Tesla Job Cuts: “profit is obviously not what motivates us”

h/t michael hart – Elon Musk has announced job cuts in an effort to curb costs at his green car company.

Guest essay by Eric Worrall

Tesla to slash thousands of jobs in profitability drive

Tesla said it plans to cut 9% of its workforce as part of a restructuring intended to reduce costs and boost profitability.
The layoffs at Elon Musk’s electric car company come as it tries to increase production of its Model 3 sedan and turn a quarterly profit this year.

Tesla said the more than 3,000 cuts would affect mostly salaried employees, excluding workers producing its cars.

Mr Musk said the job cuts were a “difficult decision”.

Tesla employed more than 37,000 people at the end of last year.

Given that Tesla has never made an annual profit in the almost 15 years since we have existed, profit is obviously not what motivates us,” he wrote in an email to employees and posted on Twitter.

“What drives us is our mission to accelerate the world’s transition to sustainable, clean energy, but we will never achieve that mission unless we can eventually demonstrate that we can be sustainably profitable.”

Read more: https://www.bbc.com/news/business-44458264

Elon Musks explanation that his business decisions are not primarily motivated by profit might come as a surprise to investors who were expecting a return on their capital. But I guess losing money every year for fifteen years is a bit of a hint.

144 thoughts on “Tesla Job Cuts: “profit is obviously not what motivates us”

  1. “What drives us is our mission to accelerate the world’s transition to sustainable, clean energy, but we will never achieve that mission unless we can eventually demonstrate that we can be sustainably profitable.”

    Meaning sustaining subsidies to sustain profits. Taxpayer get’s routed again!

        • I absolutely revel in the brilliance displayed here and there in the family of man.
          Elon Musk has been a shining light in so many ways, but Lord, when he misses the mark…

      • “…profit is obviously not what motivates us…”
        That says it all, really, for those with the ears to hear.

    • Y’ain’t seen NOTHIN’ yet, Elon! Trump pulls those subsidies for luxury virtue-signalling, and your stock is going to tank and never recover. Tucker Carlson said it best the other night; “global warming” is now a “boutique issue” for rich people.

      • I think that at basis, global warming has never been anything other than a boutique issue for rich people, but the unseen hands from within those classes, busily pulling everyone else’s strings, has gotten us into the mess we’re in. Much of the world’s problems in any area can be traced to those same sources.

        • Those unseen hands would have had no rope if the scientific societies, especially the American Physical Society, called out the utter BS of the global warming claim. But they didn’t. The APS just rolled over. And so did all the other scientific societies.

          Their position on AGW is identical to a claim that the Stefan-Boltzmann equation is a complete theory of climate. That view is beyond stupid, transits willfully incompetent, and goes right into abandoning science itself. They will never recover from the shame of it.

          • Interesting Pat. It seems to me that so invested in this anti-scientific nonsense have they become they are clean out of sea room and are going to run aground.

    • I have my doubts of the government getting involved in picking the winners and losers of the marketplace and best use energy policy but give credit where credit is due. That same tax incentive is available to anyone that wants/wanted to compete for it and I don’t see ANYONE that was able to build 1% of what Tesla is. Also he went all-in in 2002 with absolutely no idea what our fickle government may do with policy or what the economy might do.

      • Tom posted: “. . . I don’t see ANYONE that was able to build 1% of what Tesla is.”

        Well, according to https://insideevs.com/monthly-plug-in-sales-scorecard/ , from Jan through May 2018, Chevrolet sold 6,775 Bolt EV vehicles in direct competition to Telsa’s sales of 18,305 Model 3 EVs. The ratio of 6,775/18,305 is 37%, far above your asserted 1%.

        Heck, if if you took ALL of Tesla’s vehicle production (the luxury Model S and luxury Model X as well as the “common man” Model 3), the Chevy vehicle sales ratio for this time period would be 6,775/33,350, or 20% . . . again well above your asserted 1%.

        You see, facts matter.

        Also, since Tesla also has a PV solar energy sales component, I can go a round with you if you want to assert that nobody has done even 1% of what Tesla has in this field.

      • OK, then tell me how many automatic battery exchange station aka minute “tank fill” are available in Calif, where Tesla claimed it could build those and claimed the corresponding subsidies. It’s virtual!

  2. Perfect, deploy and make operational nuclear fusion, then produce electric powered vehicles. Until then converting natural gas to electricity to charge a battery for a transportation fuel may be virtual signaling for some but it’s really just silliness.

      • You are forgetting the replacement and removal cost of the chemical battery. A metal fuel tank does not have such issues.

          • Exactly. Just ask the voters of Ontario what they think of green electricity after they drove loser Wynn’s party from power.

          • Not just from power, Trebla, her party isn’t even an official party any more 🙂 heehee!

      • The whole point of the Tesla is to remove the need for fossil fuels for transport. Most electricity generation is from fossil fuels, so it fails there. And aluminium requires huge amount of energy to extract, transport and process the ore in to parts. Copper, steel, rubber, electronics etc etc…not much saving in fossil fuels there.

        So without subsidies, it will fail.

        • Figure 3 to 4 miles per kW-hr. My early-tech car gets about 40 – 45 miles on 10 kWhr in summer and around 30 in the depths of winter. So your $10 would take my car about 150 miles in summer and a bit over 100 in winter

          • Thank you John, it is hard to get those figures in NZ, as recharging is basically free at the moment. My $10 wouldn’t get me to my nearest city with hospital and services and back then

          • Warren in New Zealand

            If you’re emergency departments waiting times in NZ are as bad as they are in the UK, you’ll have plenty of time to charge up your electric car.

