Is Elon Musk a fraud?

[The Abundant Man]

Sliced bread... one of my favorite inventors in history.

Elon Musk has become the entrepeneurial world's version of the Kardashians.

Tyler Durden: We're consumers. We are by-products of a lifestyle obsession. Murder, crime, poverty, these things don't concern me. What concerns me are celebrity magazines, television with 500 channels, some guy's name on my underwear. Rogaine, Viagra, Olestra.

-Fight Club

 

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[SquatchMan]

Tesla could not be in business without government subsidies and does not produce a profit.

He could certainly be in business without government subsidies. He'd just up the price of the car and raise more investor money to cover the loss. He doesn't do this because he doesn't need to do this.

Amazon didn't produce a profit for 13 years or so. Twitter just made a profit in Q1 2018. Tesla is in a growth phase, so they just keep spending investor money.

They'll stay viable as long as Musk can keep convincing investors that the company will eventually turn a profit.

The only way Elon Musk stays in business is by INVOLUNTARY transactions that force others to pay. Is that really being an entrepreneur?

That's not the only way he stays in business. He also sells cars to people to generate revenue (not profit) and receives investor money.

The invoice when you purchase a Tesla vehicle goes to the future owner, not the US Treasury. The government has nothing to do with the purchase a Tesla.

---

All that said, I understand how people have an issue with Tesla receiving subsidies and property tax exemptions (he isn't the only company that receives gov't money though. Look up the CIA's VC fund "In-Q-Tel" and basically every MLB, NBA, NFL, and NHL team if you want to see more examples.).

However, calling Musk a "success" (implying he's a failure), comparing him to a welfare queen, and saying he's only successful because of the government are all ridiculous points to make for reasons outlined in my two posts.

 

[kkoasdfawfqwe2]

Also, His businesses are not profitable. They exist only because he is a good salesman and can keep finding more and more investment capital.

Last time I checked, Tesla was profitable in Q3 2018?

Do some digging, SpaceX likely operates at a loss.

Do you have any sources on this?

I find it quite hard to predict this when you have no insight into their books.

His wealth comes from him selling people visions and having a cult personality and being a sociopath that knows how to take all of the credit and indoctrinate followers. He doesn't have a "productocracy" just better marketing and messaging.

No productocracy?

Maybe I've just been lucky to meet the "happy customers", but I've not met ONE Tesla owner, who is not extremely happy with their car. Not ONE - and I've met quite a few. (We have a lot here in my country).

And even if Tesla fails and goes bankrupt, how is the product a scam or not a productocracy, when all the car manufacteurs suddenly want to make the same product for their own brand? You tell me.

 

[NuclearPuma]

Last time I checked, Tesla was profitable in Q3 2018?



Do you have any sources on this?

I find it quite hard to predict this when you have no insight into their books.




No productocracy?

Maybe I've just been lucky to meet the "happy customers", but I've not met ONE Tesla owner, who is not extremely happy with their car. Not ONE - and I've met quite a few. (We have a lot here in my country).

And even if Tesla fails and goes bankrupt, how is the product a scam or not a productocracy, when all the car manufacteurs suddenly want to make the same product for their own brand? You tell me.

ill concede the Tesla has a lot of happy owners.

On SpaceX books:

Profit if you include prepayments and exclude R&D.... eh okay, sounds like they are just skating by.

Disclosures to potential lenders showed the company had positive earnings before interest, taxes, depreciation and amortization of around $270 million for the twelve months through September, people with knowledge of the matter have said earlier. But that’s because it included amounts that customers had prepaid and because it excluded costs related to non-core research and development. Without those adjustments, earnings for the period were negative, the people said.

All I'm doing here is giving another side a lot of people may not know.

Tesla and SpaceX are valued in the billions because Elon can sell investors and has run them at a loss for most of their existence. That is common for Silicon Valley. Going from nothing to 20+ billion dollar valuation twice though is amazing. Guy is super talented at getting shit done. It's a long road.

But he isn't some super empathetic altruistic guy by any means like he is painted. He has no empathy. He is a slave driver at his companies with a cult personality that inspires people to work insane hours.

There are a lot of billionaires that could be studied but Musk has made his way into pop culture and it seems like idol worship at times. He is human.

Musk is a good study though to ask yourself what would you do with a few hundred million dollars? Shows you how much can be done if your willing to put the money at risk on R&D.

 

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[kkoasdfawfqwe2]

On SpaceX books:

Profit if you include prepayments and exclude R&D.... eh okay, sounds like they are just skating by.

"Disclosures to potential lenders showed the company had positive earnings before interest, taxes, depreciation and amortization of around $270 million for the twelve months through September, people with knowledge of the matter have said earlier. But that’s because it included amounts that customers had prepaid and because it excluded costs related to non-core research and development. Without those adjustments, earnings for the period were negative, the people said."


