How Musk Disrupted Two of the Toughest Industries on Earth

There's been big news in tech lately: Tesla and SpaceX chief Elon Musk had agreed to buy Twitter, the world's second-largest social network — a deal he announced, naturally, on Twitter itself. Then, as market conditions turned sour, he tried to walk away from it, and Twitter promptly sued him, as you'd expect. The courtroom drama that followed should rival the Johnny Depp–Amber Heard trial of the century.

There's no shortage of hot takes and inspirational fluff about Musk's strategies out there — after all, he's the man who reshaped both the electric-vehicle and rocket industries. He also carries built-in celebrity wattage; even a flamethrower he built as a side project sold $10 million worth. There's practically no end to what's been written about him. So let's focus on a topic that gets less airtime: Musk's real talent is making outlandish promises — sure, the Twitter deal fell through — and then largely delivering world-changing products anyway. How does he actually pull it off?

Musk happened to pick two of the hardest industries to manufacture in — which is exactly why neither had seen a real breakthrough in decades. Cars have an inherent problem: they're made of an enormous number of parts, and even tiny, invisible variances in a single component compound once everything is assembled, potentially snowballing into major defects. That's where those mysterious rattles in a lemon come from. Rockets have the same issue, except worse — one faulty part can blow up the entire vehicle. It's like beating Super Mario with a single life: not impossible, just brutally hard.

Building a Good Car Is Easy. Making It Affordable Is Hard

That's why the global auto industry has been consolidating: high quality, high efficiency, and relative affordability pull against each other, and reconciling them takes enormous resources. Building a good car isn't hard — making one that everyone can afford is. That's precisely what industry icons Ford and Toyota managed to do, fusing mass production, cost control, and high quality into one system, like juggling three balls and somehow keeping all of them in the air. Ever since Henry Ford, just nailing production has been grueling work for the auto industry.

Back to Musk: his thinking on rockets and EVs followed the same arc. He initially assumed his design chops were so far ahead of the field that he could just buy off-the-shelf parts, bolt them together, and ship. He soon discovered that was completely unrealistic. Cost was the first problem — incumbents had been manufacturing for decades, and trying to catch up using their suppliers' parts was a losing race. The cars would end up too expensive for anyone to buy, the rockets too expensive to find customers. Starting from scratch was the only path to success.

So in the end he essentially ran the Apple playbook: build your own car body, your own rocket engines, your own driving system — keep most of the core functions in-house.

This approach was enormously risky. Twice — once in 2008, once in 2013 — his companies came within a hair of collapsing outright. His ventures also had a habit of hitting crises in tandem: test rockets would blow up for no apparent reason, torching whatever cash he had left. But each time, something close to a miracle intervened — a final test launch would succeed and land a contract, or EV pre-orders would inexplicably surge — and he'd scrape through the cash crunch once again.

Rebuilding Everything From Scratch — Overturning a Century of Industry Standards

As it turned out, the do-everything-yourself strategy worked. Nearly every part of the process that could go wrong, did — and if he'd had to wait on suppliers to fix things, the pace of improvement would have been glacial, and given his precarious finances, the company would have folded long before then. Because Tesla had no track record, many of its early specs were flawed and hadn't accounted for manufacturing feasibility, so Musk borrowed the software industry's playbook of rapid iteration: fix what breaks, ship, repeat. Through an endless cycle of production failures and fixes, cars finally started rolling off the line. Because the iteration cycle was so fast, Tesla's specs kept leapfrogging the rest of the industry. Critics call it hype-driven scarcity marketing, but for Tesla owners, waiting was preferable to buying a car without those flashy features. Today Tesla holds the world's largest EV market share.

The lesson Musk offers is this: overturning a century-old industry standard is genuinely achievable — nothing you're trying to disrupt is likely to be harder than rockets or cars. But you need the right development strategy to do it.

There are really only two strategies for building a product, and smartphones make this obvious: the Apple way, where you do everything yourself — operating system, chips, all of it — or the Android way, where you handle just the most critical piece, the operating system, and let everyone else manufacture spec-compliant parts for you to assemble.

In Musk's case, the rocket and EV companies that had tried the Android approach before him had all failed, so he was forced — almost recklessly — into the vertically integrated route, and it paid off, if narrowly. The other ingredient was rapid iteration: Musk's concepts routinely ran two or three years ahead of competitors, and that pace of iteration kept building pre-order anticipation that carried him through crisis after crisis. For now, though, it looks like he won't be bringing that iteration engine to the social media industry — I imagine Facebook and Google just breathed a sigh of relief.