By on July 10, 2008

\"Several of the outfits, Ignatius noted, were new enough and expensive enough to be properly considered offenses against taste and decency. Possession of anything new and expensive only reflected a person\'s lack of theology and geometry; it could even casts doubts upon one\'s soul.\"Behind every flailing/failing company is a bunch of clueless, warring egomaniacs. Students of mismanagement mishegos have a new case study to contemplate, thanks to a portrait of the aspiring electric vehicle maker in Fortune magazine. There's plenty of SNAFU granularity to consider, but the main theme is that Tesla founder Martin Eberhard is an overwhelmed Wozniak to Elon Musk's OCD Jobs. In other words, it's a simple case of the blind leading the lame. Or is that the other way around? Anyway, there are some insanely great quotes. "Musk has kept silent until now about what happened [to Martin Eberhard's crashed Roadster]. 'I was too busy trying to fix the fucking mess he left. I haven't had time to tell my story… I will say, I have never met someone who is as capable of creating such a disinformation campaign as Martin Eberhard.'" And "When an early member of the marketing team suggested putting solar panels on the roof of Tesla's new headquarters in San Carlos, Calif., Eberhard's response was, 'Why the fuck would we do that?'" And "Musk ordered the engineers to lower the doorsill two inches, thereby losing much of the cost savings that come from using a crash-tested off-the-rack chassis. 'Have you tried getting out of an Elise?' asks Musk. 'It's like you have to be a contortionist.'" There's SO much more. Suffice it to say, we learn that seven Roadsters have been completed; each cost Tesla more to build than they [in theory] make. Each will have to have its transmission replaced. The Tesla Death Watch continues. 

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22 Comments on “Tesla Death Watch 9: A Confederacy of Dunces...”


  • avatar
    seoultrain

    One doesn’t have to be a contortionist to climb out of an Elise, but one does need to be fairly athletic. A well-placed grab-handle would have been enough of a solution for most. I always wondered how Tesla would deal with old/fat people getting in and out of an Elise chassis. I guess the their solution was not to use an Elise chassis.

  • avatar
    210delray

    This farce can’t go on much longer, can it?

  • avatar
    doug

    More math issues?? Why is this Tesla Death Watch #9?
    You’ve already had a #10.

  • avatar
    MattVA

    Does “seven Roadsters completed” mean 7 people with their cars, or does that 7 include the ones sitting in the showroom?

  • avatar
    psarhjinian

    I don’t think the Wozniak/Jobs analogy is a good one, if no reason than Eberhard is both a Wozniak and a Jobs (well, ok, maybe not quite the sociopath), while Musk is, well, he’s pretty much your standard-issue Valley vulture capitalist.

    Both men are probably accurate in their accusations: Eberhard is very much a poster child for why you should never, ever let engineers and technology people run a company. No project management, shoddy accounting, no goals, no targets, just “Hey, let’s do some cool stuff”. It’s like the bizarro version of General Motors.

    Musk, in turn, is an example of what happens when you let the foxes (venture capitalists) into the henhouse: suddenly, it’s all about ROI and spin control and the product can go hang.

    What ought to have happened is this: Eberhard should have been pushed aside (perhaps into a “Chief Visionary Officer” role) and the board appointed a professional president who–and this is important–is not one of the investing VCs. Oh, and this should have happened long before the time that things got so bad Musk had to step in.

  • avatar
    doug

    psarhjinian said: What ought to have happened is this: Eberhard should have been pushed aside (perhaps into a “Chief Visionary Officer” role) and the board appointed a professional president

    It appears that this is what Eberhard wanted all along. He didn’t want to continue as CEO, but he did want to remain within the company.

  • avatar
    lewissalem

    In IT we have something called “scope creep.” It happens when your client keeps adding and changing things (for sometimes frivolous reasons) which ad time and complexity to a project. Musk seems to have contributed significantly to the delays. Well that and the failing transmissions, and well I guess side distractions like the White Star factory, and well…

  • avatar
    Alex Rodriguez

    Sounds like the process of getting their house in order was brutal.