All I'm doing here is giving another side a lot of people may not know.

Where do you get these numbers though and these statements?

I can imagine a rocket & space exploration company to be burning money faster than the speed of light, its not about that, but I'd just like to see some documentation for it, if thats the case with SpaceX.


Also in regards to Elon Musk, I have read the book about him and I'm not saying he is a nice person by any means.

To me its not relevant when it comes to doing things nobody has ever done before, then the goal in mind is all that matters.

 

[Jeff Noel]

For the SpaceX part: I don't think Elon even cares that this business becomes profitable. The end goal is way bigger than any amount of money he could made. He also said often "If I wanted to make money, I would have launched another Internet company instead of rockets".

The man changed the world. All those eletric cars going around that are not Teslas, they're there because Tesla pushed their development. Tesla opened up their patents to other manufacturers.

Not only that, but the last time Electric vehicles tried to sell, they've been destroyed by the oil cartel. Watch the following:

View: https://www.youtube.com/watch?v=vRnUY6V2Knk


If it wasn't for the fact electric vehicles of the '90s disappeared suddenly (most of them), imagine how far that technology would be today ? That's what Tesla did. They also innovated like crazy for batteries (Hello Australia), powerwall and they're developping complete, durable solar roofs.

The Roadster 2 is about to land and the next models by then will most likely 1.5x-2x their autonomy (The roadster 2should do ~600 mi/1,000km per charge). It will also shatter a lot of records for a production EV vehicle.

What about The Boring Company that's doing crazy R&D to change a (w)hole industry (lol) ?

What about Neuralink working on a Computer-To-Brain Interface ? Imagine the potential life changing things there.

What about OpenAI revolutionizing Machine Learning algorythms ?

 

[lowtek]

I think it's reasonable to debate the ethics of building multiple businesses around government subsidies. It's also reasonable to call him out on his antics, i.e. manipulating tesla stock price with the "funding secured" tweet.

It's not reasonable to call him a fraud, as he's not lying about his products. You want an EV, he sells several. You want to launch some shit into orbit, he can get you there. That's a fair and square transaction.

 

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[ZF Lee]

I think it's reasonable to debate the ethics of building multiple businesses around government subsidies.

I felt it was fine of Elon to get some government help, as long as government serves as a partner to provide what Elon cannot get with his regular sources and that government has interests in his projects. Nothing wrong with working with parties that have interests in what you do.

So if Elon is running a scam with all his companies, what do you want him to do? Sit in a musty armchair with a thumb up his a$$?

 

[Isaac Oh]

What is your affiliation with this blog? Seems random af.

It's a blog post from 2016, doubtful it's any promotion

 

[Roli]

I will say this.... I WILL NEVER EVER BUY A TESLA.

I'm sure Elon will be devastated.



#landfill

 

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[NuclearPuma]

Bl

Where do you get these numbers though and these statements?

I can imagine a rocket & space exploration company to be burning money faster than the speed of light, its not about that, but I'd just like to see some documentation for it, if thats the case with SpaceX.


Also in regards to Elon Musk, I have read the book about him and I'm not saying he is a nice person by any means.

To me its not relevant when it comes to doing things nobody has ever done before, then the goal in mind is all that matters.

Bloomberg article from November 8.

Bloomberg - Are you a robot?

 

[MJ DeMarco]

Eccentric, bombastic, perhaps slightly sociopathic.

Fraud, no.

IMO, this "idea" seems wildly impractical and worthless. Don't know how a 1 lane tunnel that can fit a few cars can help traffic anywhere, much less LA.

Elon Musk’s Boring Co. shows off its first traffic-beating test tunnel

 

[csalvato]

Eccentric, bombastic, perhaps slightly sociopathic.

Fraud, no.

IMO, this "idea" seems wildly impractical and worthless. Don't know how a 1 lane tunnel that can fit a few cars can help traffic anywhere, much less LA.

Elon Musk’s Boring Co. shows off its first traffic-beating test tunnel

one tunnel is meaningless... a network is very powerful

 

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[Dom117]

Eccentric, bombastic, perhaps slightly sociopathic.

Fraud, no.

IMO, this "idea" seems wildly impractical and worthless. Don't know how a 1 lane tunnel that can fit a few cars can help traffic anywhere, much less LA.

Elon Musk’s Boring Co. shows off its first traffic-beating test tunnel

Definitely not worthless. You can dig almost indefinitely.
This is just proof of concept and test just like the Tesla roadster was.
This car was highly unpractical and nowhere near profitable but laid the market foundation for the Model S.

Awesome Quote: "we build our buildings 3D but our transportation systems stays 2D"
You can dig tunnel under tunnel deeper than you can build skyscrapers.
Maglev the vehicles and suck the air out of the tunnel and you can get to 200kmh+ speeds.

