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Why the 'experts' don't get Elon Musk
Posted on August 15, 2018 by Matt Pressman
As the saga to take Tesla private continues to play out, Elon Musk continues to befuddle so-called 'experts' on Wall Street. Both Musk and his electric car company, Tesla, don't fit neatly into their narratives. Inc.'s Geoffrey James says, "I've been working in business journalism for over 20 years and I've never seen any high tech leader who creates such a polarized reaction as Elon Musk."
Above: Some background on Elon Musk and his companies (Infographic: The Street); Editor's note: Numbers variable based on recent reports/filings
On the one hand, Musk has a Twitter following that rivals most rock stars. On the other hand, the financial media runs a seemingly endless smear campaign against Elon and Tesla. James writes, "The public loves the guy but the financial experts can't stand him."
As Tesla's CEO, Musk is a disruptive force. His leadership style is far from conventional. After all, "Musk plays the long game; the experts see the short game... It's hardly a secret that most financial [pros] have a very short window. To them, it's the stock price that is all important, sometimes that's because (literally) they've shorted the stock."
Why? According to James, "Many 'experts' compare Tesla to GM, probably because GM, in the Bolt, already has a viable all-electric vehicle. Their preferred narrative is that GM [and the Japanese and German car makers] will use their deep pockets to capture the all-electric market. Under this scenario, Tesla is simply a modern-day version of DeLorean, destined to go out of business and then be featured in the 2027 reboot of Back To The Future."
Above: A pair of Model 3s at at Tesla Supercharger station (Image: CleanTechnica)
Then, there's the technology angle. James notes that "other experts compare Tesla to Apple because Tesla is building a seamless union of hardware and software, along with infrastructure of charging stations to support the union, much as Apple built the iTunes environment for the iPod/iPhone/iPad Tesla is destined to get clobbered in the mass market just like Apple got clobbered in the late 1980s and early 1990s."
Furthermore, "some experts compare Tesla to the software firms of Silicon Valley under the logic that those companies are 'disruptive' and Tesla is (or is trying to be) 'disruptive' and therefore they're similar. Under that scenario, Tesla is just another hype-factory like Theranos... as if making an overenthusiastic forecast for a real, existing product was the same as committing fraud."
James concludes, "all of those comparisons, however, aren't very apt. In truth, there has never been anything exactly like Tesla, ever. It's not a car company, it's not a consumer electronics company and it's not a software company. It's all of those things and more, and that leaves the 'experts' confused and struggling."
Above: Fellow billionaire Mark Cuban weighs in on Tesla and Elon Musk (Youtube: CNBC Television)
Looking to the future, Musk is making a bold move to take Tesla private. His confidants say he's relentless in his never-ending push for progress. Meanwhile, observers remain mired in 'analysis, paralysis' trying to make sense of what's coming for Tesla. Regardless of how this all plays out, one thing is for certain — once again, the so-called 'experts' could be caught flat-footed, taken aback, and left behind.