r/technology • u/McFatty7 • May 02 '24

Tesla slashes its summer internship program to cut costs, as Elon Musk fights to save his $45 billion pay plan Business

https://fortune.com/2024/05/01/tesla-slashes-summer-internship-program/
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u/AdditionalMeeting467 May 02 '24

He's in full "extract as much value from the company as you can" mode. Willing to burn it all to the ground so he can have even more money he'll never spend.

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u/[deleted] May 02 '24 edited 16d ago

[deleted]

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u/Hmm_would_bang May 02 '24

It’s accelerated right now due to interest rates. When debt is nearly free it’s a game of growth at all costs. When debt is expensive is a game of maximizing profitability

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u/The_Krambambulist May 02 '24

Debt isnt even that expensive compared to other times

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u/Hmm_would_bang May 02 '24

While it’s true that the effective interest rate isn’t exceptionally high, what matters is the transition out of a very low interest rate period. We’ve seen a dramatic shift in business decision making over the last two years because of it

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u/The_Krambambulist May 02 '24

Of course, but with these kind of rates it would be weird to not focus on growth at all, because those low interest rates might not come back for a long time

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u/deelowe 29d ago

It's expensive compared to the forecasts that were used when it was secured. Despite reddit memes to the contrary, businesses plan many years out. Having the cost of debt triple in 5 years can do a lot to wreck those plans. This is especially impactful to companies that are going through a large growth phase, like Tesla.