Tesla Motors CEO Elon Musk’s recent comments to a German newspaper — suggesting that Apple is the “Tesla graveyard” due to its hiring of fired Tesla employees — has struck some nerves in the U.S.
Musk dismissed claims that Apple had poached staff, telling Handelsblatt that those who couldn’t cut it at Tesla would go to work for Apple instead — and he added that he wasn’t kidding.
Musk added that he didn’t take Apple seriously as a competitor in the automobile market.
Cars are much more complex than smartphones or smartwatches, he pointed out, and it isn’t as easy as asking a supplier — such as Apple partner Foxconn — to simply build it.
Disgruntled Former Employer
Musk has been known to be fast and loose with his comments, but in this case it’s arguable that the target of his derision wasn’t so much Apple as Tesla’s former employees. That could result in blowback.
“This isn’t a smart comment to make because it is actionable,” said Rob Enderle, principal analyst at the Enderle Group.
It is never a wise move to attack ex-employees individually or even collectively in the media as it could reflect badly on the firm, he told the E-Commerce Times. In particular, a CEO who does so looks like a bully.
“In effect, you are disparaging publicly a terminated employee, and that gives them actionable grounds, particularly if the termination wasn’t by the numbers — was discriminatory,” Enderle said, noting that few minorities work in Tesla or tech in general. If the firing was “the result of some kind of illicit affair,” that also could be problematic.
Musk’s remarks also might be interpreted as suggesting that anyone who jumped ship voluntarily was in fact terminated for cause, which would be untrue.
“Were I one of those folks and a woman, I’d have a call in to Gloria Allred’s office right now,” Enderle said.
“It creates an additional problem, because Tesla has also hired a lot of Apple employees,” he pointed out, “and while Cook is too smart to say something like this about ex-Apple employees, it could be inferred. There is nothing good natured about an executive bad mouthing ex-employees.”
Riffs Between Rivals
Musk’s comments may reflect his irritation that some of Tesla’s valued employees decided to defect to a rival.
“These guys have thin skins,” said Roger Kay, principal analyst at Endpoint Technologies Associates.
“Musk seems to want to rub Apple’s nose in the idea that they are accepting his rejects, implying that they have a lower standard than he does, but I’m sure the circumstances are much less clear cut than that,” he told the E-Commerce Times, “and anyway, that’s just a megalomaniac speaking — believing that he controls the universe.”
Musk’s comments also follow a reported meeting between the companies, as well as a spate of rumors suggesting that Apple might be interested in buying Tesla.
“Google approached Tesla as an acquisition, and Musk said no,” noted Enderle.
Musk’s comments may reflect his belief that a merger isn’t in his company’s best interests. On the other hand, Apple may be less interested than rumors have suggested.
Tesla no doubt has learned a lot along the way to becoming the first successful electric car maker, said Susan Schreiner, senior analyst for C4 Trends.
“There are lessons learned in being the first, such as the logistics and operations, as well as the whole gamut of creating a car,” she told the E-Commerce Times.
However, the first one to enter the race may not be the winner, Schreiner added.
Long Road Ahead
As history has proven, Apple is one of the few companies that can enter an existing market and dominate it. It succeeded by building not only a product, but also an ecosystem.
“They introduced products that are easy and seamless,” said Schreiner.
Automobiles aren’t exactly tied to one system, but in Apple’s case, it “might be a different kind of ecosystem,” she added.
This is just the beginning, and perhaps down the road Apple and Tesla could end up as partners, said Shreiner.
That’s not likely to happen, according to Endpoint’s Kay.
Musk is “too independent to join a cult, unless it’s his own,” he said. “Maybe after they figure out that they can’t build a car, [Apple will] buy his company to make a second run at it.”
For now, “the numbers just don’t work for Apple, so a merger is unlikely, and with comments like this a merger drifts closer to impossible,” observed Enderle. “Cook is protective of his people, and attacking them would be one clear way to really piss him off personally. Never wise to do that with someone that powerful.”
Neither Tesla nor Apple responded to our request to comment for this story.