It’s fair to say that Tesla investors aren’t happy. They have been forced to watch Musk pour increasing amounts of gasoline on the trash fire he started at the core of the company, all while he runs around cosplaying like it’s the late 1930s. So, last Wednesday, a group of major Tesla investors, mostly pension funds, wrote a letter to Tesla lambasting the “crisis” the company faces and demanding Musk return to Tesla on at least a 40-hour work week. On top of that, they want Musk to create a clear succession plan — you know, so they can kick him out if he fails. If Musk refused, then they would refuse any new compensation plans for Musk, which would be a major blow, as his record-breaking $56 billion compensation package might need to be reissued, given that the courts have blocked it. This is the big boys telling the child to clean up, or they will take away his battered and broken playthings. But I can’t help but feel this is the wrong move. Or is it a stroke of genius?
Ultimately, Tesla has thrived despite Musk, not because of him.
Ultimately, Tesla has thrived despite Musk, not because of him.
Ultimately, Tesla has thrived despite Musk, not because of him.
Don’t get me wrong, Tesla’s position as a meme supply is entirely due to Musk’s behaviour. But the core company’s success has very little to do with Musk. The Roadster and Model S were the actual founders’ (Tarpenning and Eberhard) ideas; all the groundwork was laid before Musk forced them out of the company. And he had very little hand in the development of these models, essentially taking a backseat to allow the engineers to do their thing. After all, he was spending most of his time trying to revive SpaceX during that period. In fact, there are even rumours that the Model 3 was Tarpenning and Eberhard’s idea too, and Musk just saw it through. However, even if that wasn’t the case, Musk was very hands-off with development, with EV experts like Peter Rawlinson (the now-CEO of Lucid) being among the main people to bring the vehicles to life.
It was these engineers who created the Model S, Model 3, and the charging network that made these EVs so enticing.
It was these engineers who created the Model S, Model 3, and the charging network that made these EVs so enticing.
It was these engineers who created the Model S, Model 3, and the charging network that made these EVs so enticing.
So, why would you force him to come back?
Well, one of these Tesla bulls, Gary Black, publicly stated that if Musk stepped down, Tesla’s stock could fall by 20% to 25%, wiping out nearly $220 billion in shareholder value. Notably, he mentions nothing about Musk’s leadership or the innovation he could bring to the role, just that the myth of Musk adds to the value of the stock.
This is why this investor letter is genius. It forces Musk to return to Tesla to maintain the added value of Musk’s myth. However, it also forces Musk to put a succession plan in motion, not only preparing the company but also the stock market for his departure. So, when his idiotic leadership begins to legitimately tank the company, they can force his resignation, keep Tesla afloat, and mitigate any losses from their investment.
