Elon Musk: How the Billionaire CEO of SpaceX and Tesla is Shaping our Future

by Ashlee Vance

SpaceX manufactures between 80 percent and 90 percent of its rockets, engines, electronics, and other parts. It’s a strategy that flat-out dumbfounds SpaceX’s competitors, like United Launch Alliance, or ULA, which openly brags about depending on more than 1,200 suppliers to make its end products. (ULA, a partnership between Lockheed Martin and Boeing, sees itself as an engine of job creation rather than a model of inefficiency.)

“Elon has always been optimistic,” Brogan said. “That’s the nice word. He can be a downright liar about when things need to get done. He will pick the most aggressive time schedule imaginable assuming everything goes right, and then accelerate it by assuming that everyone can work harder.”

Dealing with the epically aggressive schedules and Musk’s expectations has required SpaceX’s engineers to develop a variety of survival techniques. Musk often asks for highly detailed proposals for how projects will be accomplished. The employees have learned never to break the time needed to accomplish something down into months or weeks. Musk wants day-by-day and hour-by-hour forecasts and sometimes even minute-by-minute countdowns, and the fallout from missed schedules is severe. “You had to put in when you would go to the bathroom,” Brogan said. “I’m like, ‘Elon, sometimes people need to take a long dump.’” SpaceX’s top managers work together to, in essence, create fake schedules that they know will please Musk but that are basically impossible to achieve. This would not be such a horrible situation if the targets were kept internal. Musk, however, tends to quote these fake schedules to customers, unintentionally giving them false hope.

Where a typical manager may set the deadline for the employee, Musk guides his engineers into taking ownership of their own delivery dates. “He doesn’t say, ‘You have to do this by Friday at two P.M.,’” Brogan said. “He says, ‘I need the impossible done by Friday at two P.M. Can you do it?’ Then, when you say yes, you are not working hard because he told you to. You’re working hard for yourself. It’s a distinction you can feel. You have signed up to do your own work.”

One of my favorite things about Elon is his ability to make enormous decisions very quickly. That is still how it works today.”

One of Watson’s top discoveries at SpaceX was the test bed on the third floor of the Hawthorne factory. SpaceX has test versions of all the hardware and electronics that go into a rocket laid out on metal tables. It has in effect replicated the innards of a rocket end to end in order to run thousands of flight simulations. Someone “launches” the rocket from a computer and then every piece of mechanical and computing hardware is monitored with sensors. An engineer can tell a valve to open, then check to see if it opened, how quickly it opened, and the level of current running to it. This testing apparatus lets SpaceX engineers practice ahead of launches and figure out how they would deal with all manner of anomalies. During the actual flights, SpaceX has people in the test facility who can replicate errors seen on Falcon or Dragon and make adjustments accordingly.

SpaceX has made numerous changes on the fly with this system. In one case someone spotted an error in a software file in the hours right before a launch. SpaceX’s engineers changed the file, checked how it affected the test hardware, and, when no problems were detected, sent the file to the Falcon 9, waiting on the launchpad, all in less than thirty minutes. “NASA wasn’t used to this,” Watson said. “If something went wrong with the shuttle, everyone was just resigned to waiting three weeks before they could try and launch again.”

Acronyms Seriously Suck: There is a creeping tendency to use made up acronyms at SpaceX. Excessive use of made up acronyms is a significant impediment to communication and keeping communication good as we grow is incredibly important. Individually, a few acronyms here and there may not seem so bad, but if a thousand people are making these up, over time the result will be a huge glossary that we have to issue to new employees. No one can actually remember all these acronyms and people don’t want to seem dumb in a meeting, so they just sit there in ignorance. This is particularly tough on new employees. That needs to stop immediately or I will take drastic action—I have given enough warnings over the years. Unless an acronym is approved by me, it should not enter the SpaceX glossary. If there is an existing acronym that cannot reasonably be justified, it should be eliminated, as I have requested in the past. For example, there should be no “HTS” [horizontal test stand] or “VTS” [vertical test stand] designations for test stands. Those are particularly dumb, as they contain unnecessary words. A “stand” at our test site is obviously a *test* stand. VTS-3 is four syllables compared with “Tripod,” which is two, so the bloody acronym version actually takes longer to say than the name! The key test for an acronym is to ask whether it helps or hurts communication. An acronym that most engineers outside of SpaceX already know, such as GUI, is fine to use. It is also ok to make up a...

