Tesla Layoffs and Management Changes

[graham]

From the Tesla Motors twitter feed:
Twitter / TeslaMotors: The Jalopnik articles rela ...

The Jalopnik articles related to last week's layoff at Tesla aren't very accurate (surprise!) We'll talk more about it this week.

 

[siry]

I just posted this on Jalopnik:

Andrew,

The whole thing about a bulletin board with names is completely fabricated. I think you were duped by your "source." There was no bulletin board with names of those laid off. It just didn't happen.

It is true, unfortunately, that the blog post outlining the strategic rationale for the cuts the company was taking mentioned that the RH office would eventually be closing down (it was not closed down Friday contrary to reports, nor were 90% of people laid off). This should have been told to the folks at RH in person before it was on a blog. That was a mistake, but by no means was anyone "laid off by blog." Every person who was impacted met with their manager to receive the news on Friday.

Darryl (from Tesla)
____________________________

 

[graham]

Siry is back! Yay!

 

[Cobos]

Yes, definately good that Darryl is posting here again!

Cobos

 

[stopcrazypp]

Nice to see you back Darryl, it helps to have someone clarify the situation with these kind of stories, as I have seen them not only at Jalopnik but also in some gadget blogs.

For example:
Electric Car: Tesla Lays off 90% of Detroit Staff in Douchey Way
Tesla CEO: "Extraordinary times require focus"

Anyways, we are rooting for Tesla to pull through and hope to see Model S soon.

 

[TEG]

Anyways, we are rooting for Tesla to pull through and hope to see Model S soon.

Yes we are!

 

[graham]

The Truth About Cars are of course running with the Jalopnik version of the story:

Tesla Death Watch 26: Death By Blog | The Truth About Cars

But Jalopnik does now have an "Update" at the top of the article:

UPDATE: Tesla notifies Detroit workers already-in-the-know they were laid off two days ago...today!

But their one-sentence "Update" doesn't really serve as much of a retraction.

 

[mt2]

Welcome back, Darryl. The media sure isn't much for checking their facts anymore, are they? Nice to hear some of the real story from an official source.

 

[flabby]

Daryl
It certainly is good to hear from you again.

 

[graham]

Tesla CEO Details Delaying Raising Funds and the Model S Earth2Tech

Musk did give a few more details about what happened over the weeks prior to his recent decision. To move into working on the Model S, Musk says Tesla would have had to raise $100 million. Just 4 to 6 weeks before Musk’s decision, Tesla was in the process of actively fundraising and was talking to several investment entities. Then the market went into a freefall, says Musk, and the investors the company was talking to kept pushing back investment terms. Tesla could have done a deal — it would have just been under horrible terms, Musk says.

Now, Tesla is waiting for a loan guarantee to come from the Department of Energy, which is contingent on Tesla completing an environmental impact assessment (EIA) of its plant in San Jose. Tesla hopes to finish the EIA by second quarter 2009, which would delay the next-gen Model S by about six months, Musk estimates. As anyone who has been involved in these types of assessments knows, EIAs can take a very long time, and Musk by his own admission tends to be optimistic about dates and deliveries. But he says he has always delivered in the end.

Delaying the Model S and cutting staff means Tesla is focusing on its current technology, the Roadster, and on becoming cash positive. One technology Musk says the company is working on is a charger that can charge a battery in 45 minutes. That is one way the company can help overcome the “range issue” (current battery technology can only go so far on a single charge) for electric vehicles. Other ways to attack the range shortfall will be a swappable battery and building an extended-range vehicle that can travel 300 miles on a single charge.

 

[dpeilow]

Tesla Motors: A Peek Inside The Soon-To-Be-Dead Tesla Motors Detroit Office

 

[dpeilow]

Driving Tesla Near The Edge, Or Over? | Hybrid Cars

 

[malcolm]

There is a very long way to go before Tesla is over.

