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Elon Musk, the 21st Century Industrialist

On Fridays, Elon Musk gathers his engineers in an old hangar in Los Angeles. The building, next to a municipal airport a couple miles south of the Hollywood Park race track and casino, is now a research and development facility for Musk’s electric car company, Tesla Motors (TSLA). Musk uses these meetings to check the team’s progress and give straightforward, often withering, design critiques. During one such session in July, versions of the Model S sedan and the skeletal frame of a forthcoming sport-utility vehicle, the Model X, sit in a corner. Drivetrain prototypes lay on the concrete floor next to interior cabin mock-ups.

Musk’s staff huddles around him as he zeroes in on a sun visor. He hates it. He examines the seam and, noticing how it pushes up the fabric, declares it “fish-lipped.” The screws on the hinges feel like knives stabbing him in the eye. He announces he wants to find the best sun visor in the world, and then make a better one.

Illustration by R. Kikuo Johnson

The session continues in the parking lot, where a number of competitors’ vehicles—some hybrids, some conventional—await judgment. Musk squeezes his six-foot-two, broad-shouldered frame into the back seat of a luxury sedan from Hyundai and then into an Acura SUV. He scoffs at the cramped third-row seats in the Acura. “That’s like a midget cave,” he says, and the group chuckles on cue. “It’s good to get a sense for just how bad the other cars are.”

Last year alone, Acura’s parent company, Honda Motor (HMC), sold 200,000 hybrids. Toyota Motor (TM) sold 629,000. In nine years, Tesla has built a total of 2,450 vehicles. The auto industry may have had a rough time of late, but Tesla has had buckets of delays, quality issues, and near-death financial crises. That Musk feels no shame dismissing the efforts of vastly larger competitors would not surprise his friends and colleagues, who describe him as Steve Jobs, John D. Rockefeller, and Howard Hughes rolled into one. “He’s a throwback to when people were doing less incrementalist things,” says Peter Thiel, the tech investor who co-founded PayPal with Musk. “The companies he’s started are executing against a vision measured not in years but in decades.” Bruce Leak, a veteran Silicon Valley entrepreneur who once worked with Musk at a video game company, says, “He has that Bill Gates energy where his foot bounces and he’s wiggling just because he’s so smart.” Jon Favreau, a friend and the director of the Iron Man movies, has called Musk the basis for his version of comic book hero Tony Stark, the playboy inventor who builds a flying weaponized suit.

Musk has having a year good enough for another movie. In May, his Space Exploration Technologies, better known as SpaceX, successfully launched a 227-foot-tall rocket from a platform in Cape Canaveral, docking one of its Dragon capsules with the International Space Station, orbiting 220 miles above the earth—a feat NASA called “absolutely incredible.” Tesla, which went public in 2010, started shipping the all-electric Model S luxury sedan in June and will soon unveil a nationwide network of charging stations. SolarCity, where Musk is chairman of the board, is a player in the residential and commercial solar markets, with more than 28,000 customers, and is expected to go public imminently at a value of about $1.5 billion. Musk is chief executive officer of Tesla and SpaceX, and is the largest shareholder in all three companies. Following the SolarCity IPO, his net worth could be well north of $3 billion.

If they survive, they’ll continue to be improbable and inspiring businesses. “The next six months will be about really proving things for Tesla,” Musk says. “We need to get in excess of 20,000 units a year and in excess of 25 percent gross margins, which would be close to the highest in the car business.” SpaceX has a backlog of about $3 billion booked from spaceflight customers through 2017, but still has to successfully execute all those launches using equipment it hasn’t finished developing. Musk’s goals go well beyond cash-flow statements, however. “We don’t have sustainable energy production solved,” he says, “and we are not a multiplanetary species.”

Musk, 41, grew up in Pretoria, South Africa, during the last decades of apartheid. He was the oldest of three siblings. His father ran his own construction engineering firm, handling government and commercial projects. His mother was a dietician.


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