It is part of the role of a CEO in a publicly traded company to continue to inspire investor confidence. Value creation is the easy part, value capture the hard part and without that second bit Tesla's stock will implode. So he will have to talk to those investors to address their worries or the stock value will drop rapidly.

A crazy high valuation is no guarantee that a company can not go bust at some point, though in Tesla's case if they run out of money all that will likely happen is that their next round will be one at a lower valuation and with a group of investors that cares less about the short term.

Elon made the decision to play on Wall Street, that decision comes with some responsibilities and it is downright strange to see him literally bite the hand that feeds him. Without the cash he picked up through the IPO Tesla would be in a completely different position. He's made a couple of boneheaded moves (such as rolling Solar City in with Tesla), which have so far been accepted because of the halo and the promises. But there is a limit to how far that will stretch and I'm confused why he would stretch that on purpose if he has other alternatives (such as simply answering the questions). If he doesn't have any answers, which is one way to interpret his refusal, then Tesla is already in trouble.

He doesn’t want to do those things. He wants people to give him billions of dollars on the promise to do those things. Musk survives on putting in a minimal ammount of effort and having a great marketing team. The guy is a fraud.

Ha. Pretty weak attach. The dude literally sleeps at work at times, and his companies have produced things that have never been done before. Stuff that you can't really do as a weekend warrior, like rockets and the fastest/longest range EVs that people wait in line to buy

Please don't do personal attacks here. It damages the community, regardless of what you think about Musk.

https://news.ycombinator.com/newsguidelines.html

Then he should be fired because he doesn't care about his job.

I am so sick of the cult of Elon. There is no defending his behaviour here.

You've been downvoted but I don't know why. It's clearly true. He wants the power that comes with CEO, but not the levelheadedness to run what is now a large company making large promises.

What he's done is remarkable. But he should step down, assign himself a founder/chief scientist title, and move forward with "fixing" his company. No fear of ejection; I suspect he's a major shareholder.

Been running it fine for 10 years. Does sound boring.

But time is a factor, especially in relation to milestones. I think everyone would agree that Tesla's Autopilot and full-self-driving aspirations were going extremely well in 2016 [0], and we can safely assume that progress is still being made into 2018. The more relevant part, though, is the amount of progress relative to Tesla's earlier assumptions [1], and of course, compared to its competitors' progress.

[0] https://twitter.com/elonmusk/status/799908000689336320

[1] https://twitter.com/elonmusk/status/823727035088416768?lang=...

Tesla barely talks about self-driving any more. Their no-LIDAR approach didn't work.

Has he? They still deliver less cars than Henry Ford did in the 1930s.

That's interesting. In 2017 Trek manufactured more than 350 different models of bicyle[0].

I'm not sure how that reflects on Tesla. Tesla is not manufacturing bicycles. Nor are they manufacturing Model As in the 1930s automobile market.

[0] https://archive.trekbikes.com/us/en/2017

Why should Tesla not be compared to historical parallels?

As I wrote, I think that the comparison is interesting.

I'm just not sure how applicable the comparison is. I think you could compare 1930s Ford vs contemporary automakers to 2018 Tesla vs contemporary EV makers. But comparing 1930s Ford vs horse and buggy to 2018 Tesla vs contemporary automakers seems less apt to me. I think the move from horse and buggy to automobile was very different than the move from ICE vehicles to EV vehicles.

I do think that Ford's early success is incredible. It is astonishing to me that Ford could be selling millions of cars a year in 1930. I'd be interested in other transitions involving such a large expense that happened so quickly. It is interesting to wonder what the equivalent would look like today. But I don't think it is exactly fair to label someone a disappointment if they don't measure up to 1930s Ford.

It's also worth noting that Ford Motor company was founded in 1903. They installed their first moving assembly line at the end if 1913. This is the innovation for which Henry Ford is most famous.

By the 1930s, Ford Motor had 30 years of experience. Between 1908 and 1924, Ford built 10 million Model Ts.[0]

I don't know if Tesla will build 10 million cars by 2024. I think that would be incredible if they did. Nor do I know if they will be manufacturing 2 million/year by 2030. If that happens, they will have matched Ford. They will have done it in a mature market, unlike Ford. They will have done it with modern manufacturing technology. They will have done it when owning a car is taken for granted. I'm still not sure how that comparison would reflect on Tesla.

