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Elon Musk's Final Words

Elon Musk's Final Words

At the close of the SolarCity (SCTY) Q2 2016 Results - Earnings Call, Elon Musk's final words were:

I mean there is a lot of focus on this month or that month or this quarter or that quarter, but I think it's worth raising – lifting our gaze a little bit to think longer-term to a year, or two years or several years out and ultimately to where do we – what do we want the world to look like and are we going there as fast as possible. I think really in any rational person would we have reason, science and that it's important for the world to transition to sustainable energy generation and consumption sooner rather than later.

In fact, even if you just assign a probability, instead of saying it's black and white. What is your probability about going to a sustainable energy that non-CO2 generating energy is good versus bad? Even if you think it's like – if you take the position say, well we think it's 1% likely, but hypothetically that massively increasing the CO2 – massively increasing the CO2 in the ocean's atmosphere is bad.

Well, okay we're 1%, but you only have one planet. So even if you think it's highly unlikely, that global warming is real and that there's only a small chance, that it's bad. We should still accelerate the advent of sustainable energy. And anyone who thinks that it is a 100% certain that global warming is fake and that's massively changing the chemical composition of the ocean's atmosphere is fine, is a bloody fool, obviously. So that's what this is all about, this is about trying to accelerate, where we know we need to get to anyway. And not unlike small potatoes, put some pieces away, but in a very big macro scale way.

1. It doesn't matter what you believe about science.

2. Renewable, sustainable energy is axiomatic.

3. Tesla Motors and SolarCity are making the transition, whether you like it or not.

Mathew98 | 13. August 2016

@SamO - Excellent summary.

You may want to append the title "of last quarter" unless you wanted to create click bait.

The merger vote is coming SOON. Speak your minds folks.

SCCRENDO | 13. August 2016

Thanks Samo.
To all the climate change deniers on the forum let's be clear where Elon stands and what the mission of Tesla is.
Those who have been flagging climate change posts need to realize that they are trolls sabotaging Tesla's mission
To those who are deniers but are supporting Tesla anyway we thank you. You are helping to save the planet
So please buy any Tesla you can afford. If you cannot afford a Tesla at least buy a Leaf. At a minimum convert your iCE to a hybrid.
Get solar panels. One could make a strong case to purchase through Solar City to help Tesla but any solar panel system will do.
If you have money to invest think about Tesla or Solar City. It will help the company and could make you money in the long term
In the US vote against climate change deniers and for supporters. Another reason not to vote Trump but think about the rest of the ticket. If your congressman or Senator is a denier vote them out.
To those in the rest of the world. Please do what you can to support moving away from fossil fuels as best you can

carlk | 13. August 2016

Yes those same fools who think there is not enough risk from global warming then want us to believe 1 fatality in 130 million miles of AP driving is too much of a risk.

codyb12889 | 13. August 2016

A perfect statement.

No matter your thoughts on climate change most can agree that the current path we are on will likely leave the air unbreathable within a couple of generations. Even now you have large cities that get smog warnings issued saying the air is unsafe for anyone that already has a breathing problem.

Just the other day I went to the convenience store and when I walked out someone had left their car running directly in front of the door. When I opened the door to walk out thanks to the wind being going in the right direction I literally had my breath ripped away by a hot cloud of exhaust.

Is it so much to want to ask to be able to walk out of the store and not get pummeled in the face by a wall of noxious gases?

I guess the people that will tell you there is no way climate change is real will also be the same people to say if you don't like dirty air then don't live in the city.

SCCRENDO | 13. August 2016

@codyB. Just like you shouldn't be able to smoke where people inhale you fumes you shouldn't be able to drive your car where people have to inhale your car fumes. The issue is that the ICE is too entrenched and is essential to maintain our lifestyle. Thus we need to allow time for transition. By building a great EV Elon is leading the way.

Mike83 | 13. August 2016

Excellent thread. We are doing it and feeling good. Why not? Stick with the winners.

science-isbetter | 13. August 2016

+1

dansplans | 13. August 2016

EM is dead?

SamO | 13. August 2016

OMFG @dansplans wins the internet

Ross1 | 13. August 2016

For his obituary:

Rev 11:18
And the nations were angry, and thy wrath is come, and the time of the dead, that they should be judged, and that thou shouldest give reward unto thy servants the prophets, and to the saints, and them that fear thy name, small and great; and shouldest destroy them which DESTROY THE EARTH.

19: And the temple of God was opened in heaven, and there was seen in his temple the ark of his testament: and there were lightnings, and voices, and thunderings, and an earthquake, and great hail.

SCCRENDO | 13. August 2016

Back to the subject at hand.
@dansplans. Perhaps time to take Elon seriously. He does have a point, doesn't he?

dansplans | 13. August 2016

As I have stated elsewhere, the debate is irrelevant. Action on preventing the destruction of the planet is relevant.

I think EM and I agree on this in a general way.

SamO | 13. August 2016

@Mathew98,

The merger is genius. I agree that they should never been separate companies.

Soon it will be car + powerwall + solar roof + bi-directional inverter.

