Elon Musk Is His Own Worst Enemy
(Bloomberg) -- Stay on top of the electric car revolution by signing up to our Hyperdrive newsletter here.
It was an old joke at Tesla Inc. among executives: get too close to chief executive officer Elon Musk, and you’ll get burned. Flying under the radar — instead of too close to the sun — was a survival strategy at the company.
In Greek mythology, Icarus ignores his father’s warnings and flies too high, causing his wax wings to melt. Icarus falls into the sea and drowns.
Musk now appears to be entering his own potentially dangerous Icarus phase. With a net worth well over $300 billion, Musk is the richest person ever. He owns roughly 20% of Tesla and about half of SpaceX. His personal fortune has skyrocketed as the world increasingly embraces electric vehicles and human spaceflight alike. In Tesla’s home state of California — until the company moves its headquarters to Austin, that is — zero emission vehicles now account for 11% of new car sales.
Most entrepreneurs flying at Musk’s level would take the win, think about their succession plans and start turning their focus more squarely to their philanthropy.
But Musk is newly emboldened, and his juvenile swipes on Twitter are reaching new heights. He mocked Jeff Bezos with a Number 2 medal as the gap between their wealth grew. He’s taken an increasing number of potshots at President Joe Biden that sound like they are Republican Party talking points. He told the head of the United Nations World Food Programme he would donate $6 billion to fight world hunger, if the WFP open sourced the accounting on their spending.
Last week, Hertz announced plans to buy 100,000 Tesla’s, a blockbuster deal that included Tom Brady ads and the fact that Hertz will be paying full price for the vehicles. Now Musk is throwing cold water on it, saying that “no contract” has been signed. Tesla shares fell Tuesday.
“As we announced last week, Hertz has made an initial order of 100,000 Tesla electric vehicles and is investing in new EV charging infrastructure across the company’s global operations,” the car rental company said in an emailed statement Tuesday. “Deliveries of the Teslas already have started. We are seeing very strong early demand for Teslas in our rental fleet … which reflects market demand for Tesla vehicles.”
What, exactly, is Musk doing? If there’s no contract, why did Hertz announce it? Are they still negotiating terms? Or is Musk — hyper- sensitive to the idea that Tesla is “dumping” the Model 3 on a car rental company — using his platform to remind Hertz that they aren’t getting any special favors?
I’ve covered Tesla for a decade, and the arc of the company from scrappy Silicon Valley startup to most valuable automaker in the world has been remarkable. Along the way, Musk has broken the mold of what it means to be a modern CEO and largely gotten away with it — whether that’s smoking marijuana on a podcast, pushing a departing executive or being sued for securities fraud. Legions of fans love him for his bluster and brashness; Tesla’s board goes along with it.
I hope, for his own sake and that of his employees, Musk doesn’t crash and burn. He has proven to be his own worst enemy: self-sabotaging in times of stress (see: 2018); getting extremely cocky when things are going well. He’s 50 years old and has many years left to pursue his dreams of colonizing Mars and ushering in a clean energy revolution. The biggest risk, at this juncture, may be his own hubris.
©2021 Bloomberg L.P.