A comparison with 1918 Ford vs 2018 Tesla seems more relevant than a comparison between 1930s Ford and 2018 Tesla. But it still doesn't seem like a very clean comparison.

[0] https://www.history.com/this-day-in-history/fords-assembly-l...

I'm not sure it's "fine" if you're posting record losses, still more than 50% under capacity to make a profit later in the year, and dealing with recent manufacturing problems so serious that you literally had to close the production lines down.

As I write this, TSLA is down about 6% on the day, and it's not as if sharp drops or a general downward trend are unusual over the past year. They're in real trouble, and this doesn't seem like a good time for Musk to let his ego out of its box.

>Er, why is asking for something fundamental to running a business (i.e. "How much money do you have/need?") a partly boring/boneheaded/uncool question?

Some people on HN think Musk is doing us all a favour by allowing us to participate in his projects. Evidence of this is the inevitable, "Elon should take the company private" that seems to surface in these threads. As if going public is a favour from Musk, as opposed to a way to raise capital.

The company is public and the CEO is accountable to the shareholders. Period. The hubris with this company is shocking.

Also, TSLA is basically the kind of company that couldn't even exist as a private company. Access to the broad capital and debt markets is the only reason they still exist.

Emotional responses on both sides then?

The emotion seems to have been mostly on Musk's end of the line.

> But then, acting within the confines of normality isn't really the trait that may bring the dawn of a new era of humanity.

Tesla is not bringing 'the dawn of a new era of humanity', it's an electric car manufacturer. They came and went and now they're back.

that may bring the dawn of a new era of humanity.

They make cars.

I'm not defending Elon's behavior here, but speaking more generally: if you're in a place where you need to maintain maximum productivity for a while, because a deadline has slipped for example, meetings can turn into a massive time sink if you don't act like a total nazi during them.

In so many meetings, people just want to hear themselves talk, whether to offer some opinion, reiterate some point, or ask some useless question. If your goal is, "end this meeting as quickly as possible so I can start fixing the things that need fixing", often the other people in the meeting become your careless adversaries.

edit: I regret trying to raise this point in a thread about Elon Musk. :-(

>meetings can turn into a massive time sink if you don't act like a total nazi during them.

Which would explain Elon ending the conference call. Instead he spent 15-20 minutes taking open-ended questions from a youtuber with a TSLA position of 56 shares.

>If your goal is, "end this meeting as quickly as possible so I can start fixing the things that need fixing"

For Elon the 'things that need fixing' are exactly what the investors he cut off were asking about. If he is so focused on fixing those things he should have been able to give easy answers. The dodge is illustrative of how well he's handling those problems.

As well it seems ridiculous that the CEO of a ~$50B company can't spare an hour or two every quarter to explain his own company. Even Elon Musk isn't that busy.

If those are actually the things he is working on then perhaps there is no answer to give?

How long is your piece of string?

Well this morning it was three metres but then we doubled it and it looks like that was too much so come back tomorrow and we will let you know.

Then perhaps Musk could be honest and state explicitly that there is no answer. Instead, he chose to respond in a fashion that has multiple interpretations:

- There is no answer

- Musk does not know the answer

- Musk does not want to admit he does not know the answer

- Musk does not want the answer to be known

see that you are not defending, but this is not a meeting. it is an investor conference call - most if not all of the entire point is to clearly and openly answer their questions about financials...

Yeah, it’s not like a weekly status update meeting. It’s a tad unprofessional IMO. As the CEO of a public company, you are accountable above all to your shareholders.

Are these shareholders he’s talking to, or investment bank analysts trying to get the CEO to fill in their spreadsheets for them? I guess I’d be a bad CEO but I don’t get why an “investor” call should be about the company showing respect, bowing down and kissing Wall Street’s ring.

There is a difference between asking straightforward financial questions from his shareholders with grace and tact and "bowing down and kissing Wall Street’s ring"

Yes his shareholders, you know the people that were specificly invited to this call, own the company and that he has to directly answer to, by law.

