Perhaps we would all be better served with a another Gwynne Shotwell to run Tesla. BTW, doesn't Tesla also still have the solar PV business which seems to have largely disappeared?
Musk presents himself as a Tony Stark (even with a cameo in Iron Man 2, pushing an electric airplane), but in reality he is not that good at technology, but rather his fame is pushing at SCIFI ideas - reusable, VTO rocket launchers, real EVs (not golf carts), and brain interfaces. Other ideas seem to have failed - hyperloop, rapid construction of underground tunnels - because of the usual problems of needed government regulations and land rights. It was SF technology from an age before terrorism with an assumption of high quality manufacturing. (What would happen to a hyperloop transit system with a blow out?. )
McDonnell Douglas' merger with, and control of, Boeing, is a current cautionary tale of what happens when a company abandons engineering quality for juicing the stock price by cutting corners. Tesla's "self drive" feature, hardly needed for EVs, was a beta test using human guinea pigs. That is SV technology attitudes in a nutshell ("move fast and break things") but translated to consequential technology with real safety issues. The more of these types of failures he racks up, the more Musk's future prospects with be damaged. Plus, Musk treats his customers with disdain, with "enshittification" of his EVs attests.
Corporate compensation practices have been delinked from reality for years now. The issuance of stock options & outsized bonuses were narrowly designed with the principal focus on stock price appreciation. Those of us who run personal portfolios and carefully read proxy statements every year recognize this but we are pretty much a blip in the ocean given that institutions own the majority of the traded equities in America. Unfortunately, many of these institutions almost always blindly vote in favor of management. Occasionally, corporate raiders/gadflies stir up the pot in terms of seeking management changes but they are only concerned with making money on their investment. If they lose the proxy vote they exit the stock quickly
We also should not lose sight of the fact that Tesla received some major tax preferences during the early years and if memory serves, got a bail out back during the 2008 financial crisis (not to the same extent that established auto companies received). Additionally, Tesla's initial lead in EV manufacturing has been eclipsed by Chinese companies and established Euro and American companies are catching up (disclosure: I own GM in my portfolio). Tesla appears to be exiting the charging station business with the net result that EVs likely will only be useful for local trips.
Shareholders are being asked to approve a compensation package that ignores the current realities of Tesla's core business as well as the distractions that pull the CEO in different directions.
I believe Tesla almost went bankrupt in 2018. So shoot the moon. If you can hit it you can have it. I think this is when the Shanghai factory deal was also signed, along with land, loans, and grants. Tacitly there may have also been a technology exchange.
My conclusion is that, although Elon had been a producer of value in the past, he is now a destroyer of value. He's already destroyed more than half of value of Twitter/X. The bad decisions at Tesla you've highlighted are pointing it down the same path. Elon's unique combination of OCD and ADHD made him extremely productive in the high tech space. Over-dosing on money appears to have curbed this.
Perhaps we would all be better served with a another Gwynne Shotwell to run Tesla. BTW, doesn't Tesla also still have the solar PV business which seems to have largely disappeared?
Musk presents himself as a Tony Stark (even with a cameo in Iron Man 2, pushing an electric airplane), but in reality he is not that good at technology, but rather his fame is pushing at SCIFI ideas - reusable, VTO rocket launchers, real EVs (not golf carts), and brain interfaces. Other ideas seem to have failed - hyperloop, rapid construction of underground tunnels - because of the usual problems of needed government regulations and land rights. It was SF technology from an age before terrorism with an assumption of high quality manufacturing. (What would happen to a hyperloop transit system with a blow out?. )
McDonnell Douglas' merger with, and control of, Boeing, is a current cautionary tale of what happens when a company abandons engineering quality for juicing the stock price by cutting corners. Tesla's "self drive" feature, hardly needed for EVs, was a beta test using human guinea pigs. That is SV technology attitudes in a nutshell ("move fast and break things") but translated to consequential technology with real safety issues. The more of these types of failures he racks up, the more Musk's future prospects with be damaged. Plus, Musk treats his customers with disdain, with "enshittification" of his EVs attests.
Corporate compensation practices have been delinked from reality for years now. The issuance of stock options & outsized bonuses were narrowly designed with the principal focus on stock price appreciation. Those of us who run personal portfolios and carefully read proxy statements every year recognize this but we are pretty much a blip in the ocean given that institutions own the majority of the traded equities in America. Unfortunately, many of these institutions almost always blindly vote in favor of management. Occasionally, corporate raiders/gadflies stir up the pot in terms of seeking management changes but they are only concerned with making money on their investment. If they lose the proxy vote they exit the stock quickly
We also should not lose sight of the fact that Tesla received some major tax preferences during the early years and if memory serves, got a bail out back during the 2008 financial crisis (not to the same extent that established auto companies received). Additionally, Tesla's initial lead in EV manufacturing has been eclipsed by Chinese companies and established Euro and American companies are catching up (disclosure: I own GM in my portfolio). Tesla appears to be exiting the charging station business with the net result that EVs likely will only be useful for local trips.
Shareholders are being asked to approve a compensation package that ignores the current realities of Tesla's core business as well as the distractions that pull the CEO in different directions.
I believe Tesla almost went bankrupt in 2018. So shoot the moon. If you can hit it you can have it. I think this is when the Shanghai factory deal was also signed, along with land, loans, and grants. Tacitly there may have also been a technology exchange.
You threaded the needle nicely. Incentives matter, and we're doing it very wrong.
Thanks much! Yours, Brad
My conclusion is that, although Elon had been a producer of value in the past, he is now a destroyer of value. He's already destroyed more than half of value of Twitter/X. The bad decisions at Tesla you've highlighted are pointing it down the same path. Elon's unique combination of OCD and ADHD made him extremely productive in the high tech space. Over-dosing on money appears to have curbed this.