“Tesla fires hundreds as Model 3 electric car production drags”

Guest post by David Middleton

In a stunning setback to Stark Industries’ Tesla Motors’ effort to save the world from Hydra Gorebal Warming, hundreds of workers were fired in an effort to speed up production of the Iron Legion Model 3…


Tesla has reportedly fired hundreds of employees amid signs that the company is off to a slow start in manufacturing its crucial Model 3 electric car.


But the firings reportedly included engineers, managers, salespeople and factory employees.

The move comes as Tesla is aiming to rapidly expand production of its new mass-market Model 3. CEO Elon Musk had said the company would be making 5,000 cars per week by the end of the year, but that goal appears to be in jeopardy amid early stumbles.


Musk acknowledged on Oct. 6 that the company was facing “bottlenecks” in Model 3 production. He said Tesla was “diverting resources” to clear up the Model 3 production challenges, which was one factor in the company’s decision to delay its reveal of an electric semi-truck by about three weeks.

The company said in a Securities and Exchange Commission filing on Oct. 2 that “a handful” of its “manufacturing subsystems” have “taken longer to activate than expected.”

USA Today

When a CEO issues production guidance that he knows to be false…

The Truth Is Catching Up With Tesla

CEO Elon Musk is a visionary, but there is a fine line between setting aggressive goals and misleading shareholders

Charley Grant

Oct. 7, 2017 2:02 p.m. ET

New revelations about Tesla Inc.’s production of the highly anticipated Model 3 sedan should shock, but not surprise, investors.

The Wall Street Journal reported Friday that Tesla has recently been building major portions of the Model 3 by hand. This comes less than a week after Tesla announced it fell short of its third-quarter production guidance of 1,500 cars by more than 80%.


Wall Street Journal (pay-walled)

83% to be precise.

The WSJ article goes on to say:

“There is a fine line, however, between setting aggressive goals and misleading shareholders.

Tesla is inching closer to that line. Tesla was making three Model 3s on an average day in the third quarter. Mr. Musk should have known in August, when production guidance was reiterated, that the company wasn’t going to produce 1,500 Model 3s by the end of September.”

When a CEO routinely issues production guidance that he knows to be false…




234 thoughts on ““Tesla fires hundreds as Model 3 electric car production drags”

  1. Musk will soon announce he has secretly outsourced model 3 production to a robotic assembly line on the dark side of the moon. Those who didn’t believe will soon have to eat their words when deliveries start dropping out of the sky attached to Amazon super drones.

    • Actually- if that was the method of delivery, I might even pay those hyper-inflated prices to see that.

      But what would I do with a 3000 pound paperweight afterwards?

    • Why does this make me think of the scene in Avengers: Age of Ultron, when the Iron Legion went haywire?

  2. Most well run companies get rid if the lowest 5% performers every year. There isn’t much incentive to keep them around. That appears to be what is going on here.

    That Tesla is getting product out the door at all is a major miracle. He’s doing fine. Wish I could get one… Still like my Nissan Leaf for running around. About 5 cents a mile to drive and essentially no maintenance.

      • If you don’t charge and discharge from 90% to 10% on every charge/discharge cycle, you are going to shorten the battery life.

      • Of course it can be used by families. Most families have 2 cars, it’s easy to have one car for whichever person takes shorter trips and a longer range car for the other person and long distance trips on the weekend.. In the US, for example, 68% of commuters drive less than 15 miles each way.

      • Electric battery performance has never been outstanding in cold weather. Of interest in Calgary and points E & W, is an article from Forbes on March 2014.

        “The AAA tested three different EVs under controlled circumstances to gauge their performance in stop-and-go-traffic according to cold, moderate and hot climactic conditions. While the test found the three models averaged a range of 105 miles at an ambient temperature of 75 degrees, this plummeted to just 43 miles when the thermometer dipped to 20 degrees. Scorching temperatures likewise adversely affected the tested vehicles, though a bit more moderately, limiting the average range to 69 miles on a charge at 95 degrees.”

      • “Most families have 2 cars, it’s easy to have one car for whichever person takes shorter trips and a longer range car for the other person and long distance trips on the weekend.”

        In the real world, families use the “clunker” for those shorter trips. Not many normal people can afford a $35K+ car just for short around town trips.

        Of course, I don’t know about inside-the-beltway lobbyists, think tankers and journalists.

      • 2018 Leaf is 150 miles. US average miles per day for private cars is 30. But I agree it needs to get up to 300 with 80% fast charge in 20 minutes; which it will

      • Not so sure it is a bottom performer thing, If this were the caes, the company would have to let itself go. Musk for certain…

      • 150 miles in ideal conditions with a brand new battery pack.
        Just make sure your family never has an emergency and needs a second car that can be used for something other than short trips.

    • Cheap, because others are being taxed to first help you buy your toy, and then to pay for the roads that you are driving on for free.
      No maintenance until you have to replace the battery pack.

    • “Most well run companies get rid if the lowest 5% performers every year. There isn’t much incentive to keep them around. That appears to be what is going on here.”

      Maybe Musk should be on that list, Don’t know about your well run company, but mine doesn’t do that. We hire good people. we train them well and rarely fire anyone. We haven’t fired a production operator in 10 years, every operator in that time period that has left has either retired or gone back to school for a higher profession.
      Oh, the company has been around for over 150 years and is privately held, profitable and growing.

      • That seemed to start with jack Welch at GE, but I think the number was 10%. Works OK for the first or second cut, but then you’re getting rid of good people. Long range, very damaging to all but the largest companies.

        Hiring, training, and keeping good people is the route to success, and loyalty is a two-way street.

      • “Most well run companies get rid [of] the lowest 5% performers every year.”

        I was never told that in my management courses. It’s better to avoid hiring those people in the first place. What I’ve learned since is that behind every horrendous business debacle there’s at least one MBA.

      • Bob, I’m not sure with what industry your company is associated but I have seen several high tech companies, and work for a couple, that grew like mad for several years to the point that there was actually no accountability in management. They had grown faster than the available talent. When they finally got to the point where growing had slowed down and the CEO wanted to clean houses a bit management used that opportunity to get ride of people they didn’t like, not the worst workers. There were also few, if any, managers let go, just workers that had gotten on the bad side of his/her manager.

