$4b in CapEx alone for <500k units/year manufacturing capacity for a single model is the worst program-level capital efficiency I've ever heard of... in an industry that is infamously capital inefficient. And that's just what Tesla spent in 2017!
Some of that 2017 spend may have gone toward opening new sales/service locations and Superchargers to support the higher-volumes planned for Model 3. Then again, a good deal of 2016's $1.44b and 2018's $2.32b probably went into Model 3 manufacturing as well.
It's also super-important to recognize what all these billions bought: not a competitive flexible/scalable manufacturing system, but labor-intensive low-to-no-automation general assembly in a freaking tent. This makes M3 a capital efficiency failure of epic-historic proportions.
The worst part: Tesla could have totally avoided this fiasco by listening to manufacturing experts who predicted the "Alien Dreadnought" would end up in utter failure. Instead it was "Elon lands rockets on ships, bro" and "you're just trying to drive down the stock." 🤦‍♂️🤦‍♂️🤦‍♂️🤦‍♂️🤦‍♂️
That's the really scary part of this: the response from investors has been to throw more capital at Tesla, drive up the valuation, and angrily reject good advice as jealousy, insecurity and/or an effort to hurt Tesla. Talk about a recipe for not learning obvious lessons!

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More from @Tweetermeyer

15 Sep
Wow, this is huge: the safety driver who was behind the wheel the night Elaine Herzberg was hit and killed by an Uber self-driving test vehicle is being charged with negligent homicide. Whichever way this case goes, it's going to set an important precedent.
What makes this case so tough: on the one hand, this safety driver was hired to monitor a development vehicle during testing and ensure its safety... but on the other hand we know that this is an almost impossible task to sustain, and distraction was inevitable.
To flesh out the second half of that: Uber had this safety driver working 10 hours per shift, at night, all alone, with no driver monitoring. There's a good deal of scientific research that suggests this set her up to inevitably fail. More on that here👇
Read 8 tweets
25 Aug
Hilariously, this "demonstration" actually shows off more of this (fake) battery swap system's functionality than Tesla's first battery swap demonstration... and that earned them tens of millions of dollars (if not hundreds) in "bonus' CARB ZEV credits!
Musk claimed at the time that this battery swap process was fully automated... but revealed precisely zero about its actual functionality during the "reveal" event. Watch for yourself.
This "demonstration" (some might call it a dog and pony show) was literally all Tesla had to do to earn almost double the ZEV credits for every car it made. No proof it was actually being used, or was really automated required. More here: dailykanban.com/2015/05/27/ana…
Read 8 tweets
19 Aug
>starts taking customer cash for "Full Self Driving" in October 2016
>expects training infrastructure to be set up by mid-2021

🤔
I really go out of my way not to throw the "f word" around casually, but either "Full Self Driving" is a conscious fraud or it's a well-intentioned but profoundly bumbling exercise in fake-it-till-you-make-it.

In either case, not something you want to trust your life to.
The legitimate AV developer space has learned some tough, sobering lessons over the last couple of years about the price to be paid for overhyping. Musk's decision to just keep doubling down on hype will eventually lead to the same lessons, at a previously unimaginable scale.
Read 8 tweets
4 Aug
If I'm a Tesla investor, I'm wondering why the once-Tesla crazy Norwegian market has completely turned on what used to be its top brand. There's a bunch of evidence that suggests quality and service shortcomings are no longer tolerated once competition becomes available.
A lot of people used to call Norway's market "the canary in the coalmine," implying that Tesla would be the inevitable winner as markets shift toward EVs. If that view is correct, this is strong evidence that Tesla's runaway success will come to an end as EV markets mature.
The logic holds up well: Tesla's are pricey, powerful and prestigious but come with some quality and service shortcomings that early adopters happily overlook but as markets mature, consumer behavior tends to revert to more pragmatic values. Looks like that's what we're seeing.
Read 9 tweets
29 Jul
Tesla had deals with Mercedes and Toyota to supply drivetrains, batteries and co-develop EVs a long time ago.... maybe if we understood why those deals withered on the vine, we'd understand why OEMs aren't beating down Tesla's door for similar deals today?
Here's a hint at one of the factors: Mercedes and Toyota both recalled their co-developed vehicles for issues with the Tesla powertrain. Tesla-branded vehicles had similar issues with sudden loss of power, but there was never a recall. newcartographer.com/combustion/tes…
The factor hinted at above is not that Tesla's stuff was shoddy (though there is reason to believe it may have been) but that the culture gap was too wide to bridge. Auto OEMs rely on culture to catch issues top managers can't always see, and partners have to share core values.
Read 8 tweets
9 Apr
Culinary digression of the day: stupid-easy pollo asado edition. Throw these three ingredients on a chicken, leave in the fridge overnight and then smoke/BBQ on low/indirect heat (preferably using mesquite) and finish on high/direct heat. You won't believe how good it comes out.
If you want to get a little crazy (and I always do) you can throw potatoes and onions on a layer of cabbage in a pan to catch the drippings. When I did this, the cabbage took on a ridiculous smoky umami flavor that destroyed the restaurant version I was ripping off.
Sorry, no "after" photos of the batch above from a few weeks back... will try to remember to grab some of tonight's effort. Only question is: will the store have the chilies needed to re-up this most necessary condiment? 👇
Read 4 tweets

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