Bob Lutz, the quote machine who used to be vice chairman of General Motors, seems to have changed his tune about Tesla, a company he once predicted was “headed for the graveyard.”
In an interview with CNBC last week, Lutz praised Tesla CEO Elon Musk for reining in costs and finally running the California-based automaker “like a normal business.”
“He’s reduced personnel and reduced unnecessary expenditures and has basically done what any other businessman would do in a situation where you’re selling a bunch of stuff but you’re not profitable,” Lutz said on “Squawk on the Street.”
Lutz’s comments follow a surprise third-quarter profit for Tesla, which reported 2019 global deliveries of 367,200 — hitting its target for the year. The results helped Tesla shares more than double over the past three months, making the company worth more than GM and Ford Motor Co. combined.
Lutz, who in 2018 argued that the Model 3 would never make money, said Tesla has “achieved a volume breakthrough, with the plant in China opening and selling a lot of Model 3s. … As long as they can keep that premium pricing, which is, as I say, about $33,000 over where they had originally talked about, obviously that car is going to be profitable.”
The 87-year-old also complimented Musk for toning down his boastful and often erratic behavior.
“The encouraging thing to me about Tesla,” he said, “is from Elon there is less talk, less bluster.”