        Another thing you can count on, at least in high tech, is that when a company or even a government subsidiary, has its first, to use a government term, ‘RIF’ or layoff the competent employees, those that have no trouble getting jobs elsewhere, start leaving in droves. The sharp people see the hand writing on the wall and bail out. Pretty soon the company is left with mostly mediocre and incompetent employees and managers. Then, one of the rules in ‘The Entrepreneur’s Handbook’ takes over, i.e. ‘First rate managers hire first rate people. Second rate managers hire third rate people.’ I suspect that’s what happened to NASA after Congress started screwing with their budgets, and I would not be surprised if the same thing doesn’t happen to Tesla.

      • Hiring and training is an expensive process. If your turnover is a constant 5% (plus whatever people are leaving for better jobs or retiring), then you are going to be wasting a huge amount on onboarding.
        For many technical positions, it takes a month or two before you can be more than marginally productive.

      • @ Kpar
        “Hiring, training, and keeping good people is the route to success, … .”

        Maybe not THE Golden Rule, but it’s right up there!

        Also, a lot of people (both managing and managed) would do well to pay particular attention to your observation about loyalty.

      • @ Joe Crawford
        “… those that have no trouble getting jobs elsewhere, start leaving in droves. The sharp people see the hand writing on the wall and bail out. Pretty soon the company is left with mostly mediocre and incompetent employees and managers.”

        This is one of those things that is ‘obvious’ and ‘well-known’ — but it STILL has to be said! (and ‘Well done!,’ for that). So many companies fail to take heed of this particular lesson. For me, it indicates fundamental problems in higher management … or, I suppose, that the company is about to go out of business.

    • “Most well run companies get rid if the lowest 5% performers every year. There isn’t much incentive to keep them around. That appears to be what is going on here.”

      Really? Let’s do a thought experiment. Let’s consider a company of 100 employees that achieves a 2% gain in productivity every year along with a 4% yearly gain in sales volume. So, let’s say in 2010 the company, to stay even, needs just 2 new employees to compensate for the 4% gain. But it lets 5 go. Firing employees for ’cause’ is always going to be a problem so the company just simply eliminates their jobs which leaves them with unemployment compensation for which the company has to reimburse the state unemployment compensation pool (in other words, it costs money to terminate people). The 7 new hires will take about 6 months to fully learn their duties and get up to speed and that costs the company money too. And, that also drives the 2% productivity increase right out the window. Hire more? Or don’t meet the 4% sales growth? Or have the experienced employees put in for pricey overtime?

      How do you think that’s all going to end up. And, even if sales are flat and the company didn’t experience 4% growth in sales which leaves the company culling 2% of its employees (since 2% productivity increase is the norm), they still have to let 3% more go. Three employees that need to be replaced by new, uncertain hires.

      A successful company does not, year on year, terminate five out of every one hundred employees.

    • BS.
      What really is happening, as evidenced when Musk left President Trump’s business advisory council in a cunningly orchestrated huff earlier, is a clear recognition on his part that the free ride (pun intended) is over for him.

      • Exactly.
        Oh Bummer is no longer there to pay for the 400 surplus worker bees.
        Everyone knows that when you are having trouble meeting production quotas, you put off people???????

    • In the bad old days when battery powered electric cars, steam driven cars, and cars driven by internal combustion (Otto and Diesel cycles) were all competitive with each other, the steam driven car lost out for being more difficult to drive and requiring more time to get going, despite the handy advantage of maximum torque at zero rpm. Getting the maximum range out of a tank of water required careful management of the throttle, the steam cut off, and the stoking of the firebox. There was the additional problem of doing all this while navigating the vehicle along the road. The carburetor managed to balance fuel flow reasonably well on its own and the choke and spark advance were not as critical to efficient operation as the cut off and automated timing advance in the ignition was fairly simple.

      The battery powered electric car never solved the battery issues and electric vehicles only thrive in settings where swapping out batteries is a non-issue and the heavy weight of lead-acid batteries is a feature, not a bug. Internal combustion powered forklifts only have advantages where swapping batteries is difficult. They still have the same problems that they always did. As replacement battery packs are literally stranded assets, long haul electric trucking only makes sense for large operations that can keep the number of batteries waiting for trucks to a minimum.

      A fuel cell that ran on diesel fuel would convert electric long haul trucks effectively into diesel-electric hybrid trucks that had lower emissions because the fuel is not actually burnt in compressed air. I am trying to figure out who I could pitch this to, but my anxiety issues make me a terrible at sales, so cold calls to truck manufacturers are right out.

      • Plug Power and perhaps others are working on it. The electrochemistry involved in fuel cell technology is also not easy.

    • Good point. Given that Tesla employs about 33,000 people, the departures amount to 1-2% and on one has reported on how many replacements they have hired.

    • Fuel for my gas car costs about 5 cents per mile and has a 400+ mile range in any weather, hot or cold, hilly or flat, loaded or not, with the A/C or heater on full blast. Takes about 5 minutes to fully recharge. The engine will probably be good for 200,000 miles (basically the life of the car).

      Tell me more about your EV.

      • Heck I have a 15 year old German sports car that I bought last year for less than $10k and on premium gas I run at 10.5 cents per mile. So tell me how long it will take me to pay back that extra $10k by saving 5 cents per mile in gas? And I’ll take the challenge of drag racing a Telsa.

    • oh man…
      you can’t draw any conclusions from it- a few hundred bad apples always makes the one good one look bad.

    • I live in N. Nevada near Tesla Gigafactory. I wonder: Take the fastest Tesla car – How long would it take to travel from Reno to Las Vegas (including recharge time)? My ’92 Civic can do it in 7 hours getting 50 mpg. And just where would the Tesla stop to recharge?

      • Stay charged while you’re on the road using the Tesla Supercharger network. Placed along well traveled routes, a Supercharger provides up to 170 miles of range in as little as 30 minutes.


        Reno to Las Vegas is 448 miles.

        Let’s say you had a Model 3 and paid extra for the 310-mile range battery. There are three super-charger stations on the route: Hawthorne, Tonopah and Beatty. Tonopah is just over half-way (237 mi).