            In fact you could charge a fleet of the damn things from a single charging point by the time you’re seen!

            NHS; systematically screwed up by Hunt the cnut. A career politician who wrote a book about privatising the NHS, then the loony conservative party put him in charge of it.

            “After university Hunt worked for two years as a management consultant at OC&C Strategy Consultants, and then became an English language teacher in Japan.” (Wikipedia)

            So not much cop as a management consultant then.

            “On his return to Britain he tried his hand at a number of different entrepreneurial business ventures, including a failed attempt to export marmalade to Japan.” (Wikipedia)

            Marmalade to Japan?!!!!!!

            Don’t politicians bother reading candidates CV’s?????

            He was a disaster as Minister for the Olympics during London 2012 when the army had to be deployed to shore up G4S’s failure to do their job.

            He was moved sideways to Health Secretary and for the first time in 40 years there was industrial action by Junior Doctors.

            So, yea. Any concerns about charging electric cars in UK hospitals are laid to rest.

            Errrrrrr…….except I’m not aware of any hospitals with charging points.

            Back to the drawing board then.

            Sorry, rant over.

          • Right, the problems with the NHS are the fault of Hunt. He is responsible for the doing what exactly? The money? That’s the Treasury. Demand? That’s the people. How the money is spent? That’s the GPs, Trusts and so on. So that’s 99% of the problems nothing to do with him.

            As for the strike, that was a bunch of spoiled junior doctors refusing to face reality, not Hunt trying to do something stupid.

          • hunt is a clown. the man couldn’t run a piss up in a brewery never mind oversee the running of the nhs. he would do well to remember when it comes to doctors vs politicians the public will side with the doctors every time. then he better remember who pays his wages and his public servant position.

          • Set up a stall outside your house and give away free stuff all day. Work out whether the demand for free stuff goes up or down over time. I worked in the NHS for 20 years. There is no ceiling on demand as there is no DIRECT patient contribution as there is in most countries who care just as much about people but provide more effective realistic health systems.

          • there would be direct contribution from patients if national insurance was used for its original intention and ring fenced along with taxes from smokers and those who consume alcohol.

            just like car tax is used mostly for things unrelated to the source of the tax. yes the nhs has problems that need addressed and should be,but there is no need to throw the baby out with the bath water.

          • I own an EV made by Think, which started as Ford’s electric car division. Think is now defunct, not having a corporate or Wall Street sugar daddy after Ford spun it out in 2003 to absorb the losses.

            Very fun little car, and hey, it’s a Ford as opposed to a Tesla, so it actually works. When I drove it in Seattlestan, I got 2.8 miles/kWh in winter, and 3.6 miles/kWh in summer. On 37 kWh, that would be 100 miles in winter and 135 miles in winter, using rounded numbers.

            By the way, I see you pay 27 cents/kWh. Last year, we moved from the People’s Republic of Seattlestan to our Gun Nut Compound in a secure location in the Washington State countryside. We pay 9.5 cents/kWh.

            I’m still testing out the Think here, having just got it going again after replacing the 12-volt battery. The topography here is more challenging than in Seattlestan, but the preliminary results look like the fuel economy will be very close to what it got in Seattlestan.

          • Power here is $0.06/kWh (not including monthly fixed cost fees) for our coal and natural gas generated electricity. So, $10 would get me 167kWh, or 500-667 km.
            for a ICE, right now gas is about $1.20/L (including our new carbon tax). A chevy sonic is 6.3L/100km (highway). $10 (8.3L) will get you 132km.

            That is a huge difference. I guess it all depends on what you pay for electricity. $0.26/kWh seems to be the equality point. (John, you must have very high electrical rates!)

          • Jeff, with a nearly $30,000(CAD) difference in the MSRP between the Tesla Model 3 and the Chevy Sonic, at your stated fuel cost and mileage, you could buy enough fuel to drive the Sonic 396,000 km (237,600 mi for those of us in the States). At a yearly driving distance of 16,000 km for the average Albertian, you can operate a Chevy Sonic for 24 years before you break even on the MSRP of the Tesla.
            So you can go out and get a Tesla, but you’re going to need to still be driving it in 2042 to actually have it start to pay off.

          • If I have $10,000, then an electric car gets me precisely zero miles because I cannot buy an electric car for $10,000, but (using your figures) I can buy an $8,000 used Toyota Corolla and then drive 17,000 miles with it.

            Which, in fact, I’ve done.

          • You can buy a used Think City for well under 10 grand, and if you have a $7,500 U.S. tax liability you can get a new one (well, a not-driven 2012 model) for a net price of $5,500. I own a 2011 (or is it 2012?) Think City, and it’s a lot of fun.

            If you have the tax liability and can claim the credit, I think $5,500 is a steal. I didn’t buy one to save the world. I bought it out of curiosity. They’re a lot of fun, and have practical range on 80% of the battery of 65 to 70 miles in summer. Winter would be 25% less in a mild climate, and maybe 40% less in a harsh climate.

            The downside is no warranty, and you’ll have a hard time getting it fixed. The upside is that they started their lives as Fords, and are mechanically reliable. And they are much simpler than gas cars, so if you are mechanically adept you can do almost all repairs yourself.