Instead musk decided to childishly deflect.

On this specific point, he refused to answer two questions from (Wall St) analysts, and instead got questions from a (retail) shareholder. That would seem to be the right priority, even though his attitude was wrong.

He spent 20 minutes answering softball questions from a youtuber instead.

> He spent 20 minutes answering softball questions from a youtuber instead.

Not just softballs... questions that have nothing to do with Tesla today or the near future... rather... questions about Elon's whimsical dreams of the far future and how Tesla might possibly play into that.

Questions about fully autonomous electric vehicle taxi fleets, etc... but he skipped all the questions about how he's going to get Tesla there or how to survive long enough to see that future.

Yeah, but a conference call with investors is not the kind of meeting you cut short. Maybe a weekly status meeting sure, but your quarterly call with people who if things go south, you'll have to rely on their largess to borrow money from? That's something you treat with care.

Borrow money isn't the right word. They're not creditors, they hold equity. They're the owners Musk is dismissing. The point of these calls is to make sure the executive officers are being held accountable to the owners of the company with thier money Elon is managing on their behalf. It was a PTA meeting and Elon Musk was being a petulant child who doesn't think he should have to do what his parents tell him.

There are plenty of people holding Tesla bonds that are also listening to this conference call intently too.

You know Elon doesn't actually like turn wrenches and connect wiring harnesses right? Talking on the phone with investors and making sure the company maintains creditworthiness is his actual core job.

Indeed.

It is obvious to anybody looking at the balance sheets of the company that TSLA will need to raise capital soon. Either late 2018 or maybe early 2019. A company with $3 Billion cash that's losing $1-billion per quarter will need more money. That's just the facts.

Musk is going to be either relying upon institutional investors / the stock market in general for another round of equity offerings, or relying upon banks for a loan. In either case, it seems like Musk just bit the hand that feeds his company money.

Another 300,000 reservations at $1000 per is probably not going to happen. There are fewer and fewer ways for TSLA to raise tons of money.

Linear approximations aren't really the best way to do time series predictions.

Better than Elon's exponential approximations: https://twitter.com/elonmusk/status/881757617416056832

I'm not necessarily saying "TSLA Will definitely run out of money in 3-quarters". I'm saying "TSLA is currently, on a linear-approximation track to run out of money in 3-quarters".

Obviously, the Model 3 rampup will improve profitability. But the Model 3 Ramp-up also requires more resources (more humans in the assembly line. More robots in the assembly line. etc. etc.). So that still requires money.

A linear approximation is basically a quick-but-shitty-approximation. Its really easy to calculate and full of flaws, but full of flaws in a way that almost everyone can immediately understand.

Exponential approximations (ie: Musk's approach) might be more realistic... since production lines can exponentially grow to some degree. But if you are off by even a little bit, then you end up being ... oh I dunno... 8-months to 10 months late with your 5000-cars per-week estimate.

Tesla plans on spending a lot less CapEx in the future compared to last quarter, so they won't burn through as much money.

Given that he was so cavalier here that has these noses bent out of shape, and that he was tweeting April fools jokes about being bankrupt, could it be that he is actually pretty confident in Tesla's credit worthiness and that capital raising will not be required? Seems like a pretty dumb bluff otherwise - particularly on April fools.

It's the second time in a short while that he shows he does not want to run the company like it is a public company. But he does want access to that capital. Those two don't mesh.

> It's the second time in a short while that he shows he does not want to run the company like it is a public company. But he does want access to that capital.

I think that Matt Levine (bloomberg) might suggest there's more & easier money to be had in the private market, anyway (see Uber, pre-IPO Spotify, etc...).

The problem for Musk, if he also shares that view, is that taking the company private seems (to me) like an impossibility at this point.

> Matt Levine (bloomberg) might suggest there's more & easier money to be had in the private market

That hypothesis is, at least so far, not sustained by the evidence of private-market darlings continuing to rise in the public markets.

I have no idea why anyone would ever downvote this, it’s a very non controversial statement. Being a public company is a double edged sword, it most definitely has downsides to go with the upsides. Depending on the company/industry/timeline/economy/etc., for some companies the downsides of being public can become a lodestone dragging them down (see Dell).

