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For my part, it's just that Elon is the paramount example of what happens when the ROI plummets, and there's an amazing amount of investor cash floating around.
by pasabagi 7y ago
For my part, it's just that Elon is the paramount example of what happens when the ROI plummets, and there's an amazing amount of investor cash floating around.
You see it in history: the victorians built a ridiculously over-engineered, insanely extensive rail network. It didn't make any money, but at the time, there wasn't really anything else to invest in with a reasonable return rate. So everybody went in on the one thing that had the possibility of a massive pay-off. Recognize the unicorn-logic here?
Tesla kind of takes all the decades of Toyota kicking ass, and gets the lesson completely wrong - the 'machine that builds the machine' is exactly what GM was doing. Toyota was good at building cars because they were far less automated than their american competitors.
Then it works because electric cars are a great idea, batteries are massively subsidized by the phone industry, and incumbent car makers don't really have relevant expertise (since they're really good at building internal combustion engines, and a lot of the other stuff is a secondary concern). Also, because Tesla has an enormous amount of investor cash.
So why does all this bother me? It's because of where the cash comes from. Tech companies don't really pay taxes, and they don't have (relative to revenue) employees. If you imagine how many jobs Microsoft Office has replaced, you get the picture. All this is fine in itself (minus the tax thing), but when the money just gets poured into these obvious money spouts, into a company that's pretty obviously only workable because it sits at the bottom of one of those money spouts, lead by a guy who's clearly not as smart as he thinks he is - well, it feels a bit like a great example of the waste and unfairness of the system itself.
- jonplackett 7y agoWould just like to point out that in the UK we're still massively benefitting from the Victorian's far-sighted investments. They made stuff to last 100s of years. Bridges, railways, sewers, the house I'm living in. Thanks Victorians.
- karambahh 7y agoWould you have sources about Toyota factories being less automated than their US competitors? I've been told in the past that the key factor in Toyota success is their relationship with their suppliers. A top notch supply chain with just in time processes bundled with reasonable proxy stocks? Would love to read about their automation level compared to US or EU companies
- clouddrover 7y agoHere's an article on Toyota's production lines: https://www.thedrive.com/tech/26955/inside-toyotas-takaoka-2-line-the-most-flexible-line-in-the-world https://www.thedrive.com/tech/26955/inside-toyotas-takaoka-2...
- pasabagi 7y ago> Would you have sources about Toyota factories being less automated than their US competitors? It's kind of a cliche at this point - but a good start is 'The Toyota Way', which talks about developing people. I'd also be interested if you can find an authoritative source. I just have a lot of news articles - a good overview is this one in industryweek (https://www.industryweek.com/operations/tesla-vs-tps-seeking-soul-new-machine https://www.industryweek.com/operations/tesla-vs-tps-seeking...). The basic principle is somewhat obvious - automation is efficient, but inflexible. That often leads to machines sitting idle, or the overproduction of unsaleable stock. So it's a kind of poison chalice - it looks like you'll reap huge profits, but if your car doesn't sell well, you're screwed. If you invest in people instead, you can react to changing economic conditions.