        310 – 237 = 73
        73 + 170 = 243

        It’s 211 miles from Tonopah to Las Vegas.

        243 – 211 = 32

        Theoretically you could just make 1 30-minute recharging stop. Of course, if you run the AC, you would probably have to recharge at least twice.

        Depending on how many times you had to recharge, assuming you don’t speed, it would take 7.5 to 8.5 hours to drive from Reno to Las Vegas in a Tesla with a 310-mile range.

    • ‘5%’? So Tesla Motors employs 14,000 people? They must have gone on one heck of a hiring spree since 2016 because they were reported to have a tad < 3,000 employees in 2016. Solar City acquisition inflated those numbers considerably, but I don't think the 'culling' included that 25,000.

      700 represents roughly 23% of their 2016 employee count. Lots of underperformers at Tesla Motors if you ask me. It also looks more like a 'layoff'' to me.

    • Tesla model S; a car driven by rich folk, paid for by middle class folk, driven for FREE on roads paid for by middle class and poor folk.

  3. Elon Musk has made a passel of claims – one being that if Tesla does not make good on all of the debt owed by the solar roof company that Tesla took over, he will make it good himself, making for the biggest conflict of interest one can imagine – Musk , biggest official of Tesla Motors, forcing Tesla Motors (its shareholders, actually) to make good the debt so that Musk is off the hook for a personal billion of so dollars. Tesla also being sued for stock fraud via his unkept promises and also by several employes fired the day before they were to become vested in their company stock. – I’d like to know how Tesla expects to win those lawsuits(they probably don’t). Tesla’s bankrupt and
    heavilly fined solar roof company (Musk was one of its directors) – tens of millions in Govt fines for defrauding customers is now involved in his newest venture – solar shingles , which, after examining the claims that it makes that one can buy a $75,000 solar roof and have it pay for itself (if the location is good and the local power rates not high) and also requires a govt $15,000 to $25,000 subsidy. They provide a mortgage for your roof, which means they own it. Reselling your house may be negatively affected I would assume. Just another uneventful day in the life of Tesla Motors.

  4. Personally, were I able to change the Headline of your article, I would recommend

    “Tesla fires hundreds as Model 3 electric car sales (er, production) drag”

  5. OX010101: That’s great news about the Nissan Leaf. I tried to make an economic case for a Chevy Bolt here in Quebec where the electricity is cheap and gasoline is expensive (an e-gallon costs one fifth of a regular gallon). Couldn’t do it. I guess I don’t clock enough miles.

    • If electric cars ever do make it past 1 to 2% of all cars, they will find a way to start charging electrics to help support the roads.
      At which time most of the cost benefit you are currently enjoying will disappear.

      • That is why the state of Oregon is pushing for a GPS system to keep track of miles driven, so they can apply taxes based on usage. As an added bonus, now the state can keep track of your whereabouts, and bureaucrats can now sell your info to the highest bidder, legal or not.

      • Oregon and Washington have either implemented or discussed implementing (for years) a special tax on hybrids and EVs to compensate for missing fuel tax proceeds.

      • WA State is investigating ways (5, I think) on how best to do this. The numbers of EVs is small so at this time, it is not a big burden. Sometime in coming years, pay they will.

      • Yes you may be right Roger. Later Leafs and a number of other types use a heat pump system rather than resistive heating which is substantially more efficient.

      • PS: John, you are aware that battery performance also goes down by a lot when they get cold.
        Are you planning on heating them as well?

      • @John Hardy
        Heat pump systems have a performance roll-off when you get below about 30°F – 40°F. So, while performance at 20°F may be better than simple resistance heating, it won’t be by much. Heat pumps are much better at maintaining high COP’s while cooling.

      • John, have they figured out how to make a heat pump system a better heater when the temp drops below 35-40F? heat pumps make very good air conditioners, but they are lousy heaters.

    • I don’t know Trebla. It’s pretty cold in the winter in Quebec. Electric heaters draw a lot of current, and frozen batteries already are a dodgy proposition when it comes to accepting and holding a charge.

    • Perhaps if your dumbass provincial politicians had half a brain they would have supported line 9 East and the cost of fuel would be more in line with real economic standards.

  6. I wonder if this is a natural result of Gen-X and millennials who grew up believing that anything could be accomplished by surfing the net and swiping at your tablet or phone.

    Meanwhile Home Depot is freaking out with the realization that their next generation of potential customers has absolutely no idea what any of their products are for, or how to use them.

    • Freaking out? Heck, no! It’s a marketing opportunity to forge closer relationships with local plumbers, electricians, and HVAC contractors. Joe or Jane Millenial screws up a home repair project and Big Orange gets them in touch with someone who can fix it – for a piece of the action, naturally.

    • At Menards we arn’t too worried about the lack of handyman talent among the average millennial. SOMEBODY has to build or fix everything.

      Around here, it’s mostly the Mexicans and the Amish. And they make enough at it to afford to buy the GOOD tools.


      • Had my 19-year old son help me replace a water heater. It was fun watching him try to apply what he could find on sweating copper pipe from Youtube in a real situation. When he realized that he actually could do it, and how much money we saved doing it ourselves, I think he was convinced. Hope there are a few Menards and Home Depots around for DIY when he’s my age.

    • Yet cut subsidies and there sales drop about 90 percent.

      Tesla model S; a car driven by rich folk, paid for by middle class folk, driven for FREE on roads paid for by middle class and poor folk, often recharged on the backs of the middle class. ( see your local government building with the “free” charging station)

  7. But… but… the…the goal was s’posed to be 5,000 a month or sumptin’, er…. wasn’t it?

    Pay no attention to the man behind the curtain, folks. Here, doggie, come back here! Come back! Oh, rats! Now you’ve done it!! No more please let me know when lollipops and rainbows for you, my pretties!!! (Cacklesnort!)

    This was on the news last night. Why does it come as a surprise to anyone? The Tesla thing has been a scam from start to finish. Musk wants to build a colony on Mars. By the time he does anything besides run out of other peoples’ money, Mars will already have a working colony and a spaceport for tourists who want to do the Titan flyby tour.

