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Comment by goshx | Hacker News Reader

For me, judging by their cars on the streets and all the technology advancements since they started, missing production goals by a few months or even a couple years is irrelevant. I think we are all too spoiled and tend to dismiss real technological challenges because “I want it now!”.

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> because “I want it now!”.

Isn't it because "Tesla, a public company, promised/projected this production goal"?

Does that change anyone else’s lives other than those who are actually waiting for the car?

The shareholders?

Musk doesn't really care about the shareholders. He has a vision, and the company is the embodiment of that vision. The only reason he took the company public in the first place was for access to capital, and the ability for employees to sell stock.

Since the eighties there has been this maximal version of shareholder value, where the only reason for a company to exist is to maximize returns to shareholders. This was promulgated by private equity firms who would take over a firm and destroy many of the good things that a company was doing that didn't generate profits in order to increase returns to shareholders. Prior to the PE hostile takeover boom, there was a general understanding that shareholders were very important, but not the only stakeholder in a corporation.

If you invest in Tesla though, don't count on the corporate raider philosophy of stock ownership. They may have been able to get other companies in line with the threat of a hostile takeover, but Tesla has protective provisions that make it nearly impossible to do a hostile takeover of Tesla. For better or worse, Tesla is whatever Elon Musk wants it to be. If you're a shareholder, you're just along for the ride.

This is a really naive view of public company obligations. Corporations should always be acting in the interest of shareholder return, full stop. That’s not something PE firms invented. That’s the expectation that has fundamentally driven capital markets from the very outset. What might vary are the anticipated time horizon and distribution profile of returns.

What has really changed is how money moves in the markets and particularly the degree of short-termism being expressed by investors. That has a lot to do with the tremendous growth in available securities (related to opportunity cost), the increased efficiency of capital markets, dramatically lower transaction costs, and the general velocity of capital in the system. And of course, it’s just inherently easier to project near term than long term outlook and always will be.

Show me where in the law does it say "companies are obligated to make their shareholders happy." Your flippant use of the word "should" is all you have to go on so far.

If you don't like what they're doing, you are free to divest. This is a free market after all!

Dodge vs Ford Motor co. : "A business corporation is organized and carried on primarily for the profit of the stockholders"

The general reading of the fiduciary duty to shareholders is that directors of corporations are bound to promote the value of the corporation for the benefit of the shareholders.

Which was a Michigan supreme court ruling. There have been other later cases which interpreted the duties of the directors and officers more narrowly. Even the Dodge vs. Ford case contained: "courts of equity will not interfere in the management of the directors unless it is clearly made to appear that they are guilty of fraud or misappropriation of the corporate funds, or refuse to declare a dividend when the corporation has a surplus of net profits which it can, without detriment to its business, divide among its stockholders, and when a refusal to do so would amount to such an abuse of discretion as would constitute a fraud, or breach of that good faith which they are bound to exercise towards the stockholders." In AP Smith vs. Barlow, in particular, it was ruled that a corporation can make a charitable donation and not breach its fiduciary duty to it shareholders.

The primary means shareholders have to change the direction of the company is to elect a different board of directors. In the case of Tesla, that requires a 2/3 majority, and Elon holds 27% of the stock.

What? My point is that the incentive structure driving that expectation is even stronger than any legally-binding requirement could hope to be. Your framing of this issue implied that short-termism is somehow a perversion of capitalism and what I’m trying to explain is that it is in reality a direct consequence of it.

>it is in reality a direct consequence of it

I agree with this. But IMO Tesla and the like are different because they're tapping into something more. People are actually excited about electric cars now, and they're willing to put money toward the goal and let Musk steer his company, taking them along for the ride.

The shareholders, AKA people who bought stock online hoping to make money, hoping to not lose money because of others selling before them, and not contributing in any way whatsoever to the vision, execution, or success of the company, except for the cash they put in.

Yes, having 400 000 people use bicycle or walk while waiting for their Tesla 3 has significant positive effects for the environment. And if it can continue for few more years, maybe these people will permanently convert to cycling.

yeah, f*ck tech advancements and saving the planet. I want my profits now.

The problem is: They cannot save the world if they crash the company into a wall.

I am not saying that they will, and I hope they will not.

But since a few weeks, I do not completely rule out the possibility anymore. Because if only some of their problems, that are being reported right now, are systemic or hard to fix, 2018 might be a bad year for Tesla...

Hah, Tesla just can't seem to please anyone (kinda like Trump).

Saving the planet from wasteful businesses? Won’t happen in California

It hasn't. It promised starting shipping Model 3 to people probably end of 2017, people just forgot the original promise. Elon specifically said that the internal deadline (and deadline to suppliers) is sooner, as he was expecting delays, he just didn't know it would be because of the battery plant.

Musk loses credibility each time he stokes the 'I want it now' fires with unrealistic promises that he is unable to fulfill. We are impatient but he shares a large amount of the blame for creating these expectations.

Would you be more satisfied if Musk met rather meagre goals he set for the company or of he fell short of unrealistic grand milestones? I'll take the latter.

I think you’re missing the point: a technology advance without the ability to mass-produce isn’t a real advance. Otherwise we’d all be using VR-enabled memristor computers to sequence tailored anti-cancer meds.

Am I? I consider 2,000/week Model S (announced back in 2016) mass production. Just because Model 3 mass production is delayed by a few months it does not mean they can’t do it.

The point is: there's no guarantees it will be delayed by just a few months. But besides, even if they had hit all of their targets, they might just succeed, if they really pushed it, to make as many as Toyota managed to sell of _one_ Prius model (the liftback) last year, in Japan alone.

Nobody said there are guarantees. Please read my first comment.

Comparing a 80 year old company production with a 14 year old company and expecting the same production power is unrealistic.

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