Tesla is raising up to $1.5B through convertible note and share sale
techcrunch.com
techcrunch.com
- Sure the CEO might be too active on twitter and at times say or do things typically considered inappropriate CEO behavior.
- Musk often makes bold claims and sometimes misses his projected dates.
However:
- Musk also is often right.
- He delivered amazing things with the model s. The Audi e-tron looks quite nice and I think competition is nice, but it still doesn't match the 2012 model s specs.
- He wanted the model 3 entry price to be $35k. Lots of peopple doubted he could do it, and many projected it wouldn't be available until 2020 or later. It looks like the base model 3 I can order is about $39k and with tax credit brings you downt to $35k and change.
- He promised autonomous driving 2 years from 2016, and honestly many people thought he was nuts. And his prediction was overly optimistic here, but there have been a steady stream of amazing incremental improvements to auto-pilot. On freeways, the tesla can now determine when to change lanes and does it. It can follow navigation within freeways, and it can warn you if a stoplight or stopsign is approaching. They demoed true autonomy, and I believe it's actually getting quite close. Given 1 or 2 more years of incremental improvements, your tesla would be capable of driving you most places I would think. He didn't make his 2 year prediction, but his team at tesla is still doing amazing innovation in this space.
- Part of what makes a great innovator is being able to fail sometimes. Musk will continue to make bold claims, sometimes he will fail to fulfill it, but many times he will deliver.
What he's doing is nothing short of amazing. He's doing things people keep saying can't be done. Re-usable rockets that land? Electric cars? Cars that drive themselves? I'm willing to tolerate a little shenanigans in exchange for this kind of innovation.
I think people have forgotten what innovation looks like. Innovation, from the outside, looks like a huge gamble, and thats because it is. Tesla is a series of huge gambles, and the people pointing out 'hey what Tesla are doing could go terribly wrong' have a point. But they are also missing the point.
Thankfully I think Tesla have enough cars on the road now that if they do strike disaster, there will be enough momentum to have some sort of Tesla remnant to keep the fleet running. But the progress would stop.
When "we always did it that way" is a big corp disease, "we are doing it differently because we innovate" is just the start-up version of it. Tesla had, and still has, a great opportunity to disrupt the automotive industry. But not if they execute a lot worse then incumbents.
edit: interview is here: https://www.bloomberg.com/news/features/2018-07-13/-the-last...
100% automation was a gamble that didn't pay off. They scrabbled around a bit, and got to more-or-less where they needed to be via a different route.
https://boingboing.net/2018/08/24/fire-breaks-out-at-tesla-f...
And there was another one in February this year.
Not really. It's just a sign that their paint shop needs some work.
> And the first time pass rate is really bad compared to other OEMs.
For a few weeks in June. Great work taking isolated incidents and generalizing across the board.
Regardless, you are trying to say that paint shop fires mean they just need a new paint shop. What I'm saying is that their entire manufacturing operation is amateurish compared to the rest of the auto industry.
Tesla's gotten better at managing their first-time pass rates, but they're still close to the bottom compared to their peers.
Compared to companies that have been in operation for decades, and in some cases a century? Sure, let's make sure to compare all start-ups to entrenched incumbents.
Peugeot - 1889
Daimler - 1890
Fiat - 1899
Renault - 1899
Buick - 1903
Ford - 1903
Rolls-Royce - 1904
General Motors - 1908
Alfa Romeo - 1910
Dodge - 1910
Chevrolet - 1911
Aston Martin - 1913
Maserati - 1914
Mitsubishi - 1917
Bentley - 1919
Citroen - 1919
Chrysler - 1925
Mercedes-Benz - 1926 (1883 if you include Benz & Cie.)
Nissan - 1934
Jaguar - 1935
Toyota - 1937
Jeep - 1941
Ferrari - 1947
Honda - 1948
Land Rover - 1948
Lotus - 1952
Suzuki - 1956
Subaru - 1958
Mini - 1959
Mazda - 1960
Tesla - 2003I didn't know Peugeot was the oldest of the gang!
Detroit Electric - 1907
Nissan finally caught up in 2010.
Tesla didn't outproduce it until 2012.
Meanwhile, Ford and Toyota have videos of almost an entire car being constructed by robots on their production factory lines (their are parts where humans assist the robots but otherwise most of the work is actually done by the robots). There'a a famous Ford video from a decade or two ago showing one of their (now-older/discontinued) model sedans from being built and finished--entirely by robots-from frame to final painting touchups. And if you don't believe the videos, you can tour their factories and actually see their factory lines in action, live.
Ideas are a dime dozen, right? Execution is what matters is the start-up advice, right? And on that front Tesla is not looking good right now.
edit: Here's some pics of the tent, and description of the large scale scrambling it took https://www.bloomberg.com/news/articles/2018-06-25/the-futur...
"That startup has no idea what they're doing. Just last week they had to hire a bunch of new developers and they went all-remote and picked up a bunch of new management SaaS to do it. Look at IBM, they always know exactly how many developers they'll need for a project."
Tesla's got some significant problems, sure, but most of their problems seem to be the sort that a rapidly growing startup would have (including the lightning-rod CEO).
EDIT: That Tesla is still treated as a typical Silicon Valley start up and not an automotive OEM might be one of Elons greatest achievements.
Tesla talks big about automating...but Toyota actually did it, without fanfare, and managed to do so in a manner consistent with the kanban manufacturing philosophy that has defined their productivity and quality achievements of the past several decades
NUMMI is also not the factory that Toyota shows off in its videos demonstrating the awesomeness of its manufacturing processes.
I also remember way back when steve jobs tried to automate the production of NeXT cubes and broke his company doing it. I think a lot of folks do this sort of "follow one philosophy" into ruin. They want to be amazing and lose sight of what's doable/affordable/realistic.
For now.
When they have a solid product, and a lot more money in the bank, I'd expect them to be at the forefront of automation, and then it will pay dividends, they just tried to do it too soon.
Nobody went in the direction of landing boosters, despite rocketry existing for decades.
'Nobody is doing it', is more often than not, an argument for 'it' instead of against.
Often nobody's doing it, because "it" is truly stupid. What Musk is doing, is applying a formula for discovering when the majority are mistaken.
Of course they did, but they only wanted to do it on DoD money. When that wasn't further forthcoming they pivoted to other projects that were funded.
