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Tesla critic Bob Lutz vs. Elon Musk: A look back behind the bluster

Source: Revenge of the Electric Car

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In this corner, the father of the Chevrolet Volt, an auto industry veteran who has held senior positions at Chrysler, Ford and BMW, an unlikely advocate for EVs – a cigar-chomping ex-Marine who has called climate change “a crock.” Bob Lutz!

In the other corner, the mastermind of PayPal, SolarCity, and SpaceX, the archetypal Silicon Valley entrepreneur, who wants to electrify transportation and save Planet Earth – and if that doesn’t work, he’ll take us to Mars to start over. Elon Musk!

Back in the day, Bob Lutz was a champion of Tesla and Musk, citing the Roadster as a major inspiration for the Volt, and saying that he would “always owe them a debt of gratitude for having kind of broken the ice.” After Lutz left GM, he founded Via Motors, which set out to build plug-in hybrid vans and pickup trucks for commercial fleets, but has had a difficult time finding its market. The 85-year-old Lutz has written extensively about the auto industry. For whatever reason, he has evolved into a harsh critic of EVs, and especially Tesla. In 2016, he compared Musk to the leader of a religious cult. (Musk responded on Twitter, saying, “Dear cult members, I love you.”)

Lutz launched his latest salvo against the California upstarts at a forum sponsored by a provider of insurance for collectible cars, suggesting that collectors buy a Model S now before Tesla goes belly-up. He had nothing but praise for the car itself: “A Model S, especially with the performance upgrades, is one of the fastest, best handling, best braking sedans that you could buy in the world today,” he said. “The acceleration times will beat any $350,000 European exotic.”

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However, Lutz said Elon Musk “hasn’t figured out the revenues have to be greater than costs…when you are perennially running out of cash you are just not running a good automobile company. I don’t see anything on the horizon that’s going to fix that, so those of you who are interested in collector cars, may I suggest buying a Tesla Model S while they’re still available.”

Above: Bob Lutz starts to discuss Tesla and Elon Musk at the 1:06:19 mark in the video (Youtube: Hagerty via InsideEVs)

“Twenty-five years from now, [the Model S] will be remembered as the first really good-looking, fast electric car,” Lutz told the LA Times. “People will say ‘Too bad they went‎ broke.’”

This time, Musk does not appear to have responded publicly to Lutz’s zinger, but naturally, a number of his disciples have come to his defense. Enrique Dans, writing in Forbes, notes his admiration for Lutz’s writings on the auto industry, but believes that “he has missed something enormously important. In fact, possibly the most important difference between the old and the new economy: fundamentally, timeframes.”

Lutz (along with legions of stock-market analysts) sees Tesla’s ongoing losses as a sign of the company’s inevitable failure. However, according to Dans, “Seeing the bottom line as the be-all and end-all of management is problematic…The principle that revenue must exceed costs is Management 101. The tricky bit is how you define the timeframe in which that has to happen.”

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As anyone following the Tesla story knows by now, the company’s stock market valuation has no apparent connection to the number of vehicles it’s producing. Tesla’s market cap, currently around $59 billion, exceeds that of Ford, and rivals those of GM and Honda (which, interestingly, was once the subject of the same sort of criticism now leveled at Tesla). Stock-market pundits tend to see this lofty valuation as madness, proof of the irrationality of Elon Musk’s mindless minions. However, Enrique Dans finds the reason in fundamental differences in the companies’ missions, and the timeframes in which they expect to fulfill them.

If you parse the pedantic “mission statements” on the legacy automakers’ web sites, you’ll find that they basically amount to: “We want to sell cars.” Tesla’s mission statement is very different: “To accelerate the advent of sustainable transport by bringing compelling mass market electric cars to market as soon as possible.”

Tesla doesn’t just want to sell cars, it wants to change the world. This massive difference of ambition is reflected in the longer timeframe that Tesla envisions.

“In the economy Bob Lutz and other traditional car industry players understand, the goal and the metrics were clear: the quarterly results,” Dans writes. “If they were below what the analysts expected, bad; if they were higher, good. End of story. But the rules have changed…For today’s companies, profits are not the goal, they’re the cherry on the cake. Because the idea is, in the long term, to move toward an infinitely more ambitious goal, one that entails a whole new level of change. Companies that have grasped this can spend many years, even decades, without making a profit, as long as they are able to create a narrative that shows they are on the right track toward the defined goal.”

