Musk: Telsa Doing Fine, Layoffs “Raising the Bar on Talent”

Daniel Lyons takes a rather jaded view of Elon Musk’s Tesla Motors over at Newsweek:

“Five years after its founding, Tesla has shipped about 70 electric roadsters, and the car does in fact turn out to be a classic Silicon Valley product—it’s late and over budget, has gone through loads of redesigns, still has bugs and, at $109,000, costs more than originally planned. Tesla’s first 40 roadsters went out of the factory with a drive train that needs to be replaced. (Tesla will do the rip-and-replace for free.) Its second car, a sedan, has been delayed until 2011. Tesla, based in San Carlos, Calif., has raised $150 million and burned through almost all of it, plus millions more put down by customers in the form of deposits (the company won’t give an exact figure). Now, hit by the downturn, Tesla has laid off 20 percent of its staff, closed its Detroit office and borrowed money to stay afloat.

“In classic Valley fashion, Musk, 37, insists his company is doing great, despite the fact that a planned $100 million funding round recently fell apart and the company’s cash balance dropped to $9 million before Tesla lined up $40 million of convertible debt financing. ‘I really don’t feel like we’re on the ropes. We did some early retrenchment in the face of a tough market,’ he says. He claims Tesla has developed ‘the most advanced electric powertrain in the world,’ and even puts a positive spin on the layoffs, saying, ‘We’re raising the bar on talent, raising expectations to a higher level.'”

My God. Did he really say that? About employees who he just put out on the street because of a credit crunch? That’s appalling. There are thousands of good people being laid off all across the Valley – across the entire country, for that matter – through no fault of their own. A little respect, please.

Meanwhile, Owen Thomas over at sees parallels between Musk and Steve Jobs:

“If in 2011, we live in a shiny future where we drive Tesla cars powered with clean electricity from SolarCity panels, and SpaceX’s Falcon1 rockets are supplying orbital space stations, then we will be living in a reality of Musk’s making — much as Jobs envisioned the iPod in the dark days of October 2001, and then, three years later, saw them everywhere on the New York subway.

“There’s another possibility, however, which would also make Musk like Steve Jobs — the Jobs of two decades ago, who was forced out of Apple by the CEO he hired. Tesla could go under, SpaceX could fail to win the NASA contract, and SolarCity could get beaten down by rival cleantech startups. And then Musk, driving his Roadster on the lonely roads of Silicon Valley, would find himself facing a reality not constructed in his mind. An unpleasant thought, that. Far easier just to succeed.”