For all his hubris, Elon Musk certainly has a noble vision for a better and cleaner world, one in which a species in peril wisely pivots before we’re all buried beneath a global Easter Island. Of course, knowing what should be isn’t the same as making it so. In trying to turn humanity away from using fossil fuels to power its shelter, transportation and commerce, Musk is trying to do on his own what would seem the heaviest lifting even for the biggest states in the world. Colonizing Mars, another of his goals, might be easier.
In an MIT Technology Review piece, Richard Martin suggests Musk may be like Tesla–the man, not the car company–dreaming too big in trying to electrify the world. Other pundits have weighed in on the other end of the spectrum and no one can truly say what the outcome will be, but Musk’s hyper-ambitious goal has always been a long shot, hasn’t it? The most positive scenario that’s also realistic might be that Musk exhorts us to turn to solar and electric, even if his own efforts fail.
Musk’s grand vision for an integrated solar-plus-electric-vehicle behemoth, meanwhile, looks increasingly like a reality distortion field. The opening of the massive solar-panel factory the company is building in Buffalo, New York, has already been pushed back to mid-2017. Some analysts have estimated that the factory is likely to lose as much as $150 million a year once it reaches full production.
What’s more, there is little indication that huge numbers of people are clamoring for the ability to equip their homes with SolarCity panels, a Tesla Powerwall battery, and a charging system for their Teslas. In short, SolarCity’s latest moves could be a signal that merging two companies with combined 2015 losses of $1.6 billion might not be such a great idea after all.
SolarCity and other rooftop solar providers rolled to early success on a river of easy money, as banks, emboldened by generous federal subsidies, showed their willingness to underwrite customer-friendly lease deals. The extension of the investment tax creditlate last year heralded a new phase of strong growth for solar power, but companies like SolarCity and SunEdison, which filed for bankruptcy in April, have had a hard time benefiting from it as their market continues to change underneath them. Mostly ignored in yesterday’s layoff news was a separate filing in which the company said it will offer up to $124 million in “solar bonds”—at terms much less favorable to the company than previous such offerings.
SolarCity’s restructuring may well be looked back on as the first wobble that presaged the collapse of Musk’s would-be electric empire.•