Elon Musk is heading for a crash. It’s only a matter of time before one or another of his random enthusiasms brings him down. But if I had the power, I would guarantee him at least two more years of solvency before he loses control of his companies, his great wealth, and possibly even his freedom.
My apparent sympathy for Musk gets me a lot of flak from my wife, one of my sons, and most of my friends, who cannot wait to see him go under. He is so arrogant, so erratic and so wrong-headed in his politics (he must still be reading Ayn Rand) that his downfall will give great pleasure to millions.
And the downfall is almost certainly coming soon. As the entrepreneur and professor Scott Galloway recently remarked: “No company with over $1bn in revenue has ever lost 60 per cent of its revenues in a 12-month period, in a non-war period.,,,Twitter is literally the worst-performing business in history.” (Like many people, he’s still reluctant to call it X.)
The whole X debacle demonstrates the rapid decline in Musk’s business acumen. He offered far too much to buy Twitter, the delighted owners immediately accepted, Musk tried to back out, the courts forced him to go through with the deal, and he ended up owning a slowly declining business that he then put into a nose-dive.
As any 10-year-old could have told him, if he effectively abandoned serious monitoring and opened Twitter/X to every hate-filled ranter with some lies to peddle, the advertisers who are the real source of his cash flow will take their distance from his site.
But Musk told the advertisers to “go f*** yourself” if they didn’t want to advertise on his platform, so almost all his big accounts pulled out. Now, less than a year later, he is suing those same advertisers for not advertising on his platform. Good luck with that one.
In the meantime, Musk seems to be covering X’s losses by pulling money out of his most successful business, Tesla. He’s so rich that this can go on for a long time (unless Tesla’s shareholders revolt), but it’s definitely not good practice.
Why is he behaving like this? ‘Megalomania’ is not a precise term in psychology, but it usually gets worse with time and he certainly fits that pattern. Another informal term that probably applies to him is ‘on the spectrum’. While that can actually be an asset in some business contexts, it is not playing well for him.
So why should we care what happens to Musk?
The world owes him some gratitude for pioneering electric cars when nobody else was really working at it (and he did it specifically to alleviate the climate crisis), but if Tesla failed now other electric vehicle manufacturers would quickly fill the market gap. However, he still has another job to do, and if he’s not available it may not happen at all.
The fifth iteration of his giant ‘Starship’ heavy lift rocket will fly this month or next, and with every iteration it gets a bit closer to delivering the kind of performance that will transform space flight.
Every flight so far has crashed into the sea, but that’s the development method Musk uses: launch it, find out what made it fail, fix it, and launch again. It will probably take about another five flights before he gets it all right, so that’s around a year. Then another year of many flawless launches and landings before it is certified for manned flight.
And then Musk ceases to be the indispensable man. Nobody else has had the will, the skill and the money to make this thing happen, but once it is certified anybody can manage the exploitation of the reusable Starship/heavy booster combination. That will open up the entire solar system for human beings.
Reducing the cost of getting a kilogram into orbit by 99 per cent, which is the plausible claim he makes for Starship, is not an improvement. It’s a revolution. But if Musk goes bankrupt and SpaceX also gets tied up in the courts for many years – as it is increasingly possible to imagine – then the whole thing could go down the drain.
If you don’t care about the human race getting out into the universe, or at least into our own wider neighbourhood, then go ahead and hate Musk. But if you do care, then acknowledge that Musk needs two more years to make that future possible, and ask whatever gods may be to grant him that time.
Gwynne Dyer’s new book is Intervention Earth: Life-Saving Ideas from the World’s Climate Engineers