Landing rocket as a stalled idea wasn't due to lack of technical foresight, it wad a result of big companies lacking financial foresight. I give credit to Space X for making that business leap, even though landing their boosters was actually an ad hoc response to their initial failure to secure cheap Russian engines.
And now Arianne Space is having a serious look at it with Arianne 6.
They had decades of experience in the industry and the software guys (Apple and Google) drove them to bankruptcy.
Also look at SpaceX - he’s not a complete novice at complex manufacturing, and knows how to assemble and motivate a good team, and is used to competing against even more entrenched incumbents.
I’ll be interested to see how this works out but I think Musk was just too early and trying to do too much at once; he’s not wrong that automation is the future.
Also, building mostly single use rockets, reused boosters are pretty new even for SpaceX, in comparatively small number is totally different from building and running factories that spit out hundreds of thousands of cars. But I can understand why Elon might have thought he knew better. But drawing lessons from an industry like aerospace and rockets which had only a hand full of defacto state subsidized players to one as competitive as automotive was, it seems, a bad idea.
Yes, I fully agree that Elon wanted too early and too fast. And having the timing wrong still means you're wrong. And in that case this mistake and the underlying culture and way of thinking can very much doom the whole company. And that would really be a shame, wouldn't it?
[1] https://www.theguardian.com/technology/2016/feb/26/mercedes-...
That's a very insightful and prescient statement -- thanks for that. Certainly food for thought.
Fixed that for you.
https://www.theverge.com/2016/3/31/11335272/tesla-model-3-an...
The tax-credit is gone, never to return... and the $35,000 car is no where to be found.
> 200,000 have been delivered to date.
Elon Musk promised 20,000 Model 3 Cars created / month in 2017. https://twitter.com/elonmusk/status/881757617416056832
In Q1 2019, the company created 50,900 Model 3 over three months, or 17000 Cars/month on the average.
This 20,000 / month number is important, it is estimated that 20k/month is roughly the profitability point for Tesla. Elon Musk is over a year late, the profits haven't come in yet, and they can't sustainably create cars at the promised rate.
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I understand your optimism here. But this $1.5 Billion raise is more debt to a company that never has seen a yearly profit. It HAS to make money to survive, and Elon Musk has been wrong on every financial metric worth a damn.
If Tesla doesn't make a profit, it will run out of money, eventually. It can't just keep borrowing $1.5 Billion in loans every couple of years when they are late on these kinds of targets.
Where I live (CA), both Fed & CA tax credits are still valid. Go to tesla.com and configure your M3. I just did and it comes out as $33,250 (after tax credits) + $1,200 dest/doc fee = $34,450.
The above doesn't include the debatable "gas savings".
Just a few weeks ago, Elon Musk claimed $35,000 cars will be available without any credits what so ever. This isn't some long-standing promise that slipped off the schedule, this is something Elon Musk has REPEATEDLY claimed to come, but has failed to deliver.
Its a message he's been hammering since 2016: $35,000, before tax credits. The idea was for the M3 to compete against low $20,000 ICE cars.
I recognize that the goalposts have shifted. Maybe it wasn't possible. But maybe... just maybe... Elon Musk shouldn't have set $35,000 before he knew if it were possible to do. He's done incalculable damage to the brand, and is no longer able to raise prices to make the company profitable.
If Tesla could raise prices to $40,000 base or even $45,000 base, they probably would be in a far better financial situation than where they are right now. They can't do that because of the multiple years of price anchoring at $35k.
https://www.engadget.com/2019/04/12/tesla-35k-model-3-pulled...
My issue is mostly with the financial situation of the company. Its clear that the $35k M3 has been relegated as a "loss leader", and there's no work on actually making the car profitable at that price.
Again, perhaps its impossible to make a M3 profitable at $35k, and I would rather have the company make money than lose money. Its just that the years of $35k price anchoring really weakens Tesla's ability to set prices from here on out.
Doesn't it seem obvious that both processes and supply costs tend to improve over time? (this isn't Tesla specific actually)
A couple of simple examples:
- battery costs (they have been on a downwards trend for a while, and expected to keep falling)
- production/assembly line costs: initial hiccups are expected and costly, and as you fix them and learn to optimize your production, your costs also decrease. The rejection rate starts dropping, and rework costs also start dropping.
This is true of pretty much any production: you get better at it as you go, and generally your supply costs also decrease. As you get out of the ramp-up "hell" you start producing a lot more, which starts giving you economies of scale.
Lastly, innovation also offers improvements that can give you another knob. For example, the motors in the M3 are now being ported to Model S to improve the range. This gives an option to either offer a higher range, or keep the range the same but put in a smaller battery (where the savings are going to be). I expect incremental improvements in M3 to have a similar type of effect.
I consider all that "work". I imagine it will lower the production cost, given the same spec. That translates to profit, if the price point is kept the same.
There's a lot of things they did wrong to get to this point: changing the design of the M3 too much and too often, making it difficult to stock parts for repairs and all that... but ultimately, the vehicle is actually positive margin.
That doesn't make the company profitable. They spend $700 Million / quarter on their Supercharger network, their sales channels, salaries for employees, and other such "static costs". They need to get to the 5000 cars / week (or higher) point to become profitable.
That's all it come down to. They've got a positive gross margin car, its an issue of selling more of them. If there's a ton of customers waiting for a cheaper vehicle, well that was an error in Musk's marketing. Too many people are holding out waiting for a cheaper car. IMO anyway.
At ~$40,000, they make $8k per vehicle or so. If they raised average prices to $50,000 or so (assuming a base price of ~$45k), they'd only need to sell 1/2 as many vehicles to make a profit.
Edit: This 2017 PDF illustrates this well. While the 18% looks accurate for 2010 thought 2016 they are projecting that rate slowing down. Page 8 has a good chart illustrating how EV cars will soon be cheaper then ICE cars.
https://data.bloomberglp.com/bnef/sites/14/2017/07/BNEF-Lith...
Except for anywhere in snow or rain.
With neural nets, a lot of things just get learned. You don't have to specifically address them to get great progress. I'm not saying snow is 100% solved, and yes specifically addressing aspects like snow in the future will help make it even better, but autopilot has worked pretty great so far.
I've never yet seen a city with a taxi service which is reliable in heavy snow - things usually fall completely apart. (Not to mention buses, trains, planes, etc...)
Even if the robotaxis are shown to not be able to operate in snow, it's not necessarily an indictment of the whole robotaxi concept. If they can work in snow-free conditions, it's still covering the majority of time, in the majority of potential markets.
