20 February 2023, North Rhine-Westphalia, Cologne: The theme car "- Hereinspaziert, hereinspaziert ... [+] zur grten Show der Welt", the motto of the 1990 session, with a depiction of tech billionaire Elon Musk, rides in the parade. Cologne is hosting its first Rose Monday parade in three years; in 2021 and 2022, the trains were canceled due to Corona. In 2022, there was a demonstration in Cologne against Russia's war of aggression on Ukraine instead. Photo: Oliver Berg/dpa (Photo by Oliver Berg/picture alliance via Getty Images)
Is Elon Musk spending so much time on Twitter that he cant manage Tesla well? Judging by the 6% drop in Tesla stock and an underwhelming Investor Day in Austin, he needs to do a better job.
What does it mean to manage Tesla well? The two keys are the same as managing any business well:
Based on Teslas most recent financial report and Musks mushy Investor Day presentation, I think he could be doing a lot more to manage Tesla. His Investor Day performance was reminiscent of students who do their 5-page paper at the last minute and fill four pages with irrelevant material to meet the length requirement.
To do that, I think investors would be happy for him to cut his losses on Twitter so he can spend more time on Tesla.
Although its growth rate fell short of earlier guidance of 50%, Teslas fourth-quarter revenue and profit exceeded investors lowered expectations. Teslas revenue for the quarter ending in December 2022 totaled $24.32 billion 37% above the year-earlier amount and $60 million more than the estimate from Refinitiv, a financial market data provider.
Gross margins and operating cash flow both disappointed. Automotive gross margins came in at 25.9%, the lowest figure in the last five quarters. Operating cash flow was down 29% from last year, and down 36% from last quarter, coming in at $3.28 billion.
Tesla predicted relatively light production of 1.8 million vehicles in 2023. On Teslas earnings call, an analyst asked why the production guidance was so light given that Tesla has been increasing production in its factories. Musk responded by saying that the forecast assumes some friggin force majeure thing that could interrupt production.
Yet Musk was optimistic about Januarys production. As he told analysts, Thus far in January weve seen the strongest orders year-to-date than ever in our history. Were currently seeing orders of almost twice the rate of production.
Tesla did not issue new guidance. In its earnings release, Tesla wrote, We are planning to grow production as quickly as possible in alignment with the 50% compound annual growth rate target we began guiding to in early 2021.
Meanwhile, Teslas stock had roughly doubled since the beginning of 2023.
That was before March 1 when Musk held Investor Day in Austin, Texas. Since ending February at about $208 a share, Tesla stock has lost 6% of its value. That is likely due to Musks presentation, which mostly lacked serious content.
While Musk did mention plans to open a fifth manufacturing plant in Monterrey, Mexico, there was little else to interest investors. They wanted details about lower-priced Tesla vehicle the $25,000 Model 2 which they believe could spur faster growth.
What they got was hours of discussion about how much the companys new production platform would boost efficiency with no hint of what [Tesla] might actually build: no prototype, illustrative image or timeline, according to the Wall Street Journal.
Analysts see Tesla losing market share to other automakers with models that are less expensive than Teslas current lowest-priced product the $43,000 Model 3. As analysts from Mizuho Securities, a Japanese investment bank, noted: [With seven models from other automakers priced below that,] cheaper competitor Electric Vehicles (EVs) coming to market [are] potentially dilutive to Teslas share of the US EV market.
Musks Investor Day presentation also reminded me of a student who starts their final paper a day before the deadline. With a few hours left before it is due, the student cuts and pastes several pages from somewhere else.
In Musks case that was his Master Plan Part 3 a way to transition the global economy to a 100% clean and renewable sustainable energy economy by 2050. While a worthy goal, this took up time that could have been spent explaining how Tesla can grow faster.
This suggests that Musk is not spending enough time on Tesla. A February 23 lawsuit over his $56 billion Tesla pay package alleges that he is a part-time CEO of Tesla, according to Business Insider.
The lawsuit claims that Musk is too distracted by his work at Twitter and SpaceX to properly manage Tesla. Teslas third-largest individual investor, Leo KoGuan , said, Elon abandoned Tesla and Tesla has no working CEO, notes Business Insider.
Musks Twitter ownership is actively damaging Teslas appeal to customers. Once Musk bought Twitter in October 2022, Tesla customers became embarrassed to be associated with Musk.
