Elon Musk is known to have beef with a lot of people.
He says he’s not the ‘biggest fan’ of Warren Buffett
He’s blasted Mark Zuckerberg’s Meta
And he frequently pokes fun at Jeff Bezos.
Jeff who?
But one guy he really, really, really doesn’t like is Martin Eberhard, one of Tesla’s
founders.
The two have squabbled over who actually founded Tesla.
I’m not sure why he has to say he was a founder when he wasn’t, I don’t understand
that.
Yah, whatever.
And he counts himself as one of them.
Martin Eberhard and fellow engineer Mark Tarpenning incorporated Tesla Motors in 2003.
Ian Wright, JB Straubel, and Elon Musk joined later.
However, Musk believes there’s no way Tesla would have even gone into production without
him and JB Straubel, its Chief Technology Officer.
Musk pushed Eberhard out of his role as CEO and eventually, out of the company in 2007.
By then, Musk had been with Tesla for three years.
He used his earnings from PayPal to sign on as one of the first investors in Tesla in
2004 and became chairman of the board.
Why does Elon Musk despise Martin Eberhard?
He even went so far as to say: “I wish I had never met him.”
He believes Eberhard nearly drove the company into the ground when trying to produce Tesla’s
first car, the Roadster.
You can have a car that’s quick and you can have a car that’s electric.
But having one that’s both is how you can make electric cars popular.
Trouble is, Musk didn’t think Eberhard was capable of building an electric sports car.
He says Eberhard wanted to outsource car battery production to a BBQ manufacturing factory
in Thailand!
As they were having trouble finding a factory willing to produce an advanced lithium-ion
battery pack.
When a Tesla team went over to check out the factory, “Instead of a factory, they found
a concrete slab with posts holding up a roof.”
as Ashlee Vance detailed in a book about Elon Musk.
Since the Thai company couldn’t make a battery pack, it caused issues for the rest of the
supply chain.
The plan was to have the battery cells made in Japan, shipped to Thailand, where they
were turned into a battery pack, then shipped to England where a company called Lotus Engineering
would build the body of the car and attach the battery pack, before making its way to
the initial market in California.
Musk alleges Eberhard screwed up in other areas, too.
He says he outsourced the carbon fiber body panels to a company that couldn’t make them.
Carbon fiber is a special material.
It’s very strong for its very light weight.
He said the gaps between the body panels were so big you could put your thumb in between
them.
Unfortunately, I don’t have photos of the original roadster’s body panel issues but
here are photos someone posted on Twitter of a Model 3 with large gaps between the panels.
Possibly the GREATEST mistake Tesla made in the early days was deciding on the transmission
system for the Roadster.
Musk says Eberhard refused to change the motor size.
So, to achieve zero to 60 (mph) as quickly as possible WITHOUT a bigger motor, they required
a two-speed transmission rather than a single-speed one.
The first gear would take the car from zero to 60 in less than four seconds, the second
gear would take the car up to 130 mph (210 km/h).
However, the transmission couldn’t handle the jump from the first gear to the second.
Eberhard had vowed to begin shipping the Roadster in late 2007 - but there was no way that could
happen with the transmission issues.
Actually, the original plan was to deliver the car in 2006.
In the end, production for the Roadster didn’t begin until the fall of 2008.
Eberhard has responded to Musk’s criticisms.
In a message to me, he wrote: “That is of course ridiculous.
Sure, we were over-budget and behind schedule.
(Which successful startup companies were not?).
He went on to say: Since I left Tesla 14 years ago, which of Tesla's cars has been on schedule
or on budget?
How is that Cybertruck going?
In reference to Tesla’s futuristic truck.
Musk had said it would make it to market by the end of 2021 but has now been delayed until
2023.
Musk also accuses Eberhard of intentionally deceiving him about the true cost of the Roadster.
When one of Tesla’s investors sent its managing director to do an audit, they found that the
cost of producing the sports car would be $120,000 - well above the selling price of
$92,000.
Eberhard had said it would cost $65,000 to make.
Tesla had already taken deposits from hundreds of customers, promising the car would cost
less than $100,000.
Enough was enough and as the Roadster was way
over budget and late, Musk got on the phone with Eberhard, and told him the board had
decided he’d be replaced as CEO, demoting him to the role of President of Technology
in mid-2007 while keeping the same $200,000 salary he made as CEO.
Eberhard was pissed off.
And by the year’s end, he had left the company altogether.
I was voted off the island in a rather rude way.
Tesla named Michael Marks as interim CEO, followed by permanent CEO Ze’ev Drori - a
Silicon Valley semiconductor veteran - before Musk took over the top job in the fall of
2008.
Musk may have blamed Eberhard for Tesla’s troubles.
However, Eberhard has blamed Musk for the Roadster’s problems.
In this Newsweek article from 2008, Eberhard accused Musk of interfering with the design
of the car, demanding changes that were costly and led to delays.
These included installing electronic door latches, building a lightweight carbon-fiber
body, and lowering the door sill by two inches.
Musk denied that those changes were the cause of the delays and told Fortune Magazine he
was “too busy trying to fix the (bleeping) mess he (as in Eberhard) left”
In 2009, Eberhard sued Musk, alleging Musk “began a pattern of defaming and disparaging
him” in the media.
The lawsuit also states Musk “set out to rewrite history by falsely claiming that he
was the founder or creator of Tesla Motors.”
When someone on Twitter pointed out Musk was NOT the founder, Musk argued founding means
more than filing papers to start a company.
He says without him, Tesla Motors had “no employees, no IP address, no designs, no prototype,
literally nothing but a business plan”.
In its counterclaim against Eberhard, Tesla and Musk dismissed Eberhard’s lawsuit as
“nothing more than to curb open discourse on matters of importance to the public and
to extract money from Tesla….”
In the end, they agreed to a settlement.
Elon Musk, JB Straubel, and Ian Wright were allowed to call themselves co-founders alongside
Mark Tarpenning and Martin Eberhard.
Oh, and by the way, Eberhard mentioned in his lawsuit that he didn’t receive the second
Roadster Tesla ever produced as promised, which Musk sold to a friend.
The one he did finally get had been smashed into the back of a truck by an employee during
an endurance test, “almost completely totaling the vehicle”.
It was a wreck.
Perhaps a metaphor for the relationship between Musk and Eberhard.
After leaving Tesla, Eberhard briefly led Volkswagen’s EV development in the U.S.,
was the VP of Atieva which is now Lucid Motors for only six weeks, and also ran his own electric
start-up.
Now, he’s enjoying retirement.
Well, enjoying it as much as he can.
Except when Musk brings up his name.
For someone to be the worst person that I’ve ever worked with, by far, that’s not easy.
Eberhard ended his message to me by saying:
“I find it strange that Musk feels he must still spend his energy criticizing me, when
my startup company, with all its flaws, has revolutionized the entire automotive industry
and has made Musk the richest man in the world.”
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