Elon Musk started two feuds last week, with two big adversaries. And while we’d never count the Tesla (NASDAQ: TSLA) co-founder and CEO out of a fight, only one of the battles he has picked seems to have a chance of ending well for him.
Both feuds stemmed from the Tesla earnings call last week , which Bloomberg labeled “bizarre” while calling Musk’s behavior “petulant.” It was, indeed, a jaw-dropping performance (a keyword search of the call’s transcript on the Intelligize platform revealed several odd moments). During the call, Musk attacked the press, using language some would consider unfit for his office. He ignored substantive questions and mocked establishment interviewers, while indulging at length a fringe outlet that speaks to his fanboy base. As far as we know he wasn’t wearing a smokey eye, but even so the political parallels are hard to avoid.
Musk isn’t known for subtlety, and in starting his first feud – with the press – he was characteristically blunt. Annoyed by coverage of accidents involving autonomous vehicles, Musk railed at length about “inflammatory headlines” and “misleading press” and “outrageous” journalistic practices and “incredibly irresponsible” reporters. Even before those comments, however, he had done something even more disruptive. Upending the very model of the earnings call, Musk dismissed the questions of analysts and gave the floor to the operator of a YouTube channel called HyperChange TV, whose audience consists of retail investors. Musk allowed the HyperChange TV questioner to hold the floor for 25 minutes.
The move called to mind the tactics of the Trump administration, both in its evasion of questioning by establishment media and its favoring of friendly outlets. That parallel may be slightly unfair to Galileo Russel of HyperChange TV, who asked intelligent questions about a range of subjects, which yielded news about the company. Still, the fact is that Musk was allowed to brush off pressing and legitimate questions about the need for a capital raise and pre-orders for the Model 3.
“Boring boneheaded questions are not cool,” Musk said when confronted on the former topic. “Next.” Perhaps not, but they are necessary.
“These questions are so dry. They’re killing me,” he said about the latter. And then he went to HyperChange.
In 2018, there’s an open question about whether there is any accountability to facts in politics. One could view Musk’s performance on the call as an attempt to test that question in the realm of investor relations. And if that was the experiment, it didn’t go well. Voters may be willing to put their political affiliation over facts, but when their money is at stake it seems to be a different story. During and after the call, Tesla’s stock fell by more than five percent.
Shortly thereafter, Musk appeared on Twitter to explain his “arrogant dismissals” of the analysts. Even that attempt to calm the waters flopped, as his half-hearted apology implied that he doesn’t understand the fundamental difference between short-sellers and sell-side analysts.
By Saturday, Musk was knee-deep in another feud–this one with Warren Buffet. At the Berkshire Hathaway meeting on Saturday, Buffet had taken issue with another colorful comment that Musk made on his earnings call. “I think moats are lame,” Musk said, dismissing a “key component of [Buffet’s] stock-picking prowess.” Musk went on: “They are like nice a sort of quaint, vestigal way. If your only defense against invading armies is a moat, you will not last long.”
This caused Buffet to trumpet See’s Candies, a company of his that he often cites as an example of one with a wide moat. “I don’t think he’d want to take us on in candy,” Buffet said. Musk took it as a challenge, and by Saturday afternoon was tweeting his intention to start a candy business. “I am super super serious,” he said.
Observers can only hope that he follows through and that we get to watch the larger-than-life figures square off in the relatively sleepy candy sector. Musk may not emerge victorious, but at least this fight of his will be conducted out in the open. And that is a victory of sorts in and of itself.