Musk tweets he reached out to Apple's Tim Cook for acquiring Tesla | Hacker News Reader

Musk tweets he reached out to Apple's Tim Cook for acquiring Tesla

uk.reuters.com

19 pointsthg14 comments

If Tim Cook met Elon Musk, Elon Musk could have then disclosed the meeting occurred via side channel media leak: “Apple meets with Elon Musk to discuss purchase.” If that rumor got out, it would cause Tesla stock to jump (which Elon Musk likely wanted in the first place). This could then put pressure on Tim Cook to say he does not want to buy Tesla publicly. It would also confirm that Apple is interested in the car business. It could also result in pressure on Tim Cook to actually pursue the acquisition of Tesla or an investment by his own board and the media.

None of the above is really in Tim Cook’s best interest unless he really wanted to buy Tesla and displace himself as CEO of Apple. Face it: Tim Cook is not in the same league as Elon Musk and the Apple board of directors might “Smell Blood” and begin thinking of ways to exit Tim Cook and replace him with Elon Musk if such a meeting ever did occur. It is literally nothing but potential downside liability or distraction for any strategy Tim Cook has for Apple.

Tim also likely has a multi year strategy in place for Apple, all of which has been signed off on and which he does not want to shake loose. A random meeting with Elon Musk sends a signal that Tim Cook’s strategy is not final, which creates distractions - something you do not want when you are running a company the size of Apple. It is VERY HARD to keep executives and the board on track.

If you are not familiar with executive power games, you might not understand why Tim Cook would turn this meeting down. Simply meeting with Musk could set into motion a chain of events resulting in his deposition or serious disruption to Tim’s plans.

Elon Musk could then use the opening to build influence channels into the Apple board and key investors which could undermine Tim Cook’s power.

I know we all love Elon Musk, but he is a very dangerous executive and you don’t make mistakes like this with someone like him, he will exploit them to their fullest potential.

“We all love Elon Musk”?

lol

Elaborating on the “not in the same league” part, I would add that Tim Cook oversees a company and supply chain with revenue and profit far exceeding what Elon Musk has overseen to date. Musk has a some deep technical chops that Cook cannot match, but Cook has some deep managerial experience that Musk cannot match.

Any way you slice it, Apple made the right choice.

How so? Apple could have bought a big chunk of Tesla and flipped it back to the public market for ~10 times the price today, for a cool $500B+ profit. Even if they wanted nothing to do with the company's operations.

Of course, such an operation would typically be done by a hedge fund or private equity firm. But guess who is responsible the one of the world's largest hedge funds [1] with $200B+ AUM...

[1] https://en.wikipedia.org/wiki/Braeburn_Capital

That's easy to say in retrospect, but Apple stock would've also taken a hit buying what was a failing company at the time. It would've also demanded more resources and a strategic pivot on their part.

Apple makes long-term, informed decisions. Buying Tesla then and now is a pretty tough argument to make.

Oh, I definitely agree that the most prudent decision a few years ago was to avoid Tesla like the plague. Why would Apple, the most profitable company in the world, want a nearly-bankrupt car manufacturer on its books?

Nevertheless, with the benefit of hindsight, it was likely the wrong decision from both a financial and strategic viewpoint. It's the kind of wrong decision Mark Zuckerberg avoided when Facebook bought Instagram and WhatsApp (despite being ridiculed at the time). Over the next decade, Tesla will likely be one of the most serious threats to Apple's dominance in high-end consumer tech goods (the other being companies working on AR/VR).

It's never a good decision for Apple to buy Tesla, even in hindsight. Buying a capital intensive company within a heavily regulated industry is not the same as buying a social media company or a messaging app.

An increase in the stock price has little to do with the success of the actual business. Tesla hasn't gotten 600% better at being a car company. So far, Apple would only benefit from a Tesla purchase by selling the stock--which would defeat the whole purpose of buying it in the first place (Apple is not a hedge fund).

What?!? You cannot liquidate a majority stake in a company, much less a high flyer absurd beta name like TSLA, without collapsing the market. And nobody but Musk wants to hold all the cards in TSLA because nobody is truly confident it should be valued up here. But they want enough skin in the game to participate in the ridiculous squeeze. If you tried to market even 10% of the float (absent the SPX inclusion event) you would see a serious pullback.

I disagree, I think this will go down as one of the biggest mistakes in Apple’s history. It could be the downfall of the company. Their business model depends on owning the whole ecosystem — every computing device you use day to day. Once cracks start forming in that ecosystem, trouble starts.

Tesla should sell the iPad in the car. If they sold them each for $1,000 and sold 500 a day (probably on the low end) they could do more than $10M a year in profit probably.

they should sell the battery separately too, maybe....

The “iPad in the car” is very far away from being an iPad. It’s even far away from being a useful low-end Android tablet. It would take a vast amount of R&D to make it successful as a standalone product.

Oh it’s just a random tablet? Do you know what software (code) it uses? I always thought it was IOS which is the same as IPADs I think

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