Inside Elon Musk's $1.4B Score

Terry Olaes

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Fortune just put up an article that takes a good look at how Tesla's CEO Elon Musk convinced Nevada to pony up $1.4B in exchange for a massive battery plant. Check out all the wheelin' and dealin' that happened.

Still, the victory came at an eye-popping price, generating criticism in the press. Nevada is paying more than $200,000 for each of the 6,500 direct jobs the gigafactory is supposed to create. “I read Nevada’s incentive package,” says former New Mexico Gov. Bill Richardson, who negotiated with Tesla for its first assembly plant. “They literally handed over Reno and Las Vegas, lock, stock, and barrel.” Richardson is quick to add, in a rueful comment that captures the bind that states find themselves in, “I probably would’ve done the same thing as Governor Sandoval. It’s a lot of jobs in a recessionary period. You create a new kind of economy in your state.”
 

goodcooper

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USED to be?

awwwwwww vandy's back


also, this is a pretty big gamble for the state, but honestly, tesla seems to be a pretty good bet these days
 

OlIv0rIolI

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well that's cronyism at its finest, when big government and big corporations are married to each other.
 

dbu8554

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Honestly we need more stuff like this in Nevada especially in the Reno area, we are way too dependent on tourism.
 

Korrd

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I don't understand why people are having such trouble understanding this. Nevada isn't paying $1.4 billion. These are tax credits and discounts. It's money they're temporarily opting not to collect from Tesla in order to entice them to build in the state. This costs Nevada precisely nothing.

The tesla car is a massive failure and con
Please, please, I would so love for you to explain this. I'll wait.
 

Grahamkracka

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I don't understand why people are having such trouble understanding this. Nevada isn't paying $1.4 billion. These are tax credits and discounts. It's money they're temporarily opting not to collect from Tesla in order to entice them to build in the state. This costs Nevada precisely nothing.

Money lost is money paid. Just because it's not something they wouldn't have collected without Tesla doesn't mean it's not effectively a payment. Tesla is reaping a $1.4 Billion benefit to their bottom line...call it whatever you want, but that's a payment. Now, I'm not saying this is a bad thing. It can definitely be a good thing for Nevada and Tesla if things go smoothly.
 

jeremyshaw

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No money movement = no transaction = no " payment."

Nevada won't gain an additional $1.4 billion in taxes. They aren't paying Tesla anything.
 

CreepyUncleGoogle

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The tesla car is a massive failure and con

Well, that's pretty much a given with Elmo Monkey involved in it. I mean seriously, hyperloop, satellites giving out free internets? He's such a creeper, but for everyone who has figured that out, there'll be worshippers and followers who wanna believe too.
 

Korrd

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...call it whatever you want, but that's a payment.

So Nevada not giving Tesla money is the same as paying them? That's some creative redefinition you've got there. But no, it is most certainly not a payment. It is also not money lost, since it's money that Nevada wouldn't have collected anyway without a brand new factory.

Once again, this costs Nevada nothing. In fact, Nevada earns a significant sum.

Well, that's pretty much a given with Elmo Monkey involved in it. I mean seriously, hyperloop, satellites giving out free internets? He's such a creeper, but for everyone who has figured that out, there'll be worshippers and followers who wanna believe too.

Right, so the ideas he's proposed but hasn't yet pursued count against him, but his established and successful electric car and space launch companies don't count as accolades? Such objectivity. I am in awe.
 

CreepyUncleGoogle

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Right, so the ideas he's proposed but hasn't yet pursued count against him, but his established and successful electric car and space launch companies don't count as accolades? Such objectivity. I am in awe.

Well, I was trying to avoid including bursting into flames while plugged into the wall and bursting into flames on a launch pad as considerations of success in Elmo's World, but yeah, let's factor those in as well for the sake of argument.
 

Korrd

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Well, I was trying to avoid including bursting into flames while plugged into the wall and bursting into flames on a launch pad as considerations of success in Elmo's World, but yeah, let's factor those in as well for the sake of argument.

As I recall there were, what... two fires? I'm not sure what came of the investigations into each, but they certainly don't seem to have affected the success of the company. I guess you're using something other than sales, revenue, stock value, etc., as a measure of success. I guess you'll have to define our metrics.