My point still stands for most of the rest of the world, though.
The "so what" is that it isn't really an automomous vehicle of it can't navigate the roads for a solid 50 % of the year in a good chunk of North America.
>Isn't it still totally mind blowing how far it's already come?
Not really, to be honest.
The problem is he's saying or doing things that are typically considered crimes, like securities fraud.
>Musk often makes bold claims and sometimes misses his projected dates.
Or, to use normal language, he's a serial liar.
>Part of what makes a great innovator is being able to fail sometimes. Musk will continue to make bold claims, sometimes he will fail to fulfill it, but many times he will deliver.
Being willing to fail and being dishonest aren't the same thing. It's bizarre how the Musk Cult contorts itself to avoid any possibility of criticizing the Great Leader.
You need to be optimistic and a little crazy to think you know better.
But that's the point, isn't it? We have a word for intentionally providing falsehoods to investors to get them to keep giving you more money.
The going-private-at-420 thing was reckless, and he's paid the price for that.
But I don't think its accurate to brand him a serial liar. He's just doing what a CEO does.
I disagree. At a certain point, Musk turned the corner and became delusional. It's beyond simple boasting now.
He just held an event for Tesla investors called "Autonomy Day" at which he went on at great length about how Tesla robotaxis will autonomously ferry passengers around, anywhere they want to go, as a running, regulator-approved, income-producing service, by next year. There is zero chance of this occurring and he knows it.
Edit: ok you got the word "by" right but... everything else... wow. But it's not just you... the crazy thing is how many people do the same thing.
Why is that? They've now got tens if not hundreds of thousands of cars running their FSD tech all the time comparing it to what the driver actually does and using that to get edge cases to add their every growing dataset to test and train their algorithms. The average American has a commute of 16 miles [0] which gives an estimate 13173 miles driven per car by the end of next year. At a low estimate of 10,000 cars, that would give them a subset of driving data for 131,733,333 miles driven. Presumably, they label these interactions with what should have been done and then throw it into a training/test pipeline. The US car fatality rate is just over 1 per 100,000,000 miles driven [1] so they should have a training/test suite multiple times the US car fatality rate and that's not even counting regular crashes. Granted, it won't actually be that large since they don't report back when the car is running fine, but I don't see why it is 100% impossible for them to get their FSD tech to human quality driving in certain conditions (like geofenced and only run during nice weather) at some point next year when they have that much data to work with.
[0]: https://itstillruns.com/far-americans-drive-work-average-744...
[1]: https://en.wikipedia.org/wiki/Transportation_safety_in_the_U...
The problems just get harder and harder as you move from a nice controlled environment like a freeway and even there Tesla has shown there are many issues with the system where a driver needs to pay full attention for it to be safe.
From first hand experience with these problems and their complexity I fully expect a slightly better version of autopilot to be delivered and Musk to declare success despite it not being anywhere close to an autonomous fleet of Tesla robo-taxis and justify the difference with the caveats he quietly snuck in that he knew wouldn't make headlines.
That might be enough for his customers and investors so from a business sense it might pay off.
That doesn't change the fact that he's produced a great car and seriously innovated in many areas.
I am rooting for them to succeed because I think what they are doing is important and good for humanity. I am hoping Musk does the right thing, and doesn't get in further trouble with the SEC, etc. And I am hoping that the company is able to survive the tumult of the markets -- that is, the costs associated with electric cars and the supply/demand of the market. Sometimes the best technology doesn't win. It happens often. It would be a huge loss if it didn't work out.
I think it's way further off than that, like, 10+, and almost certainly not without extra hardware being added to Teslas
As of today, Tesla's autopilot page says "All new Tesla cars come standard with advanced hardware capable of providing Autopilot features today, and full self-driving capabilities in the future—through software updates designed to improve functionality over time."
This claim imo is at best overly optimistic, and at worst outright fraud. I'd be surprised if they don't get sued at some point over this. (their website used to be much more explicit about promising full self-driving too)
Full self-driving is 90% edge cases. Adaptive cruise control is not a few incremental steps away from full self-driving
Doubting like this is a pretty common view outside of Tesla, and we've heard it repeated many times here. They clearly disagree.
>Full self-driving is 90% edge cases. Adaptive cruise control is not a few incremental steps away from full self-driving
This they would completely agree with, as you can see from watching their recent autonomy day presentations. And they have an overwhelming lead in collecting edge case data, so... they're in good shape with that.
A lot of people also seem to forget that it is in the very nature of outrageous statements to be challenged and criticized.
Musk was right with his predictions a few times, but the same could be said about his challengers.
You can also order the $35k model which is distinct from the $39k model. Yes, it takes a phone call, but it is available.
You do understand that they have made it tougher to buy 35k$ model 3 only because they can't make profit off it?
According to Tesla they have the cheapest batteries, the best AI chips, the most automated factories, the most advanced self driving technology, have a driverless taxi coming soon etc. But after all these advantages they don't sell these technologies individually. They only sell cars with shitty interior and paint, panel, and quality problems at luxury prices. And even though they have a fanatic fanbase, and a lot of positive PR, they still make a loss on luxury priced shitty cars.
My point was that $35k is the lowest.
I'm glad he's doing it privately though. If the government was spending the same amount of money (yeah, yeah, if the government was really doing it it would be 10x more expensive, slower, never gonna happen, etc.) and producing the same results I'm sure they would have pulled the plug already.
These companies could dramatically change the world and I'm glad he has the persistence and commitment to keep doubling down on these moonshots (or Mars shots).
I remember with Amazon they were growing fast but the conventional analysts were saying but they make zero profit and then after a bit they are the worlds most valuable public company and Bezos the richest person. If Tesla keep up the growth it shouldn't be too hard to get finance.
Of course it remains to be seen if TSLA deliver the growth and self driving etc.
Then don´t buy the stock. Period.
I don´t like this idea of trying to protect every fool with 2 bucks. If you´re not qualified to make your own opinion about a stock then you shouldn´t be allowed to invest in the first place. Or at least, you loose your right to complain if you´ve not done your DD properly.
Some stocks are more risky than others; this is one of them. Hence why the returns might be amazing 10 years from now or be completely garbage. Pick a side and make a bet, or don´t. Either way, talking about protecting people from "risk" is a dead end.
Capital is necessary but not sufficient for innovation.
