Tesla is anti-fragile and virtually indestructible due to resilience from surviving past crises and holding over $40 billion in cash.

We were on the verge of bankruptcy because we did not get the cash flow we expected from the " Model 3". But we almost destroyed the company. Today we review some of the highlights, or perhaps the disappointing ones, from John McNeil's talk about the company, the series of decisions that almost destroyed it, how they made their way out of the production hell, and the lessons learned.

We made a terrible and well-known mistake with the introduction of the " Model 3". We were talking about the hell of production, but that hell was largely of our own making.

We designed the most automated production line in the history of the automotive industry , and designed it entirely digitally. We designed the machines digitally and planned the factory digitally.

We put all the automation in place before laying a single brick in the factory.

Then we went to install the machines on the factory floor, and I remember walking around the factory with Elon, and I looked at two machines and said aloud, "Oh my God." He said, "What's the matter?"

" What are you talking about?" "What's your problem?" I said, "Look at these machines." "They need to be calibrated every hour, which means that humans have to go in there with tools, and the machines are only 6 inches apart ."

"We designed this digitally, not in the real world." " And now we have to completely dismantle this thing." That was just one example of many things that went wrong on that path.

As a result, that line never entered the production phase. We were on the verge of bankruptcy because we did not get the cash flow we expected from "Model 3", and the only way to save ourselves was to go back to manual operations.

We literally built a tent outside the factory and produced the cars by hand, 100 cars a week at first, then 500 a week, and so on.

If Tesla hadn't been able to fight its way, with much blood, sweat and tears, out of the hell of production, it would have been game over. Tesla has faced crisis after crisis throughout its history.

She has always emerged from the other side and become more resilient and harder to defeat as a result.

However, today Tesla has a cash and investment portfolio exceeding $40 billion, multiple impressive businesses, and remains the only company that profitably produces electric vehicles on a large scale.

Tesla also has an amazing energy business, an amazing brand, and has launched self-driving taxis, and the Cybertruck is now being rolled out as well.

No alleged pandemic, no change in management, no political winds, nothing that can be logically predicted at this stage has the potential to destroy Tesla . It will take a decade of completely stupid decisions, one after another, accumulating and repeated mistakes, failed leadership, incompetent engineers, and stupidity at every level before the company dies.

Now, things could get very bad along the way, but Tesla at this point, unless multiple asteroids hit its factories at once, or a giant asteroid crashes in and destroys the Earth, in which case, well, there won't be anyone here to worry about Tesla going bankrupt . The company is virtually indestructible.

This was not the case before the increase in Model 3 production and the production hell; Tesla was extremely fragile. If they hadn't been able to solve this problem and build the tent, Tesla would have died in the middle of the last decade.

But now, in the mid-twenties, the probability is extremely low.

However, much of Tesla's resilience, toughness, and indestructibility— I think I've just coined a new word—comes from past traumas and near- death experiences. The fact that Tesla emerged from the other side of production hell tells you a lot about the company's ability to cope with crises and existential threats.

Those scars and those memories don't go away, making the company smarter and more resilient.

Not to mention, as I said, the pile of cash and investments that exceeds $40 billion. They didn't have anything like this in the hellish days of production.

For those who don't know, I currently own only two shares . Not two shares in terms of number, but two shares of two different companies. SpaceX and Tesla. I just realized that both companies had survived near-fatal experiences.

I am very happy that this is the case. It is better to own companies that have survived one or two existential crises rather than companies that have never been tested in the same way.

Because you know, there will definitely be a test that comes their way at some point. I would prefer to know that they passed the last two tests.

So that we can actually build an automated line that reflects reality. When we looked back and said, “ Look, we almost destroyed the company,” what would we have done differently?

We said: Automation comes last. You must master the process before automating it, otherwise you may bury yourself, and in that case we almost did.

Did anyone say mastering a process? For example, car manufacturing. You may have started without fully realizing what you were doing , and made a lot of mistakes along the way, including one that nearly killed the company by trying to over- automate the production of your first mass- produced vehicle .

But now you have resilience, the scars of experience, painful memories, lessons learned, and wisdom. It has produced approximately 10 million vehicles along the way. At each step, when there was no longer a risk of the company being completely destroyed, I became able to take a little risk and try to improve the process further: starting with the miniature "gigacasting" technology, half of the rear section, then the other half, then the entire rear section, and so on, thus embarrassing the entire automotive industry.

Now she has mastered this traditional manufacturing process and production line completely. I have innovated a lot, reduced a lot of costs, and eliminated a lot of complexity. I have improved and automated, and learned many lessons along the way .

You are now in a position to invest all that wisdom in reinventing how the vehicle is assembled, how it should be, how it will be, and how it is assembled now . You might even call it the unboxed manufacturing system .

Initially, this new system was used not in one of your existing mass-produced vehicles, but in the new dedicated robotic taxi, which you might hypothetically call a " CyberTruck".

I have a point to make here, guys. Tesla's Cybertruck is the culmination of all the life lessons this company has learned, including those mistakes made along the way that nearly ended its existence.

The risks that were taken and paid off, and the decisions that were made that were not the right decision at the time. Along the way, in addition to the scars, toughness, resilience that were built, and resourcefulness, Tesla has now become what can be described as an "anti- fragile" company.

It is extremely difficult to eradicate. They have been tested. They passed it with flying colors. This is one of those things hidden beneath the surface of the company. But in order for Tesla to draw all the lessons, gather all that has happened in the past two decades of the company’s life, and invest it in the future, specifically in “Cyber ​​Truck”, there is something now ingrained in its DNA that no one can replicate.

The cumulative lessons Tesla has learned throughout its journey as a company are invaluable, and we are about to see those lessons applied to a great extent in the future .

My new model for evaluating Tesla and SpaceX over 20 years is now also available on Patreon for subscribers at the investor level and above.