President Trump's role as cost-cutting emperor Elon Musk and his immersion in right-wing politics seem to distract him from Tesla at a dangerous moment for an electric car company.
Tesla's car sales fell 1% last year, even if the global electric car market rose 25%. Musk has not addressed the shortage and has not provided any concrete plans to revive sales. He also does not provide details about the more affordable Model Tesla. Tesla says it will start production this year. In the past, Musk spent months or years promoting the vehicle before appearing in the showroom.
And he has spent much of his time since the election at Trump's homes in Washington and Florida. It's far from Austin, Texas. Tesla has its headquarters and factories, or the San Francisco Bay Area, where its factories are located. Engineering office.
Over the past decade or so, Tesla has become a struggled start-up to maintain the global automotive industry. The company sold millions of electric vehicles, generated enormous profits, and forced it to invest billions of dollars to keep up with established automakers. Tesla's success is reflected in its rising stock prices, and helped make Musk the richest person in the world.
But now he appears to have lost interest in the car development, production and sales grinding business, which investors and analysts say. It could have a serious impact on his company and the automotive industry, which employs millions of people around the world.
Even before he joined the Trump administration as the government's efficiency director, Musk runs multiple companies, which has led investors and corporate governance experts to question whether he's getting too thin. I've come to my mind. In addition to Tesla, Musk controls SpaceX and carries astronauts, such as NASA, to its rockets. X, social media sites. Xai is developing artificial intelligence. And he wants to colonize Mars.
“No CEO is fully focused on ensuring Tesla is the leader in the EV space,” says Mayor of New York, who oversees pension funds for employees who own $12.5 billion worth of Tesla shares. said Bradlander of.
Lander told Musk to stay on Tesla's board and waive his CEO duties for anyone who works full-time. “That's not something you would require much,” Lander said. “It's just a basic model of American shareholder governance.”
Eric Tally, a professor at Columbia Law School, focusing on corporate governance, rarely has executives been responsible for this kind of responsibility. And while some of Musk's business can benefit from his relationship with the president, Musk's commercial and political interests can hurt Tesla and his other companies. It's virtually impossible not to collide with it, Tully said.
“The more you divide your loyalty,” Tully said.
Musk and Tesla did not respond to emails seeking comment.
In the past, he and the company's board of directors defended Musk's Tesla control and dismissed the idea that he was spreading too thin. They point to an increase in the company's stock price and robust profits as evidence that Tesla has not suffered due to his other commitments.
Musk's support for right-wing leaders in his home and in Germany, the UK, France and other countries appears to alienate a significant number of clients.
Musk's political activities and his decline in presence at Tesla also have signs that he is stimulating dissatisfaction within the company.
The complaints were evident last month at an extraordinary meeting at the company's office in Palo Alto, California. There, many employees were venting their frustration.
A senior executive who spoke at the meeting told employees he was also disappointed by Musk's “mercury” behavior and the departure of a senior executive who had a mild influence. Chief executives' biased social media posts and jobs in the Trump administration are driving away customers, making it more difficult for some employees to hire new talent in Tesla, managers say I said, York Times.
The executive urged employees to focus on their work and coordinate Musk's comments on X and other forums. “I ignore that and think about what we're working on. It's exciting for me, and is it affecting?” the manager said. “That's the best advice I can give as to how I handle it.”
The recording was first reported by the Washington Post.
There are indications that at least some investors are also questioning. Tesla stock price has fallen 25% since mid-December, but has risen about 40% since the election. The S&P 500 stock index has risen about 6% since the election.
Many investors still have faith in Musk. Therefore, Wall Street treats Tesla as more than three times more valuable than Toyota, the world's largest automaker.
Optimistic investors believe the company will develop a car that can drive on most conditions. Ark Invest, a long-time bullish investment firm about Musk's efforts, estimates that Tesla can manage half of the estimated $10 trillion market for autonomous riding services.
“We're far more seeing the path to Tesla being the most valuable company in the world,” Musk said in January. He added that the growth was “from overwhelmingly autonomous vehicles and autonomous humanoid robots.”
What made Musk seem surprisingly indifferent is the sale of the car, Tesla's biggest business today.
To discuss Tesla's fourth quarter results during last month's conference call, financial analysts will elaborate on plans to sell more cars to take advantage of Tesla's competitive advantage I asked for this. They themselves. Musk said he doesn't understand the question and the company already has millions of cars on the road.
The company lost the market share of BYD in China. European BMW and Volkswagen. Hyundai and General Motors in the US. Some Tesla drivers like musician Sheryl Crowe are very upset by Musk's political activities and say they don't sell cars or buy another one.
In January, Tesla's sales fell 59% in Germany, 63% in France and 12% in the UK, with Musk endorsing right-wing politicians and releasing an inflammatory statement on social media. Tesla sales fell 12% in California last year, accounting for nearly a third of electric vehicles sold in the US.
“Hate is real,” Ross Gerber, CEO of Gerber Kawasaki Wealth & Investment Management, wrote in X's post along with photos of cybertruck that someone had lewd and tainted.
However, the political blow is not the only problem for the company.
Tesla relies on two vehicles, the Model 3 and the Model Y, for 95% of its sales. BYD has more than a dozen electrical models, some costing less than $20,000. The Model 3 starts at $42,000 in the US before taking into account the $7,500 federal tax credit.
Automotive experts say Tesla needs cheap cars seriously to revive sales. But last year, Musk delayed his indefinitely plan to build a low-cost vehicle in Monterrey, Mexico, which cost $25,000.
The company has pledged to start production of new models at its existing plants by the end of June, but has not shown or provided details. Analysts expect it to be based on Model 3 and cost over $25,000.
“We've seen a lot of experience in our business,” said Michael Lennox, a professor of business at the University of Virginia. “That asks for a question,” he added, “Was there a lack of attention?”
Some investors said Musk's lack of interest in selling cars was clear about how unsaleable he had said about Trump's initiative that could hurt Tesla's sales.
Last week, Jim Farley, CEO of Ford, said part of Trump's plan to eliminate Biden-era electric vehicle incentives forced the company to fire workers He said it could be. But Musk hasn't said anything about them publicly.
Environmentalists in particular are very concerned that Musk, who once spoke of electric vehicles as a solution to climate change, is allied with climate deniers.
Catherine Garcia, director of Clean Transport for all the Sierra Club campaigns, said:
Musk argues that electric vehicles do not require government incentives. “We can't stop the emergence of electric vehicles,” Musk said in January. “That's going to happen.”
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