Yes, this is true. My point was more that innovative products are profitable, not necessarily the novel tool we need. See: smartphones and walled garden app stores. Innovative for sure, but an objectively shittier scenario than one built around the tool people want to use.
I don't see innovation (as in, using market forces to push forward technology) as playing any role in collective problems. The regulated market's popular hope for fighting global emissions with market effects, the carbon tax, will do very little to slow emissions on a global scale. We need to think outside the market to have any optimism.
Things that are improving exponentially seem far off when you look at them with intuitions developed on linear growth. Autonomy may be far off... or it may be closer than we think.
I don't trust my own judgement to know the answer, but I suspect the people at Tesla have a better handle on it than you or I.
I'm sure they see things in their long tail data that we would probably never think of. Even top experts at other self driving tech companies don't know all of what Tesla is seeing in its long tail data... so I think Tesla has a few more clues than the rest of us.
The long tail can't be truly infinite. It is some very large quantity driven by the combination of many, many factors. Just that amount of analysis gives us some actionable insight.
It would be very easy to miss out on some of the factors, and be off by many orders of magnitude in either direction. The actionable insight, is that the analysis needs to be pinned down and made concrete. You'd better be damned right about it, or you're very likely going to be very, very wrong.
With regards to Elon Musk, the question is, how good do you think the analysis is. They got it spot on with rockets at SpaceX. They got batteries and motors in EVs right at Tesla. What about Tesla scaling production, automation, and AI? I'm less sure about that last one.
It has over $9 billion in debt. The future is bleak with these financials.
Musk has accomplished a lot, absolutely. But as a thriving business, it's a failure.
And lately, Musk's ego has really shown, and not in a good way.
The Internet in general, and HN lately, have become extraordinarily negative places full of comments trashing people who try to do things that are bold.
I wish people would have a little optimism, or at least just say things like "wow, I personally don't think it's possible, but damn it's going to be exciting to watch them try".
We need people who are working hard to build a better future, so lets not bury them in a pile of hate and negativity.
Musk and Tesla attract more than the average share of hate, but this sentiment feeds on itself and grows like cancer. Yesterday's thread on Eric Schmidt leaving Google was dozens of people competing to see who could trash him better.
Apart from the bad effects of negativity itself, it is also supremely boring. HN's comments are slowly going from being able to find tons of interesting ideas/reactions/perspectives to finding only different ways of trashing the same person/company/idea.
Cryptocurrencies, "smart" things or IoT, anything Google related, anything even slightly related to or made by Facebook (the other day Facebook released info on their rewrite of Facebook.com and zero comments were about the tech on HN, it was just a bunch of people arguing over how awful Facebook really is), and many things that deal with JavaScript (at least on HN).
Sadly I'm going to be adding Tesla to that list now, something I should have done years ago, at least on this website.
Every topic related to those things quickly devolves into a bunch of people just yelling at each other over semantics, and it's very hard to have any real nuanced discussion.
It's like people now come online to just loudly scream their opinion about something, then leave.
Whether a tech person likes or loaths Facebook is not really of interest or any gain to us as a community. Like you said, it would be massively interesting to learn exactly what tech and how facebook are re-writing their app, but those conversations don't even happen on HN anymore.
It's amazing to think what the state of automobiles and driving will be in 5 and then 10 years (which is really not far away at all), and yet every single discussion thread just argues about the demise of Tesla instead of discussing, planning for and building the future that is inevitable, with or without Tesla.
> Every topic related to those things quickly devolves into a bunch of people just yelling at each other over semantics, and it's very hard to have any real nuanced discussion.
As much as I hate censorship, I think the moderation team at HN would be wise to shadow ban (or just outright ban) accounts that post negative rubbish, or simply expose their opinion on a topic.
Maybe there should be a rule that a person's opinion is off-limits in HN discussions. Discuss the topic at hand, but don't just cram opinions down throats. (yes, I get the irony, I'm expressing my opinion here)
Uninformed optimism? Not so much. How about some charity and informed, insightful analysis?
We need people who are working hard to build a better future, so lets not bury them in a pile of hate and negativity.
Agreed. By the same token, we can ditch the hate and have more informed negativity when it's warranted. It's mental laziness to just slam the lever all the way up because you like the feel of "up," or to slam it all the way down, just because you think "down is cool." The difficult and valuable thing is to move the lever to where it needs to go through technique and good judgement.
I agree, that would be great. Let's analyze stuff instead of just screaming out our opinions.
> we can ditch the hate and have more informed negativity when it's warranted
How does negativity (even informed negativity) help us?
How does it increase our knowledge, or ability to do new exciting things, or our ability to "push the envelope"?
It doesn't. It's a waste of time and effort. Worst case, just say nothing at all rather than being negative about a certain topic.
When working on an extremely complicated problem the last thing in the world anyone needs is a bunch of people reminding them it's really hard and that nobody has done it before and that it's going to fail for reasons x,y,z.
Remember, every breakthrough that has ever happened had a long list of reasons why it was "impossible".
In any good discussion and healthy argument, it is critical to be able to understand your opponent's point, be able to restate it accurately in a way they'd agree with, before being able to point out exactly how it's wrong (or at least unlikely).
Instead, we often see pile-ons and other supremely mentally lazy attacks.
It keeps resources from being wasted that would otherwise actually contribute to our ability to "push the envelope."
It doesn't. It's a waste of time and effort.
When something which really is impossible or impractical is called out, then huge amounts of resources can be redirected to genuinely beneficial projects.
https://www.youtube.com/watch?v=obS6TUVSZds
Are you advocating that we never doubt? Should we just "listen and believe" and somehow our positive energy will make things happen? Sorry, no. Scientific analysis has predictive power. That's what Elon Musk is all about.
Considering that one of the tenets of good engineering cultures is blame-free environments, this negativity around ambitious engineering goals astounds me.
Now, the comments are hardly worth a glance.
I really agree about the tone thing, these conversations are toxic and unproductive.
It might help if we stop referring to rich people as bold—it is honestly difficult to spend the type of capital Musk has access to, and he would have to intentionally give it away to be poor. What’s the risk? Not a risk most can empathize with.
What he has been saying about autonomy defies what anyone who works in the area knows about the state of the technology and is genuinely dangerous. People have died because he oversold autopilot.
https://gizmodo.com/tesla-autopilot-malfunction-caused-crash...
I wish he would just focus on building and selling great electric cars instead of pushing truth in areas where people's live are at stake.