  8. “An attempt by one of the world’s biggest car makers to secure long-term supplies of cobalt for its push into electric vehicles has been shunned by leading producers of the metal.
    Volkswagen issued a tender last month seeking a minimum of five years of supply at a fixed price, according to people familiar with the process, but struggled to find any takers.
    The car maker put off miners by suggesting a price that was well below current market prices, which have jumped by more than 80 per cent this year, the people said.”

    • now that is an interesting point.
      an ordinary vehicle is lethal only when moving.
      an electrical vehicle can be lethal:
      – when moving
      – 350V (or 375V (Tesla’s battery voltage) can be lethal for many people
      – incapacitating or lethal some days even weeks later. Contact across 300V+ DC even for a second will cause rapid electrolysis of blood creating gas bubbles in the blood vessels, which eventually may end in the brain, cause stroke etc.

      • vukcevic – I suggest as a weekend project trying to find out how many people have been electrocuted by production EVs (I suspect zero), and how many have suffered fatal burns from petrol/gasoline

      • John, why don’t we wait until there are more than a few hundred Tesla’s on the road, and the average age of them approaches the average age of IC cars.

      • @vukcevic

        Fairly silly to be worried about electric vehicle voltage, we all live in houses containing yards of wiring, outlets, appliances containing lethal voltages. Over a hundred years or so we have got quite good at insulation and safety codes. No reason to consider 300-400V in a car any more dangerous than higher voltages in your TV or microwave oven or solar panels.

      • Ok guys I got the point, it was just word of caution.
        There maybe some people around who may not be aware that Tesla batteries voltage is 350V + and can be lethal.

      • Vukcevic, any vehicle-related battery is lethal, including those in conventional, gas-burning cars and trucks. If you accidentally close the circuit by touching both posts on a car battery, well — ZAAAAAAPPPPP!

      • I was always told “It isn’t the voltage, it’s the amperage that kills.”

        With that in mind, I still bet a car DRIVEN by electricity would give you a worse zap then one that just uses it for control systems and accessories.

      • Down the road from me there is a row of terraced houses, but no garages. There is a hybrid car parked in front of one of the houses, with charging cable (frequently) plugged in and stretched across the payment (walkway). Probably illegal, not to mention hazards from tripping over to vandals having a go at the cable. Presumably in the next few years our local authority and the UK Power Network will have to install charging point for each dwelling. The mind boggles.

        • I note that what I think is the UK is a much more law-abiding place than where I lived in California. Cable left out unattended would vanish is short order there.

      • schitzree, true it is the amperage, but you need volts to push the amps.
        Even with wet hands, the resistance of the body is too high for 12Vs to push enough electrons through you to kill you.

    • …hum, maybe some were and we just find out about it later in some followup audit reports in the appendix.

    • The scary part of high voltage battery packs is that they cannot be turned off. I work with high voltage inverter supplies and the one thing everyone that works on them has to keep in mind that the batteries are live. One false move and there is a distinct possibility of your death. I also work with 13.8 KV in the switching stations but it is not as dangerous as the 600 volt inverter supply as it can be turned off and grounded for safety. In a car wreck I wouldn’t want any 300+ volt battery packs flying around. All charged battery packs are potential bombs and the higher capacity packs just make the bomb bigger. I find it illuminating how the Leaf’s ads read almost the same as the ads for the electric cars back in 1917. There hasn’t been much improvement in 100 years has there.

      • Interesting.
        In a petrol car crash it is easy to empty fuel tank before the wreck is towed away, but how do you discharge fully charged 350V, 85 kWh battery.

  9. This is the Roi Christophe worker incentive scheme employed during the construction of the Citadelle in Haiti.

  10. These firings took place across the board. That is a sign of healthy management and should send a positive signal to shareholders as well as to employees who see that under-performers are not tolerated. Reading anything more into it is pure speculation.

    • The Roman method was decimation, they found that pretty effective for a while until the Barbarians got inside the gates.

      • Roman decimation was counting 1 out of every ten regardless of merit on the battlefield. Firings based upon performance appraisals is entirely different.

      • Except such firings are only loosely based on merit.
        More often then not, it’s’ based on who’s good buddies with the manager.

      • Dans ce pays-ci, il est bon de tuer de temps en temps un amiral pour encourager les autres.

        [In this country, it is good to kill an admiral from time to time to encourage others. .mod]

      • “The lowest 5% are triimmed one by one. A mass firing is a horse of a different color.”

        That’s the way I always saw it done. I suppose it could be done otherwise. But my experience was that mass firings/layoffs were usually the result of either loss of a contract, sale of a division, or the CFO telling the CEO that either we get the headcount down quick or we won’t make the November 30th payroll.

      • Why are we bandying about this 5% figure? Tesla Motors executed the ‘performance firing/layoff’. Before the acquisition of Solar City with it’s 25K employees, Tesla Motors had <3K employees. As far as I can tell the 700 were directly from Tesla Motors, not the Solar City 'acquired' employee count. If that is the case, the firings constitute almost 25% of the old 'Tesla Motors' staff.

  11. The question then, is, at what price do you exit the short on TSLA stock? A lot of people have been burnt shorting Tesla the last few years as the hype fuelled the stock, but now it will trade on earnings and ratings will start to fall. The fact that Solar City is now in the stock will also be a drag on earnings as new rooftop solar falls off as subsidies dry up. If you own the stock, sell it and take the money and run. Looks like Elon Musk might be on the first spaceship to Mars and not coming back with everyone on the good Earth holding the bag.

    • What you need to look for is not just the price as such but also frequency of large packets (volumes) of trades when buying or selling the actual stock. Alternatively the information can be used in the options market when taking long or short positions to magnify gain but if not certain look for ‘in profit’ not frequently but occasionally available ‘butterfly’ spread positions (there are number of versions).

    • Good summary except the rooftop solar was still not a sustainable business for Solar City even with subsidies. It was more of a mortgage mill operation with duped applicants to mine the subsidies at a fast enough rate to leverage the business model.

  12. Darn, just when I was about to cash in my BitCoin to buy a Tesla…

    I can’t wait for our Canadian Prime Minister Selfie to offer a few hundred million to start at Tesla factory here.

      • Is that –
        “Not building pipelines and hauling oil by train is a more lucrative operation in Canada. ” – for some??