            A review. Note: They drove a pre-release Think for the review. By the time they started selling them, the issues identified in the review had been fixed.


          • The breakeven point is heavily influenced by taxes, so I like to calculate “untaxed,” “taxed,” and “equitably taxed” breakeven points.

            “Untaxed” removes all taxes from both sides of the equation; “taxed” includes fuel taxes on gasoline and WA State’s punishing $150/year flat EV tax; “equitably taxed” imagines a system that would levy a tax on the same basis as gasoline taxes, i.e., rewarding fuel economy.

            My EV gets 108 mpg-e on a blended year-long basis, which is very close to the average for EVs. Numbers below are in USD.

            – Untaxed breakeven point: $0.28/kWh
            – Taxed breakeven point: $0.15/kWh
            – Equitably taxed breakeven point: $0.26/kWh

      • Look at the total cost of ownership before subsidies and taxes. It’ not rocket science.

      • Sorry Mike, but $10 isn’t currently moving the car anywhere.

        What you can or can’t achieve in the prototype is meaningless if you can’t economically manufacture the production version for the public.

        In real world terms the Telsa 3 doesn’t work.

      • MikeN

        “$10 in electricity is moving the car 300 miles. That is not silliness.”

        When an equivalent ICE powered car cost’s $20 K less than a Tesla, how many miles will that buy?

        And when the balance sheet shows a $60 K Tesla Vs a $40 K Mercedes, you can be absolutely certain than anyone other than a rabid, insanely green accountant, will accept $30 for 300 miles every day instead of tying up $20 K equity in green virtue signalling.

      • $10 worth of commercial electricity versus heavily Federal and state taxed gasoline?
        That’s an apples to aardvarks comparison.

        Before pointing out that that 300 mile range is without A/C, radio, stop and go traffic, hills and a number of other power drains.

        And before pointing out that your $10 claim is deluded distraction from Dennis Sandberg’s comment regarding Musk’s profitless virtue signalling business model.

        • He’s also not including the much higher initial cost of the EV, nor is he factoring replacement costs for the batteries.

          • Tesla batteries retain over 90 percent of their capacity after driving 160 000 miles. The battery will retain a useful real world range for up to 500 000 miles. At this point no one owns a car for this long. These are real world numbers gathered by actual owners.

          • Exactly how many Tesla owners have driven 160K miles, much less 500K?

            You are talking about laboratory numbers, where the batteries are kept in perfect conditions and charged and discharged only at the most optimal rates.

          • This is a group of Tesla owners tracking their battery degradation. After losing about 5 percent in the initial break-in period the degradation is extremely slow. A lot of these cars have 50 000 miles on them with over 95 percent capacity still available.

            The laboratory battery that you mentioned, has 500 000 miles on it with 80 percent capacity left.

            Because of Teslas advanced thermal management system, battery replacement, at least in Tesla’s, is a none issue.

            PS. I am not a greenie. Just saying.

          • So you admit that you were lying when you made the claim that you had real world data regarding cars that had driven 160,000 and 500,000 miles.
            Why should I believe anything else you say.

            PS: Thermal management consumes power. Sometimes lots of it.
            Beyond that, just because you have “thermal management” doesn’t mean that the batteries will never get too hot or too cold. ICE cars have thermal management too.

          • No, I was not lying. There are plenty of Model S cars with 250 000 + miles on their batteries in taxi fleets around the world. Some even have 300 000 miles on them.

            The point about the thermal management is that if properly implemented it greatly extends the life of the batteries.

            The truth is that batteries will not need to be replaced during a normal lifespan or life cycle of the vehicle. Something that you are unwilling to see.

          • what is the range of the batteries when it is -15c over night and -10c during the day when making your journey ? i believe extreme cold and heat have detrimental effects on range,as does driving at a reasonable speed ie over 70mph.

          • A lithium-ion battery treated correctly (not habitually discharged below 20% and not habitually topped off if above 50%) will last 2,000 charging cycles before dropping below 70% of its original capacity.

            Assuming a year-’round average of 210 miles per charge cycle — battery drawn down to 20% — a Tesla with a 90 kWh battery (the most common confiuguration in their Model S) should last for about 400,000 miles.

            I’m not endorsing Tesla. I actually have lots of complaints about them, and expect them to go bankrupt. But lithium-ion battery realities are well-establised. From my reading on the subject, Tesla batteries in cars that have been operated as they ought to be are showing very long battery lives.

          • In order to get decent life out of your batteries, you have to treat them in a totally unrealistic manner.

          • Not unrealistic at all. It’s basically a matter of not habitually filling up until you’re at about a quarter-tank or a little less. I don’t see it as a problem, but it would certainly be an issue if the EV was our only vehicle.

            I’d be highly reluctant to advise someone to have only an EV, unless (maybe) they lived in the city and could rent cars for road trips. In that case, if they really wanted a battery-only car I’d steer ’em toward a Chevy Bolt.

      • But it will not be $10 when the tax man comes calling as they do with fossile fuels, and they will. For once the number of EV’s get high there will be no choice .

      • @Mike:
        If (a big if) all the tax and duty were removed from UK diesel prices, I’d be able to obtain ~20 litres of fuel for that $10.
        My little VW truck (a 4 pot 2 litre turbo) would take me about 260 miles. Keeping up with whatever traffic and staying inside speed limits
        In winter or summer regardless
        Actual numbers. I have the pump receipts.

