CB Insights, a data analytics firm, has done something interesting: it used algorithmic analysis to crunch 28 quarter of earnings-call transcripts from General Motors, Ford, Daimler, and Tesla.
The firm was able to make some intriguing observations from scrutinizing calls from 2011-2017, but one result stands out: Tesla spends way more time taking about robots than other automakers.
“Tesla is the only [company] talking about using robots in the assembly line, with mentions of ‘robots’ and ‘robotics’ reaching a new peak in 2017,” CB Insights wrote in its Mobility Earnings Transcript Analysis report.
Automation has been a double-edged sword for Tesla. CEO Elon Musk has talked it up a major future differentiator, enabling Tesla to build vehicles better and faster. But in practice at the carmaker’s factories in Fremont and Nevada, it’s been a mixed bag. Some efforts at automation haven’t worked, and human workers have been added to the process to fix problems.
Musk’s “machine that builds the machine” is farther off than it might have seemed a year ago.
But why aren’t other automaker’s talking about robots?
The answer has two parts. First, Musk’s embrace of automation is consistent with Tesla’s story of disruption: in a brave new world of high-tech, Silicon Valley-inspired mobility, of course the dirty work will be done by machines.
Second, established automakers have their act together with robots and have been dealing with them for decades. They might not be trying to replace all human workers with robots — in fact, efforts to do so have been unsuccessful, and car companies have learned their lessons —but they’re familiar with what automation can achieve. So they treat it as a given. If they had to talk about it, particularly on an earnings call, it might actually be a bad thing.
The bottom line is that GM and Ford use a lot of robots to build millions of vehicles globally and have for years. But because automation, as it is currently utilized, is completely baked into their business models, it’s pointless to discuss it with Wall Street analysts. They’re more concerned about financial results.
Tesla financial results have been extremely depressing: the company has never posted an annual profit in 15 years of existence and in 2017 lost more money than ever. The balance sheet is something of a disaster. The stock price, however, is riding high, largely on the strength of a story.
Robots have been, of late, a key part of the Tesla tale. So we shouldn’t be surprised that Musk has been spending more time than anybody else telling investors about them.
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