      • How about Bombardier selling a 50.01% equity interest in the C-series Jet to Airbus just now for about …

        … No dollars at all it appears. Bombardier gets Airbus’ “procurement, sales and marketing and customer support expertise to the airliner program.”


        So, we can see actual economics and old-school finance has gone completely illogical in today’s world. That does not continue indefinitely. It is reminiscent of the dot.com bubble of 2000 and the commodity/housing bubble of 2008.

        Investing your own money depends on you figuring out which craziness will continue for a time and which will blow up tomorrow . I’m betting solar blows up any day now but Tesla continues the pixie dust magic until some disaster day which will impact all kinds of other pixie dust investments. But that is not today.

        When does Tesla run out of other people’s money (cash). That is the day. Move into bonds fast when this looks to be imminent. If anything, buy Lithium since Lithium batteries are not going anywhere except dominating the market for battery power.

  13. Are they getting rid of the PR department too? They could get rid of hundreds of jobs in house that way and thousands of subcontractors currently in the MSM.

  14. “About 5 cents a mile to drive and essentially no maintenance.”

    If you are in the business of selling junk to clueless consumers EV and PV is the product you want to sell.

    Being in the power industry, I know we would love to gain market share from the oil industry just as the drillers would like a piece of the power industry.

    The reason this not happen is the dynamics of the industry. Power is a cheap commodity but expensive to store. Transportation requires a fuel that is cheap to store during transportation.

    Capital costs are very high in the power industry. It is a regulated public service so that those costs can be shared. Maintenance cost is important too. The longer you can keep something running the lower the capital cost per unit of generation. Maintenance is also critical for safety.

    Power = voltage x current

    As mentioned earlier, EV batteries are at much higher voltage. Visualize the difference between bumping into someone walking and getting hit by a car going 60 mph. Maintenance is what keeps you from getting run over by the energy stored in your battery to provide the power to drive 60 mph.

    There are all kinds of justifications people give for buying a car. I am fine with ‘because I wanted it.’ However, there is no good engineering or environmental reason for buying an EV.

    • Tesla model S; a car driven by rich folk, paid for by middle class folk, driven for FREE on roads paid for by middle class and poor folk, often recharged on the backs of the middle class. ( see your local government building with the “free” charging station)

  15. Musk has made his fortune by basically figuring out how to get free money from the government and pushing people to work for him for free. I have friend and ex-coworker who interviewed with SpaceX for an engineering job. At the final interview Musk talked to him in person and told him “I can’t pay you what you’re making at your current company (Boeing), you’ll have to take a paycut of about 5 to 10%, and I will need you to work at least 60 hours a week for your salary”. Musk did tell my friend that he would get shares of company stock, SpaceX is a private company but when it went public he could make money that way. Last I read from Musk though is he doesn’t want the company to go public until after they land on Mars, which is targeting to do in 2045. Knowing his over estimations that date will probably be more like 2065.
    Internal company review sites are full of engineers at SpaceX who say they love the fact that they can basically do whatever type of engineering method they want to solve things (Doesn’t sound like they will be ISO 9000 anytime soon), but ALL of the reviews mention how many hours the engineers work, estimates I saw were anywhere from 70 to 90 hours a week, with no paid overtime.
    The people in the shop at SpaceX on the other hand said its a great place to make a lot of money (hourly workers must be paid for their overtime) since they work long hours, but they are nearly all shocked at the lack of quality control being enforced. Comments like I’m amazed that every rocket out of this shop doesn’t explode, or I’m shocked when any rocket makes it off the pad, you can use whatever tool you want for any job, nobody cares…
    For me, I’m still at Boeing, and to compete in commercial space with SpaceX our managers are constantly deciding to cut on quality of engineering and increase risk to save money. Being a public company Boeing can’t hand out stock to employees like SpaceX since Boeing stock is money, and it counts against the bottom line when given to employees.
    One last note, I read an article about a manager who used to work for Musk, he said you can always tell when a person has just left a meeting with Musk because they look defeated. No matter how much you do, Musk always wants you to do more, and many times just because its cool, not because it will make the product any more effective or more reliable or cheaper.
    So to me, Musk is not making anyone’s life better, especially not salaried people who work for him, he sucks the life out of his workers and then fires them if they only work 55 hours a week for 40 hours pay.

    • Steve, I am not surprised that Musk has that attitude. It’s a damned shame that some people, driven by ignorance and avarice or arrogance, have to learn about safety the hard way. Hopefully he will learn his lesson from unmanned testing before he gets into manned flight. His attitude reminds me of Bill Gates’ attitude toward software design and development (re: reliability and security) that almost single–handedly destroyed the internet.

      I am surprised that Boeing seems to be following Musk down that rabbit hole. You said of Boeing “…our managers are constantly deciding to cut on quality of engineering and increase risk to save money.” It sounds like they are falling into the same trap that BP (i.e., British Petroleum) fell into that has killed 15 workers, injured 180 more and has cost them around $10 billion in fines and settlements over the last 12 years. BP pretty much became the laughing stock of the petroleum industry with their attitude toward maintenance and increased risk.

    • I’m no great fan of Musk’s other companies, but SpaceX is leading the way in space because it’s not following the same procedures as the rest of the aerospace business. We’re not talking about airliners that will have to fly twice a day for decades with minimal maintenance here, but rockets that will fly perhaps ten times at most with time for maintenance between every flight. More than that, we’re not talking about rockets that have to work first time and be thrown away, we’re talking rockets that are reusable, which allows them to study exactly what does and doesn’t become degraded during a launch, to determine what needs to be beefed up and where corners can be cut.

      They’ve lost two Falcon 9s, but neither were due to assembly issues. One was caused by a contractor sending parts that didn’t meet the spec, and one due to a fuelling procedure change that had entirely unexpected effects. You can certainly argue that the former should have been caught with better internal checks and the latter should have been tested more thoroughly before use, but clearly the way they assemble rockets is working fine so far.

      NASA had complex procedures for the shuttle to the point where three people had to sign off to say that a tool had been removed from the vehicle after use. Yet they still managed to fly tools into space and back on a couple of occasions: clearly all that paper-work didn’t. And they flew astronauts for decades in a vehicle that killed its crew one time in sixty or so: even if the SpaceX rockets blew up every other launch, they’d probably be safer than that because it actually has a way for the crew to escape.

