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Tesla is running out of money

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The story of Elon Musk is like a comic book. At first he seemed like a hero — they called him Iron Man, and he seemed to be saving the world, reported (Australia).

Now he looks like a cartoon villain. His fight against the true heroes who got the Thai boys out of the cave is attracting worldwide attention. (That will happen when you tell your 22 million Twitter followers that someone is a paedophile.) This is shedding light on a lot of other behaviour that matches up.

Tesla customers around the world are getting angry as the car company is increasingly looking like it misled customers and investors about prices, features and manufacturing capacity.

As Tesla is wobbling, Mr Musk’s character is being revealed. He grows angry and petulant, accusing true heroes of paedophilia and leaning on charities he supports to tweet in his defence.

The ending to a good comic book would bring a neat resolution full of justice. But this is real life. Here’s why Elon Musk will get away with it all.

Elon Musk’s car company, Tesla, is running out of cash. It has huge debts, limited cash flow, and lots of cars just sitting around in lots unsold. It burns millions of dollars a day just staying open. The company is so desperate that it is even asking its own suppliers to return some of the money it already paid them.

You might expect Tesla to go broke. But that would be to misread the situation. Tesla is so prominent that politicians will want to save it. Tesla is an exceptional company — it will get exceptional treatment when its exceptional flaws come to the surface.

Who wouldn’t want to save an all-American innovation story, especially one that does manufacturing in America? Donald Trump himself will probably go down there and personally keep the company alive.

The company’s high profile and huge number of employees have given it a status not unlike big banks — Tesla is now “too big to fail”. Anyone hoping for a neat third act where Tesla disappears under the weight of its mistakes is likely to be disappointed.

Mr Musk donates heavily to both Republicans and Democrats. He’s a gifted salesman. He has convinced millions to give up their own money to his car company — he will have no difficulty convincing politicians to give up other people’s money.

What US or Californian senator, aspiring for re-election, would pass up the chance for a photo opportunity with a grateful Elon Musk? Hoping some of his cool factor will rub off onto them, the politician will dig deep into piles of taxpayer dollars to keep Tesla alive, and to make sure Elon Musk is still involved.

Musk’s own brother has said that in different circumstances, Elon could have ended up in jail.

“Elon … took risks that seemed like they could have landed him in jail for using someone else’s money,” Kimbal Musk said in a biography of Elon Musk published a few years back. The quote refers to a period early in the history of Tesla when it ran close to the edge. If Elon flirted with the law once to keep the company alive, he will probably do it again.

But history is written by the winners. If you survive, desperate measures on the way to glory become stories about how committed you are. So long as Tesla’s stock price is up — and it is well over $US300 ($A400) at time of writing, valuing the company at over $US50 billion ($A67 billion) — nobody will worry much about technical issues over whether or not Elon was or wasn’t in breach of the law.

The stock price has held up extremely well over the last year, despite huge numbers of revelations about the company and its CEO that would be very damaging at any other company. So long as that continues, nobody needs to worry.

Tesla’s enemies love to point to the fate of Theranos CEO Elizabeth Holmes as what could happen to Elon Musk. Holmes got in huge trouble for promising to revolutionise blood testing for diseases, but didn’t actually have a product that worked. She has been charged with criminal fraud.

The US Securities and Exchange Commission put out a statement about Theranos that caught the eye of many people interested in Tesla: “The Theranos story is an important lesson for Silicon Valley … Innovators who seek to revolutionise and disrupt an industry must tell investors the truth about what their technology can do today, not just what they hope it might do someday.”

That might look like a pointed reference to Elon Musk’s promises about self-driving cars, but there are a few differences between Musk and Holmes.

Most of Elon Musk’s claims are about the future, and if they don’t come true, they are easy to deny. They could all just be honest mistakes. Of course the astute observer can see the pattern — Elon has promised full self-driving cars, a car for $35,000, a robot factory, steady high rates of production, and many other things that have never come true — but individually each one just looks like a technical snafu or someone else’s fault.

Even if the situations were identical, if you think the 34-year-old Holmes and a 47-year-old man with an enormous army of furious fans would get the same treatment, you haven’t been paying attention. They might be equal under the law, but the law is administered by people whose prejudices matter.

The rise of Donald Trump is a good lesson — people who seem awful often have the exact qualities to rise to the top.

Arrogance, lies and narcissism are traits we love to see punished in comic book narratives. One reason that is so satisfying in fiction is we don’t see it much in real life. In the nonfiction reality we all inhabit, Elon Musk will most likely go from strength to strength.

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Tags: Elon Musk , tesle
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