"There is no secret sauce in Tesla. They use the same lithium-ion batteries as everybody else."
Tesla may have just wowed the auto industry and the world again with the double debut of its Semi truck and second-generation Roadster, but not everyone is buying into the hype, specifically former General Motors VP Bob Lutz. Never one for keeping his opinions to himself, Lutz spoke to CNBC just after Elon Musk presentation and quickly put cold water on the entire Tesla business model. “The company, folks, is going out of business. At this rate they’ll never get to 2019,” Lutz said.
Lutz specifically pointed out Tesla’s out of control costs, inefficient manufacturing operation and no dealership network. Furthermore, there’s nothing that Tesla does that can’t be duplicated by other automakers. “There is no secret sauce in Tesla. They use the same lithium-ion batteries as everybody else.” Given that, Lutz believes his former employer, GM, could be at an advantage because its batteries are more capable and cost less. Yes, Tesla has better design than GM; just look at the Model 3 compared to the Bolt. Enough said. However, Lutz reminded his interviewers of GM CEO Mary Barra’s recent announcement of 20 new electric vehicles by 2023, all of which will be based an all-new platform.
The Bolt was just the start and very soon will be outdated. But Tesla, according to Lutz, whenever it finds itself hemorrhaging cash and needs a capital infusion, Musk deflects. “Never mind that. Look at the battery plant. Never mind that. Let’s go to Mars. Never mind that. Let’s tunnel under LA,” as Lutz put it. The Semi truck and new Roadster are just two more deflections that will raise badly needed cash and keep Tesla’s shareholders happy. It’s the same pattern Musk has been using for years. “Elon Musk, for many people, has become the god-like figure to replace Steve Jobs of Apple,”
Lutz continued. “I get emails saying why do you criticize Elon Musk. Don’t you understand he’s trying to save the planet? Saving the planet he may be, but meanwhile he’s running a lousy business. With Tesla, you never how much is fact and how much is fiction.”