My point stands
Thank you for writing such a crisp response covering all the right points.
I feel most people just piss on Musk/Tesla and his daring moves - actually IDK why but I don't care.
What I care about is trying to understand the other party. Where they come from. Why are they doing this. What are the risks involved. And in the long term, where are they headed.
Your post answers all of this.
More power to Elon Musk. We need more bold entrepreneurs like him who aren't afraid to be themselves and take world changing risks.
The only problem with little shenanigans is that its market manipulation- even if it appears to be legitimately accidental.
Respectfully, I disagree. True, he has I think caused the spaceflight industry to think about re-usability again in a meaningful way. And arguably he has also generated a lot of hype for the battery electric car industry.
Having said that, his accomplishments often tend to be inflated by his followers. Tesla ultimately failed to deliver a $35k mass market affordable vehicle. Even Model 3, is out of reach for most people in U.S when the median household annual income is only $56k. At ~$40k, Model 3 essentially remains a luxury vehicle for most. Whereas the competition is quickly catching up. Arguably the Chinese electric vehicle market is now the global leader in electric vehicle market.
SpaceX still has yet to do a crewed launch to LEO. Rocket re-usability is great, but what we really need is a man rated launch vehicle. With the recent DM-2 anomaly, SpaceX won't be launching any people to orbit for at least a year.
Also, whilst propulsive landing looks very cool, it's been done before. SpaceX wasn't the first to do it successfully. Electric cars have been decades. Autonomous driving has also been conceptualized a long time ago, and hell, Tesla isn't even close to the leader in autonomous driving right now in terms of technology.
I don't care that I get a better car for my money! When Tesla is saying that they have the best selling car in its class, you see the Mercedes C-class and the BMW 3-series in the chart. How can they seriously call it a mass-market affordable car when these are the cars that they are competing against?
And while other companies are trying to play catch-up with them, they're testing their Raptor engine for a new rocket that will be dramatically larger than Falcon 9 but with a similar launch cost.
Name anyone who can do propulsive landing the way SpaceX does. They land their rockets on floating platforms in the ocean with amazing precision. Nobody else is remotely close to that kind of engineering feat.
> They are utterly crushing all competition in terms of price and launch cadence.
Launch market is not the entirety of the spaceflight industry.
"The share of launch vehicles is as small as 4 percent of the overall market of space services." - Dmitry Rogozin
And Blue Origin can do propulsive landing like SpaceX: https://www.youtube.com/watch?v=nNRs2gMyLLk
Propulsive landing has been around for a while: https://www.youtube.com/watch?v=39cjZTCay24
Whilst it seems (and is!) very cool to see the boosters land, it seems to impress the laymen a lot more than the true technical worth of the feat. Here's an addon to the Orbiter spaceflight simulator with recoverable falcon 9 stages: https://www.orbithangar.com/searchid.php?ID=7091
More or less requires college level kinematics at the core of the control/guidance.
Also with the recent DM-2 anomaly, SpaceX is playing catch up with Blue Origin, not the other way round.
Do you mean DM-1? Anyway, I don't see how SpaceX is playing catch up to BO when BO hasn't even built an orbital rocket or man-rated capsule yet...
You are right that people overstate their accomplishments, but excessively downplaying them is actually the worse behavior.
https://finance.yahoo.com/news/average-car-prices-more-1-110...
These price levels do seem high relative to median income and many buyers are overextending themselves. But the market is what it is.
I spent $18k on what I still regard as a really nice car a couple years back, and it felt like a completely over the top extravagance.
I can't imagine what would compel me to spend 37k on a car...
No. No no no.
Elon Musk has done some amazing things, but I am adamant his stance on Autopilot has led to unnecessary deaths and when anyone takes his side that they are actually close to true autonomy, you are undermining how dangerous it is to rely on Autopilot as anything other than advanced cruise control. As more time goes on, we find out more evidence about how Autopilot has been misrepresented, and while the NHTSA study being flawed cannot currently be directly tied to Tesla I cannot imagine that a governing body could be so incompetent without a corrupting influence from Tesla [1]. Elon Musk himself talks about how Autopilot requires driver attention when asked by critics, however when demonstrating the technology himself on national television he has his hands off the wheel and regularly is not watching the road [2]. He goes to great lengths to hide any negative data against Autopilot, as already referenced in [1] where it took 2 years to overcome the legal blockade just to get the data provided in a publicly released study, as well as getting Twitter to suspend someone's account for providing this spreadsheet of problems (including deaths) with Autopilot [3]. I absolutely believe an investigation, at the bare minimum for false advertising and personally I believe negligent homicide, should be brought against him because of it (I am not saying he is guilty, but there is certainly a need to find out).
How many people may have died because Elizabeth Holmes misrepresented (and in that case, quite obviously committed fraud) the capability of their product? I am not saying Musk and Holmes are the same, but people would not stop talking about how amazing she was until they found out she was just lying about everything.
Elon Musk is absolutely wrong about Autopilot. When lives are at risk, it is not okay to suspend disbelief just because of the hype.
[1] https://www.thedrive.com/tech/26455/nhtsas-flawed-autopilot-...
[2] https://www.forbes.com/sites/jimmcpherson/2018/12/11/in-his-...
[3] https://docs.google.com/spreadsheets/d/1ESnyJ4b7m96OCjs3GSQ6...
To me, that seems to indicate Autopilot is a net safety gain, despite not being perfect.
https://medium.com/@MidwesternHedgi/teslas-driver-fatality-r...
Here's one way. Highway driving is already significantly safer per mile than local roads,
> The grim statistics provided by the National Highway Traffic Safety Administration also show that drivers on rural roads die at a rate 2.5 times higher per mile traveled than on urban highways. Urban drivers travel twice as many miles but suffer close to half the fatal accidents. [1]
That explains away Musk's "AP is twice as safe" comment. It's only twice as safe because people generally only activate it on the highway, which is already 2.5 times safer!
[1] https://www.npr.org/2009/11/29/120716625/the-deadliest-roads...
That has absolutely nothing to do with whether people have died due to false claims about the ability of Tesla's autopilot. The cars may be safer, but if 1 person died or 100 people died because Musk/Tesla lied about autopilot that is a problem. It doesn't matter how many other accidents their cars have or have not been in.
> - Musk often makes bold claims and sometimes misses his projected dates.
This strikes me as some serious euphemising for someone who lied about his company having a buy out offer and randomly accused a hero of terrible tragedy of being a pedophile. We should not excuse the complete lack of maturity.