I also don't know what launch pad incident you're referring to. Are you maybe confusing SpaceX with Orbital Sciences? But again, even a failed commercial launch (which SpaceX hasn't experienced) wouldn't make the company unsuccessful. Different metrics again here, I'm guessing.
 

CreepyUncleGoogle

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As I recall there were, what... two fires? I'm not sure what came of the investigations into each, but they certainly don't seem to have affected the success of the company. I guess you're using something other than sales, revenue, stock value, etc., as a measure of success. I guess you'll have to define our metrics.

I also don't know what launch pad incident you're referring to. Are you maybe confusing SpaceX with Orbital Sciences? But again, even a failed commercial launch (which SpaceX hasn't experienced) wouldn't make the company unsuccessful. Different metrics again here, I'm guessing.

Yeah, you're not very well informed about either Tesla or SpaceX. But I don't think there's much discussion to be had even if you did know what you were talking about since you measure investment value over human life to determine success to form the basis of an Elmo-like.
 

Korrd

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Yeah, you're not very well informed about either Tesla or SpaceX. But I don't think there's much discussion to be had even if you did know what you were talking about since you measure investment value over human life to determine success to form the basis of an Elmo-like.

I'm asking you for specific information about your claims (like how you just implied there's been loss of life that I'm now marginalizing). If you can't even provide a source, then you're right and there isn't anything else to discuss, unless you want to talk about tinfoil hats as fashion accessories.
 

CreepyUncleGoogle

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I'm asking you for specific information about your claims (like how you just implied there's been loss of life that I'm now marginalizing). If you can't even provide a source, then you're right and there isn't anything else to discuss, unless you want to talk about tinfoil hats as fashion accessories.

Point out where in your commentary prior to this post where you asked for source citation. Oh wait, you didn't until it became useful as a tool to further an argument on a faltering foundation of non-information. I'm honestly kinda surprised that you'd even try that since it's not like you can go edit it into a previous post and claim that it was there all along.

Also, just wow, you can't even go do a teeny, tiny bit of reading on your own. It's no wonder you have no idea at all what those two companies have been doing. Who needs tinfoil when there's so much sand around your head, Mister Ostrich.
 

Draax

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Point out where in your commentary prior to this post where you asked for source citation. Oh wait, you didn't until it became useful as a tool to further an argument on a faltering foundation of non-information. I'm honestly kinda surprised that you'd even try that since it's not like you can go edit it into a previous post and claim that it was there all along.

Also, just wow, you can't even go do a teeny, tiny bit of reading on your own. It's no wonder you have no idea at all what those two companies have been doing. Who needs tinfoil when there's so much sand around your head, Mister Ostrich.

The previous poster is simply asking for you to back up your previous claims and is doing so in a mature manner. Your posts, on the other hand, are full of ad hominem personal attacks and very juvenile name calling, which I think speaks volumes about your character and credibility.
 

Korrd

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Also, just wow, you can't even go do a teeny, tiny bit of reading on your own. It's no wonder you have no idea at all what those two companies have been doing. Who needs tinfoil when there's so much sand around your head, Mister Ostrich.

Point me in the right direction. Just a little help, that's all I ask. I follow SpaceX pretty closely, so I'm honestly surprised by your accusation of launch failure(s). Tesla I follow less closely, but even there what I have read doesn't seem to back up the apparent insinuation of systemic design flaws (IIRC, one incident occurred when the vehicle wasn't even plugged in, and in another the only damage was to the cord at the wall). You've also seemingly implied loss of life due to one or both companies. In any case, even providing evidence for your claims, the success of the companies in question is unchanged, which brings us back to the--again apparent--initial accusation of presumed failure of any endeavor "with Elmo Monkey involved in it".

Generally, the burden of proof rests upon the individual making the claim. Since you've made several, all I've asked is that you link me to a source that establishes a factual basis for those claims. I'm perfectly willing to do that "tiny bit of reading" on my own, but I don't even know what specific claims you're actually making, thus my request for clarity. If you're not willing to unpack it any further, I'll fully understand and we can move on before we run the risk of having a meaningful exchange.
 