        So we see how much the electric costs and how far it gets you. Just a teeny weeny smidgeon more than the diesel.
        Now, do we get to see the cronies at work – how all energy prices are very effectively tied to the price of oil?

        So then we’re (me certainly) left wondering, IF there is soooooooo much oil (& natural gas) out there, why is the price of same so jittery.
        The Royal Automobile Club (RAC) send me stuff and recently we were told that the price of fuel on UK supermarket forecourts had changed EVERY day since mid March. Sometimes down but otherwise relentlessly up

        So if there is really so much oil out there that we’re safe for decades if not centuries ahead, why so nervous?

        • I have an EV made by Think, the now-defunct EV division of Ford. Its fuel economy of 108 mpg-e on a blended year-’round basis is very typical of the EV car class. If all taxes are taken out of both sides of the equation, the EV breakeven point relative to gasoline is an electricity rate of 27 U.S. cents/kWh.

          But people have to pay taxes. So if you will tell me what petrol costs where you live, and what if any extra taxes are levied on EVs, I can give you the breakeven electricity rate.

          So you know: I am not the EV salesman. I bought mine strictly from a car-nut curiosity standpoint. I think the AGW hypothesis has failed, and I might be one of the few EV owners who will tell the absolute, unvarnished truth about them, including giving the accurate numbers.

      • Where it then sits for six hours before it can move again. What’s the additional six hours of non-use costing?

      • My car can do 300 miles with a bit over $12 in gas, and half of my fuel cost is road taxes which you aren’t paying.

        • In WA State, where the politicians waste no opportunity to do the eco-dance but turn around and levy a puninitive tax on EVs, my EV’s gas-tax replacement (and then some) fee amounts to about 60% of the total fuel cost. The equivalent gas vehicle’s fuel pump tax amounts to 19% of its fuel cost.

          If you want all the numbers used to make the calculation, feel free to ask.

      • How many kWh of electricity does it take to charge the battery enough to travel 300 miles? Obviously, the $ amount varies depending on the cost of electricity in your community.

        • My EV gets 2.8 miles/kWh in winter (107 kWh to go 300 miles) and 3.6 miles/kWh in summer (83 kWh for 300 miles). The blended year-’round number is 3.1 miles/kWh (97 kWh to go 300 miles).

      • $10 in electricity for 300 miles is theoretically achievable, but not realistic for most users. It does not account for:
        — continuous use of AC in hot climates
        — continuous use of heaters in cold climates
        — battery inefficiences associated with cold climates (battery thermal management)
        — the actual cost of the electricity before the AC-DC conversion inefficiency of charging (~ 5% loss) and the parasitic loss from battery self-discharge if the full charge is not used right away (~0.5% per day).

        There is plenty of silliness afoot regarding EVs.

        • At the electricity rate I pay (9.49 cents/kWh), and year-’round fuel economy of my EV (108 mpg-e) — which is very much on average for electric cars — $10 worth of electricity will take me 327 miles.

          This is measured by a submeter at my electrical panel, i.e. includes all the juice for the charging losses that you mentioned. It accounts for using the heater in the winter. I don’t use the A/C, or at least I haven’t, because I was running it in Seattle and really didn’t need to use it in my tiny EV.

          Now that we’ve moved to a place with hotter summers, I’ll be able to get a read on how much juice the A/C uses. I am told by others than it doesn’t use nearly as much as the heater does in winter.

          I have chronicled all the data for my car. I absolutely insist on telling the truth. I’ve been tossed from plenty of EVangelist sites for doing so. This is a very, very big deal with me, one aspect being those charging losses. Nissan has an online site called “Carwings” to chronicle the LEAF’s electricity use, and it omits the charging losses and thereby reports unfactually high fuel economy.

          My having pointed this out is what got me tossed from the very first EV site I ever visited. My position is (and will always be) that an EV is no different than any other appliance, and that to meaure its electricity use you start at the outlet, not after the electrons get through the inverter.

          I think of them as cars and not causes. Give the facts or forget it.

      • But what are you going to do when you get there and there is no charging station? Push it home? Perhaps carry extra charged batteries in the trunk? Call the ICE tow truck?

    • The irony is that completing a project like ITER or NIF would take only a few days’ worth of the world’s ‘green energy’ subsidies. Yet it will be many years before they are completed. Probably because the beneficiaries of the subsidies don’t want an actual solution.

      • Not true ! Whilst they don’t want a REAL solution
        they would enjoy the empathy !
        and THAT is what the whole “save the planet” thing is about !
        FEELINGS ! …..and…….er……..subsidies !……….er……did I mention subsidies ?

  3. “Given that Tesla has never made an annual profit in the almost 15 years since we have existed, profit is obviously not what motivates us,” he wrote in an email to employees and posted on Twitter.

    I remember posting a comment in The Guardian a year or two ago explaining why I, an experienced investor, would rather crawl across broken glass than invest in Tesla. I was taken to task by the True Believers. The very existence of these dedicated patsies would have been enough to cause me to avoid investing.

      • Good gig if you can lock the US Govt into your launch platform, and prove/assure that its safe for human flights. Not too many are keen to sit on top of a fueling bomb on the pad.

      • Quite the opposite. The other space launchers in the US, ULA as they are called, are a bigger scam than Tesla. SpaceX is actually saving money as they are just LESS of a scam. Even Europe’s ESA / Ariennepsace can not compete. Their CEO flat out said so.

