Fool Us Once: The Elon Musk Edition

Rian Schmidt

April 13, 2024

Table of Contents:

Oh, there will be a robo-taxi in August.
But it won't be true.
There's no stopping what's going to happen, only delaying it.
The interesting question is why he does it.
The road to butter brickle ice cream and Ice Station Zebra every night.

Oh, there will be a robo-taxi in August.

Musk will put whatever he has for an Optimus by then into the driver's seat of a Model Y. He'll put a cute "Taxi" hat on it. He'll release a video of it driving somewhere without hitting anyone in an intersection.

But it won't be true.

But this "robo-taxi" won't be street legal. It won't even be a serious thing. It's a distraction to fend off the imminent crash of Tesla's stock, which is currently trading somewhere around a PE of 40 with negative growth. By contrast, Toyota is currently trading at a PE of around 11.

So, TSLA could drop by half and still be trading at roughly twice the multiple of the largest car manufacturer in the world.

But it's not a car company! Yes, in fact, it is. That's what they make and sell. Cars and car-adjacent products. Every day that goes by, all of the other car companies catch up to the rather incredible first-mover advantage that Tesla had in recent years.

There's no stopping what's going to happen, only delaying it.

So, Musk has to keep coming up with distractions. Optimus, the CyberTruck, the Roadster, a low-cost model to compete with the Chinese. But none of it is real.

Optimus is a product without a market. A million dollar toy that can almost walk across a flat room, while Boston Dynamics dogs run across stacked pallets and shoot up firing ranges, while being beaten with hockey sticks.

Word is out that they are abandoning the cheap Tesla, wisely. The Roadster's been coming soon for years.

The CyberTruck was seemingly rushed out the door with fit and finish issues and promises of bullet-proof glass that were proven on-stage, famously, to be untrue. That happened under a BIG RED DISPLAY that said the truck started at about $40K.

But now:

The price of the 2024 Tesla Cybertruck starts at $81,895 and goes up to $101,985 depending on the trim and options.

None of this is new. From a 2016 article about the Model S:

"In two years you'll be able to summon your car from across the country," Musk said. "If your car is in New York and you are in Los Angeles, it will find its way to you." Along the way, Musk says the car will even be able to charge itself.

That "two years" was January 2018, six-plus years ago.

The interesting question is why he does it.

It's not that baffling, really. He's the richest man in the world. It's worked out for him. He learned early on the value of the outrageous story and the public's gullibility and need for counter-culture heroes.

Trump is one. Musk is one.

But, as of late, it feels like his self-created wave of mythology has begun to crest. Maybe it's the drug use. Maybe it's just that he was the perfect player for the perfect game for a limited amount of time. The Bee Gees were huge for a while there.

So Musk faces a choice-- transition from "scrappy founder" to "mature leader" or double-down. He's chosen to double-down. His pay package wasn't unreasonable; it's the whole business court system in Delaware that's unreasonable. Tesla's not a car company; it's an AI (or humanoid robot, depending on the day) company. And now... robo-taxis. In August.

The road to butter brickle ice cream and Ice Station Zebra every night.

Musk's ill-suited to long-term leadership of a stable company. He thrives on chaos and risk. Becoming Bill Gates is not really an option for him. His only road leads to Howard Hughes.

Morbid as this sounds, he's the kind of guy that you read died in his bathtub, going out as a Jobsian myth. So far, that hasn't happened. Instead, TSLA's down over half from its high, 30+% YTD, and Musk focuses his time telling Bob Iger to go fuck himself if he doesn't want to advertise on the cesspool that is, gulp, X. Remember, X? The everything app? Like they have in China? That was him, too.

I'll leave this here with an apology if I'm wrong, but don't give up your Uber account quite yet. Robo-taxis are a long way off. He's lying again. He knows it. Hell, everyone knows it.

But we're all so used to it by now that it doesn't even register.

Circinaut is a Fractional CTO services provider, based in Portland, Oregon, working with clients all across the country. I focus on application development, technology advising, and ongoing support for small and medium-sized businesses.
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