CreepyUncleGoogle

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Point me in the right direction. Just a little help, that's all I ask. I follow SpaceX pretty closely, so I'm honestly surprised by your accusation of launch failure(s). Tesla I follow less closely, but even there what I have read doesn't seem to back up the apparent insinuation of systemic design flaws (IIRC, one incident occurred when the vehicle wasn't even plugged in, and in another the only damage was to the cord at the wall). You've also seemingly implied loss of life due to one or both companies. In any case, even providing evidence for your claims, the success of the companies in question is unchanged, which brings us back to the--again apparent--initial accusation of presumed failure of any endeavor "with Elmo Monkey involved in it".

Generally, the burden of proof rests upon the individual making the claim. Since you've made several, all I've asked is that you link me to a source that establishes a factual basis for those claims. I'm perfectly willing to do that "tiny bit of reading" on my own, but I don't even know what specific claims you're actually making, thus my request for clarity. If you're not willing to unpack it any further, I'll fully understand and we can move on before we run the risk of having a meaningful exchange.

Since you don't apparently read any [H] news:

http://www.hardocp.com/news/2013/10/03/tesla_model_s_aces_safety_tests_but_catches_on_fire/

http://www.hardocp.com/news/2014/07/09/lapd_stolen_tesla_involved_in_police_chase_splits_half/

http://www.hardocp.com/news/2013/11/07/tesla_third_model_s_fire_in_past_two_months

http://hardocp.com/news/2014/03/28/dont_want_to_burn_death_edition

And the most recent SpaceX failure

http://www.hardocp.com/news/2014/08/23/spacex_falcon_9_rocket_explodes_midflight_during_test/
 

CreepyUncleGoogle

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The previous poster is simply asking for you to back up your previous claims and is doing so in a mature manner. Your posts, on the other hand, are full of ad hominem personal attacks and very juvenile name calling, which I think speaks volumes about your character and credibility.

Oh, yes, there's nothing credible about my claims of cars or rockets cating on fire. :)
 

acidrain97

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We'll see how this whole thing works out.. I live in Reno. Please stay far away from this dump as you can... Just a word of advice...
 

Korrd

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Since you don't apparently read any [H] news:

Well, at least I wasn't surprised by any new information. ;) But excellent, thank you. Of course I'm familiar with each of these stories. At the risk of summarizing each article, let's address each one in turn, since our reading comprehension seems to differ.

1) A traffic incident in which the vehicle struck a large metal object that impaled the battery compartment. Despite that damage, during the fire the passenger compartment remained unscathed and the driver was unharmed. Not content with having the highest rated car ever, Tesla added additional safety features after this incident. Still the safest car, still a successful company. No casualties.

2) Someone steals a car, engages police in a highspeed chase, and crashes. I don't know what this proves. Tesla didn't make an indestructible car? Does that somehow demonstrate negligence? At any rate, still the safest car, still a successful company. Injuries caused by reckless driving. Elon Musk is a monster for allowing it to happen.

3) Are you actually reading these? Driver collides with a trailer hitch, battery fire. That upgraded shield from the October incident wasn't in play yet, but along with that Tesla adjusted the suspension of the Model S to ride higher and further reduce the risk. And per the article, compare these incidents with 250,000 other vehicle fires, 400 deaths, and 1200 serious injuries from other makes. Safe, successful, no injuries. This is getting boring.

4) Uh... this was an update about the upgraded shield in response to the above incidents. I don't know what you're trying to say with this one. Safer, successful, no injuries. Bad Telsa! BAD!

5) I'm going to assume that when you wrote "bursting into flames on a launch pad" you meant it figuratively. At any rate, yes, a rocket was destroyed. Then again, it was a test vehicle that was putting new equipment through its paces and being pushed to its limits. This is what test vehicles do. And yes, sometimes things break. That's why they're being tested. This is how we make progress; we make things, then we break them in order to make them better next time. Here, a test rocket provided valuable data that will be used in the future vehicles. Did you bother to read up on what actually happened and what was learned from it? That's far more interesting than what you seem to have taken away.