Tesla’s long road to ultimate triumph is not unprecedented – it’s a path that’s been trodden by other tech companies that set out to transform an industry. “For how many years did Amazon continue turning in negative quarterly results while its share price rose steadily?” asks Dans. “Did Jeff Bezos…supply his investors with drugs to maintain their confidence? Yes, he did, actually: a powerful substance called growth and clarity in the use of funds obtained. Amazon’s mission was never to sell stuff, but to change the world.”

Amazon is not the only example. In this age of instant communication, in which whole industries can be radically transformed, or even disappear, “reporting a profit each quarter has never been less important.”

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“If Lutz is right, if the grand plans for a new economy that will change the world are bullshit, Tesla will go bust,” Dans concedes. “But if Tesla’s plans and strategy make sense, it may well spend a long time in the red, but it will end up as the auto industry’s benchmark.”

Change is taking place ever faster, and humans’ attention spans are growing ever shorter, so it may seem counter-intuitive that the timeline for corporate success should grow longer. However, even in the fast-paced internet era, changing the world, or even one industry, can’t be done in the space of one quarter. Tesla’s mission is a risky one, but so far investors are willing to accept that risk.

Bob Lutz and Elon Musk look at the world in two different ways, and they have very different visions of the future. Which one will prove prophetic? We shall see.

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Note: Article originally published on evannex.com, by Charles Morris

Source: Forbes

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Investor's Corner

SpaceX’s biggest earnings test yet lands Tuesday, and Tesla shareholders should be watching

SpaceX reports earnings Tuesday as Wall Street watches AI spending, Starlink growth and Tesla merger

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SpaceX reports third quarter results after the market closes Tuesday, with a webcast at 4:30 p.m. ET streamed on X, and Tesla follows a day later. Bloomberg consensus, cited by Pepperstone, calls for revenue of $12.89 billion, adjusted EBITDA of $6.62 billion and adjusted EPS near $0.15. That would be about 65% growth from the second quarter and SpaceX’s first profitable quarter since its IPO. Analysts expect roughly $6.4 billion from AI and $4.9 billion from Starlink, which is projected to reach 14.3 million consumer subscribers. Capital spending is forecast at $19.6 billion, leaving free cash flow near negative $11.6 billion.

The numbers matter because SpaceX has spent months trying to win over a skeptical market. It priced its record IPO at $135, spiked to $225.64, then sank near $105 in early August. Friday’s close of $146.03 sits about 28% below the June high. The Q2 report beat on revenue at $7.8 billion and put Starlink at 12 million subscribers, but $18.4 billion of capex hurt the stock. Since then SpaceX reached orbit on Starship Flight 14 with 26 Starlink V3 satellites, agreed to buy 800 MHz spectrum for about $8 billion as part of its Starlink Mobile push, and signed a fourth compute hosting deal in four months worth roughly $13 billion a year from December. Management is targeting more than 2 gigawatts of compute by year end and a $100 billion annualized revenue run rate. Evercore ISI, which raised its target to $275, said the quarter may be judged more on those targets than the reported figures

All of this sits under the Tesla merger question. Barclays analyst Dan Levy expects an all stock deal in which SpaceX buys Tesla at a premium, using reference values of $2.1 trillion and $1.5 trillion, and said an announcement would need to come by late October or early November to be voted on at Tesla’s December 6 annual meeting. Barclays estimates Musk would hold about 37% of the combined company and 56% of the votes. Musk said in July that combining companies cannot be discussed on an earnings call, but an investor question asking when SpaceX will merge with Tesla is sitting on SpaceX’s Q&A platform, and Teslarati has tracked how the Roadster demo revived the talk.

If a deal happens, Tuesday’s result would effectively set the price Tesla holders would receive. Their shares would convert into SpaceX stock, along with exposure to a company with a heavy investment on AI, while Tesla itself expects 2026 capex above $25 billion. A strong quarter and calmer spending would make that exchange easier to sell. Another round of heavy capex and a falling stock would make it harder.

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Tesla’s flying Roadster just revealed something bigger than the car

Analysts say the Roadster demo puts a Tesla and SpaceX merger back on the table.

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Tesla’s new Roadster, upside down and trailing cold gas thruster smoke, flips over a lineup of Tesla vehicles at the Roadster unveiling near Waco, Texas on October 15, 2026. (Image: Tesla)
Tesla’s new Roadster, upside down and trailing cold gas thruster smoke, flips over a lineup of Tesla vehicles at the Roadster unveiling near Waco, Texas on October 15, 2026. (Image: Tesla)

The Roadster unveiling near Waco ended Thursday night, and by Friday morning much of the investor reaction had less to do with the car than with who owns the rocket technology inside it.

