Why Elon Musk will be remembered as an automotive pioneer
As I write, Tesla, the manufacturer of electric vehicles (EVs), has a market capitalisation of $1.051tn, which makes it the world’s sixth most valuable company by market cap. Tesla shares are trading at $1,047, which is 64% higher than at this time last year. Elon Musk, the founder and CEO of the company, currently has a net worth estimated at $300bn, which makes him the richest person in the world.
Enormous wealth, like power, acts as an aphrodisiac that warps people’s perceptions of those who possess it: it’s as if they’re surrounded by a reality distortion field. Similar force fields have enveloped Bill Gates and Steve Jobs in their time and now it’s Musk’s turn. Because he’s uncommonly voluble on social media, especially on Twitter, where he has 65.7 million followers, his every utterance is assiduously parsed by besotted fans (all of whom call him “Elon”, as if he were a buddy of theirs). This gives him an influence way beyond that of any other corporate executive, influence that, on some occasions, even affects global financial markets through what the normally sober Financial Times calls the “Tesla-financial complex”. A closer examination of his Twitter feed, though, yields an impression of a really complex individual: a baffling combination of formidable intelligence and ungovernability – part visionary, part genius, part fruitcake and part exploiter of tax loopholes and public subsidies. And it raises the question: what (or where) is the real Elon Musk?
The answer, I suspect, lies in his mastery of the business of manufacturing complex products. One sees it, for example, in the way SpaceX, the aerospace company he set up to reduce the colossal costs of space travel, has become the first non-state organisation to: successfully launch, orbit and recover a spacecraft; send a spacecraft to the International Space Station; manage the first vertical takeoff and vertical landing for an orbital rocket; and send astronauts to the International Space Station. Anyone who thinks this stuff is easy has never done it.
Compared to SpaceX, you’d have thought that the business of manufacturing electric cars would be child’s play, especially since, compared to vehicles powered by internal combustion engines, they’re considerably simpler. (Basically, an EV is like a massive skateboard where the huge battery is the board.) Even so, when Tesla started making them in 2008, the world (not to mention Ford, General Motors, BMW, Mercedes, VW and Toyota) sniggered, which, oddly enough, reminded this columnist of the way Nokia and Motorola sniggered in 2007 at the idea of Apple making a mobile phone.
The story is the same in the case of the car. Tesla did eventually figure out how to make them – making bodyshells out of aluminium and then kitting them out with all the stuff that goes into a vehicle using a combination of robots and humans – and now its Model 3 is emerging as the bestselling new car in a number of markets.
But it turns out that, just as with Apple and the smartphone, mastering the art of conventional manufacturing was just the beginning. Some time ago, Musk seemed to have had an epiphany, perhaps triggered by a conversation with a grizzled veteran of car manufacturing named Sandy Munro, who allegedly likened the rear end of
a Tesla shell during manufacture to a patchwork quilt. Why, Musk mused, couldn’t the entire bodyshell be diecast in one piece from molten aluminium, just as reproduction toy cars are?
You can guess where this is heading. Tesla bought a number of colossal press-casting machines – inevitably christened “Giga Presses” – from Idra, the Italian company that makes them. And they are now deployed in some Tesla factories turning out the rear half of Model Y bodyshells as single pressure-moulded pieces. Suddenly, a task that required 70 different parts to be assembled by 300 robots is being done by a single giant machine. The obvious next step is to use the same process to make the complete bodyshell in one fell swoop.
This step – and the huge investment needed to implement it – suggests a new way of thinking about Musk: as the spiritual heir of Henry Ford. Since the early days of the car, there have only been three major paradigm shifts in the manufacturing process. The first was Ford’s introduction of a moving production line, memorably satirised in Charlie Chaplin’s Modern Times, which could turn out a completed Model T in 90 minutes.
The second paradigm shift came from Toyota in the postwar years – the famous “lean” production method that involved minimising inventories and arranging supply chains for justin-time delivery of components that arrived just before they were needed at the relevant stage in the manufacturing process. Although invented in Japan, and initially ignored by the US car industry, in the end every car has been made the Toyota way.
Lastly, the arrival of the Giga Press and the thinking behind it is what suggests that, in the end, Musk might be remembered not so much as the oddball who dreamed of colonising Mars (or possibly expired thereon), but as the guy who found a new way of making terrestrial vehicles. He will doubtless be frustrated by this thought, but – hey! – that’s a price the rest of us might be prepared to bear.
What I’ve been reading
Words of wisdomHow to Fix Social Media is a long, thoughtful and historically informed essay by Nicholas Carr in the New Atlantis.
Woolf at the doorThe Work of Living Goes On: Rereading Mrs Dalloway During an Endless Pandemic is a lovely essay by Colin Dickey on the dystopian undercurrents in Virginia Woolf’s famous noveland its echoes in our attempts to “move on” from Covid.
On the bright side…Why Humans Aren’t the Worst (Despite, Well, Everything Happening in the World) is the title of an intriguing interview with the journalist and historian Rutger Bregman by Kara Swisher.
A closer examination of his Twitter feed yields an impression of a really complex individual