$50M worth of Tesla equipment sits unused in a Wheatfield warehouse • Hacker News Board

Re: $50M worth of Tesla equipment sits unused in a Wheatfield warehouse

#101

Post by gowld » Wed, Mar 04, 2020, 5:55 PM UTC

jiofih wrote: post #97

jlmorton wrote: post #62

Earlier quoted context omitted.

Well, let's be clear about the timeline. Silevo was planning a factory in upstate New York, and the State of New York was planning to invest $225 million in that project. In June 2014, SolarCity agreed to acquire Silevo. Three months later, with Elon Musk's personal involvement, the Cuomo Administration agreed to increase their investment to $750 million, in a much-expanded deal. Construction of the factory began und…

Why would have Elon Musk been involved? Did he actively participate in SolarCity management before the acquisition?

Yes.

Solar City was a Musk (nee Rive) family business from the start.

https://en.wikipedia.org/wiki/SolarCity#History

> SolarCity was founded in 2006 by brothers Peter and Lyndon Rive, based on a suggestion for a solar company concept by their cousin, Elon Musk, who is the chairman and helped start the company.

https://en.wikipedia.org/wiki/Lyndon_Rive

> Rive is a cousin of SolarCity investor and entrepreneur Elon Musk, as their mothers are twins

(That means that Rive and Musk are genetically half-siblings.)

Re: $50M worth of Tesla equipment sits unused in a Wheatfield warehouse

#102

Post by reaperducer » Wed, Mar 04, 2020, 6:02 PM UTC

JackFr wrote: post #63

qubex wrote: post #41

Earlier quoted context omitted.

The production of armaments is a bit of an economic anomaly, to be honest. All businesses, including arms manufacturers, require a constant flow of business in order to cover their fixed costs and remunerate their investors (debt holders and shareholders). If governments only order weapons when they need them to fight a war, then the arms manufacturers would shut form at the end of a conflict and would take ages to “…

When I was growing up my father had an ashtray from his days in the navy, which was made from the bottom of a three inch shell. On the bottom stamped in the metal was '1944', which as a child confused me because I knew my dad was in the navy from 1959-1965, so I asked him. "Let's just say they made A LOT of those in 1944."

That's why there are military surplus stores all over the country. Great stuff to be had -- cheap!

Re: $50M worth of Tesla equipment sits unused in a Wheatfield warehouse

#103

Post by searine » Wed, Mar 04, 2020, 6:05 PM UTC

wpietri wrote: post #78

searine wrote: post #5

This seems like kind of a 'gotcha' article. "One out of every $6 spent on machinery for the Tesla factory is now unused." I'd imagine most healthy large companies operate this way. Utilizing the majority of their equipment and having some reserve capacity in parts and equipment stored.

You imagine healthy companies just having 17% of total investment sitting around in warehouses because they might need it someday? I encourage you to read up on Lean Manufacturing and just-in-time delivery, which swept the US in the 1980s. Even to an MBA, over-ordering gear by $50 million is pretty obvious waste.

>You imagine healthy companies just having 17% of total investment

I imagine healthy companies keep enough manufacturing parts to be able to repair/replace/scale as needed. Particularly a company like tesla which is well known for scaling rapidly.

> I encourage you to read up on Lean Manufacturing and just-in-time delivery, which swept the US in the 1980s.

These are only efficient when you are pushing all your externalities on the other guy. Tesla doesn't globalize their supply chain nearly as much as other manufacturers, which would explain the stock of machinery.

Re: $50M worth of Tesla equipment sits unused in a Wheatfield warehouse

#104

Post by stefan_ » Wed, Mar 04, 2020, 6:07 PM UTC

atonse wrote: post #38

new_realist wrote: post #19

Earlier quoted context omitted.

Considering that Tesla will longer make solar cells in that factory (Panasonic is ending the relationship and withdrawing by September) I’d guess that it will all be unused shortly; this is just what has obviously been relocated so far.

What am I missing here? Is there any reason why another company can't just take over, seeing as they could probably get the equipment at a great discount?

You are missing that it makes absolutely zero sense to make solar cells in NY. Never has.

The fact that SolarCity is such a failure just accelerated this deal blowing up.

Re: $50M worth of Tesla equipment sits unused in a Wheatfield warehouse

#105

Post by jandrese » Wed, Mar 04, 2020, 6:09 PM UTC

jlmorton wrote: post #62

pbreit wrote: post #37

As usual, Tesla's involvement in the original deal is reported incorrectly. Tesla had no involvement in the original deal. Nor did Solar City. In fact, Silevo did the deal, was then acquired by Solar City which was then acquired by Tesla.

