What Happened to Elon Musk?

Posted on the 14 May 2020 by Thiruvenkatam Chinnagounder @tipsclear

Musk maintained notions of flights to Mars, and at the same time denied that it was his native planet. He behaved like no other CEO of an automaker before him, and legions of worshiping fans lined up, giving his Twitter account a level of attention rivaling that of President Donald Trump. When Elon Musk tweets a vague hint about an upcoming product revelation or reports of potential planetary destruction, the media immediately catches it. same Twitter CEO Jack Dorsey asked Musk for advice on how to improve the service.

Ford CEO Jim Hackett does not have a Twitter account.

Everything seemed fine until it wasn't.

In the summer of 2018, a boys' soccer team in Thailand was trapped in a cave that quickly filled with water. While the 12 boys and their trainer were desperately waiting to be rescued, Musk intervened to offer his services. His team could use much of the same capsule technology developed by Musk's rocket company, SpaceX, to build an underwater capsule to aid rescue, he said at the time.

But after one of the rescuers involved in the rescue effort criticized the ship, Musk went wild, baselessly calling the rescuer "pedo", which is often shorthand for "pedophile", but who, according to Musk, simply meant "scary".

It was the first time that Musk's apparent belief that he can do anything, that he knows better than traditional experts, has garnered him widespread public reaction.

The rescuer sued Musk for defamation. Musk won, and the civil victory only emboldened him and seemed to defuse the effect that all criticism had had on him. While Musk was once the rebel leader of an arrogant scrappy, he was now the wealthy tycoon who had crushed a single emergency responder in court after publicly calling him, at best, "scary".

Even before the trial was won, however, Musk's Twitter account veered in another costly direction. On August 7, 2018, Musk tweeted that he was taking Tesla privately at a price of $ 420 per share and that the financing of the deal was "secure". Such an announcement would send shockwaves to any business community. The fact that he had been tweeted with such relative nonchalance was either the mark of an unconventional executive making deals - or, perhaps, something derailed.

It quickly became clear that the agreement was far from being concluded and that Saudi Arabia's potential funding had never materialized. The US Securities and Exchange Commission intervened, stating that "in truth and in fact Musk had not even discussed, let alone confirmed, key terms of the agreement, including the price, with a source of potential funding. "

It would surely be the straw that broke the back of Musk's Twitter feed. It's one thing to target a cave diver without Musk's vast resources. It is quite different to take regulators from the United States federal government. The shareholders have taken legal action alleging that he intentionally manipulated Tesla's share price.

The SEC wanted to ban Musk from acting as an officer or director of a publicly traded company, effectively demanding that he be removed from Tesla entirely.

But it didn't stick. Musk spent the next few weeks make fun of the SEC from, of course, his Twitter account. After months of negotiations, the SEC agreed on a weakened settlement, the only significant result of which was that Tesla would appoint a new president, and Musk's tweets on certain topics - largely limited to financial well-being and production numbers of the company - would now be examined by "a lawyer specializing in securities".

It didn't seem to matter to investors. Tesla's share price climbed higher and higher, soon totaling market capitalization higher than Ford's former "Big Three", General Motors and Fiat Chrysler Automobiles combined.

Then the coronavirus pandemic began.

In a county that is one of the hardest hit by the coronavirus in the region, Tesla employees are returning to the company's plant in Fremont, California. Despite an order from local health authorities prohibiting the manufacture and assembly of non-essential products, the Tesla factory resumed production of vehicles over the weekend.

Musk, as usual, went on Twitter, saying that if someone was to be arrested for breaking the order, it should be him.

The local health department has capitulated, agreeing to Musk's demands that the plant reopen next week, even though production has already resumed.

This is a situation that has been preparing for months. Musk has long questioned the real risk of coronavirus. From January, he tweeted that the coronavirus was no more dangerous than other common viruses despite expert advice that it is, in fact, much more lethal.

In March, while there were just over 15,000 nationally confirmed cases of Covid-19, it was Tweeter that the United States would have "nearly zero" new cases by the end of April.

"Coronavirus panic is stupid," he said. wrote.

Also in March, when Alameda County, California, where Tesla's head office and manufacturing plant are located, placed home stay orders, Tesla delayed its closing for a week.

But at the end of April, the country was rapidly approaching a million cases. By the time Musk forced the reopening of his factory, more than 80,000 Americans had died.

In a recent conference call with investors, Musk took the time to speak out about the residence restrictions he said were hampering his business, comparing them to "forcibly imprisoning people in their homes".

Upon reopening the factory, Musk and Tesla said steps were being taken to keep workers safe. County health officials said they would monitor these efforts to ensure workers are protected from infection as much as possible.

Musk and Tesla are not known to have erred in prudence, even in security. It is, after all, the company that provides Autopilot semi-autonomous driving software for its cars that comes with the warning that it is still in "beta test" mode. Musk and Tesla insisted that the software is, overall, safer than an unassisted human pilot when used as intended. However, other automakers offering such technology have said they will not ask the driver to "beta test" the software on the street.

Tesla's way is not to wait, however. While other automakers are waiting for foreclosure orders to be lifted to even begin reopening their factories, Tesla is moving forward. For better or for worse, that's what Tesla and Musk do. But now, apparently nothing in government or his business holds back Musk's impulses, the well-being and lives of their workers rest on this decision.

And for better or for worse, the barriers put in place by society depend on the institutions that maintain them to ensure their strength. But these barriers were not designed to withstand the assault of an aggressive CEO supported by considerable personal wealth, workers faced with rising unemployment and a collapsing regulatory framework in the face of real calamitous test. With a hole the size of Elon Musk broken in these barriers, it's not clear that anything is holding Musk back.