Tesla car owners can get $ while their car drives for them and can get paid for grid services if they are plugged in.

SCCRENDO | 13. August 2016

If we don't define the problem we cannot address it. Elon's mission is highly relevant and worth discussing because many even on these forums do not understand. The strategy by deniers is maintain ignorance. If the problem doesn't exist then we don't have to address it. The debate is relevant until we remediate global warming and climate change.

JeffreyR | 13. August 2016

@OP "...massively increasing the CO2 in the ocean's atmosphere is bad."

Doesn't make sense. Is that "oceans and atmosphere" instead?

SCCRENDO | 14. August 2016

@Jeffrey. It wasn't that well worded but all are bad. Increasing CO2 in the atmosphere increases greenhouse gases but increasing CO2 in the ocean drops the pH which is also bad

fgaliegue | 14. August 2016

@JeffreyR you may want to read this link, which delves into the chemistry of it all: http://wwwDOTpmelDOTnoaaDOTgov/co2/story/What+is+Ocean+Acidification%3F

(replace DOT with you know what)

JeffreyR | 14. August 2016

Thanks, I am quite aware of ocean acidification. But, most would agree my edit makes more sense as it covers both acidification and greenhouse effect. The way it's written above makes it seem there is a particular ocean with its own atmosphere w/ a problem.

SCCRENDO | 14. August 2016

@Jeffrey. Point taken

Madatgascar | 14. August 2016

Elon struggles to get the right words out sometimes. This looks like one of his more inarticulate moments. It continues to bother me that he lectures investors on what humanity ought to do without also taking the extra step to spell out the business care for developing a brand that people know will lead in the right direction, even if it requires sacrifices. You have to acknowledge the sacrifices and lay out a credible plan to overcome them successfully. You have to prove to investors that you are not going to follow your moral compass right over a cliff.

carlk | 14. August 2016

He does not need to prove anything. and could not anyway, to those investors who can only talk about next quarter's profit and valuation. I think he's just saying please take your money and run I don't need to have anything to do with you.

Ross1 | 14. August 2016

To you doctors out there, what DSM V markers would you attribute to EM?

Mathew98 | 14. August 2016

Not every genius is in the spectrum. Did you ask the same question for every Silicon Valley CEO?

Madatgascar | 14. August 2016

@carlk, I think there are a range of investors out there, and I agree Tesla does not want the ones you are talking about. There are a lot of Tesla investors who are willing to go long, who believe they can do well by doing good. They see both a need and a market for a socially and environmentally responsible company that also has exceptional tech savvy to create highly differentiated products for which people will pay significant premiums. Even these true believers need to see an argument for profits down the road. Almost every investor also has a fiduciary duty to look for the ROI at some point, and if all they ever see is losses and dilution and "never mind, we're doing the right thing," they could lose confidence. If this happens en masse it could spell real trouble for Tesla.

SCCRENDO | 14. August 2016

Ross it is irresponsible for any physician to make a diagnosis without talking to and examining a patient. Often further confirmatory tests are needed.

brando | 14. August 2016

@carlk +1

@tbouquet -1

PS Interesting to compare and contrast GM Volt to Tesla Model S.
Just use Wikipedia articles.

https://en.wikipediaDOTorg/wiki/Chevrolet_Volt

https://en.wikipediaDOTorg/wiki/Tesla_Model_S

The facts speak for themselves.
I suspect few will take the time to actually read.

dansplans | 14. August 2016

Why would you compare the Volt to the Model S?

Mathew98 | 14. August 2016

Why would anyone compare anything to the MS. Where's the competition you speak of?

dansplans | 15. August 2016

Mathew98 +1

You are absolutely correct. You can't compete with a car that isn't for sale anywhere in the world.

Ross1 | 15. August 2016

@SCCR:
I read Ashlee Vance's book.
He is quite obviously not in the first or probably second standard deviation IMHO.
As I am not a physician it is therefore responsible of me to say so: I think he is like me. LOL

Ross1 | 15. August 2016

although I am not like him

dansplans | 15. August 2016

@Mathew98 Sorry, I got cross threaded. I was referring to the M3.

dansplans | 15. August 2016

Volt vs MS is even more silly. Different class and markets.

SCCRENDO | 15. August 2016

@Ross. I also read his book. It takes a real driven personality to achieve what he has. Sometimes the margin between physiology and pathology can be very narrow. Unfortunately medicine has evolved where we just code things pretty much in binary terms. But there is a continuum with most things where we assign cut offs sometimes arbitrary. Take height for example. It is a continuum. So how do you define short vs tall?? Where does shortness end and tallness begin. The issue with psychological/psychiatric conditions is at what point does the condition become harmful to oneself and to others.

vperl | 15. August 2016

OP, please change the title of this post.

My FOB died and I got over it easily, not sure about Elon .

Tesla-David | 15. August 2016

@SamO, +1, great post!

@carlk +1

@tbouquet -1

Agree with @vperl about title change. None of us want these to be EM's final words.