I think its too early to say Dell has been a posterboy for why going private makes sense, the company was saddled with massive amounts of debt due to the trasition, and are currently struggling to keep above water.

The situation has a lot in common with why leveraged buyouts almost always end in disaster, dispite the hype surrounding them when they are first annouced.

If Musk has a way to keep investors happy without spending time on these calls, he doesn't appear to have deployed it yet. If he doesn't think keeping investors happy is necessary or part of his job, well I guess we'll find out.

There's nothing to "defend". These articles are entirely misleading and absurd. What he said wasn't even noteworthy.

This is not a very frequent meeting. He is explaining to the public & investors why they should keep backing Tesla, and it happens only once a quarter. It's worth being thoughtful, given the tens of billions of dollars all the non-Elon shareholders have at stake.

I recall reading an interview with musk on wait but why (edit: https://waitbutwhy.com/2017/03/elon-musk-post-series.html ) where the interview mentioned researching musks intolerance for "boring" questions and even trolled him a bit.

Obviously the appropriateness is different, but this is not new behavior. Anyone trying to draw conclusions about the state of tesla from his behavior here is probably making mistakes (or at least using bad data) unless they thought the same BEFORE this call.

Letting one person ask 10 questions means less time for other investors to ask their own individual questions.

This is true, but retail investors don’t typically interact at this level. At the beginning of the call Elon said that they would let the earnings call run until they were out of questions. That clearly didn’t happen...

To be fair (edit: figuratively, to state a favorable viewpoint on Elon's decisiont to give more time to one person) he was asking excellent/interesting/challenging questions and it was really interesting to me to hear Elon's answers.

I think Elon might have done well to be less brusque with the more run of the mill questions but I really enjoyed listing to the long exchange there

> To be fair he was asking excellent/interesting/challenging questions and it was really interesting to me to hear Elon's answers

thats the opposite of being fair, but unfair is fine sometimes.

>thats the opposite of being fair, but unfair is fine sometimes.

fair point ;)

> he was asking excellent/interesting/challenging questions and it was really interesting to me to hear Elon's answers.

In the context of an investor call, which are supposed to convey an investment thesis for the company, I cannot agree. The questions were too pie-in-the-sky to have any bearing on whether TSLA equity/debt/or hybrid have an attractive relative value. It seemed to me that Elon was simply running out the clock.

It's a filibuster.

Yeah but his questions weren't really that great. The two questions from analysts he skipped before throwing it to the youtube guy were tough questions asking about specific details that Elon obviously didn't want to answer. Youtube guys questions were softer which is why Elon stayed with him for so long. I have to say I think letting someone like Gali ask questions at all is pretty bad, it specifically degrades what these calls are for. It's basically a filibuster.

So Musk turned a Conference Call that people want to be like a trial... into a commercial for Tesla.

You may not like it as a speculator of the stock, but it might be more in line with his and Telsa's long term interest.

> You may not like it as a speculator of the stock

Or, you know, an owner of the stock with a long position. Someone who cares that the company is a viable business.

> but it might be more in line with his and Telsa's long term interest.

His long-term interests don't matter. It's a public company. His shareholders' long term interests are what's important - his job is to execute on them. If he can't do that, he shouldn't have taken the company public.

He works for these investors, not the other way around.

I disagree - I thought the questions were good. I wish both sides were able to answer questions, as Elon had promised in the beginning of the call! (He said something along the lines of, we want extra time for Q&A, will keep the call running until there are no more questions)

Having a retail investor at the table is a great thing for Tesla shareholders, IMO because so much of the public is interested in the company. I think the split between retail/institutional is 50/50 (I may be wrong on this).

Here are some interesting things that came out during Gali's questions:

- Tesla network/autopilot: autopilot safety data on quarterly basis. Timeline of network depends on regulators. A lot of autopilot crashes are from experienced drivers.

- More info on getting towards level 5 autonomy (hardware is going to be enough, but needs more powerful computers)

- Model Y production - not starting until 2020

- Supercharging network (V3): compared to Porsche’s 350kw supercharger. Tesla's main goal is to increase range.

