One day Tesla will be worth more than Apple, claimed Elon Musk, the man who hopes to begin colonising Mars before the next decade is out.
“It’s only hubris if I fail” said Julius Caesar.
If we act likes gods, we are doomed to fail, or so we are told. Daedalus is the first example, he made wings from the feathers of birds, glued them together with wax, and he and his son Icarus, took to the skies, like gods. They flew too close to the sun, the wax melted, and Icarus fell to the Earth.
Elon Musk, possibly the most remarkable man on the planet, warns that he “may be delusional.”
But he says, he can see a clear path to how Tesla (worth $51 billion) can become bigger than Apple (worth 750 billion, or so), or least bigger than Apple is now.
Why, or how?
Because Tesla is “getting good at building the machine that builds the machine,” said Musk.
He explained: “The programming of the robots and how they interact is far more complex than the software in the car. I think this is going to be a very difficult thing for other manufacturers to copy. I wouldn’t want to be in their position.”
Here is the snag.
In Q1 Tesla saw operating expenses rise by 32 per cent, but revenues only increased by 18 per cent.
Then again, it does seem that sales at Tesla were hit, as the would-be customers awaited the arrival of the Tesla 3.
But can it happen?
Can Tesla really come to rival Apple for the title world’s biggest company?
The Tesla business model needs investors to believe at least some of the hype. For it to really become a player that rivals the traditional car companies for market share – in addition to market cap, as it is already doing – Tesla needs scale.
The more cars and solar panels and solar roofs it can make, the more it can get the cost of its batteries down, reducing the cost of its cars, creating a true mass market.
Tesla is also a pioneer in autonomous cars, and when Musk says the “programming of the robots and how they interact is far more complex than the software in the car” he is not wrong.
But Tesla is in a chicken and egg situation. It needs scale to get costs down and sell more cars, but to get scale it needs to sell more cars.
How do you make the breakthrough? One thing is for sure, you won’t achieve it by setting modest targets.
In fact, if his recent TED interview is any guide, Musk is not arrogant, is not, on the face of it full of hubris, he is simply charged with a desire to save the planet.
Thomas Sowell once said: "Some of the biggest cases of mistaken identity are among intellectuals who have trouble remembering that they are not God.”
But then Caser also said “I came, I saw, I conquered.”
Musk may yet conquer, and if he does, we will all be winners.