SCCRENDO | 15. August 2016

@Tesla-David +1
@vperl +1 (Never thought I would ever say this). So we do have to be careful when using the title "Final words"
@Samo +1
@tbouquet +1

carlgo2 | 15. August 2016

Last words? "I snuck off to Mars with some selected interns. Oh, by the way, an asteroid will hit earth in 10, 9, 8....."

Ross1 | 15. August 2016

Interns as in Monica Lewinsky?

georgehawley.fl.us | 15. August 2016

Is it my imagination or is it getting warmer here?
😓

Mathew98 | 15. August 2016

Was it the cigar or the humidor that made it warmer?

johnse | 15. August 2016

@tbouquet 'Almost every investor also has a fiduciary duty to look for the ROI at some point, and if all they ever see is losses and dilution and "never mind, we're doing the right thing," they could lose confidence.'

It really depends on the goals of the investor. As long as one can see the value of the company increasing in all the myriad ways to value a company (capital investments, brand value, IP value, revenues, etc.) one can ignore monthly and quarterly "losses".

But this is very much long-view investing. The bears and shorts tend to discount this view and thus proclaim TSLA as a fraud. Amazon is a very prominent company that has also followed the path of reinvestment. It is only recently beginning to show "profits."

Unfortunately, the TSLA stock price is only a very loosely-coupled expression of the value of the company--but it is also the only way that most of us can participate in this long-view of the company.

vperl | 15. August 2016

Most people and institutions make investments to make money.

One may or may not approve of the company, but see there is an opportunity to make a profit.

Being a capitalist, profit is good.

Look at the state of Michigan, outlaws the sale of Tesla vehicles, but owns tens of thousands of shares of Tesla Motors stock.

Go figure....

SCCRENDO | 15. August 2016

Michigan banning Tesla sales is protectionism for the car industry and the existing dealership model. But they recognize TSLA as a good investment. The hypocrisy of pure capitalism.

carlgo2 | 16. August 2016

Ross, no dresses on Mars.

Ross1 | 16. August 2016

You been there?

Madatgascar | 16. August 2016

@johnse, totally agree. The argument for long term investment potential is very strong. Tesla bears consistently portray Tesla as "burning up cash." Tesla is not burning cash, it is converting one kind of asset (cash) to another (robots, factories, SCs, R&D) that will have greater value to the company over the long term to satisfy the insatiable demand that demonstrably exists for their demonstrably high-profit vehicles. Establishing economies of scale on the giga scale before competitors do is key to future dominance.

The bears also like to cite Elon Musk's apparent disregard for shareholders' interests. Just last week Mark Speigel was paraphrasing Musk saying "I don't care if Tesla goes out of business, as long as we succeed in accelerating the transition to sustainable transport." He goes on to cite competitors' plans for 40 new EVs.

A better approach to investors would be to outline plans to build the best, most compelling cars in the world, show how EVs are better than ICEs in every category, show how pathetic the competition has been, how desperately they try to make their ICEs sexy and their EVs ugly, how their dealer networks sabotage EV sales, and show that this dynamic is practically guaranteed to make Tesla the long-term leader in EV. Better yet, Tesla's success is now forcing its competitors to spend billions to build more EVs that similarly will not be allowed to succeed. Beating these bozos should be like taking candy from babies. Eventual big-time profitability MUST be part of the plan, not only to ensure Wall Street's continued participation, but because only greed will eventually spur the competition.

In the highly unlikely event that the competition develops more compelling EVs than Tesla, now Tesla will have solar roofs and Powerwall to provide a complete green energy solution, differentiating itself from the pack. If competitors beat Tesla at this too, Elon can be happy to eat his shirt, because he will have saved the earth in the process.

dansplans | 16. August 2016

@tbouquet There is a decent argument for a long term investment upside, assuming Tesla can survive to get there.

"insatiable demand that demonstrably exists for their demonstrably high-profit vehicles" If this statement was actually true, then the future of Tesla would be assured.

The fact is that Tesla has not spent anywhere near the budgeted amounts on capex items in recent quarters. You can't build cars without lines and robots. That is certain. Tesla needs to up their game, by quite a lot, if they are to survive past the end of the decade.

Madatgascar | 16. August 2016

@dansplans, I agree, they need to up their game. To do this they will need to raise significantly more capital. To do this they need to sell their business plan better. All their suppliers need to buy in too. I think they will get there... Panasonic just upped their investment in the gigafactory by around $3.8B. You can bet it's because they see the potential for Tesla's business success, not because they decided there was more than a 1% chance that "massively increasing the CO2 in the ocean's atmosphere is bad." (Hope those were not Elon's exact words.)

dansplans | 16. August 2016

Panasonic has not changed their investment in the GF at all. It still remains at $1.6B over time.

Panasonic is raising $3.8B, some of which is earmarked for the GF. It remains to be seen how much Panasonic will need to spend to equip phase 1 of the GF. I believe that their original $1.6B was intended to equip at least up to phase 2, possible more. Only Panasonic's upcoming quarterly reports can state what level of spending they actual achieve for GF production.

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