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Comment by reaperducer | Hacker News Reader

Aren't Twitter workers still trying to get their severances and they took the offer when Twitter actually had the money to pay.

Considering that SpaceX is so far behind on its bills that dozens and dozens of companies in Texas have had to place liens against the company, my guess is that neither the Twitter people, nor the SpaceX people, nor the federal buyout people will ever see a dime.

For some reason, links to stories about the leins and SpaceX becoming notorious for not paying its bills are hard to come by, but it's in the printed newspapers regularly; as recently as yesterday. Here's and older link I could find: https://www.chron.com/culture/article/spacex-overdue-bills-t...

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The article mentions $2.5MM liens which is drastically less than 1% of expenses of $1445MM ("[SpaceX] generated $55 million in profit on $1.5 billion in revenue during the first quarter of 2023")

It don't appear to be because SpaceX is having trouble paying.

I would guess SpaceX are delaying payment as much as possible because it is cheap lending and because it's run as an extremely mercenary company.

Their costs of deliquent payment are likely below their lending costs. So optimally don't pay until the cost of deliquency exceeds lending costs (maybe ≈ junk bond rate per year).

While interesting, I don't see how it might make any difference to any federal workers' decisions?

Musk doesn't pay "because he can get away with it" isn't better or worse than "because there's a money shortage"; and in any case, the federal government being delinquent is a very different kind of catastrophe, as is it making promises it refuses to keep.

Many things are based on the assumption of the impeccable credit of the US government.

Elmo being a shitty business partner isn’t the same as the US.

We're on the same page, I think.

There's a possibility of contagion from Musk to the US government, but I very much agree they're different — and it's much worse if that contagion goes from potential to actual.

Who give a shit what their revenue is. It tells me nothing about how they pay their vendors.

2.5mm in liens is just how much they have proveably shorted construction workers in Texas. It doesn't count other vendors doing work that isn't elegible for a lien, or how many workers got shorted, but it just wasn't enough to worry about.

If you were one of the 70+ businesses that held a lien against them, you would think differently.

> It don't appear to be because SpaceX is having trouble paying.

Having the cash to be paid out, and having the systems in place to pay your bills are two different things.

> I would guess SpaceX are delaying payment as much as possible because it is cheap lending and because it's run as an extremely mercenary company.

Violating the terms of your contract isn't cheap lending. It is fraud. The fact that they are getting away with it isn't a defense.

> Their costs of deliquent payment are likely below their lending costs. So optimally don't pay until the cost of deliquency exceeds lending costs (maybe ≈ junk bond rate per year).

Consistently and intentionally violating the terms of payment is, as noted above, fraud. They are getting away with, and they might continue to get away with it, but mercenary businesses getting away with crime is a bad thing.

I mostly agree with you. I wasn't excusing or agreeing with the behaviour. I was only trying to ponder the amoral financial incentives.

Aside: I think most moral people struggle to even recognise amoral decision making. I also suspect that learning to be more sociopathic can be profitable. I don't much admire most doyens of business. Trying to fight amoral business people seems like a personally losing game because you eventually internalise their tricks.

Sigh, these rage bait style of responses are as bad as the original article. Reuters was not even able to figure out what % was due to contractors as opposed to Tesla itself.

Everything you said says nothing of how they pay their vendors. $2.5mm is not exactly breaking news for construction projects. Most large projects have some percentage of total project value in liens.

I know we all want to get upset but its too hard to say either way, the dollar amount is far too small, it maybe involve a large portion of contractors and based on the cost of the development does not seem to be a rampant issue.

>> Most large projects have some percentage of total project value in liens.

I hate to be this guy but please provide a source for this. I’ve been involved in the construction industry for quite a while, almost exclusively on large and mega projects, and “most” of my jobs have not had any percentage of their total project value in liens.

One company that refused to pay for work my (then) company performed is SpaceX. Our work did not permit filing a lien.

