Elon Musk Gambled Tesla to Save SolarCity • Hacker News Board

Re: Elon Musk Gambled Tesla to Save SolarCity

#251

Post by marvin » Tue, Aug 27, 2019, 7:06 AM UTC

semi-extrinsic wrote: post #238

pmorici wrote: post #213

Earlier quoted context omitted.

Maybe Musk will be proven right in time but having followed Tesla for a long time and having recently purchased a Model 3 (It's an incredible car). The Solar City purchase is the one thing that never made a lot of sense to me. Even if you start from the premise that it makes sense for Tesla to be in the solar business, it's hard to rationalize that the best way to break into that market was to buy a debt laden solar…

AFAICT they are still losing money on every Model 3 though? Doesn't matter that your cars are really good if you're not profitable. Just look at Saab.

All of Tesla’s models have a healthy gross margin, meaning that their economics get healthier with every car they sell.

Tesla as a whole still operates at a loss, but that’s to be expected with the massive expansion of production capacity they’ve been continuously doing since 2012.

Re: Elon Musk Gambled Tesla to Save SolarCity

#252

Post by spiderfarmer » Tue, Aug 27, 2019, 7:31 AM UTC

reilly3000 wrote: post #229

pmorici wrote: post #213

Earlier quoted context omitted.

Maybe Musk will be proven right in time but having followed Tesla for a long time and having recently purchased a Model 3 (It's an incredible car). The Solar City purchase is the one thing that never made a lot of sense to me. Even if you start from the premise that it makes sense for Tesla to be in the solar business, it's hard to rationalize that the best way to break into that market was to buy a debt laden solar…

As a Tesla owner would you be more likely to consider SolarCity if you wanted to install solar? Are there any enticements, integrations, or efficiencies in doing so?

The Tesla app allows you to manage all Tesla products, like the Powerwall and Solar panels, but that's as far as the ecosystem goes right now. I don't see any incentives on their website.

Re: Elon Musk Gambled Tesla to Save SolarCity

#253

Post by macspoofing » Tue, Aug 27, 2019, 7:46 AM UTC

omnimus wrote: post #116

joering2 wrote: post #109

Earlier quoted context omitted.

Very interesting, but can you elaborate how we could benefit from colonizing Mars? Even more so - how could SpaceX be much more worth by being able to go to Mars, and how others wouldn't be able to achieve similar step sometime after them (depriving SpaceX from exclusivity of operation) Mars is much smaller than Earth with much more hostile environment. I heard some ideas of growing trees or putting air on Mars, but…

You should ask Musk about that. I think he believes that we as humanity need backup plan if anything is to happen to Earth. Also he is probably megalomaniac and thats why he sets to grand goals. By the way i am pretty sure people who come to Mars in numbers will colonize it and it now it seems that United States will be the country that colonizes and claims Mars.

>By the way i am pretty sure people who come to Mars in numbers will colonize it

I don't see people push for colonizing Antarctica, or the Canadian Arctic. Both places are far more friendly to humans than Mars ever will be.

Mars is a dead-end. It may have a science station one day, but nothing more. Ever.

Re: Elon Musk Gambled Tesla to Save SolarCity

#254

Post by mschuster91 » Tue, Aug 27, 2019, 8:07 AM UTC

jcranmer wrote: post #235

asdfk-12 wrote: post #186

Earlier quoted context omitted.

If you are referring to urban areas - what about the crippled subway system and insane traffic congestion in NYC?

NYC has 5 4-track trunks moving 10-car trains through its densest core. If that's insufficient, then the only thing that's going to improve throughput is getting everybody out and having them walk. And there are places (hi Times Square!) where that is insufficient to move the demand. NYC has a throughput problem. High speed doesn't improve throughput, it worsens it.

> NYC has a throughput problem. High speed doesn't improve throughput, it worsens it.

With ultra-dense city cores the only way to fix them is proper city planning - meaning: tearing down skyscrapers outright or converting them from offices into affordable housing to reduce the hordes of low-income staff travelling for hours just to get to work.

The "free market" has failed here because stuff still works (=people get to work and make money) but the cost is put onto society as a whole (congestion, smog, life quality degradation, hours upon hours wasted being in transit).

Re: Elon Musk Gambled Tesla to Save SolarCity

#255

Post by spiderfarmer » Tue, Aug 27, 2019, 8:36 AM UTC

macspoofing wrote: post #222

spiderfarmer wrote: post #102

For all the negativity here about Musk and his business decisions, there is something to be said for integrating transport and energy services in one great package. I consult for a large energy conglomerate that wants to get into this market from the energy suppliers side, but the problem is that they are completely clueless when it comes to expanding beyond their traditional business. In their vision, they'll supply…

>there is something to be said for integrating transport and energy services in one great package. I don't know about that. Do you know why Boeing and Airbus don't make their own engines? Or how about why (practically) no car manufacturer makes their own tires? Because sometimes it makes no sense (or is downright detrimental) holding the entire vertical. Tesla is in the electric car game and the Li-ion battery game -…

Integration of products and services doesn't mean you have to develop those products yourself. Tesla is already working with Panasonic and LG for their panels and batteries, so I'm not sure what you mean.