    But it sounds like they have made great strides in that regard, and have the right people finally in palce. If they can survive the next 6-9 months and get production ramped up to at least 30 cars per month by the end of that period, they should be fine.

    Great find though. Very interesting read.

  • avatar
    John Horner

    Ah, now this is the true story of the Silicon Valley I know. Perhaps we could have a new underground video series: “Egos Gone Wild”.

  • avatar
    Areitu

    MattVA: When I last drove by the Tesla dealership, the showroom was nearly empty with only one or two cars inside.

    Didn’t the elise-based Opel speedster/Vauxall X220 have lowered doorsills? Adopting that chassis via Lotus may have made more sense, although there’s always the possibility the sills are still too high.

    It seems like Musk is bit of a perfectionist, every detail must be in order, or it’s no good. From the sounds of it, starting and running a car company is harder than putting a satellite into orbit.

  • avatar
    guyincognito

    @ Areitu Says:

    Why, has Musk ever gotten a satellite into orbit?

  • avatar
    mkeenly

    Engineers, myself included, must follow KISS, “Keep It Simple Stupid”.
    Lowering the doorsills and trying to get the two-speed transmission
    into Version 1 of the vehicle may prove to be the factors as to why
    this company’s failure is inevitable.
    I love cars, and I hate to see this happen…

  • avatar
    shiney

    psarhjinian said: “Eberhard is very much a poster child for why you should never, ever let engineers and technology people run a company. No project management, shoddy accounting, no goals, no targets, just “Hey, let’s do some cool stuff”.

    Most of the problems you describe seem to have been brought on by Musk. I’m not sure what industry you work in, but most of the engineers I know in the car industry are project managers, and in general are good at setting goals and targets. (I’ll give you the shoddy financial record keeping & cash flow control). It tends to be “all industries are the same” MBAs that set unrealistic goals and can’t control product scope.

    If they had stuck to Eberhard’s original vision of just getting a simple car finished and on the market they might have had a chance. Instead you had Musk, his pockets and ego flush with Paypals success (a company he was forced out of ) wanting to take this straightforward, though still very difficult vision, and turn it into a triumph of silicon valley ego over the dinosaurs in car making. He seems to have brought in scope creep from hell. Lotus had a market accepted regulation approved chassis – and Musk decided it had to be changed because his wife couldn’t get in and out gracefully? change the sill height? new door latches? new seats? WTF was he thinking! You have to wonder if he was really interested in building cars at all. And I would love to see the justification for attempting to build a car manufacturing plant in the bay area…

  • avatar
    mkeenly

    The idea of building cars in the Bay Area is a way to get the media (and the VCs)
    to listen. It is nothing more than a stunt to generate interest for the necessary next
    round of financing.

  • avatar

    a friend was obsessed with mr toole’s novel & sent me a copy to peruse whilst i was otherwise disconnected from western culture in the land of the raising yen. good choice of posting title …

  • avatar
    jpappl

    My comment is for Robert and all of the other people on here and elsewhere who actually want to see the Tesla experiment and others like them fail.

    It is absolutely anti-American to do so considering our position with the oil and other energy issues. As a country we have not prepared for this because so many Americans felt they were entitled to cheap gas forever. Now they act shocked.

    Unfortunately, ideology will rule the day because only about 10-20% of us are true independents. Everyone wants to blame the other side and we aren’t getting anywhere.

    Here comes along Tesla and others who are trying to create a product that can help alleviate some of the oil/gas demand ( the only short term solution ) trying to create a revolution in transportation by giving people electric cars that take away the negatives (short range, poor performance ) and you idiots (excuse me) are hoping for their demise. It’s insane to think this way.

    Now, I understand that you don’t want to see vaporware. Couldn’t agree more. Zap X is an example. But give these guys and others some friggin breaks and some credit.