        This isn’t to say that they are not cheating, it’s just that everyone else in the space business is WORSE! Competition has kept the other car makers honest, aside from Tesla.

      • Ian, that’s a valid point. How can Space-X be schooling NASA so completely, while Tesla is so wrong in so many ways?

    • Killer Marmot

      “I was taken to task by the True Believers.”

      Who doubtless don’t invest a penny in anything themselves.

      I gave up on the Guardian a year or so ago when I encountered RockyRex who systematically removed posts of mine on climate change because they challenged his school teacher authority.

      It wasn’t until a short while ago I was informed he is a moderator, but he doesn’t mention that.

    • “Given that Tesla has never made an annual profit in the almost 15 years since we have existed,”

      Good God, the man seems to be proud of the fact that he’s losing money.

      • but investors who bought early, and sold on highs have all made money. even a Ponzi scheme can make you money if you get out early enough

  4. Eric, did Elon Musk steal your girlfriend or something. What is with our childish stalking of his business on what is a climate blog? I mean come on man… time to focus on the real issues.

    (???????) MOD

    • Quite simply, it’s fascinating.

      The politics of Tesla are innately tied to the politics of climate change. It’s also a microcosm of the cronyism endemic in this entire system. Tesla has failed to turn a profit for 15 years, has relatively few intellectual assets. However, it has received and continues to receive billions for development of toys for the rich. There is no sign that they are going to reverse this in the foreseeable future. Despite the clear warning signs, it is somehow valued equal to or greater than car companies a hundred times its size. Much of this is due to the societal benefits of the car which are arguable at best.

      I could write psychology papers on the mob madness surrounding this company. A brand loyalty that exceeds even Apple, mostly from people who have never and probably never will actually purchase a product.

      • Tesla is also one of two large automobile manufacturers in the USA (the other is Ford) that hasn’t filed for bankruptcy and been bailed out by the US taxpayer. In 2009 Ford got a loan of $5.9b and Tesla got $465m. I think Ford has paid its loan back. Tesla paid its loan back early

    • Hello Simon, you made the statement “on what is a climate blog?” Actually it is a science blog covering any relevant topic be engineering, history even social.

      Tesla is of interest to people for many different reasons. Myself I am curious as to why they still can’t met their production goals. I have a Machine-Tooling back ground thus I am intrigued. It takes very,very special type kind of management skill to still be missing your production goals after so long time. I have never seen this before.


      • Mike the Morlock

        “Actually it is a science blog”

        Well said Mike. Got there before me.

      • Mike,
        From what I understand, Tesla on the Model 3 decided to forego the basic design verification of tools and also building prototype tools before creating a working factory. Who knows how much process verification they did either, obviously not enough. After all it’s always easier and cheaper to change electrons in a computer, than it is to change tools that are already made.

        • That actually correlates with something that I read a while ago. The Silicon Valley bunch, of which Musk is one, tend to regard an EV as a computer with wheels on. And this is neglecting – what is it? – about 150 years of automotive ENGINEERING. Not really surprising that Tesla Inc. is in trouble…

        • Ironically, Tesla is located in the former NUMMI automotive plant, which was a joint venture between Toyota and GM. Toyota showed GM how to manage inventory and shop floor control, which GM unsuccessfully tried to integrate into it’s bureaucracy.
          Maybe there is a curse on that building or it’s like a lightening rod for stupid ideas.
          Here’s a link to the NUMMI story: https://hbr.org/2009/09/nummi-what-toyota-learned

    • Because it takes vast subsidies from taxpayers on the basis that climate change is a serious problem.

    • Typical troll, taunt people for revealing facts you want to remain hidden.
      Place restrictions on what you want other people to be allowed to talk about.
      It’s all about control.

  5. Musk’s pretense that Tesla could eventually return a profit without taxpayer subsidization is becoming increasingly apparent. (It could never have gained ANY traction at all without the CO2 hoax, and is therefore relevant to discuss here.)

    • ““What drives us is our mission to accelerate the world’s transition to sustainable, clean energy……” might be regarded as pretense, as the product in this domain only consume energy, none create it.

  6. The word is that they attempted to automate assembly too much with whizzy robots. They should have studied existing successful operators who apparently consider a degree of human input is still essential. Now they are firing people off the floor. A Silicon Valley attitude for sure.

    • “Now they are firing people off the floor. ”

      No, only salaried employees (mostly from the Solar City subsidiary), not production workers.

      • Roger Knights

        To think I applied for a sales and marketing job with solar city in the UK about 20 years ago. It was before I knew anything about the environment and global warming (as was).

        I didn’t get the job as I probably didn’t come across as rabidly green. In fact, knowing me, quite the opposite, unwittingly.

  7. Elon Musk NEVER made any profit with any of his companies – or, to be precise, he didn’t pay any taxes.

  8. “Elon Musks explanation that his business decisions are not primarily motivated by profit might come as a surprise to investors who were expecting a return on their capital.”

    Actually, many investors, including funds, seem not to be primarily profit-oriented either. (Perhaps the profit-oriented investors have mostly bailed out.) One commenter said that their mindset is that of backers of a Kickstarter project they like—i.e., not primarily money-seeking.