      Job-wise, yeah, I wouldn’t work there. But I’d probably have jumped at the chance if I’d had it in my 20s, just to be able to build rockets.

  16. Given (just) the admitted production issues, only the truly gullible would buy any of the early-made Tesla 3s.

    Time for Musk to make another tour of Congressional staffs and other gullibles for another batch of tax breaks, subsidies, etc.

  17. All you lot are taken in by omission of facts. Everyone who sought union membership are on the redundancy list.

  18. Disney’s reboot of Tailspin has a new character. Mark Beaks. I’m positive he a parody of Elon Musk and other such tech wizards.

    I was more sure of this when the big reveal in the episode revealed that his newest project was all sizzle and not even the smell of a steak. And he had taken steps to sabotage the release so the people buying stock would not find out.


    • “peter October 16, 2017 at 1:59 pm
      Disney’s reboot of Tailspin has a new character. Mark Beaks. I’m positive he a parody of Elon Musk and other such tech wizards.”

      Looks like a rebooted Gyro Gearloose. Gyro was/is a technical master engineer.

      If anything, Musk and others are pale imitations of Gyro.

      • No, Gyro is still in the show as Gyro. Though they seem to have taken some inspiration from the character Sheldon on Big Bang Theory for how they portray him. Has poor social skills to say the least.

      • Peter:
        Gyro has been a Donald Duck / Mickey Mouse denizen decades before very recent modern television.

        Gyro has always been a madcap wild inventor easily crossing all boundaries between sciences and mechanics.

        The base character is Gyro.
        Any claims to recent inspiration still stems from the original and ongoing Gyro Gearloose.

  19. One way to solve the UAW unionization push. Throw in a few poor performing managers and engineers for NLRB cover, as the firing to union bust tactic is blatantly illegal and has been since long before I took labor law back in 1975.

  20. Surely the driverless cars can do that job. Or maybe use the hyperloop to shuttle the few Model 3s back and forth on a revolving loaner basis.

  21. I find the ill-informed Tesla-bashing on this website exasperating. They fired 400 – 700 workers out of 33,000, allegedly for poor performance. Big deal. There are a lot of people waiting for this car who don’t care a fig about CO2

    • There’s nothing wrong with the cars. I think the bashing is centered around the arrogance of Musk and his subsidy fishing at the peoples’ expense. I don’t care how “legal” it is and don’t buy the axiom that if he didn’t do it someone else would when I’m paying for it. Throw in a shaky economic model …. albeit common for the tech industry …. and you have a whipping post.

      • markl – you might be right, although I am not sure if “arrogance” is fair. I wonder if the £80 billion the US government spent bailing out GM Ford etc in the noughties would have come in for the same pasting? Surely any sane person would take subsidies where they are offered, so the bashing should be aimed at the politicians doing the offering.

      • Resourceguy: the Chinese might but the Germans won’t. One of the VW heads admitted in July 2017 that to reach their stated goals on EVs they need about 20 battery gigafactories er, like the one Tesla started building in, er, 2014. You cannot scale EV production without a source of cells far larger than any conventional western automaker currently has available.

        You are right about the Chinese though. By 2020 on present trends they will utterly dominate lithium cell production

      • There is something wrong with the M3. The off set touchscreen with all controls is inherently unsafe. I would not drive nor ride in an M3. Indeed, they should all be painted day glow orange to warn other drivers to stay well away from them, or outlawed altogether.

    • Ill informed? Tesla S is a $120,000 toy with huge subsidies attached. Solar roof tiles that do not practically exist, financially diverting from EV sizzle to bail out cousin’s failed Solar City. No volume Model 3 yet at a base price of $35k and a likely ‘real’ price over $50k. A Nevada subsidized gigafactory building an obsolete LiIon cylindrical metal form factor instead of pouch cells.
      You need to learn the difference between sizzle and steak. Musk is a VC reincarnation of P.T. Barnum. who tried but failed to distinguish humbuggery (his word and book) from outright deception. For publicly traded Tesla, humbuggery is violation of longstanding securities laws.

    • It was Tesla that made it public. These “firings” were just an act of desperate distraction. With the shareholders now sedated, the agony of a non-selling car may continue for a while.

    • A trollop wanders in,
      slinging ad hominems,
      dropping condescension and aspersions,
      spreading misinformation,
      completely without facts.

      A) GM received a loan from the Federal Government.
      • The total was far less than johnson’s specious £80 billion claim.
      • GM turned over 61% equity in stock to the Federal Treasury as compensation and took a loan for the remainder.
      • GM paid off the loan, early.
      • Obama’s Treasury dumped the remaining GM stock on the market in December 2013. Taking a bath in the process.
      U.S. Treasury’s final loss due to bad stock management was $10.2 billion in dollars, not pounds.
      B) GM sold 275,552 light vehicles in the USA, during August.
      For that matter GM sold an additional 164,996 vehicles in China. GM’s Cadillac brand alone, sold 15,014 vehicles in China.
      Tesla is effectively a Ponzi scam; selling stocks to suckers; while spending investor and subsidy cash incredibly fast.
      Tesla makes money by selling EV tax credits to other car companies.
      Tesla allegedly sell cars by extensive use of subsidies.
      Meanwhile Tesla is:

      “INVESTOR ALERT: Goldberg Law PC Announces an Investigation of Tesla, Inc. and Encourages Investors with Losses Exceeding $100,000 to Contact the Firm”

      “INVESTOR ALERT: Levi & Korsinsky, LLP Reminds Investors of an Investigation Involving Possible Securities Fraud Violations by the Board of Directors of Tesla, Inc.”

      Grossly absurd negative P/E ratios; over five years.
      Astounding lopsided debt ratios.
      Negative earnings per share.
      “TSLA has not issued dividends in more than 1 year”
      Heavy anti-Tesla success stock bets.
      TSLA Shares Sold Short = 27.06 M
      Change from Last Report (issued 2X per month) = -9.74%
      Percent of Float = 22.25%
      For example; 2.88% of GM’s shares available for trade (float) were sold short for the same period.
      Tesla is following the classic robbing Peter to pay Paul pyramid scheme.