The guiding principle at SpaceX is to embrace your work and get stuff done. People who await guidance or detailed instructions languish. The same goes for workers who crave feedback.

“There is a fundamental problem with regulators. If a regulator agrees to change a rule and something bad happens, they could easily lose their career. Whereas if they change a rule and something good happens, they don’t even get a reward. So, it’s very asymmetric. It’s then very easy to understand why regulators resist changing the rules. It’s because there’s a big punishment on one side and no reward on the other. How would any rational person behave in such a scenario?”

“Elon is changing the way aerospace business is done,” said NASA’s Stoker. “He’s managed to keep the safety factor up while cutting costs. He’s just taken the best things from the tech industry like the open-floor office plans and having everyone talking and all this human interaction. It’s a very different way to most of the aerospace industry, which is designed to produce requirements documents and project reviews.”

“We have complete control. We have our own test site, while most of the other guys use government test sites. The labor hours are cut in half and so is the work around the materials. Four years ago, we could make two rockets a year and now we can make twenty a year.”

Just as it did in the early days, SpaceX continues to experiment with these new vehicles during actual launches in ways that other companies would dare not do.

It’s common, though, for SpaceX to test out a dozen other objectives in secret during a mission. Musk essentially asks employees to do the impossible on top of the impossible.

It’s worth pausing for a moment to meditate on what Tesla had accomplished. Musk had set out to make an electric car that did not suffer from any compromises. He did that. Then, using a form of entrepreneurial judo, he upended the decades of criticisms against electric cars. The Model S was not just the best electric car; it was best car, period, and the car people desired. America had not seen a successful car company since Chrysler emerged in 1925. Silicon Valley had done little of note in the automotive industry. Musk had never run a car factory before and was considered arrogant and amateurish by Detroit. Yet, one year after the Model S went on sale, Tesla had posted a profit, hit $562 million in quarterly revenue, raised its sales forecast, and become as valuable as Mazda Motor.

Ever since, Musk has tried to turn any snafu with a Tesla into an excuse to show off the company’s attention to service and dedication to pleasing the customer. More often than not, the strategy has worked.

“One of the things Elon pushed hard with everyone was to do as much as possible in-house,” Lloyd said. Tesla would make up for its lack of R&D money by hiring smart people who could outwork and outthink the third parties relied on by the rest of the automakers. “The mantra was that one great engineer will replace three medium ones,” Lloyd said.

In the tradition of many a Musk employee, von Holzhausen had to build his own office. He made a pilgrimage to IKEA to buy some desks and then went to an art store to get some paper and pens.

Musk wanted to make another statement with a huge touch-screen. This was years before the iPad would be released. The touch-screens that people ran into now and again at airports or shopping kiosks were for the most part terrible. But to Musk, the iPhone and all of its touch functions made it obvious that this type of technology would soon become commonplace.

As Musk dug into the situation more, he discovered that the laptop screens simply had not been tested before under the tougher automotive conditions, which included large temperature fluctuations. When Tesla performed the tests, the electronics ended up working just fine. Tesla also started working hand in hand with the Asian manufacturers to perfect their then-immature capacitive-touch technology and to find ways to hide the wiring behind the screen that made the touch technology possible. “I’m pretty sure that we ended up with the only seventeen-inch touch-screen in the world,” Musk said. “None of the computer makers or Apple had made it work yet.”

From a distance, the display model looked glamorous and refined. The media reports from the day described the car as the love child of an Aston Martin and a Maserati. In reality, the sedan barely held together. It still had the base structure of a Mercedes CLS, although no one in the press knew that, and some of the body panels and the hood were stuck to the frame with magnets. “They could just slide the hood right off,” said Bruce Leak, a Tesla owner invited to attend the event. “It wasn’t really attached. They would put it back on and try and align it to get the fit and finish right, but then someone would push on it, and it would move again. It was one of those Wizard of Oz, man behind the curtain moments.”

