I often tell the Tesla team: “It’s okay to scrap equipment or money. It’s not okay to scrap time.”347
When I was interviewing for a vice president of machining, I explained I was paying for everything at SpaceX out of pocket. I asked him, “What’s the cheapest you would work for?” He haggled, and eventually we agreed. Ten minutes later, I gave him a contract. This was a Saturday at 5:00 p.m. He started working that night.348
Q: Do you deliberately make aggressive prediction timelines to drive people to be ambitious?
For internal timelines, we set the most aggressive timelines we can. I do this because there’s a kind of “law of gaseous expansion” for schedules. Whatever time you set, it’s not going to be less than that. It’s rare that something will ever get done faster than the schedule.349
When I cite a schedule, it is actually the schedule I think is true. It’s not some fake schedule I made up. It may be delusional—that is entirely possible, and that has happened from time to time. But it’s never some knowingly fake deadline, ever.350
I want to emphasize that some dates are not dates that will actually be met. For example, the initial release date for the Model 3 at Tesla was an impossible date because there are seven thousand unique components in the Model 3, and our deadline assumed all of them would arrive on time. That won’t happen. But, it was a date for us to hold ourselves (internally) and our suppliers to.351
I do have a habit of being optimistic with schedules.352
When I give estimates about our production, it’s guesswork. Especially guesses about exponential curves. In exponential growth, the difference a year or two makes to an outcome is enormous. We got a lot of criticism for the number of cars we delivered in 2017. The area under the curve of production in 2017 was quite small because it was the beginning of an exponential ramp, but once that growth got going, the area under the curve was enormous. That’s why people were so shocked. I kept trying to say this, but people don’t understand what exponential means.353
In 2018, we doubled our global fleet, cumulatively. We made and delivered about as many cars as we had in our entire history. Most people thought it wasn’t possible. If you predicted linear growth, it wouldn’t seem possible.
But when making estimates involving exponential growth, small changes in the calendar breakpoint have enormous percentage differences in outcome. The time difference is small, but the percentage difference in the outcome is enormous.354
As far as our predictions are concerned, the media tends to report all the wrong ones and ignore all the correct ones. I’ve had a long career in multiple industries. If you list just my sins, I sound like the worst person on Earth. But if you put those in the context of what I’ve done right, it makes much more sense.
I don’t want to blow your mind, but I’m not always right.355
The longer you do anything, the more mistakes you will make, cumulatively. If you sum up just the mistakes, it sounds like I’m the worst predictor ever, which is not the case.
Some of them happen sooner or later, but they do tend to come true. It’s rare they do not come true eventually. For radical technology predictions, the point is not that it was a few years late, but that it happened at all. That’s the more important part.356
I may be a little optimistic, but I always deliver.357