I remember thinking that this is the future of electric vehicles. Boring. Reliable. No drama or shenanigans about CEOs doing weed or pissing off regulators or stiffing suppliers or "production hells" or falcon wing doors and touchscreen dashboards or getting rich people to adopt it first and making everybody else wonder if the price will ever come down. Everything just works.
China's already there with electric buses and electric scooters. I think they own those markets now (well-deserved based on their execution BTW).
If you haven't been paying attention to renewable tech in East Asia, you should definitely explore more; I think it would be valuable experience for the rest of the world's big-volume automakers. At least I learned a lot.
Even the higher end Jaguar I Pace has a waiting list. AFAIK no EV manufacturer has managed to ramp the productions enough to meet the demand
Of course vehicle sales can participate in improvements in battery cost, but there's plenty of investment there whether you are retailing cars or not.
https://www.hyundaiusa.com/ioniq/
Hyundai is taking a smart approach, making sure new platforms support electrification to varying levels. Take the Kona for example, it was introduced as an ICE vehicle and is shaping up to be an intriguing EV.
Unfortunately they're limiting EV model sales to certain states. Hoping they expand beyond compliance car status soon. The Kona EV is _actually on lots_, around $40k before any rebates/credits/incentives, and has a ~250 mile range.
Tesla will always be a media circus company unfortunately. With or without Musk there are many people who have a lot to gain with it failing. I think they have a clear path forward and will succeed.
https://electrek.co/2019/05/01/tesla-gigafactory-3-drone-vid...
Tesla in China might be the biggest story for Tesla as a company.
I'm not sure they learned anything from the Leaf tbh. It's a fine little car and I've never met anyone who owned one (myself included) who said anything other than "it needs more range and it's too expensive". Sure there's all sorts of things you could nitpick about, just like with any car, but at it's core the range and sticker price are the only major issues.
My Leaf has a reported range of 75-90 miles fully charged. I'm in the South Eastern US and my commute to work is roughly 25 miles of highway (65-80mph) driving one way. So in theory I should have 25+ miles of range when arriving home in the evenings but highway driving draws more power as does operating climate control so that's best case. It doesn't leave much room for errands in the evenings after work.
I lost a bar recently but oddly it does not seem to have affected the range at all.
But some people know the truth: That it could have easily been another 50 or 100 or 200 years before some OTHER innovator came along to lead the pack along.
The story is timeless.
"Imitating" something in a way that is commercially successful to the point where the technology gains widespread adoption when before it had only niche adoption is innovation in itself.
Tesla is building the early smartphones. Someone else is going to build the iPhone and yet someone else will build the hordes of HTCs and the Samsungs running Android.
Give the fact that Musk didn't start Tesla I don't really understand this comment. Musk has done a great deal to further electric vehicle adoption, but it's not like it's he's the only person in the industry. It obviously wouldn't have taken another 50 years.
If Tesla didn't exist, I bet traditional motor companies would have asked for more and more incentives worldwide to make EV cars. And then they'd have ramped up production and collected all those sweet tax dollars.
With Tesla about, nobody lobbies for new EV incentives, because it would be helping the 'outsider', and it's fairly apparant they aren't needed.
And everyone plays up the Single Great Genius Who Did Everything Himself (including the men themselves) and how they personally boldly innovated everything. N
ever mind the fact that Musk did not start Tesla and is not the person actually designing or implementing its technology. He is the Great and Glorious Musk, so he deserves all of the praise.
That story is indeed timeless.
Nissan was making (to quote parent) "boring and reliable" electric cars before Musk showed up. I don't know what you're on about with the rest, it's pretty non-sensical.
A bit odd how quickly the cynics and Monday Morning Quarterbacks usurp the conversation.
I think Tesla made EVs cooler or made them look like an actual option, but it isn't true that other car makers just ignored EV options. They produced them for decades, there just was no public interest. VW for example had a new electric model at least once every decade for over 50 years now (a golf each in the 70s, 80s and 90s, a EV bus in the 70s etc.), there just wasn't much mainstream interest.
Its just so nice to ride something that doesn't pollute.
The moment you realise you're sitting in traffic, and you're the only one not pumping CO2 into the atmosphere, it really change your opinion - I will never, ever go back to internal combustion engines.
Being able to charge at the house - amazing. I never have to go out of my way to fuel up - granted, I do have chargers all over the city if I need it, but the two batteries I use get me all over Vienna every day, with spare to get home with ease.
I wonder what a Tesla moped would look like? IMHO, this would be a greater move for Tesla in Europe - where mopeds just plain work.
Either way, I'm never going back to gas. Its just that great.
Because you generally can't contract for the federal government while breaking federal laws.
But, of course, the rules are not the same for him as they are for you and me.
Tesla drug-tests, and fires employees who test positive for THC, regardless of whether they are under the influence or not.
You can test positive for THC, and be stone-cold-sober when you show up to work. THC markers can stay in your system for weeks.
The fact is, they are not testing whether or not someone is showing up to work high. They are testing whether or not someone got high in the past few weeks.
They have a reason, the reason is unfair, unscientific, and is not consistently, or fairly applied throughout the company. One set of rules for the peasants, another for the executives.
The Economist used to be boring, but smart with a wicked dry wit. Now it’s just boring (sigh). Tesla will be profitable & cash flow+ in Q3 & Q4, so obv no need to raise money.
Well before it confirmed the latest missed production target, investors worried about the firm’s cash-burn rate in 2018. In addition to the $2bn or so of capital that may be required to expand production of the Model 3, Tesla has some $1.2bn in convertible debt maturing by early next year. On March 27th Moody’s, a credit-rating agency, downgraded Tesla’s debt, cautioning that the firm “will likely need to raise additional capital during the second half of 2019”. Jefferies, a bank, predicts that Tesla will need $2.5bn to $3bn this year.
The cited prediction by Moody’s was very close, apparently ("likely need to raise capital in the second half of 2019").
This was the tweet (April 2018) Elon has replied to.
Tesla may well be cashflow positive in Q3/4 2050.
2019 is much different time, with Tesla scaling back.
If they need to raise money then it needs to be focused solely on delivering cars. Not some future taxi service or robot what evers. It should only be towards getting the model Y line up and running on time and under budget, getting the full refreshes of S and Y out. then once you are profitable by year car company, then you do robo. taxi.