Re: Elon Musk Gambled Tesla to Save SolarCity

#256

Post by mcv » Tue, Aug 27, 2019, 9:55 AM UTC

martythemaniak wrote: post #36

Well, Tesla is one long stream of gambles. You dont get to school an established, global, trillion dollar industry without taking risks. The only notable thing here is that hating on Musk is really popular these days. So the failed gambles (this, falcon doors, the initial overautomation of the Model 3 production, etc) will be highlighted and mocked, while the successful gambles will go unmentioned or incorporated as…

> "The only notable thing here is that hating on Musk is really popular these days."

I don't hate Musk at all. I love what he does and what he has done. But he plays a ridiculously high-risk game, and that could risk destroying all the great things he built.

Re: Elon Musk Gambled Tesla to Save SolarCity

#257

Post by semi-extrinsic » Tue, Aug 27, 2019, 11:20 AM UTC

marvin wrote: post #251

semi-extrinsic wrote: post #238

Earlier quoted context omitted.

AFAICT they are still losing money on every Model 3 though? Doesn't matter that your cars are really good if you're not profitable. Just look at Saab.

All of Tesla’s models have a healthy gross margin, meaning that their economics get healthier with every car they sell. Tesla as a whole still operates at a loss, but that’s to be expected with the massive expansion of production capacity they’ve been continuously doing since 2012.

OK, I should rephrase that. They are not losing money on every car. But they are still far from being profitable selling hundreds of thousands of $35k cars.

According to the letter Musk himself posted in early January of 2019, he said they can squeeze out a tiny profit when selling the top end Model 3s at $45k+. And that they have a big effort ahead to make a profit selling $35k cars. This is a far cry away from a healthy gross margin.

https://www.tesla.com/blog/tesla-company-update?redirect=no

Re: Elon Musk Gambled Tesla to Save SolarCity

#258

Post by macspoofing » Tue, Aug 27, 2019, 11:25 AM UTC

spiderfarmer wrote: post #255

macspoofing wrote: post #222

Earlier quoted context omitted.

>there is something to be said for integrating transport and energy services in one great package. I don't know about that. Do you know why Boeing and Airbus don't make their own engines? Or how about why (practically) no car manufacturer makes their own tires? Because sometimes it makes no sense (or is downright detrimental) holding the entire vertical. Tesla is in the electric car game and the Li-ion battery game -…

Integration of products and services doesn't mean you have to develop those products yourself. Tesla is already working with Panasonic and LG for their panels and batteries, so I'm not sure what you mean.

I was pushing back against the statement: "there is something to be said for integrating transport and energy services in one great package."

I interpreted that statement as justifying Tesla's SolarCity purchase (which was always a bad idea. Even back when the purchase was announced, almost everyone knew this was a favour for Musk because SolarCity was in a downward spiral and there was no business reason to justify it.)

Like you alluded to in this response, Tesla never needed SolarCity to have a integrated solution. I agree, EV-buyers are probably the kinds of people that may want solar panels. As vehicle buyers they are also the kinds of people who want tires for their cars. In both cases, it makes far more sense for Tesla to rely on partners to supply solar panels and tires to those buyers, rather than compete in those markets directly.

Re: Elon Musk Gambled Tesla to Save SolarCity

#259

Post by navigatesol » Tue, Aug 27, 2019, 11:54 AM UTC

tigershark wrote: post #237

navigatesol wrote: post #76

Earlier quoted context omitted.

You think Musk was the first to propose reusable rockets?

I think that Musk was the first and the only one to propose, build and continuously operate reusable rockets capable of autonomously landing at a fraction of the price per launch of whatever existed before. And the only one that made possible a safe landing of three rockets in the same mission with Falcon Heavy. Do you have any proof that anyone else did the same before him?

>Do you have any proof that anyone else did the same before him?

That anyone proposed resuable rockets before Musk? Use Google. You're naive if you think otherwise.

>at a fraction of the price per launch of whatever existed before.

There's no evidence that these resuable rockets are a "fraction" of the cost to re-launch. In fact, the cost is likely the reason that no one else has done it; it doesn't make economic sense, not because it's impossible.

Re: Elon Musk Gambled Tesla to Save SolarCity

#260

Post by coldtea » Tue, Aug 27, 2019, 1:05 PM UTC

xkjkls wrote: post #176

dragontamer wrote: post #45

Earlier quoted context omitted.

> The purchase of SolarCity by Tesla was the single dumbest thing Elon Musk did Why was it a bad move for Elon Musk? Elon Musk owned many SolarCity shares (in fact, Elon Musk was the chairman of SolarCity). If SolarCity would go bankrupt, Elon Musk would have lost a lot of money and power. Elon Musk saved SolarCity to save his own skin and money. Its not really that hard to imagine. Now Tesla shareholders, who overwh…

> Now Tesla shareholders, who overwhelmingly voted for the merger, made a big mistake. But Tesla shareholders own the company, they are allowed to make whatever decisions they want. They voted for the merger based on Musk's claim that SolarCity had a good financial position and that they were releasing a revolutionary solar shingle product. Both of those were wrong.

>They voted for the merger based on Musk's claim that SolarCity had a good financial position and that they were releasing a revolutionary solar shingle product. Both of those were wrong.

Well, if the arguments at the time were good enough to convince them, sucks to be them. What are they gonna do?

Unless they were given tampered numbers or false factual information, Musk could oversell SolarCity prospects six ways from Sunday and they can't do anything about it.