Wedbush analyst Dan Ives said the event “puts the Tesla/SpaceX relationship on the table in a tangible way,” pointing to the propulsion, pressure vessel and control hardware sitting on a Tesla product. Gene Munster of Deepwater Asset Management called the demo “a ridiculous display of engineering” with “no commercial value” beyond embarrassing traditional automakers, though he said it showed Musk wants the two companies together.

The more specific forecast came a day earlier from Barclays. Analyst Dan Levy told clients a deal could be announced before Tesla’s annual meeting, which must happen by December 6, and that an announcement in late October or early November could make shareholder approval harder. Barclays expects SpaceX to be the buyer in an all stock deal, with Tesla holders receiving SpaceX shares at a premium, based on market values of roughly $2.1 trillion for SpaceX and $1.5 trillion for Tesla. If nothing lands around the meeting, the bank still sees an announcement within 6 to 12 months.

The Roadster demo just added more weight to merger speculations. Tesla’s demo used cold gas thrusters and pressure tanks of the kind SpaceX uses on Falcon 9, and Musk described the car as a collaboration between Tesla and SpaceX engineers, as we mentioned in our breakdown of the three Roadster configurations.


Musk has not publicly addressed a deal since the event, as far as we have seen. His most direct answer remains the one he gave at the All In Summit, when he said that with so much collaboration, “who can imagine what action one might take” without ruling anything out. Ives has held to a 2027 timeline since his March note, and Musk pushed back on the China piece of the speculation when ARK floated a year end announcement in August.

The next test is Tesla’s third quarter earnings call on October 21. However, we recall in July that Musk told analysts, “we can’t talk about combining companies and that kind of thing on an earnings call,” so a clear answer wouldn’t be expected.

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Elon Musk breaks his silence on the Starlink impact to Ukraine drones

Musk says the US military and president set Starshield limits, not SpaceX, amid Ukraine complaints.

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Elon Musk says the speed limit cutting out Ukraine’s military Starlink terminals is not SpaceX’s decision. In a post on X Wednesday, Musk wrote that “Starshield systems are owned and controlled by the US government. Any limits on speed or usage are decided by the US military and ultimately POTUS.” He added that Starlink is a commercial service limited to civilian or defensive activities and “cannot be used for offensive military action, as doing so would be inappropriate for a commercial company.”

He was replying to Mykhailo Fedorov, Ukraine’s former defense minister, who had thanked Musk for restoring connectivity at speeds up to 160 km/h and said removing the Starshield limit entirely is “now critical for Ukraine’s defense.”

The complaint started Tuesday night, when Ukrainian officials said military terminals began losing service above roughly 100 mph. Presidential adviser Serhiy Beskrestnov said the defense forces got no warning and several missions were disrupted, as Teslarati reported earlier Wednesday. The 7th Rapid Reaction Corps told Reuters connections dropped for 10 to 20 seconds at speeds well below the limit, which made drones harder to control. Poland’s foreign minister, Radoslaw Sikorski, asked Musk on X whether he is “playing politics with your products again.”

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That is why the Starlink and Starshield distinction matters. SpaceX introduced Starshield in 2022 as the government version of Starlink, with an initial focus on Earth observation, communications and hosted payloads. It won a Space Force contract in 2023 with a $70 million ceiling. In December 2024, the Pentagon moved Ukraine’s terminals onto Starshield, covering about 3,000 units across two contracts. Ukraine’s military connections therefore run through a service that Musk now says sits under Washington’s control.

SpaceX pitches subscription model for Trump’s Golden Dome

While Musk’s post describes who holds authority, it does not infer that anyone ordered the limit, and neither SpaceX nor the US government has confirmed who set it. Ukrainian officials have pointed to the timing, which follows President Trump’s push for an energy ceasefire and Musk’s Saturday post that “Zelensky has gone too far.” The BBC noted Trump denied threatening to restrict intelligence sharing with Kyiv, and no evidence has been presented that Washington requested the cap.

The episode also revives a promise from 2025. After Poland accused him of threatening Ukraine’s access, Musk said Starlink “will never turn off its terminals” and would not be used as a bargaining chip. Poland has since supplied more than 29,000 terminals to Ukraine. Teslarati also covered Kyiv’s search for Starlink alternatives in 2025, and the latest dispute gives that search new urgency.

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