Elon Musk Talks: 'Several More Years' at the Helm
Speculation that, now the Model S has been launched, Tesla Motors CEO Elon Musk is packing his bags for full-time residence at other company Space X can be put to rest. In an interview, Musk told me he is “committed to staying at Tesla for several more years. It won’t be forever.”
Musk is Tesla’s resident perfectionist, and some new hires and investors obviously want him to remain at the helm. A departure now would be disruptive, especially when there are crises, such as the blip in Tesla’s stock price after analyst Theodore O’Neill of Wunderlich said last week that the company would cut third-quarter Model S production from 1,000 to 500.
A Confident Guy
The financial community is wondering when Tesla will start making money, and when stuff like that hits, it’s good to have Musk around. “We never actually reported what third quarter production will be,” Musk told me. “The only number we talk about is the production target of 5,000 this year. It’s not a demand issue: We have orders for well over 10,000 cars. We’re confident that the 5,000 number will be approximately correct. The production ramp is very narrow as we iron out the supply chain, but it ramps up very quickly. We want to be careful about the quality of each car.”
And, so far, quality has been very high. I drove the Model S for the first time late last in Mahwah, New Jersey, where Tesla is staging one of its “Get Amped” test drive events for reservation holders. The car I drove was not only a thrilling ride, it was very well made, with nary a squeak, rattle or misaligned panel.
Musk says he is “personally inspecting all the cars before they go out,” which prompted me to ask how the CEO of two major pressure-cooker companies could possibly have the time. “We do it at the end of the day, once a week,” Musk said. “We look for gaps that aren’t quite right, things like that. And we pick cars out at random for test drives to make sure they feel right."
The "Perfect" Car
"People’s initial impression needs to be as perfect as possible," he said. "Some people think we should go for the maximum production rate right off the bat, but we want them to associate Tesla with reliability. So if the cars aren’t coming out as fast as some people would like, I’m sorry about that. But they need to be perfect.”
Tesla is also trying to avoid performance issues, such as the hot-weather range drop that some Arizona owners have found in their Nissan LEAFs. “I predicted that exact thing,” Musk said, adding that the Model S uses liquid cooling for the battery pack and other components. “The Model S has an awesome cooling system,” he said. “We took it out for summer endurance tests in Death Valley, and brought a tow truck along in case it broke down. But it was the tow truck that broke down.”
That "Badass" Truck
Musk confirmed that Tesla might have a “high-tech, badass” pickup truck in its future, and that it is starting work on a smaller third-generation car that could offer an electric alternative to the BMW 3-Series or Audi A4. That would be Tesla’s volume car, with a target of 100,000 cars and what Musk describes as “some cool design innovations to keep the cost down” to around $30,000. “But it has to be compelling,” Musk said. “It has to have Tesla levels of quality, or we won’t build it. But I’m confident we can get there.”
Indeed, Musk is confident about almost everything, including the company's ambitious sales target of 20,000 Model S cars for 2013. “I have a high degree of confidence in that number,” he said. “I haven’t been as emphatic about the 5,000 cars for 2012--that’s our production target.” The Tesla Factory, of course, has the capacity to produce up to 500,000 cars annually, and Musk doesn’t hesitate when asked how long it will take to get up to that speed. “Certainly less than 10 years,” he said. “Maybe seven or eight years.”
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