Elon Musk Has Turned Tesla's 'Failing' Into Winning | Tech News

Elon Musk Has Turned Tesla's 'Failing' Into Winning

Once a laggard, the electric-vehicle company now boasts the widest profit margins of any automaker.

| Updated on: Feb 22 2023, 07:27 IST
Elon Musk Twitter Bankruptcy Talk: Timeline
Elon Musk
1/13 He’s told employees to brace themselves for long hours, that “the road ahead is arduous and will require intense work to succeed,” and said bankruptcy was possible. Here’s how the saga is unfolding: (Bloomberg)
Elon Musk
2/13 Oct. 27: Musk takes control- His first act is to fire the Board along with CEO Parag Agrawal, CFO Ned Segal, head of legal Vijaya Gadde and Counsel Sean Edgett. Musk forms advisory team that includes celebrity attorney Alex Spiro, VC David Sacks, Neuralink CEO and head of Musk’s family office Jared Birchall, investor Jason Calacanis, and partner of Andreessen Horowitz Sriram Krishnan. (Reuters)
Elon Musk
3/13 Oct. 28: Brands begin to take pause- As Musk plans to unban accounts and says he will charge for user verification, advertisers suspend ads. (AFP)
Elon Musk
4/13 Oct. 31: Top tweeters protest- Amid murmurings of plans to charge existing verified accounts, author Steven King tweets, “$20 a month to keep my blue check? F**k that, they should pay me. If that gets instituted, I’m gone like Enron.” (AFP)
Elon Musk
5/13 Nov. 1: Teams working around the clock- The product team works over the weekend on Musk’s idea to charge users for blue check marks. A photo of product director Esther Crawford sleeping on the floor of a conference room, trying to make the deadline, goes viral. Meanwhile, managers are asked to make lists of who can be fired. Employees print out their software code for review by Musk and engineers from Tesla, to determine if their contributions are worthy of keeping a job. (REUTERS)
Elon Musk
6/13 Nov. 3: Massive layoffs begin- A memo is sent to all employees telling them of imminent layoffs and to watch for an email with the subject line: “Your Role at Twitter.” Badge access to offices is suspended as 3,700 staffers receive word that they’ve been cut. Realizing employees essential for the continuity of the business have been let go by mistake, some are asked to come back. (AP)
Elon Musk
7/13 Co-founder EV Williams tweets, “Heart’s out to the tweeps getting laid off today.” Co-founder Jack Dorsey adds, “I realize many are angry with me. I own the responsibility for why everyone is in this situation: I grew the company size too quickly. I apologize for that.” (REUTERS)
image caption
8/13 Nov. 5-6: Musk responds to celebrity protests- Unrest grows on the platform over the weekend, particularly over the issue of impersonator accounts. Actress Valerie Bertinelli starts a movement of people changing their Twitter names to “Elon Musk.” Comedian Kathy Griffin joins the protest, finds her account locked. Then Musk announces, “Going forward, any Twitter handles engaging in impersonation without clearly specifying `parody’ will be permanently suspended.” (AP)
Elon Musk
9/13 Nov. 8: Musk sells more Tesla- Despite a previous vow not to sell any more Tesla stock, Musk sells an additional $3.95 billion, bringing the total sold in past year to $36 billion. (REUTERS)
Elon Musk
10/13 Nov. 9: Musk Blue tick mark- Blue check mark option becomes available for purchase, and immediately becomes a tool for impersonators. An account masquerading as Nintendo Inc. posts an image of Super Mario holding up a middle finger. (REUTERS)
Elon Musk
11/13 Tesla and SpaceX CEO Elon Musk, and a close cadre of advisers are considering a host of changes to the way Twitter is run and makes money. (REUTERS)
Elon Musk
12/13 Nov. 10: More key executives quit as Musk warns of bankruptcy- In his first meeting with employees, Musk tells them to brace for 80-hour weeks and requires everyone back in the office full time. He also says bankruptcy for the company is not out of the question if it doesn’t start generating more cash. Several executives in charge of keeping Twitter safe and accountable to its users quit, including chief information security officer Lea Kissner, chief privacy officer Damien Kieran and chief compliance Marianne Fogarty.. (AFP)
Elon Musk
13/13 Nov. 11: Verified accounts get “Official” tags- Twitter adds badges that say “offiical” to verified accounts in some places, though confusion abounds. More brands depart the platform. (REUTERS)
Elon Musk
icon View all Images
Tesla is now turning every $100 of revenue into an industry-leading $26 of profit after production costs -- the widest gross margin since the Austin, Texas-based company started selling more than 50,000 cars annually in 2015. (via REUTERS)

Anyone Googling the phrase “Tesla failed” is immediately inundated with the purported shortcomings of the multinational automotive and clean energy company's zero-emission, electric vehicles, workplace culture, business practices, occupational safety and, especially, its controversial Chief Executive Officer Elon Musk. In times like these, it's appropriate to recall what Gertrude tells her son Hamlet in Shakespeare's most famous play: “The lady doth protest too much, methinks.”