I can not think of a better solution apart from lowering the amount of vehicles on the road.

You should check the talk with Joe Rogan on youtube if you want to get inside his mind and really see how he thinks.

 

[csalvato]

Definitely not worthless. You can dig almost indefinitely.
This is just proof of concept and test just like the Tesla roadster was.
This car was highly unpractical and nowhere near profitable but laid the market foundation for the Model S.

Awesome Quote: "we build our buildings 3D but our transportation systems stays 2D"
You can dig tunnel under tunnel deeper than you can build skyscrapers.
Maglev the vehicles and suck the air out of the tunnel and you can get to 200kmh+ speeds.

I can not think of a better solution apart from lowering the amount of vehicles on the road.

You should check the talk with Joe Rogan on youtube if you want to get inside his mind and really see how he thinks.

Bingo

 

[luniac]

Definitely not worthless. You can dig almost indefinitely.
This is just proof of concept and test just like the Tesla roadster was.
This car was highly unpractical and nowhere near profitable but laid the market foundation for the Model S.

Awesome Quote: "we build our buildings 3D but our transportation systems stays 2D"
You can dig tunnel under tunnel deeper than you can build skyscrapers.
Maglev the vehicles and suck the air out of the tunnel and you can get to 200kmh+ speeds.

I can not think of a better solution apart from lowering the amount of vehicles on the road.

You should check the talk with Joe Rogan on youtube if you want to get inside his mind and really see how he thinks.

yea in LA where the next big earthquake is gonna happen and fuk up all those tunnels and the people in them.
Don't know if it's the best state to do this in.
or is it gonna be anti earthquake like elon says with mobile tunnel segments, in that case maybe it can work?

 

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[csalvato]

yea in LA where the next big earthquake is gonna happen and fuk up all those tunnels and the people in them.
Don't know if it's the best state to do this in.
or is it gonna be anti earthquake like elon says with mobile tunnel segments, in that case maybe it can work?

LA has the biggest need of any major US city, aside from maybe NY. And the fact that Space X is based there makes it accessible to do the work.

And tunnels, in general are very earthquake friendly, so to speak. They aren't 100% safe, but they are much safer than, say, a highrise, depending how the entry/exit is designed.

https://www.sciencedirect.com/science/article/pii/S2467967417300053

 

[luniac]

LA has the biggest need of any major US city, aside from maybe NY. And the fact that Space X is based there makes it accessible to do the work.

And tunnels, in general are very earthquake friendly, so to speak. They aren't 100% safe, but they are much safer than, say, a highrise, depending how the entry/exit is designed.

https://www.sciencedirect.com/science/article/pii/S2467967417300053

nice

 

[MJ DeMarco]

one tunnel is meaningless... a network is very powerful

Just don't see the car as the mode of the future, even self-driving on a tunnel rail.

Now the hermetically sealed vacuum tube, now that's what I'm gearing for.
Guess I've watched far too many Star Trek episodes.

 

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[csalvato]

Just don't see the car as the mode of the future, even self-driving on a tunnel rail.

Now the hermetically sealed vacuum tube, now that's what I'm gearing for.
Guess I've watched far too many Star Trek episodes.

Curious: What do you see as the mode of transportation of the future?

 

[MJ DeMarco]

Curious: What do you see as the mode of transportation of the future?

Some form of quantum entanglement.

 

[NuclearPuma]

Curious: What do you see as the mode of transportation of the future?

It's going to be distributed teams and remote working and web conferencing.

Instead of a company having a big HQ they will have multiple smaller offices distributed around the city or country that web conference each other. Each office with a different focus and collaborating through the web.

The best solution in my opinion will be eliminating the need to travel far in the first place. Eliminate massive down town office head quarters and replace with smaller office buildings distributed throughout the suburbs.

 

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[csalvato]

It's going to be distributed teams and remote working and web conferencing.

Instead of a company having a big HQ they will have multiple smaller offices distributed around the city or country that web conference each other. Each office with a different focus and collaborating through the web.

The best solution in my opinion will be eliminating the need to travel far in the first place. Eliminate massive down down office head quarters and replace with smaller office buildings distributed throughout the suburbs.

Until we invent a means of teleportation, people still need to get from point A to point B.

Commuting to work is only a part of that - and likely a smaller part than you think.

For example, if you go to NYC on Easter Sunday and try to drive from Brooklyn to NJ the ride can take up to 4 hours (for a ride that should take 35-45 minutes).

Yes, if everyone worked remotely from home, we would likely see rush hours attenuated, but they wouldn't go away. And in cities where congestion is the norm at any time of day (e.g. London, Beijing, Jakarta, NYC, Hong Kong, LA, etc.) a migration to 100% remote work is relatively meaningless.

