Elon Musk: Gas should cost $10 per gallon

The Tesla Motors founder sounded off at the Wired Business Conference as to why he thinks the Prius isn't good enough, why auto CEOs shouldn't be finance guys, and that he wants to get a bigger toehold in Detroit.

NEW YORK--"I'm anti-tax, but I'm pro-carbon tax," Tesla Motors founder Elon Musk said onstage at the Wired Business Conference here Monday--a remark that prompted interviewer and Wired editor-in-chief Chris Anderson to quip that he was a "true Silicon Valley libertarian."

Tesla Motors Chairman and CEO Elon Musk Tesla Motors

Gasoline "should probably be $10" per gallon, said onetime PayPal co-founder Musk, who is also attempting to make sending satellites into space cheaper with a start-up called SpaceX . "I'm not paying for the true cost of gasoline at the pump...since nobody's explicitly paying for the CO2 capacity of the oceans and atmospheres, it's getting consumed. We will pay for it down the road, but we are sort of ignoring it for now."

Musk's company has put out the Tesla Roadster, a pricey sports car that runs exclusively on electric power. On the way is the Model S, a more affordable sedan. Separate from the technology, Tesla has gained a reputation for financial difficulties and corporate bickering. Earlier this month, former CEO Martin Eberhard sued Musk and the company for libel and breach of contract .

Musk's rash attitude and devotion to cutting-edge innovation has constructed him as a figure less than willing to compromise. He didn't sound too satisfied, for example, with the level of innovation in the Toyota Prius, the car that is practically synonymous with environmental consciousness in the auto industry.

"A Prius is not a true hybrid, really," he said. (A plug-in Prius is on the way.) "The current Prius is like, 2 percent electric. It's a gasoline car with slightly better mileage."

That said, Tesla shines quite a bit brighter due to the utter disarray of the U.S. auto industry, with major automakers falling into bankruptcy and Detroit in a continuing downward spiral. This, according to Musk, was the inevitable result of a completely broken system.

"Great companies are built on great products," he said, and when those products take a turn for the worse, so does the company. Automakers, Musk theorized, focused too much on the money rather than innovation. "The path to the CEO's office should not be through the CFO's office, and it should not be through the marketing department. It needs to be through engineering and design."

Musk said that unions weren't inherently the problem but the way that they were structured was. "It's not out of the question to have unions. But if they do have a union, they've got to understand that they're on the same side of the company," Musk said. "I really am kind of against having a two-class system where you've got the workers and the management sort of like the nobles and peasants." In other words, Musk thinks Detroit could use a dose of Silicon Valley corporate culture.

Surprisingly, Musk implied that Detroit will survive. "I think it'll probably be a healthier place. This has been somewhat cathartic. Maybe, I think, maybe I'm being overly optimistic, but I think this will be a cathartic experience," Musk said. "I think GM and Ford, maybe not Chrysler, but GM and Ford will come out of this healthier...and more competitive."

He wants Tesla to be part of that, obviously.

"I'd like to take up some of the manufacturing plants," he said. "When the mess gets sorted out I'd like to have a conversation with whoever's in charge."

 

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