My experience with projects and AP in general. ~$2mm across 70 liens without any split between contractors vs spacex is not that interesting. Did not look like they even accounted for a chain of liens based on the same original unit of work. The report came out in 2024 and the count and $ sum was from 2019, so over 5 years including COVID years. During COVID liens jumped quite a bit and on projects that span multiple years I don't find $2mm over 5 years that shocking.

Now SpaceX could totally be stretching their NWC as far as it goes and always paying late on purpose. Really impossible to tell in this style of shock reporting.

I would be surprised in your experience that you have never had cases of a GC not paying on his end and those folks throwing a <$100k lien on the project. Or a dispute between the GC and payer.

There are disputes about payment on lots of projects I've worked on. That wasn't your claim. You claimed that liens were filed and perfected on "most" jobs, and that is not my experience.

And I said that was my experience that liens often crop up and the scale of these were not out of the norm especially on the project size and timeline. After all the project is actively being used and some of these are not purely new construction related. Boo.

It could be, also, that they are refusing to pay because they are not happy with the delivery and looking to fight it further in court. I’d say they have real cash flow issues when they stop paying their employees and electricity bills.

Sadly, it's super common in business to delay paying up.

That’s still an expense even if they didn’t pay. Same as when you bill a customer, it’s considered revenue even if they didn’t pay. They probably have cash flow issues since it reached the lien stage.

Edit: Never mind. They’re counting Musk’s personal donations against spacex. See reply.

——

SpaceX donated $265M to Trump last year:

https://www.opensecrets.org/2024-presidential-race/donald-tr...

It sounds like that’s comparable to their total profit for the year, and it would cover the liens 100 fold.

I wonder how much of that cash was taxpayer money that got laundered and used for Trump’s personal finances.

$280,475,260 of total contributions was from individuals. AKA Elon Musk.

https://www.opensecrets.org/orgs/summary?id=D000029147

Thanks for correcting me.

The page I linked is confusing. (Why attribute it to SpaceX, but not X or Tesla?)

When you disclose this stuff, you have to list the donor's occupation/employer, and Elon said he was CEO of SpaceX every time he funded his PAC.

Peak HN. You are literally making things up about something you know nothing about.

Is it possible Mr. Musk's companies are actually in deep trouble financially, and this political stuff is actually a means to an end?

Tesla is abundantly wealthy mostly on the back of it's delusional investors creating a self-fulfilling prophecy.

As was Enron...

Enron is making a comeback now: https://www.cnn.com/2024/12/02/business/enron-resurrected-jo...

as a crypto play apparently, so

> mostly on the back of [its] delusional investors creating a self-fulfilling prophecy

continues to hold true.

Sounds like crypto…

I'm not saying you are wrong, but GME is an interesting contrast. Despite delusional investors they didn't manage to make anything of it.

They're still around. Remember they were shorted because they seemed on the verge of bankruptcy..

More zombie than thriving though.

Fair enough. They were able to exploit it with a massive share offering at a high price, which not only got them in the black but set them up with considerable holdings sufficient to survive the next downturn. So they're not going anywhere. But yeah, I don't think they have any ideas for future growth.

They should have used that money to buy GOG and go into digital distribution competing with Valve & Epic, or something like that.

But then again, so many stable companies get pushed by their investors to make big ambitious bets, then go belly-up. I kinda got respect for them just focusing on a good brick-and-mortor game buying experience.

Tesla is a fraud just short of Enron. (Enron was a complete fabrication. Tesla is a real company with fabricated valuation.) The valuation is based on hand wavey gibberish. The company has repeatedly sold consumers products that don’t exist. The concepts of duty of care, loyalty, and obedience are foreign concepts to the owner of the company.

JP Morgan’s analyst position on the company really says it all: https://finance.yahoo.com/news/jpmorgan-deeply-skeptical-wal...