A case in point is Tesla owner John Blumenthal who wrote in the Los Angeles Times, Will people see me as a symbol of right-wing environmentalism, a living oxymoron?...Now that Musk has apparently swung to the far right banning journalists from Twitter while reinstating neo-Nazis Im horrified to be associated with his brand whenever I drive anywhere.
To be fair, there does not seem to be much evidence that many EV buyers have turned away from Tesla due to Musks involvement with Twitter. Indeed, leasing firm Octopus EV told the Financial Times that two of its Tesla customers out of more than 1,000 had switched to another make.
Bob Perkowitz, a onetime Tesla owner who also described himself as a former fanboy, said he hasn't bought a new one because of Elon Musk's apparent right-wing views, his tumultuous Twitter acquisition, and his radical emphasis on free speech which he fears will allow misinformation to spread more widely online, according to Insider.
One analyst thinks Musks views are bad for Teslas brand. As Paul Krugman wrote in the New York Times, Tesla is a brand whose customer base largely consists of wealthy cultural liberals who were attracted in part by Elon Musks perceived with-it persona. Musks public embrace of MAGA conspiracy theories is an almost inconceivably bad marketing move, practically designed to alienate his main buyers.
Teslas growth has been impressive; however, its 37% result in the most recent quarter fell short of its 50% growth target.
To its credit, Tesla does intend to make considerable investments in its future growth. Teslas total price tag for its growth ambitions could reach $175 billion.
While Tesla has spent $28 billion to cement itself as the worlds most valuable car company, CFO Zach Kirkhorn said March 1 that Tesla could spend $150 billion more the achieve long-term goals such as making 20 million vehicles a year over 15 times more than the 1.3 million it delivered in 2022.
While capital is certainly an important requirement for boosting a companys growth, the most significant question that was not answered during Investor Day is: What is Teslas strategy for sustaining 50% annual growth?
While the analyst community expects a lower-priced vehicle to enable Tesla to grow faster, that assumption strikes me as ignoring the consumer appeal of competing EVs.
After all, Teslas U.S. EV market share is slipping down from 70.5% in 2021 to 63.5% in 2022. Teslas position is changing as new, more affordable options arrive, offering equal or better technology and production build, according to S&P Global Mobility.
One such beneficiary is Ford. When Chris Romanowski, an Atlanta-area musician decided to buy an EV this year, he opted against buying a Tesla finding the vehicles look ugly, and its ride bumpy and noisy. Instead, he bought a $70,000 Mustang Mach-E.
According to the Washington Post, Romanowski found it more attractive and comfortable. He thought the Mustang handed better and his father had owned a candy-apple-red 1966 Mustang.
Many rivals are piling in to the market. Ford with about 7% share is in second place; Kia is third with 5%; and Chevrolet and Hyundai control about 4% each. Meanwhile, Mercedes-Benz and others are rolling out EV models that are challenging Tesla in the luxury market, reported the Post.
Tesla investors need answers to key questions: What are the fastest growing EV market segments? What products does Tesla have in the works that target these markets? Are those products a better value in terms of quality, performance, and price than competing products? How will these new products boost Teslas growth rate to 50%?
If Musk were to step away from his Twitter bauble, perhaps he would have enough time to come up with compelling answers to these questions.