The Tesla team worked fast inside of a tiny lab with about 45 people knocking out 35 Rav4 test vehicles at the rate of about two cars per week.

Musk, though, approaches everything from a Platonic perspective. As he sees it, all of the design and technology choices should be directed toward the goal of making a car as close to perfect as possible.

Just as he did at SpaceX, Musk placed the desks of his engineers right on the factory floor, where they worked in an area cordoned off by rudimentary cubicle dividers. Musk had a desk in this area as well.fn10 The Model S launch event took place in a section

The first few thousand Model S cars, for example, would ship without the parking sensors and radar-assisted cruise control common on other high-end cars. “It was either hire a team of fifty people right away to make one of these things happen or implement things as best and as fast as you could,” Javidan said.

Musk pulled people from recruiting, the design studio, engineering, finance, and wherever else he could find them and ordered them to get on the phone, call people with reservations, and close deals. “If we don’t deliver these cars, we are fucked,” Musk told the employees. “So, I don’t care what job you were doing. Your new job is delivering cars.”

As the Model S fever gripped Silicon Valley, I visited Ford’s small research and development lab in Palo Alto. The head of the lab at the time was a ponytailed, sandal-wearing engineer named T. J. Giuli, who felt very jealous of Tesla. Inside of every Ford were dozens of computing systems made by different companies that all had to speak to each other and work as one. It was a mess of complexity that had evolved over time, and simplifying the situation would prove near impossible at this point, especially for a company like Ford, which needed to pump out hundreds of thousands of cars per year and could not afford to stop and reboot.

What Musk had done that the rival automakers missed or didn’t have the means to combat was turn Tesla into a lifestyle. It did not just sell someone a car. It sold them an image, a feeling they were tapping into the future, a relationship.

This means that Tesla does not develop and hold on to a bunch of new features over the course of the year and then unleash them in a new model all at once. It adds features one by one to the manufacturing line when they’re ready. Some customers may be frustrated to miss out on a feature here and there. Tesla, however, manages to deliver most of the upgrades as software updates that everyone gets, providing current Model S owners with pleasant surprises.

‘You don’t need to bring the car in,’ because it’s not true.” Tesla also has the edge of having designed so many of the key components for its cars in-house, including the software running throughout the vehicle. “If Daimler wants to change the way a gauge looks, it has to contact a supplier half a world away and then wait for a series of approvals,” Javidan said. “It would take them a year to change the way the ‘P’ on the instrument panel looks. At Tesla, if Elon decides he wants a picture of a bunny rabbit on every gauge for Easter, he can have that done in a couple of hours.”

What separated Tesla from the competition was the willingness to charge after its vision without compromise, a complete commitment to execute to Musk’s standards.

They spent two years studying solar technology and the dynamics of the business, reading research reports, interviewing people, and attending conferences along the way. It was during the Solar Power International conference that the Rive brothers really hit on what their business model might be.

What’s more, SolarCity is a key part of what can be thought of as the unified field theory of Musk. Each one of his businesses is interconnected in the short term and the long term. Tesla makes battery packs that SolarCity can then sell to end customers. SolarCity supplies Tesla’s charging stations with solar panels, helping Tesla to provide free recharging to its drivers. Newly minted Model S owners regularly opt to begin living the Musk Lifestyle and outfit their homes with solar panels. Tesla and SpaceX help each other as well. They exchange knowledge around materials, manufacturing techniques, and the intricacies of operating factories that build so much stuff from the ground up.

“There could be external factors or there could be some unexpected recall and then suddenly we need to raise money on top of dealing with that. I feel a bit like my grandmother. She lived through the Great Depression and some real hard times. Once you’ve been through that, it stays with you for a long time. I’m not sure it ever leaves really. So, I do feel joy now, but there’s still that nagging feeling that it might all go away. Even later in life when my grandmother knew there was really no possibility of her going hungry, she always had this thing about food. With Tesla, I decided to raise a huge amount of money just in case something terrible happens.”