The scary thing is that the lie is so big, everyone is exposed to it — TSLA is 2% of VTI’s holdings.

I don't know offhand what TSLA's stock price is, but I think it's fair to say that the speculative value is at least very high if you believe that Tesla Optimus is at all a viable competitor to Boston Dynamics Atlas. I see much more long-term potential value in that than the car business.

Robotaxi is also a pretty interesting bet. I'm skeptical that it'll pan out, or at least that it will ever reach the same level of safety as Waymo without lidar, but on the other hand AI has obviously significantly advanced and been significantly democratized compared to when Tesla first launched Autopilot over a decade ago. More significantly, I see the decentralized rollout strategy as a potentially viable path to beat Waymo to the punch of a full-scale deployment. Waymo might still get there first based on its headstart and massive warchest, but Tesla's strategy is essentially crowdfunding it while using the market to optimize geographic distribution. The downside is that allowing the Robotaxi to be used in arbitrary/novel locations might be significantly less safe and/or more computationally expensive than Waymo's approach, so it's a more uncertain bet than Waymo.

I'm also thinking that we'll have "cool" humanoid robots before we'll have fully autonomous cars.

It just seems that self driving is staying a "hard problem" (harder than expected!)

Both would be insanely economically valuable.

I do fear humanoid robots will face intense competition from Chinese mass manufacturing, undercutting them with cost while mostly matching features.

It’s about 180x earnings, just under $380/share today.

Elon dangles all sorts of bullshit to get you thinking about nerd nonsense. “OMG, a Tesla robot will do my laundry on Mars with my robot rocket ship!”

It’s all bullshit. They’ve been dangling the imminent $25k car for a decade. The Tesla roadster that people put huge deposits on is nowhere to be found.

People are figuring it out. My previous comment would have created a 100+ comment thread in HN 5 years ago.

Both Tesla and SpaceX are insanely profitable.

Tesla was very profitable. Gross Margin is 14% now of revenue now. 1/4 of their their $8B profit is emissions credits. That's not shabby and they have lowish debt ($20B).

But it isn't what I'd call insane. Google's gross margin is 58%, profit is $349B.

I'm not sure why you're comparing the gross margin of a car company to an internet company. General Motors has a gross margin of 10%. Ford's is 7%. Historically Tesla's was ~25%, but yeah it's fallen a bit since I last looked.

> I'm not sure why you're comparing the gross margin of a car company to an internet company.

Because the benchmark set was "insane". I agree no car company gets insane profitability levels. Tesla was never insanely profitable by most metrics.

SpaceX is not insanely profitable. Starlink might become so, but it isn't yet.

Only because they're funneling every dollar they earn into Starship. But as Starship contributes absolutely nothing to current revenue, excluding those costs is the only fair apples-to-apples comparison. We don't know their exact costs because SpaceX is still a private company, but estimates are on the order of 60% profit margin across their business lines.

I am complete outsider and know nothing about this so I am sorry to ask but in my view this is a shocking proposition. Can anyone corroborate this?

EDIT: Specifically the claim that "SpaceX is so far behind on its bills that dozens and dozens of companies in Texas have had to place liens against the company"

Corroborating complaints about twitter severance [0]. The lawsuit was dismissed because of jurisdiction, not merit.

[0] https://www.reuters.com/legal/elon-musk-beats-500-million-se...

They churn through employees fast and they usually exit through burnout (no offloading) and the people wanting to work there skew towards young people who don't know what they're doing. A lot of work gets delayed, dropped, etc and some bad suppliers even take advantage of that ("the last person said they'd do X").

I know it's en-vogue to hate on Elon companies, and a lot of people would love to hear that the World's Richest Man is having financial issues, but in reality it's a bunch of starry-eyed newgrads trying to make the world better but taking on more than they can handle.

It's remarkable that, for a bunch of young people who don't know what they're doing, they've completely decimated any competitors - both public and private.