    You know the big 3, toyota, honda have been fiddling around building cars for a long time. They produce cars in the millions. Don’t they have recalls, don’t they promise cars will be out that never do. Everyone has a future models sections, thats just vaporware for the most part.

    Every hydrogen car that is built is a car that will never be. They have no intention of really pushing this because it takes more energy to produce hydrogen than it makes. It will never happen. But the Govt gave them 300 million to play with so they are using the money to build a car to nowhere, it’s a real car ( cost 200,000 + to build )but the hurdles to create a hydrogen infrastructure are something we can’t afford. Natural gas would be better.

    All auto manufacturers, oil companies, and everyone down the line are subsidized through the nose. That money can be spent moving in a different direction.

    But now all of you wonder how were going to charge these electric car things away from the home.

    A little research would prove that the grid can handle the load as long as we continue to build additional plants to keep up with the future demand.

    The military has fast chargers, other companies make fast chargers, they can be put up everywhere in the entire country in a matter of months with a major push from private and/or govt investment. No brainer, no problem. Electricity is everywhere that the electric car would be used, mainly in and around cities as a commuter car. It is a perfect commuter car becuase in stop and go it’s not burning fuel, which is where a lot of fuel in our ICE cars is wasted. It can go from 0-60 quickly and you not driving 140 mph on the local highway.

    But big business, big oil and big govt will drag there feet, partly to avoid economic chaos. That is the real hurdle, dealing with the economic issues of job change, not the technological side of charging the stupid car.

    Who here doesn’t honestly believe that battery tech and charging tech and all the things that go with it will not be far more advanced in 5-10 years ? Look at the progress made in a few years.

    Compare that with gas prices at $6 a gallon or spending about 1.5 million to install a hyrdogen fill pump.

    I hope Tesla and all the others prove all of you nay sayers wrong. They are acting, whether for their own financial reasons, in the interest of the common man. Many here just don’t seem to get that.

    Expect delays, expect performance issues and maybe a recall. All normal with every other car company.

    And Robert. I know you are mad at all the publicity they get even though they are not delivering cars for the most part. But they are closing in on that. The reason they are getting the publicity is because this is a totally new technology that could change the way we live.

    If gm, toyota came out with a car like this before them nobody would have cared. But they didn’t, makes you wonder if they ever would.

    Thanks for listening.

  • avatar
    nonce

    There’s been repeated calls here for someone, anyone to drive a Tesla on their own and check the range. Autoweek did just that. You can see their numbers.

    AutoWeek

  • avatar
    Rix

    The technology is real, and it is excellent. Toyota could have built this and made it work. Although the market is probably too small for them and they wouldn’t use carbon fiber…they would have made some money, too.

  • avatar
    doug

    http://money.cnn.com/video/ft/#/video/fortune/2008/07/09/fortune.tesla.071008.fortune

  • avatar
    Campisi

    For God’s sake, how hard can it be to make what is essentially a giant remote-controlled car without a remote?

  • avatar
    nonce

    For people who have never started their own company, I’m sure this sounds like chaos. They imagine that if they were ever to form a company, everything would be roses, and only perfectly rational people would be involved, and everyone’s jobs would be perfectly aligned with their skills. Everything would be perfectly planned and only prudent risks would be taken.

    In reality, small companies are chaos. You go to war with the employees you have, not the employees you wish you have. People that join small companies have hopes and dreams of their own that might not align exactly with yours. Even if it were possible to rationally determine the best person for the job, which it isn’t, you don’t have the ability to do that.

    The whole Fortune article sounds exactly like any new company. And they’ve switched to doing what they have to do to get things shipped.

  • avatar
    m_o_s

    What is all this nonsense about saving cost using a crash-tested off-the-rack chassis? They had to design a new chassis anyway (unless they wanted to somehow mount their battery to the Elise engine mounts), and even had they somehow shoehorned a new car into an old chassis, they’d have had to re-crash-test the car again anyway too. Even small things like changing the structure of the dash can trigger a new crash test — to say nothing of a new powertrain.

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