Posted on April 12, 2017 by Matt Pressman
With Tesla [NASDAQ; TSLA] surpassing GM as the most valuable automaker in the U.S., many are asking if Elon Musk's electric car company should warrant such a lofty valuation. One corollary may be his other company, SpaceX. Trent Eady writes in Seeking Alpha* that, "On March 30, SpaceX made history... the first time in the history of spaceflight that a rocket has ever been launched into orbit twice. It's a milestone on the path to full rocket reusability, which could bring the cost of launches down by more than one hundred times in the long term."
Above: Tesla Model S parked in front of SpaceX (Image: Pinterest)
Eady elaborates: "SpaceX has just done something NASA couldn't do and that long-established spaceflight companies like Boeing and Lockheed Martin in their United Launch Alliance joint venture couldn't do. That should give us pause. What has the rest of the world been doing wrong? What is SpaceX doing right? How did this little upstart company come into the arena and show up the giants of the space industry? Fifteen years ago, if anyone had predicted this would happen, it would have sounded too farfetched to believe. SpaceX's achievements should not have been possible. So now there must be a reckoning. It's time to rethink our assumptions and intuitions about what is possible."
Above: Elon Musk explains why this latest SpaceX achievement is a "huge revolution in spaceflight" (Youtube: VideoFromSpace)
Sound familiar? Yes, "Musk's approach to building companies with radically counterintuitive results is generalizable from the space industry to the car industry. What has worked for SpaceX will work for Tesla. This is why I take seriously Musk's heady vision for Tesla's factories [producing scores of Model 3s]... The evidence is in what SpaceX has accomplished despite ample prima facie reason for incredulity, and to a certain extent in what Tesla has already accomplished. Tesla has the right leadership in Musk, the right intellectual approach, fresh pain from the hubris of Model X design and production, and with its acquisition of Grohmann Engineering, a team with over half a century of world-class expertise."
Above: Tesla Model 3 was recently photographed driving along the Hyperloop test track at SpaceX headquarters (Image: Teslarati)
Eady reminds us that, against all odds: "SpaceX's competitive position is incredible. As the world's only organization launching reusable rockets into orbit and landing them, SpaceX is like a normal airline competing against airlines that destroy their planes after every flight. Unless other companies or government space agencies can learn to reuse their rockets, no one can compete with SpaceX. The entire global launch industry will belong to the little upstart from Los Angeles."
Above: Elon Musk stands in front of a Tesla at SpaceX (Image: Jebiga)
That said, it's worth considering that: "Something similar could very well happen for Tesla. If Tesla can produce cars without humans on the production line while the rest of the world is limited to human speed and cost, the result will be a rupture in the car industry like Henry Ford's introduction of the moving assembly line in the 1910s. Elon Musk has already proven himself once. Why doubt that he can do it again?"
*Source: Seeking Alpha