Elon Musk is in the news again with another distraction so it must be about time to report Tesla’s second quarter earning’s reports.
First, the distraction.
Neuralink, the secretive company bankrolled by Elon Musk to develop brain-computer interfaces, will provide its first public update later today in an event streamed over the internet.
“We’re having an event next Tuesday in San Francisco to share a bit about what we’ve been working on the last two years, and we’ve reserved a few seats for the internet.”Elon Musk’s brain-interface company is promising big news. Here’s what it could be.
This could be the big reveal of what the mysterious company has been up to since Musk announced it two years ago, and hired a pack of leading university neuroscientists to pursue his goal of connecting human brains directly to artificial-intelligence software.
Elon wants to hook your brain to a computer for some unknown reason. MIT—authors of the above article—speculated that Elon would demo a monkey playing a video game. Based on what I know, it doesn’t take much brain power to play video games so Elon will have to do better than that to get my attention on this project.
Meanwhile, several pieces of Tesla news have surfaced in the last few days.
Sales
Tesla has been claiming that sales are up so of course to they announced another price cut. This is contrary to common sense but this is the company fathered by Elon Musk.
Tesla delivered more electric cars in the second quarter than any three-month period in its history, alleviating concerns that demand is waning for its stylish vehicles as tax incentives in its main U.S. market begin to phase out.
Despite the heartening news Tuesday, Tesla still hasn’t proven it can consistently make money despite repeated promises from CEO Elon Musk to reverse the company’s long history of losses.
Musk himself has already acknowledged Tesla will post a loss for the past quarter, but forecast profits after that—something he also did last year, only to be proven wrong. Analysts polled by FactSet are predicting the company will absorb a loss of about $228 million for the second quarter. If those projections hold true, Tesla will have lost nearly $1 billion during the first half of this year.
Tesla’s car deliveries rebound, but challenges still abound
Tesla cuts price of Model 3 and Model S, increases price of full self-driving option
Bricks without straw
Tesla workers have told CNBC that, in order to meet Elon Musk and Tesla’s delivery quota for the second quarter, that they were subjected to unfathomably harsh conditions and took numerous manufacturing shortcuts.
This “bombshell” should come as no surprise anyone who has followed the Tesla story.
However, Tesla operates its manufacturing business in what is called an “open-air tent factory,” and employees told CNBC that they were forced to work through freezing nighttime temperatures, excessively hot daytime temperatures, and even unhealthy air quality brought on by wildfire smoke.
Whereas most legitimate automobile manufacturers rely excessively on robots and other automatic means of production to meet delivery estimates, these employees said they themselves had to bypass the robots and put the cars and battery packs together themselves.
This included the use of electrical tape to fix some defects. Great. That should rival being able to trick an autopilot-enabled car with table salt.
The grander point about how Tesla is being run is a referendum on Elon Musk. If these same stories came out of any other legitimate car manufacturer, the entire industry would be in an uproar.
Managers would get fired, senior management would be forced to resign, the stock of that particular company would fall, and government regulators would be all over that company in less time than it takes a BMW to go from 0 to 60.
This isn’t even the first time we’ve heard about worker conditions. It’s been going on for two years.
But because this is Tesla and Elon Musk, everyone seems to turn a blind eye.Tesla’s Corner-Cutting ‘Bombshell’ Shouldn’t Surprise You
Mark my words: If vehicles were delivered in this quarter under the conditions that these employees describe, consumers should worry that they are going to suffer from higher-than-average mechanical and recall problems.
Autopilot claims scaled way back amidst programmer mutiny
A day after Elon Musk suggested that auto-driving Tesla cars might not be sold to the public and could instead be hawked as robotaxis, a report dropped revealing that in recent weeks nearly a dozen Tesla Autopilot engineers had already hit the eject button.
You can’t make this stuff up.
Tesla Engineers: We’ll Drive Ourselves Home
As many as 11 individuals on Tesla’s software Autopilot team departed the company during the past few months, according to The Information, continuing a purge which began when Elon Musk booted the team’s leader in May.
The significance of these Autopilot departures cannot be overstated. One of the highest profile functions of future Tesla vehicles is its ability to drive itself.
While there are other competitors in this market, for 10% of this division’s workforce to get up and leave means that they do not believe the timeline that Elon Musk has set for the product is in any way realistic.Elon Musk’s Tesla Autopilot Engineers Mash the Eject Button
And that’s not the only problem: There has always been doubt regarding the safety of Tesla’s Autopilot system, not only in its supposed ability to reduce crashes, but also in the numerous crashes in which it has allegedly played a part.
Cult of Elon Musk
The article above calls followers of Musk a “cult.”
This should tell investors and consumers a lot about company culture. It is a personality cult. The product itself has a cult-like following. Tesla is all about Elon Musk.
Musk certainly has cast a spell on the true believers of his utopian dreams. He has made an irrational and emotional connection with people that willingly follow where he leads. These folks are convinced that Musk is singlehandedly transforming the world and the cosmos. They can’t wait to follow him to Mars.
My problem with Musk is that he doesn’t risk his own money to do anything, he always manages to fund his ventures with tax dollars and gullible investors. He starts much and finishes nothing. He is the 21st Century P.T. Barnum.
Musk claims economic miracle
Oh, if you thought Burger King and Bill Clinton had cornered the market on whoppers try this from Elon:
Tesla Inc.’s Elon Musk is standing by a claim that the company’s electric cars will be appreciating assets once they’re capable of driving themselves.
Musk, Tesla’s chief executive officer, first made the claim in a podcast interview in April that the company’s vehicles will gain in value because they’ll eventually be capable of fully autonomous driving. He stood by this in a reply to a follower who wrote Tuesday that he was unsure if the CEO was joking or making a “really dumb” statement.
Quinn Nelson, the owner of a media company that produces videos about tech products, kept engaging Musk in a debate over the claim, which Nelson said “makes no sense.” The CEO replied that Tesla is bundling full-self driving — or FSD — into all cars the company builds, and that Tesla will be unable to keep up with demand when the vehicles are capable of complete autonomy.Musk Stands by His Tesla Appreciation Claim That Was Called ‘Really Dumb’
With the exception of collectors’ cars and other rare cases, depreciation has been a fact of life for automakers, dealers and rental-car companies for decades. While Kelley Blue Book has handed Tesla a best resale value award for its Model 3, for example, the car-shopping researcher estimates the sedan retains about 69% of its value after three years.
My take
The wheels are falling off the Tesla dream. Musk would rather be doing other things than running this company and it shows. His attention and passion are elsewhere. He is a butterfly searching for the next colorful flower to pollinate.