    • Tesla model S; a car driven by rich folk, paid for by middle class folk, driven for FREE on roads paid for by middle class and poor folk, often recharged on the backs of the middle class. ( see your local government building with the “free” charging station)

  22. Kpar commented: “….That seemed to start with jack Welch at GE, but I think the number was 10%. Works OK for the first or second cut, but then you’re getting rid of good people. Long range, very damaging to all but the largest companies…..”

    +1, accurate description of the forced regular attrition. Once started the moral goes absolutely in the toilet while people are doing everything to make themselves look good and others look bad. Hard to bring on new hires as the word gets out they’re just looking for fodder to make their 10% goal. It’s part of the “New Age” business ethics to increase productivity. Tesla has always had a history of over promising and under delivering. It’s part of the Silicon Valley culture. Tesla has to succeed on it’s own as there’s no reason for anyone to buy it for its’ manufacturing ability or technical innovation. Over priced cars relying on subsidies to attract/bribe easily infatuated buyers. Their constant hype keeps them alive but eventually catches up with their bottom line and they’ll join the legion of tech companies in the area that have gone from cream of the crop to “what was the name of the company that…..”.

    • She gave Tesla’s employee-count as 33,000. If that includes merged-in Solar City employees, as I suspect, it’s misleading.

      • Solar City is not affected. My old extensive multi national company did not simply remove “dead wood” across the whole board. Neither did it pick on one subject matter while choosing who leaves. So any complaint to the NLRB (as yours is) would be moot in law.
        Tesla will have issues in the future which will make this niggle pale into insignificance. Due to their operating structure, the unreliability record, the closed servicing/resale ethos, the humongous depreciation and competition. All affecting the fandom.

      • “Solar City is not affected. … So any complaint to the NLRB (as yours is) would be moot in law.”

        I didn’t say or imply anything about complaining to the NLRB. My point was that the presenter in the video upped that Tesla employee count by including SC workers, making it look (misleadingly) as though the firings of 700 were only a small percentage of the workforce, instead of a large one.

  23. Shameful that Tesla would fire employees when it receives government subsidies for this electric car. Seems counterintuitive when they need experienced workers to meet their 5000 per week production quota. Close the operation down. A electric car many of us simply cannot afford. Stupid and silly to prop-up this sort of wasteful government spending. Let the venture capitalist come in and provide these operating funds.

    • That’s his big brother. He has a sister named Jovan Musk who has her own line of fragrances.
      (sorry, couldn’t stop myself)

  24. There has always been a huge problem at Tesla. Anyone can build a single car. hell, I could build a car. people have been doing it for years, building new cars out of assorted parts.

    The problem is this – to reduce costs cars must be built and sold in bulk – then the costs for the company can be amortized out over a lot of product. However, there is a lot of stuff that goes into the supply chain, so you need to bulk up everything. You know who is really good at bulking up supply chains? Existing car companies.

    Tesla is trying to beat ford, GM, and Toyota at a game they mastered a century ago. They may have better tech, but seriously, the tech is the easy stuff. Build cars in bulk is very, very hard.

    What Tesla needs to do, right now, is stop trying to build mass numbers of cheap cars, and focus only on expensive cars built in small numbers to exacting standards. Then license your technology to any and all car companies. Sell them batteries, drive trains, whatever. Become the Motorola or AC Delco of the car industry. Focus on the charging network and making sure all new electric cars are serviced by it.

    If they do that, quickly, maybe they have a chance.

    • In the world of gross revenue (do auto companies even make money?) there is a simple equation.

      Price per car x number of cars = gross revenue

      At 3 cars per day Tesla will never make enough money to be a major auto manufacturer, which I believe is their goal.

      3 x 365 x $30,000 = $32,850,000

      • “Steve from Rockwood October 16, 2017 at 3:56 pm”

        Note sure, as it costs vast amounts to tool up for car making. When in the early 90’s Vauxhall (GM) in the UK tooled up to make the Corsa (Holden Barina in Australia) they spent GBP6mil before they sold a single car. I know Nissan received substantial Govn’t subsidies in the 80’s to setup shop, Honda probably did too. Toyota here in Aus during the Kevin Rudd years received over AU$75mil to help develop an Australian made hybrid. That year, IIRC, Toyota made a profit of about the same amount. So I am sure car makers make money one way or another.

      • exactly – make fewer, better, more unique cars. This idea of competing in mass manufacturing…not going to happen.

    • I hope not. Tesla model S; a car driven by rich folk, paid for by middle class folk, driven for FREE on roads paid for by middle class and poor folk, often recharged on the backs of the middle class. ( see your local government building with the “free” charging station)

  25. The model 3 using 120 volt service requires 54 hours to fully charge the battery. More than9 hours with 240 service. Better have more than 120 volt service available……

      • but the demographic Tesla is aiming at for its mass market push are those people living in multi-unit dwellings in the gentrified cities, those are the places where people do not have 240V service, much less having 120V outlets nearby to where their Model3 will be parked. Can all those folks conveniently take their cars to a public charging station? And where is the cost savings for them if they have to pay at a charge station rather than through their own electric bill?

      • If you want to truly recharge overnight, you will need either 480V or two parallel 240v services.
        For many people 9 hours may not be enough

  26. This is what happens when a bunch of millennials are hired to build cars. Should have made it in China. They would pump out thousands of those cars with no problem and no Complaints.

  27. Here’s a brief news article about the event on the financial site Seeking Alpha. There are 676 comments on it, so there are likely a few pearls among them.

    Here’s an article from just before the news (3 days ago), “Elon Musk Appears To Be Taking Investors For Fools”. It has 435 comments, again likely including a few pearls.

    “Tesla has reportedly fired hundreds of employees amid signs that the company is off to a slow start in manufacturing its crucial Model 3 electric car.”

    So much for all those new green jobs the green goblins promised.
    (Isn’t Telsla in CA? What has Governor Moonbeam said about this? All those fired were not illegal immigrants so no problem?)

  29. Earlier this year bought a 2012 Mitsubishi MiEV with 12k miles at an auction. Living in rural Michigan, very few bid on it so I got it for a song with 5 years left on the battery warranty. I use it to drive to work and back to save miles and wear on my 2016 Ram 1500, but it’s also cheap to drive and fun actually. If it doesn’t work out I could always sell it for a nice profit to a more planet loving person than me in Ann Arbor who wants to save the planet. For now it’s a fun experiment.