    To follow the drama via daily threads, pro and con, on Tesla, go to https://seekingalpha.com/symbol/TSLA

  9. “Please do not be alarmed,” the voice continued, “by anything you see or hear around you. You are bound to feel some initial ill effects as we have been rescued from certain short-selling at an unprofitability level of two to the power of negative two hundred and seventy-six thousand against-possibly much higher. We are now hovering at a level of two to the power of negative twenty-five thousand against and falling, and we will be restoring dividends just as soon as we are sure what is normal anyway. Thank you. Two to the power of negative twenty thousand and falling.”
    The voice cut out.
    Ford and Arthur were beside a small luminous pink Tesla plant.
    Workers were streaming out, dejected.
    Ford was wildly excited as market share of his namesake soared.
    “Arthur!” he said, “this is fantastic! They’ve been laid off up by a company powered by the Infinite Unprofitability Drive! This is incredible! I heard rumors about it before! They were all officially denied, but they must have done it! They’ve built the Unprofitability Drive! Arthur, this is… Arthur? What’s happening?”
    Arthur had jammed himself against the door to the office, trying to hold it closed, but it was ill fitting. Tiny furry little hands were squeezing themselves through the cracks, their fingers were inkstained; tiny voices chattered insanely.
    Arthur looked up.
    “Ford!” he said, “there’s an infinite number of Shakespearean monkey investors outside who say they want to bemoan ‘how weary, stale, flat, and unprofitable, seem all the uses of this world!.’ ”

    ~Badly mangled Douglas Adams with sloppy apologies

  10. I struggle to understand the hatred for Tesla displayed in the comments.

    I guess there are many people who have shorted Tesla stock and have been alarmed by the rising production rates and stock valuation

      • Because all of those vehicles can still be seen on the road 50 years after they were manufactured?

        But you won’t see a Telsa on the road 50 years of age.

    • The fact that he sucks up huge amounts of government money to keep his boondoggle running.
      Then again, for those who never pay taxes, government money is free.

    • I don’t know about hating him – but I do tend to have an intense dislike for people who enrich themselves by sending the tax man to pick my pockets.

      (I was going to insert an image of his Bel Air estate here – but couldn’t decide which one of the five mansions he owns there to show.)

    • Here’s a quote from a commenter on the Seeking Alpha site’s TSLA page:

      “Much of Tesla’s disclosure is not just selective, but purposefully deceptive and designed to mislead investors, consumers, and regulators. Egregious examples include: failure to disclose material information during a capital raise (Solar City acquisition), gamed ZEV regulatory bodies (battery swap), purposefully misleading non-GAAP metrics (including gross margins), accepting deposits for products years away from production (if ever), and charging customers thousands of dollars for nonexistent technology (full self driving).”

      There are many such (accurate) accusations in that venue.

  11. > Elon Musks explanation that his business decisions are not primarily motivated by profit might come as a surprise to investors who were expecting a return on their capital.

    Investors at rhis point should be concerned about return of capital rather than return on capital.

    I’ve no doubt that among those 3900 “white collar” employees are the very people who have been putting in countless hours jumping in every time the assembly line glitches. Musk is about to find out the hard way just how those cars are making it out the door.

    • If he’s getting rid of his white collar staff, that means he’s getting rid of the designers that should be coming up with the fixes for the current models as well as all future models.
      This move indicates that even Musk has realized that his dream has no future.

  12. He is right , it is not about profits it is about ego .
    That suckers wish to keep given them money is there problem.
    The only issue is that subsides from the tax payer are also used to prob-up is ever expending ego.

  13. The general public is not aware of the practical issues with a battery only powered car. For many people these practical issues would be a show stopper.

    Cold weather is a problem. Battery capacity is reduced by 40 to 50% even with the Tesla parked in a heated garage. It is not always possible to find heated parking.

    Battery capacity decreases year by year. The loss of battery capacity is greater for higher ambient conditions,

    Time to charge at a supercharger is 1/2 hour to 1 1/2 hour. In cold weather it takes 20 to 30 minutes to warm the battery before super charging can start.


    With the advent of winter in Chicago my 2015 Tesla 85D 4 months old / driven 5000 miles looses almost 40-50% range.

    Jan 18th – The car was charged to 237 and was preheated to 72 deg F before leaving the garage. Drove 106.3 miles and had only 44miles left on the battery range indicator (yellow battery icon) – outside temperature 6deg F. NET LOSS OF RANGE 87 miles (the 44 miles would only have given me a another 20+ miles of range.in which the loss would have been 107 miles on one trip.

    Dec 23rd – This loss of range was noticed earlier LOSING 70 miles on a full daily charge outside temp 42 deg F.

    Tesla tech had advised me to preheat the car after Dec 23rd issue to heat the car which also triggers the heating of battery pack 30 m before leaving. Heating the battery pack apparently draws a lot of power to heat the battery – pumps – coolant heater etc – they also advised me to keep it plugged in at all times when not in use at home.

    DAILY LOSS PARKED IN GARAGE IS 3 to 7 miles. Please let me know for those living in cold weather areas if you have noticed similar loss of range as I would like TESLA to remedy this.


    I’m at over 35k miles and just a little under 2.5 years since taking delivery. My max charge is coming in at 250 miles, so I’ve lost 15 miles or 5.66% of my range. If this trend continues, I will have about 235 miles at max charge at the 5 year mark and somewhere at 210-215 miles at the 8ish year mark.


    Charging from 10% to 90% takes about 1 hour when NOT sharing A/B pair (charging in A stall when B is not in use). First half hour charging at about 100-110kW, then next half hour charging speed tapers all the way to 30kW.

