The Future Of Tesla Is In Musk’s Hands

Is the leading all-electric carmaker dependent on a leader who rationalizes failures as opportunities? Does the future of Tesla rest with a human who sees computer vision as vital to the advancement of technology and society? Could what seems like poor impulse control instead be an element of a larger, logical philosophy, one that Tesla CEO Elon Musk has alluded to on many occasions?

These and other arguments are at the core of this Sunday’s New York Times Magazine cover, which poses the question, “How do you explain Elon Musk?”

Musk “presents himself,” author Christopher Cox says, “as a man who simply embraces astonishing amounts of present-day risk in the rational assumption of future gains.” The article draws upon the metaphor of “blind spots” to dig deeply into Musk, musing that his “erratic” behavior is more cerebral than unsteady, more cautious than capricious.

“If you want a parsimonious explanation for the challenges the company faces — in the form of the lawsuits, a crashing stock price, and an AI that still seems all too capable of catastrophic failure,” Cox summarizes, then look no farther than its “brilliant, sophomoric chief executive.”

It’s Hard to Look the Other Way: Musk is a Human with Many Foibles

In the last year, it has seemed that Tesla narratives focused a whole lot on the antics of mercurial Musk. Many former Tesla aficionados expressed their dismay over revelations about Musk’s private life and other uncomfortable circumstances, worried that his often outrageous antics seeped into the Tesla brand identity. Over and over again, the media asked, why is there such a distinct line between fervor over the Tesla brand and chagrin over Musk’s behavior as chief of the world’s leading all-electric car company?

“Perhaps there’s no mystery here,” Cox offers. “Musk is simply a narcissist, and every reckless swerve he makes is meant solely to draw the world’s attention.” Musk himself may endorse this theory, as shown in his attitude during a recent deposition.

An attorney questioned him, “Do you have some kind of unique ability to identify narcissistic sociopaths?” to which Musk replied, “You mean by looking in the mirror?”

Collision as Data Collection Opportunity?

Cox focuses on the wave of lawsuits that are hitting Tesla this year due to the company’s self-titled Full Self Driving (FSD) software, describing the marketing language around it “dangerously overhyped.”

Musk sees the world, according to Cox, “as part of an ad hoc system of utilitarian ethics” that explain many of the “mystifying decisions that Musk has made, not least his breakneck pursuit of AI, which in the long term, he believes, will save countless lives.”

Cox counters that the Musk’s “long term” attitude may be neglecting the short term.

In February, the first lawsuit against Tesla for a crash involving Autopilot will go to trial, with 4 more to follow in quick succession. Attorneys are arguing that Tesla’s position has adhered to a “single theme: Tesla consistently inflated consumer expectations and played down the dangers involved.”

Bloomberg Hyperdrive notes that Musk’s email series with his FSD developer team included a caveat. “I will be telling the world that this is what the car *will* be able to do,” Musk explained, “not that it can do this upon receipt.”

Prospective jurors in the civil case said Musk had a “mercenary” personality, was “willing to take risks,” was a “fast-rising businessman,” and was a “smart, successful pioneer.”

AP Wire related that Elon Musk was depicted in the “going private” tweet trial as either a liar who callously jeopardized the savings of “regular people” or a well-intentioned visionary.

Cox insists that collisions that occurred as part of the FSD beta testing “generated data, and with enough data, the company could speed the development of the world’s first truly self-driving car. He believed in this vision so strongly that it led him to make wild predictions.”

Would early adopters have an “appetite for risk” that matched Musk’s? Many of the interviews that Cox conducted seemed to say “yes, we are willing to take a chance to be on part of this wild and wonderful experiment into the future of Tesla and technology.”

Musk’s ideal customer, according to Cox, was a person who was “willing to accept the blame when something went wrong but possessing almost limitless faith in the next update.” In a deposition, an engineer at Tesla seemed to concur. “We want to let the customer know that, No. 1, you should have confidence in your vehicle: Everything is working just as it should. And, secondly, the reason for your accident or reason for your incident always falls back on you.”

Personal responsibility is key to the defense that Tesla will make to juries and the closely watching public this spring. The words of the company’s safety report bring it home. “While no car can prevent all accidents, we work every day to try to make them much less likely to occur.”

The Future of Tesla Looks Fine for Many Investors

So much of the Cox article seems to be swirling around the company in addition to the FSD lawsuits — to the point that one might wonder if the time devoted to gathering data and conducting multiple interviews ended up being a detriment to zooming in on the most timely perspective on Tesla and Musk.

It’s hard to argue with Cox when he says that Tesla is “a company that depended on an unbounded sense of optimism among investors to maintain its high stock price.” It was at one point worth more than Toyota, Honda, Volkswagen, Mercedes, BMW, Ford, and General Motors combined.

Then again, Tesla made the headlines last week when it made deep price cuts in the US and Europe on the heels of two rounds of price reductions in China. Those are signs Musk is willing to act aggressively to keep the company growing. Tesla earns more money for every vehicle it sells than any of its global rivals. Now, according to a Reuters analysis, Musk is using that superior profitability as a weapon in the EV price war he started.

Tesla delivered just over 1.3 million electric vehicles in 2022. Before the cuts, Wall Street was projecting about 1.8 million vehicles sold in 2023. Now that Tesla has cut the prices of its vehicles, Barrons says the all-electric carmaker will continue to sell more and more vehicles. In fact, Automotive News Europe suggests that Tesla’s plant in Germany is struggling to build enough Model Y cars to meet increased demand following the company’s recent price cuts.

The Motley Fool outlines that, while Tesla is “one of many Nasdaq stocks to lose significant value in 2022,” the electric automaker remains highly profitable. “And its reasonable valuation positions it for long-term success.”

Tencent, known as one of the world’s largest gaming and social media firms, invested in Tesla in 2017, taking a 5% stake for around $1.78 billion. David Wallerstein, chief “eXploration” officer at Tencent, told CNBC that despite Musk’s distractions, he still counts on the company “to keep blowing our minds with what they do with technology.”

Cox agrees in the New York Times cover piece that “Tesla is a big car company with thousands of employees. It existed before Elon Musk. It might exist after Elon Musk.”

Moreover, Cox acquiesces that “Musk has somehow maneuvered himself into running multiple companies where he can plausibly claim to be working to preserve the future of humanity. SpaceX can’t just deliver satellites into low orbit; it’s also going to send us to Mars. Tesla can’t just build a solid electric car; it’s going to solve the problem of self-driving. Twitter can’t just be one more place where we gather to argue; it’s one of the props holding up civilization.”

“With the stakes suitably raised,” Cox admits, “all sorts of questionable behavior begin to look — almost — reasonable.”

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