Elon Musk Knew Tesla Would Fail From Start: ’10% Chance Of Success’

CEO Elon Musk may be an icon as a billionaire entrepreneur and innovator.

But this “Man with the Midas touch” himself says his journey had been hard and he lacked confidence on the success of Tesla.

Today, Elon Musk net worth is astronomical. But the founder of the flagship electric vehicle company is too candid and modest when he says, “I only counted on just 10 percent of success on Tesla.”

Elon Musk’s nostalgic look back on his early days and the experience will be coming up in the Sunday podcast Ride the Lightning Tesla Motors Unofficial Podcast.

In his conversation with host Ryan McCaffrey, Musk looks back at his post-PayPal days when he floated Tesla. “I thought, we have a maybe 10% chance of success,” he reiterated.

Early struggle amidst optimism

Musk admits how skepticism would dominate his thoughts after hearing constant denigration that his electric car concept is set to collapse.

“These days people don’t remember just how foolish it seemed to make an electric car. We were just relentlessly denigrated and said that you know, we are obviously going to fail and the fact that we're doing an electric car was just stupidity squared,” Musk said on the podcast.

Musk also informs that his capital to invest in Tesla came from a portion of the $180 million he amassed selling PayPal in 2002. But the Tesla investment in 2004 catapulted him to the role of chairman as well.

SpaceX was also founded using a part of the Paypal money in 2002.

Musk said he considers it “a great honor when somebody puts in his hard-earned money to buy our car instead of somebody else’s, some other car.”

Anguish at the unrealistic negativity

On the podcast, Musk does not hide his anguish at the negativity prevailing against Tesla even after a decade.

Musk said: Mow that there are lots of electric cars, people don’t realize that this was not the case at all back in 2008, when we went into production with the Roadster, or certainly 2012 when we went into production with the Model S.”

In the program, Musk also recalls his hard labor during the ramp-up of Model 3 Tesla in October. Those days he used to work 120 hours a week just to ensure that the decisive market push for Model 3 is not failing.

“The other option would have been, Tesla dies,” Musk said and adds he will never allow that option as “Tesla cannot die.”

Tesla’s mission and future

Elon Musk sends a message that hard times are not new to Tesla and it has the resilience to surmount such challenges.

In April, Tesla reported a tough fiscal quarter with a larger-than-expected loss and less revenue. That followed Musk’s personal mail to staffers to be more conservative in cost-cutting and they can count on his direct supervision.

Musk’s vision of Tesla continues to be evergreen and asserts Tesla is indispensable for the future as a vehicle of sustainable transport and energy generation.

Meanwhile, Jim Chanos, investor, and Tesla critic slammed Musk’s management style and said despite the turmoil and missed expectations Musk will pull on and will not be ousted.

Addressing investors and business persons at a Connecticut event, Chanos, who heads the world’s largest short-selling fund, said Musk is “re-learning the hard lessons automakers in Detroit learned 100 years ago.”

“It’s one thing to manufacturing cars but Detroit learned the hard way they didn’t want to be at the nexus” of selling cars directly to consumers and they delegated that job to dealers, Chanos said.