 

[Cobos]

There is a very long way to go before Tesla is over.

Yeah it seems the biggest problem is everyone is worrying about the fact that Tesla only has delivered around 50 cars. When they also got around 50 cars now in different stages of finished, it does take 6 weeks for the ship to cross the ocean and I doubt they are sending the cars one per ship. It seems to me they are delivering more cars than Think actually is, and noone is talking about them going under...

Cobos

 

[vfx]

Yeah it seems the biggest problem is everyone is worrying about the fact that Tesla only has delivered around 50 cars./QUOTE]

Frustrating but also never-ending. Remember when TTAC made a big deal about Tesla never having delivered a single car to a customer? Then only one car, then it was -Only the investors have gotten their cars-. Now as Tesla crosses the "Tucker" mark it's "only" 50 cars. Later we will hear that Tesla has "only" delivered 500 cars ...and so on.

Then it starts all over with the Whitestar!

 

[dpeilow]

Technology start-ups face the downturn | Fright night in the valley | The Economist

Elon Musk, boss of Tesla Motors, a start-up that recently began producing an electric sports car, learnt useful lessons from the dotcom bust. He steered PayPal through the early days of the shakeout by maintaining a focus on its core online-payments business and by ditching plans to develop other offerings.

Good point.

 

[TEG]

Yeah, that article sums up the "slam on the brakes!, potholes ahead!" attitude that seems to have happened recently.

 

[graham]

BusinessWeek: Electric Carmaker Tesla Downshifts

Article from businessweek that includes the sneak peek photo of the Model S which doug posted in the Whitestar thread.

This is the entire article which is more about the changes in management etc of Tesla in general, so I posted it here:
Electric Carmaker Tesla Downshifts - BusinessWeek

Since its founding in 2003, Elon Musk's Tesla Motors has been a proud creature of Silicon Valley. That's to say a startup with outsize ambitions and a public disdain for business as usual—or at least as practiced by the dinosaurs in Detroit. On a tight budget, Tesla built an electric car, the Roadster, that's acclaimed for its harmonious balance of greenness, beauty, and performance. Tesla has 1,200 back orders for the $100,000 sports car, mostly from wealthy trendsetters.

But Musk, a software entrepreneur who made millions with PayPal (EBAY), has bigger aspirations: He dreams of one day producing a line of electric vehicles for every purse and purpose. A few weeks ago, Tesla seemed to be on the road to making that happen. Musk had verbal commitments for $100 million in private capital, federal loan guarantees geared at jump-starting development of alternative vehicles, and thoughts of going public next year.

TROUBLE AHEAD?
Then the world changed. On Oct. 11 Musk's financial advisers at Goldman Sachs (GS) called with bad news. Investors, fazed by the credit crunch, were suddenly demanding tougher terms. Musk organized bridge financing and poured more of his own money into Tesla. With $55 million-plus at stake, Musk, who is chairman, asked the CEO to step aside, and he took over that role. He began retrenching, laying off 80 of 380 people, cutting costs, and postponing Tesla's second model, the $60,000 Model S sedan. "We're taking action before we're forced to," Musk says.

 

[stopcrazypp]

From that article they say the Roadster was initially over budget by $40k. And also they had to cut costs, with one cut replacing the transmission handle with a button. Didn't realize they were that over budget with the Roadster.

 

[graham]

Didn't realize they were that over budget with the Roadster.

Yes, they mentioned the cost overruns in the article linked in this thread:

http://www.teslamotorsclub.com/news-articles-events/1335-fortune-magazine-teslas-wild-ride.html

In Tesla's own prospectus for its most recent round of funding, dated April 12, 2007, it had estimated the cost of building the car at $65,000, dropping as production ramped up. But just two months later, the VCs now believed the average cost was going to be well north of $100,000 for the first 50 cars and would decrease only slightly as more cars were built. "If this is true," Eberhard told Colson and the room, "you and I are both fired."