Until we are all just heads in jars or have our consciousnesses unloaded to a server, you can never get rid of the innate human need to move your person.

 

[biophase]

I think self driving cars would make people change where they live in relation to work. If you can sleep during rush hour traffic, then a 2 hour drive isn't that bad. I used to take the train to work and I looked forward to my 45 minute nap every morning on the train.

Also, vacations or even second homes would be used alot more. For example, if I get home from work on a Friday afternoon and I want to go somewhere that is a 12 hour drive. I'm too tired to do that, but if I can punch in the destination at 8pm and arrive at 8am on Saturday refreshed, I'm more likely to take weekend vacations all the time.

 

[yaponchik]

If you know anything about R&D and SG&A costs(Most people who worship Musk don't) you'd know that Musk's' companies are worthless.

Musk might be the greatest marketer of all time.

 

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[csalvato]

If you know anything about R&D and SG&A costs(Most people who worship Musk don't) you'd know that Musk's' companies are worthless.

Musk might be the greatest marketer of all time.

Can you elaborate?

 

[yaponchik]

Can you elaborate?

Tesla loses money on every car they make. Fanboys of Musk try to counter this by saying Tesla reports they have gross margins in excess of 20 percent. They say this because they think companies operate without SG&A expenses and ignore R&D.

You must count SG&A expenses unless you believe that Tesla cars dematerialize at the Tesla factory and rematerialized in the driveway of the buyer - and the money is automatically deducted from your bank account and paid directly to the vendors who supplied the parts.

Of course, we know that doesn't happen. There is a large staff of people who work go to work for Tesla every day doing all the things that keep the company running and keep people buying their cars. No company operates on gross margins - gross margins are just a datapoint.

Net margins are what matter, and on that front, Tesla is losing lots of money. And that is separate from their R&D spending and spending on facilities for battery factories and expansions. I'm solely talking about operations to build and sell their existing product lineup.

 

[csalvato]

Tesla loses money on every car they make. Fanboys of Musk try to counter this by saying Tesla reports they have gross margins in excess of 20 percent. They say this because they think companies operate without SG&A expenses and ignore R&D.

You must count SG&A expenses unless you believe that Tesla cars dematerialize at the Tesla factory and rematerialized in the driveway of the buyer - and the money is automatically deducted from your bank account and paid directly to the vendors who supplied the parts.

Of course, we know that doesn't happen. There is a large staff of people who work go to work for Tesla every day doing all the things that keep the company running and keep people buying their cars. No company operates on gross margins - gross margins are just a datapoint.

Net margins are what matter, and on that front, Tesla is losing lots of money. And that is separate from their R&D spending and spending on facilities for battery factories and expansions. I'm solely talking about operations to build and sell their existing product lineup.

What are their net margins and what is your source?

Last quarter they reported profits in excess of 300M on their public earnings report.

Tesla rides Model 3’s popularity to its first profit in two years

 

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[biophase]

Tesla loses money on every car they make. Fanboys of Musk try to counter this by saying Tesla reports they have gross margins in excess of 20 percent. They say this because they think companies operate without SG&A expenses and ignore R&D.

You must count SG&A expenses unless you believe that Tesla cars dematerialize at the Tesla factory and rematerialized in the driveway of the buyer - and the money is automatically deducted from your bank account and paid directly to the vendors who supplied the parts.

Of course, we know that doesn't happen. There is a large staff of people who work go to work for Tesla every day doing all the things that keep the company running and keep people buying their cars. No company operates on gross margins - gross margins are just a datapoint.

Net margins are what matter, and on that front, Tesla is losing lots of money. And that is separate from their R&D spending and spending on facilities for battery factories and expansions. I'm solely talking about operations to build and sell their existing product lineup.

I don’t think anyone here judges profitability of a company based on gross margin.

 

[The Abundant Man]

Tesla loses money on every car they make. Fanboys of Musk try to counter this by saying Tesla reports they have gross margins in excess of 20 percent. They say this because they think companies operate without SG&A expenses and ignore R&D.

You must count SG&A expenses unless you believe that Tesla cars dematerialize at the Tesla factory and rematerialized in the driveway of the buyer - and the money is automatically deducted from your bank account and paid directly to the vendors who supplied the parts.

Of course, we know that doesn't happen. There is a large staff of people who work go to work for Tesla every day doing all the things that keep the company running and keep people buying their cars. No company operates on gross margins - gross margins are just a datapoint.

Net margins are what matter, and on that front, Tesla is losing lots of money. And that is separate from their R&D spending and spending on facilities for battery factories and expansions. I'm solely talking about operations to build and sell their existing product lineup.

Don't care. Can't wait for the future of electric self-driving cars