Musk’s ultimate goal, though, remains turning humans into an interplanetary species. This may sound silly to some, but there can be no doubt that this is Musk’s raison d’être. Musk has decided that man’s survival depends on setting up another colony on another planet and that he should dedicate his life to making this happen.

think there are ways he has dramatically improved over time,” said Thiel. Most impressive to Thiel has been Musk’s ability to find bright, ambitious people and lure them to his companies. “He has the most talented people in the aerospace industry working for him, and the same case can be made for Tesla, where, if you’re a talented mechanical engineer who likes building cars, then you’re going to Tesla because it’s probably the only company in the U.S. where you can do interesting new things. Both companies were designed with this vision of motivating a critical mass of talented people to work on inspiring things.”

The rank-and-file employees tend to describe Musk in more mixed ways. They revere his drive and respect how demanding he can be. They also think he can be hard to the point of mean and come off as capricious. The employees want to be close to Musk, but they also fear that he’ll suddenly change his mind about something and that every interaction with him is an opportunity to be fired.

“Elon’s worst trait by far, in my opinion, is a complete lack of loyalty or human connection,” said one former employee. “Many of us worked tirelessly for him for years and were tossed to the curb like a piece of litter without a second thought. Maybe it was calculated to keep the rest of the workforce on their toes and scared; maybe he was just able to detach from human connection to a remarkable degree. What was clear is that people who worked for him were like ammunition: used for a specific purpose until exhausted and discarded.”

There’s a tendency, especially in Silicon Valley, to label people who are a bit different or quirky as autistic or afflicted with Asperger’s syndrome. It’s armchair psychology for conditions that can be inherently funky to diagnose or even codify. To slap this label on Musk feels ill-informed and too easy.

which have consigned man to peril that much longer. The perceived lack of emotion is a symptom of Musk sometimes feeling like he’s the only one who really grasps the urgency of his mission.

When Musk announced in 2014 that Tesla would open-source all of its patents, analysts tried to decide whether this was a publicity stunt or if it hid an ulterior motive or a catch. But the decision was a straightforward one for Musk. He wants people to make and buy electric cars. Man’s future, as he sees it, depends on this. If open-sourcing Tesla’s patents means other companies can build electric cars more easily, then that is good for mankind, and the ideas should be free.

“Elon has that deep appreciation for technology, the no-holds-barred attitude of a visionary, and that determination to go after long-term things that they both had,”

“And he has that consumer sensibility of Steve along with the ability to hire good people outside of his own comfort areas that’s more like Bill. You almost wish that Bill and Steve had a genetically engineered love child and, who knows, maybe we should genotype Elon to see if that’s what happened.”

Gates.”fn8 But the more you know about Musk, the harder it becomes to place him among his peers. Jobs is another CEO who ran two, large industry-changing companies—Apple and Pixar. But that’s where the practical similarities between the two men end.

Smil presents numerous examples of the ways in which the manufacturing industry generates major innovations and creates a massive ecosystem of jobs and technical smarts around them. “For example, when some three decades ago the United States stopped making virtually all ‘commodity’ consumer electronic devices and displays, it also lost its capacity to develop and mass-produce advanced flat screens and batteries, two classes of products that are quintessential for portable computers and cell phones and whose large-scale imports keep adding to the US trade deficit,”

“By 2010 the electronic controls for a typical sedan required more lines of software code than the instructions needed to operate the latest Boeing jetliner,” Smil wrote.

“This becomes a competitive advantage for him, too. Why would you want to work for a defense contractor when you can work for a guy who wants to go to Mars and he’s going to move heaven and earth to make it happen? You can frame a problem in a way that’s really good for the business.”

“Good ideas are always crazy until they’re not.”

“The way Elon talks about this is that you always need to start with the first principles of a problem. What are the physics of it? How much time will it take? How much will it cost? How much cheaper can I make it? There’s this level of engineering and physics that you need to make judgments about what’s possible and interesting. Elon is unusual in that he knows that, and he also knows business and organization and leadership and governmental issues.”

mean we just have a single proof point now that you can be really passionate about something that other people think is crazy and you can really succeed. And you look at it with Elon and you say, ‘Well, maybe it’s not luck. He’s done it twice. It can’t be luck totally.’ I think that means it should be repeatable in some sense. At least it’s repeatable by him. Maybe we should get him to do more things.”