These guys are idiots, fucking morons, and can’t get anything right. Somehow they’re also outcompeting us on everything. It isn’t clear why, but it must be because we are smarter.

China very effective at copying all the stuff SpaceX is doing despite this being deliberately made difficult by ITAR, suggests there's a lot of room for the American (and ESA) competitors to be structurally inept without needing Musk's staff to be demonstrating an unusual (as opposed to industry standard) degree of genius.

They have copied the external look of the rockets (which is, for obvious reasons, not protected by ITAR), but to my knowledge no one, China or otherwise, has managed to match the internal engineering prowess nearly a decade later.

To say that China is "very effective at copying all the stuff SpaceX is doing" is quite the stretch.

Blue Origin has finally turned it around and is getting close to matching SpaceX.

I sure hope so, but also caution (admittedly as an outsider, your posts suggest greater familiarity than I have) that there's not enough evidence yet to be confident of that — finally getting to launch is really impressive, but their first orbital capable rocket is still a sample size of 1.

(Counter point is that New Glenn's one orbital launch is more impressive than all of the Starship launches combined, as SpaceX is willing to burn hardware during tests and they have many more Starship tests to go).

I know people at SpaceX, but I don't know anyone at Blue Origin. We're all very curious to know what has changed, as they very clearly have made changes. There was a large shakeup in company management there in late 2023, and the turnaround on timeline was stunning. They are certainly moving very, very fast now.

China is the world's largest economy by large (in terms of their internal costs - PPP), have 1.4 billion people meaning a proportionally larger share of extremely capable outliers, a highly capable technocratic orientated leadership with defacto authoritarian powers to get things done, and they are highly motivated to demonstrate successes in space. And a lot of SpaceX's 'secret sauce' isn't really secretive. For instance that Starship is made out of stainless steel is a big deal, but now provably correct. And rapid reuse/landing is again now obviously viable and a very good idea, which was not at all apparent for many years.

In spite of all of this they are still a very distant 2nd place behind SpaceX. If anything ITAR hurts more than helps SpaceX since it means their talent pool is strictly limited to strictly domestic talent. They seriously have something "special" going on.

Are they behind? China has a space station and they have done a sample return from the Moon. They've landed on Mars as well. If you stick to a narrow definition of rockets, there's a case to put SpaceX ahead. But overall, they are closing the gap with the US very quickly. I would not be surprised if they put humans on the Moon before Artemis or SpaceX.

Yeah I'm definitely only speaking in terms of rockets. In terms of achievements I think China is probably #1 overall, but it's close -- SpaceX's Polaris Dawn mission puts them well ahead in terms of human spaceflight. That said if we just dropped the whole SLS nonsense and started dedicating NASA's $20 billion+ per year to actually doing stuff, our achievements would rapidly surpass given the edge in rocketry.

Artemis definitely isn't going to be putting anybody on the Moon. It again relies on the SLS which is just an endless money pit. But I do think it'll be interesting to see if SpaceX gets there before China. But I think the big picture is on Mars. I expect whoever gets their first will probably foretell who dominates space for the next century. Because once you can put men on Mars, the entire Solar System starts to viably become your playground.

Damn, all these fucking morons and idiots are not structurally inept and everyone else somehow is. It must be because we are very intelligent that these morons are successful.

I'm not entirely clear who you're mocking here; Boeing, trying to understand why SpaceX and China are doing well? If so, we're on the same page.

all the other competitors are unserious and/or treating it as a money siphoning scheme. in particular, the public contractors siphoning money from the government and blue origin siphoning money from bezos.

It would be surprising if spacex wasn't just awful at paying things on time, as there's no reason they should have actual financial difficulties.

I don't know what the person you are replying to is talking about. They clearly don't know anyone who works at SpaceX. The age there does trend young, but think 24-year-old flight controller for Apollo, not intern that doesn't know anything. I have friends who work at SpaceX and gripe about how difficult it is to hire people. But not for lack of applicants--their standards are just so high. Nearly everyone working at SpaceX is cracked.