    When supercharger site is busy and A/B stalls are shared, it takes 1.5 hours (first 20 mins slow b/c most juice goes into another car in pair, then second car start tapering and your charging speed goes up for a while, and eventually tapers too).

    In cold weather below freezing it takes 20-30 mins to warm battery for higher speed charging, so warming period adds to charging time.

    • “I’m at over 35k miles and just a little under 2.5 years since taking delivery. My max charge is coming in at 250 miles, so I’ve lost 15 miles or 5.66% of my range.”

      So much for the claim from James above, that batteries retain 90% of their capacity after 160,000 miles, or that the batteries will still be useful after 500,000 miles.

    • Tesla charging software doesn’t allow full charging/discharging when nearly new. Then, as battery capacity falls, the software allows more depth of discharge. Thus, the capacity loss is hidden for the first few years, and rate of capacity loss cannot be predicted from the early years of use.

    • All battery-only EVs have pretty much the same battery dynamics. I have a first-generation EV made by the now-defunct Think division of Ford. But they really are all the same, the major difference being how big the battery.

      My EV’s winter fuel economy has been 77% of its summer fuel economy, and that was in Seattlestan where winters are mild. I’d expect Chicago to be worse, and Minneapolis to be worse yet. The so-called 260-mile battery in the Tesla Model S was, in practical reality, more like 175 miles in a Pacific NW winter — and then only if the cabin heat was turned off and the only warmth was supplied by the seat heaters.

      It’s hard to get a Tesla owner to tell you the truth. After all, they’ve paid $100,000.

      Even under ideal conditions, with the weather just right and “superchargers” spaced ideally and there being no lines or “pairing” at the charge station, a Tesla driver will spend one-sixth of his road trip sitting at the charger. The “superchargers” add about 6 miles of range per minute. My 1-ton diesel pickup adds 90 mies of range per minute at the pump, and a typical small car will add 150 to 175 miles of range per minute.

      As for capacity, a lithium-ion battery will keep 70% of its charge for 2,000 cycles, provided you don’t habitually discharge below 20% state of charge or top it off when it’s above 50%. Thus, the 25 kWh battery in my Think (same size battery as a Nissan LEAF) should last for about 100,000 miles. A Tesla model S 90 kWh battery, treated correctly, ought to last for 400,000 miles or so.

  14. Profit is the great equalizer in a free market system.

    Since free markets have been severely hindered by government intervention through: protective tariffs, subsidies, special tax breaks, low-interest government loans, bailouts, tax holidays, excessive rules, liscensing, regulations, mandates, archaic labor laws, insane anti-trust laws, etc., many companies that should not exist, do, and many others that should exist, don’t…

    When the profit motive is replaced by government largess and interventionism, the market becomes inefficient and $trillions of taxpayer money is squandered, innovation is impeded, economic growth is hampered, government debt increases, cost of living increases, and our standard of living is decreased.

    Whenever, a CEO says, “profit has never been what motivates us”, short their stock and buy puts.

  15. Thinking like a “Green”of course. Magical thinking divorced from reality. Second career as a fiction writer of scary climatic apocalypse in the offing?

  16. He has also been in communication with Martians and N. Tesla. They all make a great team.

  17. Musk’s “Mission” has passed him by – he will be building but 5 electric passenger vehicles by the time the world’s automakers roll out well over 120 electric vehicles, over the next several years.
    Musk also lied big time by claiming to have been the motivating force behind the transition to electrics. The obstacle that has prevented practical electric cars for the past 100 years has been the lack of a cheap, fast charging, long-lasting battery, which Tesla (who has always bought their batteries in the same way as any laptop PC manufacturer ) has had nothing to do with. Musk
    is one huge liar and egomaniac.

  18. Whatever the other goals, a business that doesn’t make a profit soon finds itself in the garbage heap.

    • As a retired financial analyst who saw a thing or 30: “Elon,” when the funding window closes, it will close so fast it will make your head spin.

  19. What percent of the 9% cut didn’t show up to work for free when called upon to do so last year?

  20. I have a tiny electric car (made by “Think,” the now-defuct spinoff of Ford’s electric car division) and a 1-ton diesel pickup. The EV’s fuel costs 2.7 cents a mile, compared to the diesel truck’s 22.5 cents a mile. The EV is almost identical in size and weight to a Scion iQ microcar. Its fuel cost per mile is 10 cents.

    Taxes introduce a distortion. The lying, hypocritical, tax-drunk worthies of Washington State, who forever proclaim their eco-progressiveness, actually penalize EVs with a $150/year tax, ostensibly to recoup lost gas tax revenue. It adds 3.8 cents/mile to the EV’s fuel cost, bringing it to 6.5 cents/mile. A tax that used the same principle as petrol taxes — the lower the fuel economy, the more you pay — would charge the EV 0.5 cents/mile.

    Either way, though, the EV is a lot cheaper than a petrol car: less than one-third the cost of running the truck, and two-thirds the cost of running the equivalent car. If taxed equitably, it would cost 1/7th what the truck does, and one-third what the equivalent car does.

    To head a couple things off at the pass:

    1. I am not one bit smug about the EV. I think the AGW hypothesis has been shown invalid. I bought the EV strictly out of curiosity, being a car nut.

    2. I did not claim the $7,500 federal tax credit. No special privileges for me.

    • What fun is driving a tiny electric car unless you are in a parade with the Sahib Shriners.

