By on June 30, 2020

Tesla CEO Elon Musk is reportedly cracking the whip again, spurring his company’s workforce into a frenzy of car-building as the end of the second quarter looms.

After posting a surprising first-quarter profit in early April, Tesla warned that the full weight of the coronavirus pandemic — and related lockdowns and sales implosion — would land on its balance sheet in Q2. To keep investor enthusiasm alive, the push is on to make those numbers as rosy as possible.

In an internal email obtained by Reuters, Musk makes a somewhat militaristic appeal for employee buy-in on the blood, sweat, and tears front. In a message that calls to mind the “maximum effort” backdrop of Twelve O’Clock High, Musk suggests that avoiding red ink is somehow possible.

“Breaking even is looking super tight. Really makes a difference for every car you build and deliver. Please go all out to ensure victory!” Musk wrote in the Monday missive.

If that email were a poster, there’d be vast fields of wheat, a factory looming in the distance, and piston-engined planes soaring majestically overhead as a nation of people, united in purpose, toil towards a better future for their children.

Tesla posted a slim $16 million profit in Q1, surprising analysts and investors. Of course, that black ink was a big win for a company that stretched itself nearly to the breaking point in its haste to ramp up production of the Model 3 while getting the Model Y ready for production, earning plenty of losses in the process. Because of the pandemic, the automaker put any near-term fiscal predictions on hold. A guidance for the full year will be released with its Q2 earnings, Tesla said in April.

As Fremont, California assembly plant workers put the pedal down for victory, Tesla has many irons in the fire. In Shanghai, Q2 is all about getting its Model Y on the assembly line while ramping up production of the Model 3. In Germany, a plant build is underway. And in the U.S., the company seems very close to securing land and tax assurances in order to set up a second domestic assembly plant in Austin, Texas.

[Image: JL IMAGES/Shutterstock]

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21 Comments on “Musk to Toiling Masses: Greater Yields Mean Victory!...”

  • avatar
    SCE to AUX

    “Breaking even is looking super tight.”

    How many mfrs can say they’re even close to breaking even in Q2?

    It’s fun to mock Mr Musk, but when F, GM, and FCA all report losses for Q2, TTAC will shrug and say “of course… pandemic.”

    • 0 avatar
      Art Vandelay

      Their are patterns involving profitability for those other makers. This just isn’t the case with Tesla so yeah, most are a little more cynical with respect to Tesla.

    • 0 avatar

      Take away the carbon credit scam and see how close Tesla is to breaking even, or even surviving.

    • 0 avatar
      Rick Astley

      Tesla is not a profitable company. As others have said before, the artificial subsidy of CAFE credits to sell is the business that Tesla’s really in.

      Plus the approximately $1.8 billion in taxpayer subsidies on the purchase of their luxury cars. Like the Prius, Tesla’s are cars which pick their driver, it just so happens that type of person also loves other people buying them things (a trait shared by Elon Musk).

      JP summed it up very eloquently:

      • 0 avatar

        @rickastley: ” it just so happens that type of person also loves other people buying them things ”

        A sure sign of severe mental illness. Shouldn’t they require those kinds of people to register? A registered level 10 gift receiver. They could post their pictures in the post office and show maps where they live. Watch out for that house. I hear the guy that lives there once got a set of golf clubs from his family for father’s day and… he liked them.

  • avatar

    This should help with the quality of the product…not.

  • avatar
    Tele Vision

    Reminds me of a Bill Burr piece about Steve Jobs: “I want my entire music collection in that phone – GET ON IT!”

  • avatar

    “Eliminate slogans, exhortations, and targets for the work force asking for zero defects and new levels of productivity. Such exhortations only create adversarial relationships, as the bulk of the causes of low quality and low productivity belong to the system and thus lie beyond the power of the work force.” – W. Edwards Deming

    • 0 avatar

      It’s unfortunate that Musk’s hubris prevents him from embracing the Deming principles. Tesla have prospered to an extent based on unique design features but the bad quality is going to bite them hard down the road.
      Those Model Ys look like they could have been built in a GM X-car plant in 1980. Other manufacturers are introducing similar products with Toyota Production System levels of quality.

      Musketeers may accept the need for a 10 grand repaint on their new car at owner expense, but that’s not sustainable in a competitive market.