- Interested in having supercharger network partner with another auto maker

- Tesla Semi - building out batteries/renewable energy to lower cost

- Nikola lawsuit

- Tesla Energy: prioritize power wall backlog now. Gigawatt/hour project coming out soon. How it compares to competition

- Tesla thanking China - possibly building Gigafactory in China

>IMO because so much of the public is interested in the company

What do you mean by "so much of the public"? Outside of tech circles, Tesla isn't as well known as you imagine.

Why do we need to hear about all of their ideas and potential on the conference call? I can read Twitter, Electek, Teslarati, Reddit or others for that.

It is the most popular Retail investor stock, so it's not just tech folks.

"It is the most popular Retail investor stock..."

Source?

These are interesting questions, but for the most part, don't require concrete answers in the same way that "Do you have enough money?" do. Musk has plenty of places to talk about his bold ambitions and predictions. But the earnings call is one of the few regularly scheduled occasions when he and other executives can be demanded answers about current realities.

Yes, I agree. I do think allowing Gali to ask just one or two questions before throwing it back to the other analysts would have been a better tactic.

Allowing him to ask almost 10, especially after the abrupt shutdown of the other questions, came off as a slap in the faces of the other analysts.

I'm not familiar with these types of calls, but might it be possible he's trying to avoid getting into the nasty bits in front of all of the investors collectively in the hopes of swinging back around and dealing with them individually?

I've found that strategy to be pretty effectively employed by "perception management" types elsewhere. You know, guys with "reality distortion fields?" When you have a large group of people you're trying to maintain context for, you can end up getting into circumstances where you can get caught at giving contradictory statements more easily. Once the group catches that, they tend to dig and twist, and have further ammo for doing what you, the presenter, DON'T want.

Isolating said group members allows you the luxury of being able to devote your full attention to spinning the perception you're managing to only show what you want them to see without getting caught with your pants down by someone else you spun a yarn for previously.

I could be wrong of course, but I've seen it before.

There was a petition of sorts on twitter to get Hyperchange on to the conference call. I think Elon was trying to segue with a plug to these guys because they aren't the regulars.

I'm asking seriously though, what would he stand to gain from hiding info about capex? Or do you think the reaction from investors is due to his attitude or signs of stress/things going wrong internally?

He doesn't want to admit they company will need to raise money later this year.

He actually addressed capital raise on the call and it was pretty clear when he kept saying that they wouldn't need or want a capital raise

Yes, but that is the sort of "boring" detail that he routinely lies about (as are ramp-up schedules, delivery amounts, revenues and that sort of boorish stuff only Wall Street nerds care about)

Yes, but when institutional investors pointed out holes in his explanation about how you could go from burning 1B a quarter with 3B on hand and not need a capital raise, they got "boring" and "next."

> He actually addressed capital raise on the call and it was pretty clear when he kept saying that they wouldn't need or want a capital raise

Yes, his forward looking statement was clear, just as Tesla's repeatedly-missed production projections have been clear.

OTOH, when your statements about the future keep turning out to be wrong, it's not surprising that people want more than your conclusions but also want supporting evidence that those conclusions are grounded in reality.

Disagree about it being embarrassing and cringey. I appreciate his no-bs and no-fluff candor.

Elon called out the press for writing misleading articles to generate clicks. He went as far as calling it irresponsible and dangerous.

He also called out day-traders, saying of you can't handle volatility then sell your stock. "I am not here to convince you to buy Tesla stock."

You can listen to the call at https://edge.media-server.com/m6/p/nwvzygvo

Yeah I agree with you nodesocket. Musk comes off as focusing on the right things, not getting bogged down by a x% difference on capital outlay here or there.

> not getting bogged down by a x% difference on capital outlay here or there.

People would not be after him so much if he hadn't missed almost every prediction he's made. The company is quickly approaching a cliff that the Musk cheerleaders cannot simply cheer him across. Timelines really start to matter when your runway is running out.

Why do they keep asking him? It seems stupid. He can tell you very clearly what will do (and he does it). He obviously can’t predict the timeline.