      • Remember: I am a car nut and bought it strictly out of curiosity. I’m going to say some good things about it, but please trust that I’m not one of those virtue-mongers. God help me.

        The EV is a fun little runabout to take on short jaunts into town for groceries. Electric motors are all about the torque, and this one seems to be optimized for 0-40 mph or so, although the car will go 70-75 mph on the highway too.

        The downside with a Think is that, even though they do have airbags and a safety cage, it’s a plastic body and you’d really hate to hit a deer or one of the pickup trucks which comprise at least half the vehicles where I live. I figure they’d have to use a dental suction tool to remove what’s left of me.

        Still, though, it’s fun to drive. Save the world? Not only no, but hell no. Fun though. And for a car that looks like it was the product of a drunken three-way between a Smart car (but a foot longer and a few inches taller), a Chunky candy bar, and an escaped rodeo bull, I’m continually amazed by how much stuff it can haul. 4x the cargo space of a Smart car.

        I had it outfitted with steer horns and was going to offer to run around the next rodeo at halftime, but the horns blew off a couple weeks ago when I was driving it at 70 mph into a 35 mph wind on the Interstate. I guess it’ll have to be the Shriner parade, then.

        p.s.: Elon Musk is a joke, and I don’t think Tesla is long for this world.

      • There is no doubt at all that electric cars have certain advantages over gasoline powered cars. (This is in stark contrast to the situation with respect to aircraft. I wish I could go a couple of days without reading an email containing a breathless report on the effort of some misguided fool to build an electric airplane that will, for sure, revolutionize something.) An awful lot of the complexity associated with an automobile’s drive train goes toward dealing with the limitations of its internal combustion engine. It’s been well refined over the last dozen decades, but the complexity is still there.

        The question is whether the disadvantages that an electric car also no doubt has are greater than the advantages. For the vast majority of people, the answer to that question would seem to be yes, but that doesn’t mean that someone with a somewhat different set of values won’t judge it differently. Heck, if I had the money, time, and expertise, I might be tempted to take a junk car and convert it to electric, just to show people I could do it. It sounds like a fun project.

        If I did that, I’d have to drive it around, just to show that I could. I do the bulk of the driving for my household, so most trips on most days are fewer than ten miles, which means the range wouldn’t be so important, even if it was limited by the battery powered, but oh so necessary, air conditioning. It might even be practical for that part of my driving. I’d hate to have it as my day-to-day car, though.

        • We used to live in Seattlestan, and then moved to 20 acres in a secure undisclosed location in the countryside in WA State. It is hard to overstate how many things there have been to do, so swapping out the EV’s defunct 12-volt battery + a few other odds and ends were on the low end of the priority list, especially when we have two other perfectly fine ICE vehicles and a brand new Arcticat 700cc gas-powered UTV with a plow blade for next winter. And a gun rack.

          All of which is to say that the revitalized EV has been revitalized for only two weeks. But I had driven it enough in Seattlestan to have become quite familiar with not only the basics but its particular quirks. (Note: It’s my 17th motor vehicle; they all have their quirks however they are powered. The EV is the quirkiest, but well within the tolerable zone for a first-generation space shot.)

          So, upon getting it going again, I was and still am quite curious about its performance characteristics. This is especially the case given that where we live has significantly greater topographical relief than our Seattlestan neighborhood did. I’ve made a point of testing it in the various permutations around here, and thus far the results have modestly exceeded my expectations, given that it’s a 1,200 foot climb from town to our Wingnut Gun Compound (13 firearms, 16,000+ rounds, beware tweekers!), and EVs really don’t like the uphill.

          The car has A/C, but I have never used it. Give me a couple months, and there will be some days. I will be curious. The heater worked fantastically well in Seattlestan. Very far exceeded my expectations. But I am wondering if the A/C unit is even charged, given that the car is now 7 years old and I’ve never even turned it on.

          I am not the battery car salesman, at least not the battery-only car salesman. At the national level, I might be the plug-in hybrid salesman due to the energy efficiency factor (roughly 2-1/2x at the current U.S. electricity generation mix.) But I think range and charge time is and will long remain a major sticking point for battery-only EVs, even when subsidies manage to equalize up-front capital costs.

          That said, it’s a 12-mile roundtrip to town and back, and I can get five of those on a summertime battery charge, within the recommended 80% capacity band. This makes for quite a viable grocery-getter. I think I’ve fired up Carbon Bigfoot (the pickup) once or twice since getting the EV up here. That said, if someone in the area were to ask me whether they should get a battery-only car, my answer would be: “Make sure it’s not your only car.”

          Trust me: I have drunk no one’s Kool-Aid except that which is sold by Kraft Foods, and it’s been a long time even then. You are not corresponding with a glassy-eyed eco-zombie, but rather someone who will give credit where credit it due, no more and no less. By the way, I need to order another sticker from the NRA to put on the electric car. We’re not all kumbaya artists.

  21. Well thank goodness I am not a Shareholder for one.
    I bet the non profit motivation was not in the Prospectus so is Musk in breach of any Law??

  22. You have to love Socialism and its road to ruin. “My mission is to lose money until the company becomes an agency of the Department of Energy and a ward of the taxpayer” It is the expectation of the socialists in Government to pay Tesla Employees today on the future earnings of the as yet unborn citizens of this great county. As the future tax payments of all living citizens has already been spent. The subtle variation of that last sentence highlights the transition to Government owning all means of Production. Pass the Vodka Comrade

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