Telsa doesn't need sayers to make shit up when the CEO is like a jack Russell terrier
"Take a moment and think about why are they doing this event now. Elon is setting a stage for a capital raise, he's pitching the autonomy narrative after the Model 3 cash cow narrative failed. They're trying to convince investors (and customers) to give them money because money-printing autonomous taxi service is coming next year."
It is probably because they can't
They get money now and keep the car for use as a robo-taxi.
And if they do reach fully self-driving first - and someone will have to lead the way and prove it enough for regulators to allow them on the roads - then they'll have everything else already in place to relatively speaking own/efficiently capture a large portion of the market.
- They were horribly late in delivering the car (and now claim they are going to have fully autonomous taxis by next year when they couldn't even deliver on a basic car on time)
- They can't make the $35k car they promised without losing money
- They have exhausted the market of people that will pay 50k for an electric car knowing the fuel savings will never make up for the premium so they have excess inventory
- They now are low on cash, high on inventory so they make up this moonshot story to get people to invest in them again. Simply saying they are doing standard leases would be too honest.
The day is going to come soon where the amount of people that believe the hype will dwindle and the debt will pile up even more where there is a liquidity crisis. It is essentially a legal pyramid scheme. I have to hand it to them though being able to convince a good amount of people that their leasing is actually ensuring a future supply of robo taxis is impressive. One day people will laugh at the outrageousness of that.
If Tesla was aiming to be the size of Porsche (not VAG) or Lamborghini it’d be something.
But the same “conversion” rates from young person wanting a dream car to old person affording dream car apply regardless of if it’s an EV or a ICE, because the limiting factor is money.
So “stealing” the kind of volume that Porsche and Lamborghini get from... daydreaming young people, isn’t worth anything in the long run if you’re talking about keeping up Tesla’s 40B dollar market cap
Reminds me a tiny tiny bit about rpis. They were said to be a little smaller and a little cheaper. But truth is, you have a lot more chance getting a rpi+options at 50$ than a 10$ rpi w.
That said, the momentum is so huge, it doesn't matter anymore.. maybe this will apply too ?
It's not "their plan," it's just an additional way to bring in cash. If the cars can't be robo-taxis in three years, they'll let lessees buy them out or sell the cars used.
[1] https://youtu.be/Ucp0TTmvqOE?t=13330
Are there any municipalities that have already passed regulations allowing driverless cars on the roads? Are any already working the regulations through the process? If the answer is no to both of those, there is no way autonomous taxis happens next year.
Having "autopilots" crash while drivers are in the car also does not help the case.
https://www.theguardian.com/cities/video/2019/mar/09/waymo-t...
Initial trials will probably include humans if required to avoid needing laws passed (as I think Waymo is doing), I don't really see that as a huge obstacle, and once the human-supervised models can prove they are safe, it'll be easy enough to change regulations if required.
I imagine Musk has had discussions with a few and felt emboldened to make his statement by that. Of course he constantly exaggerates, the projections of possible profit for owners were not realistic (at least in the next decade), and his timelines are about 2x faster than real life, so I'd be surprised if they have more than a small trial next year for this.
If I come to you asking for $1 billion in funding. I don't tell you about the boring, low growth, probable outcome. I tell you about the exciting, new, unexplored potential market just waiting to be tapped.
But no, self driving taxis aren't just around the corner.
Whether it works? I don't know, the stock rose on the news which would suggest some people are convinced.
Whether your view of a company is positive or negative, you can put your money where your mouth is.
Tesla does not have that kind of advantage over established carmakers.
Assuming Tesla improves their cash flow, this new +$1.5 Billion raise will provide Tesla with another 1 to 2 years to turn the company around... for a total of 3ish years worth of cash reserves.
Remember the key profitability calculation from years past: 5000 Model 3 Cars / week is the break-even point. (Its a very blurry estimate, Tesla managed to be profitable with ~4500 M3 cars in Q3 2018... margins and other services may change that). With cheaper cars and fewer cash credits, maybe the new profitability point will be ~6000 cars/week instead. But that's Tesla's overriding goal.
Tesla is currently selling 2500 Model 3 Cars / week based on latest estimates. A drop from Q3 2018. USA is at the end of a car cycle, so the USA is dropping sales in general (this is why Ford and GM shut down so many of their factories, in preparation for this cyclical downturn). Tesla is feeling the effects of this as their sales drop. They HAVE to get Chinese and European sales numbers up now, to make up for the loss of American sales.
Europe is completely stuck in economical weak growth, and has an extremely high population density and good public transport system that makes it clearly try to steer away from personal vehicle. Not to mention the fact that german cars are starting to embrace electric engines, and have an insanely better reputation regarding manufacturing quality than tesla.
There again, i don't see how a 40k vehicle is going to sell well enough to compensate from the american market decline.
You basically cannot get timely repairs on a tesla. This is getting mainstream coverage.
Your car could be out of service for 5 months. That's simply a no-go for a lot of more mainstream buyers myself included.
My own prediction, some skinny / dark days ahead until they work out some of the kinks. Execute on getting parts inventory up / available. Model Y execution. And price - a huge segment at 32K or so especially in Model Y segment - my worry is that with federal rebates going away the price issue becomes much worse.
You get a loaner Tesla during repairs so it's not that bad.
I was at work and discovered a flat tire at lunchtime. By 2pm there was a truck there with a loaner wheel, identical to my wheel. Not a lame low-speed wheel. The tire was also identical... same brand, same model. They took my wheel away and when it got to the service center, they called me and said that the tire would need to be replaced, as the flat was not fixable.
After a week they called me and said they couldn't find my wheel. It was lost somewhere. They said they would keep looking. Sounds like a nightmare, right? Well I had the perfectly good loaner wheel, so I was fine. It's a company going through some growth spurts, so there are bumps in the road sometimes.
Then a week later I came too close to a curb and put curb rash on their new loaner wheel. I had signed a document saying I would be responsible for damage. I called them (no hold time btw) and said hey, you lost my wheel, and you're taking a while to get it back to me, are you going to hold me to this thing about no damage on the loaner wheel? And they said, no, some wear and tear is fine. I mentioned the curb rash and they said don't worry about it, it's fine.
A week later they called and said they had found the wheel, replaced the tire, and the new tire replacement would be free, comped by Tesla because of the extra delay. That day they brought my wheel with the new tire on it to my workplace and mounted it onto the car in the parking lot, which took all of 10 minutes out of my work day. No charge for the tire, no charge for the time, no charge for the curb rash damage to their loaner wheel, no charge for anything whatsoever.