      • 0 avatar

        @indie500fan: “Those Model Ys look like they could have been built in a GM X-car plant in 1980.”

        For the exact same reason as the x-cars, production was everything and they were running the line as fast as possible. I witnessed it first hand. We even screwed up some cars once, I brought the list to final, and was told to forget about it and that the dealer would take care of it. Got the lecture about production being a priority.

        “the need for a 10 grand repaint on their new car at owner expense”

        For me, it’s okay if I’m ordering the high end performance model. For the low-end commuter car, it would be an issue. At the high end, I would order it in white saving the $1000 to $2000 color paint costs. I’m also interested in a different color than what they offer.

        For the low-end car (if I get a tesla for commuting) I’d talk to a local tesla certified shop I know and see where it might need some sort of protection. I wouldn’t do a complete repaint for a commuter car. But, you’re totally right about it not being sustainable. Slow down the line until you figure out how to speed it up and get the quality up.

      • 0 avatar
        Rick Astley

        Indi500fan, I hate to nitpick your post, because I agree with almost all of it….

        But a full-car repaint these days is well over $10K if you want it stripped down to metal and painted properly.

        Thankfully the color pallet and design template at Tesla never changes so they don’t have to waste any resources. Red, white, blue, black, three grey/silvers…. Vinyl wrap the car for about $3,000 would protect the paint a bit longer.

        • 0 avatar
          Art Vandelay

          Or they could just paint it to a level of something like a Dodge Journey or one of the other bottom feeder type cars. Nobody should expect a repaint. If you just have to paint your Tesla Jack Baruth Audi Green, fine. If I had the means, why not.

          But there is no other group of owners out there that rationalizes painting a new car just because the paint is garbage. i’d love to read the comments if the C8 had such issues. Heck if the freaking Versa had such issues.

          And yes, an OEM quality color change? 5 figures and you are disassembling a good chunk of your new car unless you don’t want your engine bay, trunk, or any part of the inside beyond the door jambs not to match.

  • avatar
    Greg Hamilton

    And Tesla stock is up on the news. I should have listened to BigTrucksReview when he bought Tesla at just under $200. He was right about many things.

  • avatar

    Give Musk 10 years and Tesla will be the largest car company in the world. While other companies are cutting out models and shutting down plants Tesla does just the opposite and in exponential rate.

    • 0 avatar
      Art Vandelay

      You may be correct, but if they don’t address this give them 20 years and they will be GM circa 2008.

      and yes, they are adding models but come on, they have 4. I think Ferrari has a wider model portfolio. Ferrari!

      • 0 avatar
        SCE to AUX

        They may become GM someday, but less likely if Mr Musk goes away.

        Ferrari is a one-trick pony, so the comparison is questionable.

        • 0 avatar

          Ferrari lost its cachet for me when they started selling more than 5,000 units/year worldwide (2005). So commercialized now – sniff.

          [Total cumulative Ferrari sales volume in the history of the planet = well under 250,000 vehicles. (About 9 months worth of Civics, spread across 73 years.)]

      • 0 avatar

        “Wider model portfolio.” Interesting metric.

        Tesla currently offers:
        • The same number of models as Chrysler.
        • Twice as many 4-door sedans as Ford or Dodge.

        (Next can we talk about “sales volume per model”? Ha.)

  • avatar

    At least when Rosie the Riveter was exhorted to produce more for the war effort, there was a tangible result to work for as a reward: Winning the war and getting the boys home.

    Musk on the other hand, exhorts his workers to bust their a*ses for nobody but him and his glory. So 1930s Ford with his special police to quell the union mob who felt they were being shafted. Who feels inspired to put in extra effort for nothing? Not me.

    There are about three Teslas around where I live, so I’ve never had the chance to study the fit and finish up close, except once in the pouring rain. I didn’t bother. So I wonder, without having a clue as to the answer, whether the poor body fit spoken of is as a result of not designing things properly so they fit exactly in place without jockeying things around. Or whether the work force basically doesn’t give a damn or a combination of the two. With Musk’s continual exclamations of his bounteous wonderfulness, is the workplace happy or just a bunch of people who treat it like a supermarket job just with slightly better pay?

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