Tesla and SpaceX are both successful companies, despite your claim that anything involving Elon Musk is "a massive failure and con" (ala Saito). Tesla cars do not have a proven history of "bursting into flames while plugged into the wall", nor do SpaceX rockets have an established pattern of "bursting into flames on a launch pad". Your accusation that because I questioned you I am "not very well informed about either Tesla or SpaceX" and "have no idea at all what those two companies have been doing" are also without merit, since you yourself seem to be misinformed about several key details.

And no, I don't "measure investment value over human life to determine success". Meanwhile, you never did answer the question: what criteria are you using?

I apologize to everyone for the length of this post, I just get a little pissy about unfounded and unqualified opinions that condemn people who think outside the box. It's called innovation. Maybe there'd be more of it if people didn't get shit on so often for trying it.

I'll show myself the door.
 

Grahamkracka

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No money movement = no transaction = no " payment."

Nevada won't gain an additional $1.4 billion in taxes. They aren't paying Tesla anything.

That's like saying whenever you rent out a room in your house and someone moves in for free that you aren't in effect "paying" the new occupant. You wouldn't have gotten money in he/she weren't there, but now that they are...it provides a direct benefit to them by staying there rent free and you are out of that rent money.
 

Grahamkracka

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Well, at least I wasn't surprised by any new information. ;) But excellent, thank you. Of course I'm familiar with each of these stories. At the risk of summarizing each article, let's address each one in turn, since our reading comprehension seems to differ.

1) A traffic incident in which the vehicle struck a large metal object that impaled the battery compartment. Despite that damage, during the fire the passenger compartment remained unscathed and the driver was unharmed. Not content with having the highest rated car ever, Tesla added additional safety features after this incident. Still the safest car, still a successful company. No casualties.

2) Someone steals a car, engages police in a highspeed chase, and crashes. I don't know what this proves. Tesla didn't make an indestructible car? Does that somehow demonstrate negligence? At any rate, still the safest car, still a successful company. Injuries caused by reckless driving. Elon Musk is a monster for allowing it to happen.

3) Are you actually reading these? Driver collides with a trailer hitch, battery fire. That upgraded shield from the October incident wasn't in play yet, but along with that Tesla adjusted the suspension of the Model S to ride higher and further reduce the risk. And per the article, compare these incidents with 250,000 other vehicle fires, 400 deaths, and 1200 serious injuries from other makes. Safe, successful, no injuries. This is getting boring.

4) Uh... this was an update about the upgraded shield in response to the above incidents. I don't know what you're trying to say with this one. Safer, successful, no injuries. Bad Telsa! BAD!

5) I'm going to assume that when you wrote "bursting into flames on a launch pad" you meant it figuratively. At any rate, yes, a rocket was destroyed. Then again, it was a test vehicle that was putting new equipment through its paces and being pushed to its limits. This is what test vehicles do. And yes, sometimes things break. That's why they're being tested. This is how we make progress; we make things, then we break them in order to make them better next time. Here, a test rocket provided valuable data that will be used in the future vehicles. Did you bother to read up on what actually happened and what was learned from it? That's far more interesting than what you seem to have taken away.

Tesla and SpaceX are both successful companies, despite your claim that anything involving Elon Musk is "a massive failure and con" (ala Saito). Tesla cars do not have a proven history of "bursting into flames while plugged into the wall", nor do SpaceX rockets have an established pattern of "bursting into flames on a launch pad". Your accusation that because I questioned you I am "not very well informed about either Tesla or SpaceX" and "have no idea at all what those two companies have been doing" are also without merit, since you yourself seem to be misinformed about several key details.

And no, I don't "measure investment value over human life to determine success". Meanwhile, you never did answer the question: what criteria are you using?

I apologize to everyone for the length of this post, I just get a little pissy about unfounded and unqualified opinions that condemn people who think outside the box. It's called innovation. Maybe there'd be more of it if people didn't get shit on so often for trying it.

I'll show myself the door.

The guy is a anti-Tesla/SpaceX troll. Just ignore it.
 

FiveFig

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That's like saying whenever you rent out a room in your house and someone moves in for free that you aren't in effect "paying" the new occupant. You wouldn't have gotten money in he/she weren't there, but now that they are...it provides a direct benefit to them by staying there rent free and you are out of that rent money.