During this entire time notice I did not lose use of my car at all. Nor did I have to go to any service center.
People who do lose use of their cars get loaners... different from their own cars, but a bit too first world of a problem for me to complain about.
I didn't mind not going to a tire shop... tire shops are not my idea of fun.
2019 Model 3 - $530 2019 BMW 330i - $370 2019 Lexus ES 350 - $335
It's amazing that Geico wants 60% for Model3 compared to ES 350, which is a true 4 passenger luxury sedan.
I think Tesla is missing a trick by not clearly distinguishing the models for insurance purposes. The SR buyers are subsidizing AWD P buyers insurance.
I wish there were a forum were decent discussion about Tesla would still be possible but wherever (HN, Reddit, Ars Technica, ...) you look, it always ends the same way.
Any recommendations, maybe?
Twitter and Reddit are good as long as you use the Mute/block buttons to weed out the crap from both sides.
They are still stuck hating the CEO, regardless of the company’s achievements, so it is useless to try to debate.
I remember a few names of the worst offenders that I just ignore now but it sucks anyways.
Edit: Using Stylus, the following solution is possible to highlight the names of selected people (the list needs to be updated when you want to add someone):
a[href$="username1"],
a[href$="username2"],
...
{
color: darkred !important;
}
A forum where this is possible would be highly exclusionary, nothing like Ars Technica or Reddit or HN. Those forums handle simple disagreements in a decent, typical way but there is no way to have a balanced, thoughtful discussion with cultists. Elon Musk has cultists.
Q2 is going to be a positive quarter as the only reason Q1 fell short was missed deliveries from cars in transit to Europe and China.
Tesla sold 10,000ish Model 3 cars in April. That's 2500 Model 3 cars/week. Remember, 5000ish cars/week is the breakeven point, when Tesla is profitable.
https://insideevs.com/news/347137/tesla-model-3-s-x-sales-ap...
Inside EV is pumping the story. But anyone paying attention recognizes that Q3 2018 and Q4 2018 were the quarters to look at. Q3 2018 sold 4653 Model 3 cars / week (and also sold way more Model S / Model X cars).
Tesla is severely behind on Q2 numbers, there's almost no way they're going to hit their guidance. 100%, Q2 will be a miss as well, I guarantee it. The numbers are already quite bad for Q2. Either that, or "Inside EVs" is wrong (quite possible... but buy the rumor, sell the news, amirite?)
Q3 is where you can hope for Tesla to become profitable. They gotta expand into Europe and China and make up for all the lost sales. Americans are at the end of an automotive cycle, Americans are not going to be buying cars for a long time (in general).
2. Tesla is such a divisive topic right now, that you can gather a lot of opinions and viewpoints on this stock. Other stocks, like Costco or Target, are less exciting. There's so little discussion that almost no one would want to talk to me about those stocks.
3. I can state strong opinions as a test to myself. They're documented, and sometimes I'm wrong. But making predictions and improving my own predictive skills in the market is absolutely essential if I want to make money in the long term. So I'll get my "paper practice" with Tesla, with regards to investing strategy.
4. The topics I DO care about deeply, don't get upvoted and don't get discussed. https://news.ycombinator.com/item?id=19702487 .
It takes two to tango. I post interesting subjects when I can, but everyone around here is talking about Tesla. I'd rather talk about GPUs and CPUs, but there really isn't as much discussion around that subject these days. (Unless... Tesla makes an ASIC chip. Then I get to talk about GPUs, CPUs, AND Tesla at the same time!)
If you're insinuating that maybe I have a greater reason... I own ZERO Tesla stock. The shares I do own are Costco, Lattice Semiconductor, Ford, SPY ETF, Pebblebrook, and a few others. Tesla is purely a theoretical exercise for me, since there's a lot of discussion online and analysis available. Other stocks don't even have a fraction of the analysis or discussion Tesla has, so its great "practice" as far as I'm concerned.
I don't short shares either. So no shorts, nor do I have any put options right now. (My last put options / bear bets were on Kellogg and on Bank of America, if you want to know my stock-trading history). I don't make many bear bets or play it short very often... its very difficult to predict short squeezes and other issues like that, so I recommend people to stay away from shorting.
> ... we expect to return to profitability in Q3 and significantly reduce our loss in Q2.
https://www.sec.gov/Archives/edgar/data/1318605/000156459019...
Can Tesla by itself exist after 5 years ?
I can't see a middle of the road outcome for Tesla; it'll either be wildly successful, or Musk will destroy it in the attempt.
But fundamentally, an acquisition of this nature is a simple build vs buy decision. In a situation where Tesla is ready to undergo a fire sale, its R&D will have already been cut to the bone.
If Tesla stagnates technically, "build" becomes infinitely more attractive; you're no longer desperately chasing a moving target, you're simply replicating what is known to work. Companies that can do this (as opposed to original R&D) are a dime a dozen.
If the company is still healthy, I just don't see who would have the means and motive to acquire it.
Tesla has a clear path forward, they are just raising to start Model Y, Semi and Pickup production.
https://www.marketwatch.com/investing/stock/f/financials/bal...
Tesla is valued in large part based on the kind of math you'd commonly see applied to a VC backed company three orders of magnitude smaller; multiplying a large payoff value by a small chance of success.
People are making a bet on it becoming a trillion dollar behemoth that snatches tons of market share from energy and automobile companies during the turbulent switch over to renewable energy.
If you're confident in their execution, it's worth it to have Tesla swing for the fences chasing this vision even if there's a large chance of failure. Assuming of course you have diversified - I think you'd have to have a screw loose to go all in.
(Not my view that they actually will go bankrupt. But failure due to overspending on fixed costs tends to work out differently than being unable to cover marginal costs.)
If you can just avoid dying, you get rich. That sounds like a joke, but it's actually a pretty good description of what happens in a typical startup.
Q1 2019: -702
2018: -976
2017: -1,961
2016: -675
2015: -889
2014: -294
2013: -74
2012: -396
2011: -254
2010: -154
2009: -56
2008: -82
2007: -78
If you use a loan against your shares to buy more shares and that causes your share value to increase, that's a very interesting chain of events.
Of course, in 3 years, Tesla's situation could easily be vastly different in both directions. And Musk would probably prefer to fund Mars ambitions than necessarily Tesla.