> 24-year-old flight controller for Apollo

E.g. intern that knows nothing

From the perspective of a crusty old man anyway.

The average age of everyone in the room at Mission Control during Apollo 11 was 28. The managers in the room were outliers (e.g. Gene Kranz was 36), which drew the average up. The median age was younger.

The Manhattan Project was made possible by similarly young grad students.

You can be as crusty as you like, but the reality is that young smart people can be extraordinarily effective under the right conditions.

Flight controllers execute the mission, but they also rely on the engineers who built the things and wrote the procedures. Flight controllers often are young, even today and even in control centres outside SpaceX. The engineers designing and building the systems tend to be a bit older.

Not in the Apollo days they weren't. They were almost all straight out of engineering school.

I know a few people working at SpaceX. Most are good. But a few I wonder how they ever got hired there.

As a customer of SpaceX, though, I have to say their customer service is barebones. It is almost a relief when I work with another launch provider since they provide a much better service and support. I always compare it to a low cost airline in my head, like flying Spirit instead of Emirates kind of thing.

They've outcompeted by improving their designs faster, by being willing to take risks and do stuff that might work, rather than requiring 9000 levels of process for everything. To my mind that's completely consistent with the kind of company that might lose track of some invoices and not pay until a supplier kicks up enough of a fuss.

Yeah, I've always been trying to be objective as possible when it comes to the hate sent towards Tesla, SpaceX, etc from the heat Elon is getting but having lived near Hawthorne, I've met a couple of people who worked at SpaceX and it is insane. I had a really good friend who moved from the midwest with his wife to spacex and she became a favorite at spacex which meant she lived at spacex. He would see her like once a week and eventually they went to shit. I had applied there before but after seeing that I was no longer interested

The only thing surprising to me is how people don't know this.

The propaganda machine must be real good.

I think people in the industry know? I went to a SpaceX recruitment event back in 2010, and even then they were very upfront about it. People give their heart and soul to the company, and their turnover from burnout is shockingly high. The recruiter had some nicer way of phrasing it, but it was completely transparent what they meant.

Why was this guys wife so important to have around the office at SpaceX if she wasn’t an employee?

I think he is saying she is a SpaceX employee, and was doing well at her job but working a lot.

It is confusingly worded, but I think the wife is the SpaceX employee.

To be a neutral as possible. The claim is very much a hit piece that makes a good soundbite or headline. Most large construction projects have single digit liens that get placed against it and in this case we don't know what % of the liens are because of contractors not paying and which are SpaceX themself.

Hadn't heard of it either until up-thread so I looked. The two primary articles that were found on a search were from Reuters and the San Antonio Express News. Most other seem to just be referencing the Reuters article and using the same quotes. Tend to think the opinion up-thread is probably close, and SpaceX is basically not paying because they can, because people want the work, and because they can make more holding the money and delaying as long as possible, while eating relatively small fees.

Reuters, May 2024: "Quick to Build, Slow to Pay" https://www.reuters.com/technology/space/musks-spacex-is-qui...

SAEN, Feb, 2025: "Contractors say they're owed more than $5.5 million" https://www.expressnews.com/business/article/spacex-unpaid-c...

There's also a "somewhat" unique one from MySanAntonio that goes over the general range of lawsuits that are being filed against Musk in Texas over a range of issues. It happens to include the Reuters article lawsuits and liens as one of the many listed.

MySanAntonio, Sept, 2024: "lawsuits in Texas" https://www.mysanantonio.com/news/austin/article/elon-musk-t...

https://www.fastcompany.com/91124157/spacex-contractors-texa...

https://www.reuters.com/technology/space/musks-spacex-is-qui...

They're hard to come by because people think rockets magically solve all of our problems and so any problems they introduce are ignored for the "greater good".

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