Not even close my friend.
In your analogy that 'room' is a current income generation device with investment money already allocated (building the house, painting, etc...); Because the investment was already made, it could easily be 'rented' by anyone any second and generate revenue.

Tesla, on the other hand, is more akin to a farmer with a couple hundred extra acres of desert land doing nothing but letting nature take it's course; While deciding to NOT charge a business taxes to build on his land (but only for the first 3 years, after that it's rent time bitches!!!) Because the farmer knows every new worker is another hungry mouth he can feed with his crops, and will end up making MORE money by NOT charging land use. After a couple years of good business, he can start charging rent/tax/etc because the economy has grown due to his vision of the future and lack of instant greedification.
 

TwistedAegis

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I like Tesla, but not the biggest fan of current corporation shopping around for tax incentives. Giant, cash-fat corporations wandering around with bundles of cash, letting cash-poor gov'ts sniff at it, then letting the beggars fight among one another, with the "winner" getting barely anything.

The problem is that, once the taxes then are supposed to hit, the company then threatens to move elsewhere, and the supposed future revenue never shows up.
 

McFry

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Oh, yes, there's nothing credible about my claims of cars or rockets cating on fire. :)

What exactly is your argument here? That because there were a few accidents during the development of new technology we should....abandon it completely?
 

TwistedAegis

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Please stop. While CUG isn't always trolling, most of you have been here long enough that it should be obvious when she is, and Tesla is definitely a subject where this conversation isn't going anywhere.
 

Parja

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Plus there's...

All the subsidies would start kicking in after Tesla hit targets for job creation and investment.

So beyond the relatively small initial investment, not a whole lot for Nevada to lose since Tesla has to meet some targets before the real subsidies kick in.
 

Jagger100

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His plan goes well beyond Tesla's volume. He's using his 'persona' and 'fanboy-dom' to gain anti-competative advantage over rival battery makers via government subsidies and exemptions. Most of which are those that advanced the technology he is using and are struggling due to slower than expected growth.

Must be nice when the government helps you take over an industrial sector. Boy must know how to give plump kick-backs.
 

Parja

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His plan goes well beyond Tesla's volume. He's using his 'persona' and 'fanboy-dom' to gain anti-competative advantage over rival battery makers via government subsidies and exemptions. Most of which are those that advanced the technology he is using and are struggling due to slower than expected growth.

Must be nice when the government helps you take over an industrial sector. Boy must know how to give plump kick-backs.

He's not doing anything any other large corporation doesn't have the power to do. The major automakers have had plenty of time and opportunity to advance battery technology and simply haven't. Going all in on this is a huge gamble for Tesla, and if even moderately successful, will pay back huge dividends for Nevada for minimal real investment.
 

Jagger100

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He's not doing anything any other large corporation doesn't have the power to do. The major automakers have had plenty of time and opportunity to advance battery technology and simply haven't. Going all in on this is a huge gamble for Tesla, and if even moderately successful, will pay back huge dividends for Nevada for minimal real investment.

Actually this is quite untrue. His technology is basically built on other automakers efforts as a starting point. Anything else is your fanboy fantasy. The other automakers just aren't good showmen in comparison and don't have fanboys in the media ready to erupt at anything they do..
 

CreepyUncleGoogle

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Please stop. While CUG isn't always trolling, most of you have been here long enough that it should be obvious when she is, and Tesla is definitely a subject where this conversation isn't going anywhere.

I'm _never_ trolling.

(Now stop telling people or you'll ruin it for both of us! :p)
 

FiveFig

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For all the Government [H]ate that goes around you would think people would be happy for Musky "sticking it to the man" for that much.

Apparently all the jobs it will create and other industry jobs it will support and boost mean nothing if he's not giving $$$ to the government to redistribute into ''free'' healthcare, food stamps, free phones, etc...

Oh the entitlement and jealousy...If you aren't directly gaining something for nothing then ''fuck everyone else, screw it all to hell!!!'' amirite?
 

Parja

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Actually this is quite untrue.

I'd like to know, specifically, what part(s) of my post is untrue.

His technology is basically built on other automakers efforts as a starting point.

Tesla's battery packs use about 6000-8000 of these. I'd like see your information regarding how other automakers have significantly helped advance that technology.
 
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