Companies

Jan 12, 2018

Does Elon Musk hate free markets?

Tesla's obsession with coordinating all stages of production in-house has been trumpeted as part of its genius, but can the dream last?

Jason Murphy ā€” Journalist and economist

Jason Murphy

Journalist and economist

Elon Musk

Elon Musk, CEO of Tesla, is a peculiar billionaire. He seems to have an aversion to markets. Given the choice between buying something and making it, he chooses the latter. While other car-makers outsource, he insources.

Tesla was designed with an enormous footprint.  It built, and owns, the factory where its batteries are made. It runs its own dealer network. Because its cars are pioneering and unique it must run its own Tesla-branded fueling stations and service centres.

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4 comments

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4 thoughts on “Does Elon Musk hate free markets?

  1. Draco Houston

    “Nobel-winning economist Ronald Coase first addressed this in a 1937 paper, The Nature Of the Firm.”
    Do you mean specifically that it was the first time Ronald Coase addressed this or the first time anyone addressed this? If it is the latter you need to do more reading.

  2. AR

    He seems to be using the Richard Branson “l’etat, c’est moir” commercial model, successfully thus far.
    Clearly he has benefitted from the flood time of cheap money and it will be interesting, and heartening, if it survives the ebb.

  3. old greybearded one

    Mitsubishi among others was very strong on this idea. Japanese companies were big on quality. It was what they could do, being very short of resources. You sue the example of Apple. Now I am a long term user of their computers, and I will tell you now, the stuff that is made in China is nothing like as robust, fixable or reliable as the ones done in Malaysia, Taiwan and Singapore were. Maybe that is what Musk is thinking. Lowest price is not his first reference, working properly is.

  4. Misty Donnelly

    He’s into making money and engages wage labour to make it happen. If you care about anything more than you’ve got stars in your eyes for the rich.

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