Either it’s impossible to predict, or Elon can’t do it. Either way continuing to expect accurate predictions from him is the definition of insanity.

There is no fast approaching cliff or any such nonsense. Tesla's market cap is $50B. They can release stock and dilute current shareholders if they need to. Talking about whether it is a $4.4B capital outlay or $4.0B capital outlay doesn't matter.

What matters for Tesla is making sure that their core offering doesn't get overshadowed by an established automotive manufacturer before they can scale. What matters for Tesla is that petrol prices don't plummet due to some new unforeseen technology of economic downturn. What matters for Tesla is that their cars wear reliably so they don't tarnish their reputation.

That's not "bogged down" to a professional investor. Which is who these conference calls are for.

No, he comes off as someone who has to be the smartest person in the room and when he gets asked questions he doesn't know the answer to, he deflects. This is immature.

Then let his CFO answer the questions. These are important things to shareholders.

That x% is the length of their runway. It is fundamental to the future of the company.

Jeffrey Skilling had the same approach too. In fact, he was even bolder than Musk because he not only evaded an obviously mean-spirited question, but he called out the investor as an "asshole". You can listen to the excerpt at:

https://www.youtube.com/watch?v=FSK0v0vTgXA

Maybe the CEO of Enron currently serving a prison sentence is not an ideal role model.

That's the joke…

Pretty funny comment on that video (posted 6 months ago):

> Elon Musk in a couple of years I'm calling it now

Elon called out the press for writing misleading articles to generate clicks. He went as far as calling it irresponsible and dangerous.

Elon Musk criticising others for making misleading statements to generate hype seems more than a little hypocritical, no?

Neat! Glad to hear it. Do you have a couple billion dollars Tesla can borrow?

When my landlord next asks me about when my rent cheque's coming, I'll let him know that I find his line of questioning to be boring fluff.

He's just not ready for me as a tenant.

It was fantastic to watch him use Gali as a PR tool while he dodged real questions?

Perspective. Listening to a retail investor who never gets a seat at the table get to ask so many questions was a good thing - for Gali.

I can be cynical too and look at it as a PR stunt - in many ways it was given that he allowed Gali to ask almost 10 questions - but at the end of the day I was thinking - good for that guy.

Yeah I concur. The kind of numbers they're talking about are no joke.

Investors immediately responded to Elon's hubris in kind by severely punishing the stock. Seems the joke is on Musk.

How did you figure out that the reason the stock fell was this particular one? (Edit: "Elon's hubris" in particular)

Stock programs have all kinds of explanations they give out as to why a stock moves. Usually, it's a guess.

> How did you figure out that the reason the stock fell was this particular one?

https://assets.bwbx.io/images/users/iqjWHBFdfxIU/iYhgfoDa6lZ...

Correlation =/= causation. But... its reasonable to see the connection here.

I had the Google stock chart open while the call was running. It was pretty much night and day. Before the call, it was up by about 0.25%. Then after market, during the call it was hovering between 1% and -1% - then immediately after the dismissal it started dropping quickly.

Sure, but if the stock starts dropping during an earnings call in after hours trading and drops a whopping 5%+ at the opening of the next session then it is a reasonable assumption that something during the earnings call triggered the sell-off. And they were doing ok right up to the point where Elon stopped answering investors questions.

7% drop does not really equate to Tesla Plunges IMO.

Was this bad enough that you wanted to sell?

Really? They beat earnings estimates, so I would assumed the stock would have gone up, at least by a few percentage points.

I would say a 10% drop in a stock over a few hours is "plunging".

I hear plunge and I think time to by, but here are prices from last 30 days:

I see numbers above the recent peak, and below the current low.

musk is cringey in general

If an investor's decision to buy or sell a stock is based on how "cringey" a conference call is and not the numbers then I think they are in the wrong business. I think Elon did the right thing. It would be better for Tesla in the long term if the day traders sell their stocks. Tesla fans such as myself would love to pick up some stocks at low prices and because we buy into the vision we will not sell it anytime soon which brings more stability to the stock.

To those who are down voting my comment without providing a rebuttal: https://www.barrons.com/articles/family-office-leaders-are-e...

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