  30. If Tesla flops perhaps that will diminish enthusiasm for otherwise purported green breakthroughs. It should cause a pause in the current green bandwagon toward EVs.

  31. I for one want to believe in Elon Musk being a true forward thinking entrepreneur. However when one spreads themselves (and their shareholders money) so thinly, and when the Model3 is screaming “big out of control problems”, I think South Seas Bubble, Ponzi etc. It looks like the “old treat you like a Mushroom” as in keep you in the dark and feed you s**t.
    I hope his next investment is not a Snake Oil Farm!!!

  32. Elon has schemed lots of money from taxpayers and investors (read: suckers) to tackle the hard wall limits of physics. The wall is winning…

  33. Elon Musk may have a lot of great ideas. They look wonderful on paper, don’t they? Yeah, but production is reality. Daydreams are cheap. Reality costs real money, and producing the daydreams is reality.
    So far, Elon Musk hasn’t done a whole lot more than act like a sideshow carney barker. His production rate is a fail. He’s ditched people because they cost money to keep on the line (reality), which may mean he’s looking at cheaper labor (less or no experience), but he has NOT met his obligations to people who put a deposit on a vehicle and are now wanting their deposits returned to them (reality).
    I’m glad that so much research has been done on improvements in internal combustion engines because gas prices at the pump are not going to return to the 1960s levels of $.259 to $.359/gallon (for regular) and it does save me money. This is a big plus for me.
    But Elon Musk doesn’t seem to understand that the real world is like me: we expect results and he is not providing them.

    • When you factor in inflation, gas prices have gotten pretty close to the level they were in the 60’s several times in the last decade or so.

  34. Leaving aside the technical issues that beset electric cars, electric cars will never go mainstream until two fundamentals are addressed. First, their high price. Second, their low resale value. The subsidies given to buyers does not adequately make up for this inherent problem.

    Most people do not have the cash to buy a new car. Hence this purchase requires financing. However, financing is not an attractive option for the finance houses, since the resale value of the car is so low. It has little equity, once the purchaser drives the car off the forecourt.

    Many finance deals lend money on the basis that the car will have a significant value in say 3 years time after purchase, but this is not so with electric cars. Most electric cars lose about 80% of their value within 3 years of purchase, and this is a major stumbling block to encouraging people to buy electric cars. In fact, some models depreciate by about 84% in just 3 years. Who in their right mind would buy a new electric when there are such high levels of depreciation?

    • Richard,
      Thanks for that information which I was not aware of. Wonder why this issue is not more widely reported and known.
      Of course the problem of a viable battery still remains elusive which provides significant range, despite considerable resources including manpower and $$$ having been thrown at its development for an auto. I often wonder if a better battery may never happen given all the failed efforts to date.
      The battery may be one of the reasons the resale is so low.

  35. I don’t understand the enmity toward Musk on this site. Unlike 99% of the commenters here, I’ve actually worked with him, way back in 2002 long before the first flight of the Falcon 1. He, Tom Mueller, and Tim Buzza spent a lot of time in Mojave working on the first tests of the gas generator for the Merlin engine, which were run on the XCOR 5K stand. We produced some prodigious clouds of black smoke…

    SpaceX was a demanding but honest and fair customer, requiring us to provide reasonable documentation of the man hours and materials expended on the project. We moved forward quickly over several months. Elon didn’t ask anyone else to qork any harder than he did- but he did work long hard hours. In the years since more than a few of my proteges went on the work at SpaceX, and most are still there.

    SpaceX is challenging all other launch providers with a superior product at a lower price point, and while they have contracts with NASA and the USAF, these were awarded competitively, not as earmarks from Congress. When the government of China complains to the UN about your company’s aggressively growing market share, I dare say you’re doing something right. When you’re taking flak, I guess you know you’re over the target…

    • https://i0.wp.com/www.capitalmarketlabs.com/blog_images/TSLArevfcf_915.PNG


      Elon Musk will eventually run out of OPM and the corporate welfare checks will soon be a thing of the past. Tesla’s Federal tax credits will begin to phase out after they deliver they 200,000th PEV. Based on current forecasts, that will occur in Q3 2018.

      There’s neither a rocket science nor a greenschist exemption to the effects of increasingly negative cash flow.

    • The hostility to Elon Musk is mostly due to his subsidy mining operations, and serious doubts about the technical viability of his product. His space enterprises seem rather more technically viable, but his financing is still dodgy.
      Bell Labs did a great deal of science and engineering work that was exemplary, but that did not make ATT any less of a regulated monopoly providing mediocre service at a high price and acting as a cash cow for several layers of government, and “safe” investments to its owners.

    • Here is why he us not appreciated…
      Tesla model S; a car driven by rich folk, paid for by middle class folk, driven for FREE on roads paid for by middle class and poor folk, often recharged on the backs of the middle class. ( see your local government building with the “free” charging station)

  36. The incorrect facts on subjects from batteries, (production/availability), Electric cars in usage, recharging times, cost to run, resale values, (without checking the facts) and so on in here is astounding.
    C’mon guys, shape up!

    Personally I don’t give a monkeys cuss what the fuel is. As long as the car is like a Mercedes inside to drive & doesn’t end up with a high price per mileage (inc. depr’tn) with the end of its tenure with me.

    I drive a Nissan Leaf. I don’t care how fast it recharges in town or at home. Cars are normally only driven a couple of percent of their whole lives, no matter what anyone says.. Rapid charging is on motorways where having a coffee snack and a pee takers half an hour. Doctors orders.

    This car per mile equates to 142 (UK) mpg. Servicing is rolling gear, no engine. Very few consumables. (liquids & cabin filter every two years).
    It cost me the same as an equivalently specc’ed ICE car. Had it 4 years, Mileage depreciation is 13%.
    Have no plans to sell it. My daughter is expecting it as her first car when she passes her test. So I’ll update with the new 150+ mile Nissan Leaf or such.

    Sure I’ve driven ICE cars since. I simply do not like vehicles with all that indefinable internal racket and driving effort any more.

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