When it comes to Tesla Inc., such criticism is little more than a sideshow. No other carmaker comes close to matching its performance, which includes posting record revenue each year since it began reporting financial results in 2007. With a stock market value of $659 billion as of Friday, Tesla is worth more than Toyota Motor Co., Mercedes-Benz Group AG, Volkswagen AG, BMW AG, General Motors Co., Stellantis NV and Ford Motor Co. combined.

You may be interested in

MobilesTablets Laptops
7% OFF
Apple iPhone 15 Pro Max
  • Black Titanium
  • 8 GB RAM
  • 256 GB Storage
28% OFF
Samsung Galaxy S23 Ultra 5G
  • Green
  • 12 GB RAM
  • 256 GB Storage
Google Pixel 8 Pro
  • Obsidian
  • 12 GB RAM
  • 128 GB Storage
Apple iPhone 15 Plus
  • Black
  • 6 GB RAM
  • 128 GB Storage

And while everyone thought Musk's entanglement with Twitter Inc. would be damaging to Tesla, the results prove otherwise. Tesla is now turning every $100 of revenue into an industry-leading $26 of profit after production costs -- the widest gross margin since the Austin, Texas-based company started selling more than 50,000 cars annually in 2015. Tesla also scores the highest profit margin among the 10 largest automakers, providing a huge competitive advantage by allowing it to invest more money into improving its cars and developing new products than its peers, according to data compiled by Bloomberg.

Also read
Looking for a smartphone? To check mobile finder click here.

Musk teased as much in recent weeks, saying Tesla will reveal more details about its smaller, cheaper next-generation electric-vehicle platform at its investor day on March 1. Given the company's already dominant market share in the EV industry, it's probably a day that its competitors are dreading.

It's little wonder that 30 analysts have a “buy” recommendation on Tesla, a record for the company going back to its initial public offering in 2010. The number of upgrades rose 32% last year even though Tesla's shares plummeted 65% amid a nasty bear market for tech stocks. The Bloomberg Recommendation Consensus Rating, which quantifies analyst forecasts, reveals that no other automaker was so emphatically upgraded.

Perhaps the reason why analysts are enamored with Tesla is because it continually proves the doubters wrong in a business once considered impregnable. Annual sales of its flagship Model 3 sedan increased 278 times to 493,310 units in 2022 from less than 2,000 in 2017, according to data compiled by Bloomberg. Deliveries of Toyota's Prius, the industry's benchmark hybrid vehicle, fell 66% during the same period. Sales at Shenzen, China-based BYD Co., the biggest rival manufacturer of EVs, rose just 17-fold.

With every auto company now selling EVs -- an outcome predicted to be the demise of the California startup that prompted global car buyers to begin rejecting the universal internal combustion engine -- Tesla just two months ago was reported to be teetering from the assault of its detractors, led by short sellers Jim Chanos, David Einhorn and Andrew Left. Scion Asset Management founder Michael Burry, who made his fortune and reputation by correctly anticipating the subprime mortgage financial crisis, was among those seeing no end to the pitfalls enveloping Musk.

Too many of Tesla's critics are focused on Musk's antics. For them, Tesla's success in the stock market and premium valuation even with last year's setback is solely due to unrelenting demand from Musk's legion of “fanboys” and the same folks who think Bitcoin will still go to $1 million and supplant the global financial system.

Few bothered to mention that Tesla, which lost $670 billion market value last year, was still twice the value of Toyota when the short-selling bonanza and stock market carnage climaxed. That's because Tesla's market share remains robust. With more than 3.6 million vehicles on the road, Tesla accounts for 20% of all battery-electric vehicles, according to data compiled by Bloomberg. In 2017, the ratio was 13%. Who would have guessed back in 2017 that a Tesla Model S would reach the coveted 1 million miles driven milestone? But it happened in 2022 and may prompt an entry in the Guinness Book of Records.

“Tesla has the most exciting product of any company on Earth by a long shot,” Musk said on Jan. 25 after the company released its quarterly earnings results. Hyperbole? Sure, but it's hard to argue with the results, which certainly don't scream “Tesla failed.”

Catch all the Latest Tech News, Mobile News, Laptop News, Gaming news, Wearables News , How To News, also keep up with us on Whatsapp channel,Twitter, Facebook, Google News, and Instagram. For our latest videos, subscribe to our YouTube channel.

First Published Date: 22 Feb, 07:26 IST