Well, let's be clear about the timeline. Silevo was planning a factory in upstate New York, and the State of New York was planning to invest $225 million in that project. In June 2014, SolarCity agreed to acquire Silevo. Three months later, with Elon Musk's personal involvement, the Cuomo Administration agreed to increase their investment to $750 million, in a much-expanded deal. Construction of the factory began und…

So the whole project is stuck in development hell? Is this going to be "Gigafactory/2"? I guess the question I need to ask is "is this project dead or on hold?"

Re: $50M worth of Tesla equipment sits unused in a Wheatfield warehouse

#106

Post by jandrese » Wed, Mar 04, 2020, 6:13 PM UTC

Robotbeat wrote: post #79

nradov wrote: post #70

Earlier quoted context omitted.

That is unfortunately no longer realistic. The skills and supply chains needed to produce high-end military equipment are too different. The production lines have to be kept continuously running or else they would take so long to reestablish that in any serious conflict it would be too late.

The problem isn't that the skills and supply chains are fundamentally different but that supply chains for non-military equipment become globalized if not outright off-shored (often to geopolitical rivals) and therefore cannot be counted on in case of a major geopolitical conflict. Pre-massive-globalization, we had no problem gearing up for WW2. Our industrial capacity was largely in-house. There were some things lik…

In WWII it was the domestic auto industry that converted over to building tanks. However today most of the domestic auto manufacturing is for foreign companies like Toyota, while our domestic companies largely manufacture overseas or in Mexico now.

It would be amazing if WWIII broke out and we had to call on Tesla to manufacture tanks.

Re: $50M worth of Tesla equipment sits unused in a Wheatfield warehouse

#107

Post by jandrese » Wed, Mar 04, 2020, 6:15 PM UTC

jfengel wrote: post #40

mr_overalls wrote: post #30

Earlier quoted context omitted.

Prime example: the NRO donated two unused spy satellites to NASA, each more powerful than the Hubble Telescope. https://www.space.com/16000-spy-satellites-space-telescopes-...

Unless they also donated launch costs, and $90 million per year to run it[1], it's no surprise that they're not actually using it. It's small compared to the overall budget, but not free. [1] https://www.nasa.gov/sites/default/files/atoms/files/fy_2018...

Has anybody asked Elon Musk if he wants to show off what a Falcon Heavy can do and maybe get some other billionaire to pitch in for operating capital?

Re: $50M worth of Tesla equipment sits unused in a Wheatfield warehouse

#108

Post by jandrese » Wed, Mar 04, 2020, 6:17 PM UTC

walrus01 wrote: post #52

mr_overalls wrote: post #30

Earlier quoted context omitted.

Prime example: the NRO donated two unused spy satellites to NASA, each more powerful than the Hubble Telescope. https://www.space.com/16000-spy-satellites-space-telescopes-...

Those were mirror and optics/satellite body assemblies, not two fully completed unused spy satellites. The electronics, power systems and communications systems were entirely absent.

Aren't those more or less off the shelf parts these days? NASA should have the know-how to finish the final details on a satellite like that.

Re: $50M worth of Tesla equipment sits unused in a Wheatfield warehouse

#109

Post by jandrese » Wed, Mar 04, 2020, 6:19 PM UTC

briandear wrote: post #53

blackearl wrote: post #17

Earlier quoted context omitted.

I've heard you need to use it or lose when it comes to gov budgets. Anecdotes of jets dumping fuel into the ocean just to come back and refill to keep a budget.

Zero based budgeting would be my first policy proposal as President.

It's a shit ton more work, and the government takes about 18 months to come up with the annual budget already. The only reason it works at all is the ability to let hundreds of thousands of small projects coast on their last budget.

Re: $50M worth of Tesla equipment sits unused in a Wheatfield warehouse

#110

Post by nradov » Wed, Mar 04, 2020, 6:20 PM UTC

Robotbeat wrote: post #79

nradov wrote: post #70

Earlier quoted context omitted.

That is unfortunately no longer realistic. The skills and supply chains needed to produce high-end military equipment are too different. The production lines have to be kept continuously running or else they would take so long to reestablish that in any serious conflict it would be too late.

The problem isn't that the skills and supply chains are fundamentally different but that supply chains for non-military equipment become globalized if not outright off-shored (often to geopolitical rivals) and therefore cannot be counted on in case of a major geopolitical conflict. Pre-massive-globalization, we had no problem gearing up for WW2. Our industrial capacity was largely in-house. There were some things lik…

The skills and supply chains are just fundamentally different in crucial areas. A prime example is the specialized techniques for welding together thick hull sections of specialized steel alloys to build a complete submarine. There's no equivalent in civilian industry. If that production capability is ever lost due to a long gap in new submarine orders then it would take many years to reestablish. Institutional knowledge if a fragile thing.