See the original post:
Tesla Investors Arent Impressed With Elon Musk. Twitter Is One Reason Why
- Elon Musk bought Twitter because the account tracking his private jet annoyed him, book says - Quartz - February 16th, 2024 [February 16th, 2024]
- Elon Musk Says Employees Are 'More Productive' in the Office. A New Study Says He's Wrong - Inc. - February 16th, 2024 [February 16th, 2024]
- Elon Musk, fuming over $55 billion Tesla pay ruling, switches Neuralink incorporation from Delaware to Nevada - Fortune - February 16th, 2024 [February 16th, 2024]
- SpaceX files to move incorporation site from Delaware to Texas - CNBC - February 16th, 2024 [February 16th, 2024]
- Top labor economist says dont believe the AI doom narrativeand his reason why is the underpopulation crisis Elon Musk talks about - Fortune - February 16th, 2024 [February 16th, 2024]
- Elon Musk to his sycophant pet journalist Matt Taibbi: "You are dead to me" - Boing Boing - February 16th, 2024 [February 16th, 2024]
- Ukraine Says Russia Is Using Starlink at the Front Line, Prompting Pushback From Elon Musk - The Wall Street Journal - February 16th, 2024 [February 16th, 2024]
- Elon Musk opposes aid to Ukraine, says Putin can't lose Bloomberg - Yahoo News - February 16th, 2024 [February 16th, 2024]
- Musk ordered to testify again in SEC investigation of Twitter takeover - The Guardian - February 16th, 2024 [February 16th, 2024]
- Tesla Stock Is Up Again. What's the Latest News. - Barron's - February 16th, 2024 [February 16th, 2024]
- Who killed Twitter? - Platformer - February 16th, 2024 [February 16th, 2024]
- Ex-Twitter engineer says Musk wrongly fired him for leaking information to the press - Business Insider - February 16th, 2024 [February 16th, 2024]
- How Teslas Board Can Solve Its Elon Musk Problem Without Overpaying - Barron's - January 23rd, 2024 [January 23rd, 2024]
- Elon Musk: Diversity-based hiring is antisemitic - POLITICO Europe - January 23rd, 2024 [January 23rd, 2024]
- Elon Musk Backs Prediction of 1 Billion Humanoid Robots by 2040 - Elon Musk Backs Prediction of 1 Billion Humanoid ... - IoT World Today - January 23rd, 2024 [January 23rd, 2024]
- Elon Musk, CEO of X, to visit Poland amidst online antisemitism uproar - NBC News - January 23rd, 2024 [January 23rd, 2024]
- Elon Musk expresses shock about the Holocaust after Auschwitz visit that was incredibly moving, and deeply sad and tragic that humans could do this to... - January 23rd, 2024 [January 23rd, 2024]
- Elon Musk says he is 'Jewish by Association' after Auschwitz visit - USA TODAY - January 23rd, 2024 [January 23rd, 2024]
- MrBeast's first video on X made $263,000 in win for Elon Musk's creator dreambut the YouTube star dismissed the ... - Yahoo Finance - January 23rd, 2024 [January 23rd, 2024]
- Elon Musks satellite army has a new target: Connecting the $183 billion farm industry to high-tech ag tools - Fortune - January 23rd, 2024 [January 23rd, 2024]
- Everything Elon Musk Did During His Visit To Auschwitz - The Onion - January 23rd, 2024 [January 23rd, 2024]
- Elon Musk visits Auschwitz after uproar over antisemitic messages on X - The Guardian - January 23rd, 2024 [January 23rd, 2024]
- Elon Musk visits Auschwitz with Ben Shapiro - The Jerusalem Post - January 23rd, 2024 [January 23rd, 2024]
- At Auschwitz, Musk says social media, free speech would have prevented extermination - The Times of Israel - January 23rd, 2024 [January 23rd, 2024]
- Musk on visiting Auschwitz: It will take a few days to sink in - Forward - January 23rd, 2024 [January 23rd, 2024]
- Stellantis CEO warns of EV bloodbath and race to the bottom if car makers follow Elon Musks lead and start cutting prices - Fortune - January 23rd, 2024 [January 23rd, 2024]
- Elon Musk says audits show less antisemitism on X than other apps - Fox Business - January 23rd, 2024 [January 23rd, 2024]
- Musk vs. Zuckerberg: Elon seems to envy the other CEO's Meta control - Business Insider - January 23rd, 2024 [January 23rd, 2024]
- Elon Musk With Ben Shapiro in Auschwitz: Another Cynical Whitewashing Performance - Haaretz Today - Haaretz - January 23rd, 2024 [January 23rd, 2024]
- Elon Musk visits Auschwitz after uproar over antisemitic messages on X - South China Morning Post - January 23rd, 2024 [January 23rd, 2024]
- Following Auschwitz visit, Elon Musk says X could have saved Jews from the Holocaust - JTA News - Jewish Telegraphic Agency - January 23rd, 2024 [January 23rd, 2024]
- Will Elon Musk's xAI Be The Downfall Of OpenAI After Sam Altman's Betrayal and Ousting? - Yahoo Finance - January 23rd, 2024 [January 23rd, 2024]
- Elon Musk Surprisingly Reacts to Bitcoin's Epic Surge By U.Today - Investing.com - January 23rd, 2024 [January 23rd, 2024]
- Elon Musk visits Auschwitz amid uproar over antisemitic messages - Business Insider - January 23rd, 2024 [January 23rd, 2024]
- MrBeast reveals his first video on X made $263,000but the YouTube multi-millionaire dismissed the cash as a facade and is giving it away - Fortune - January 23rd, 2024 [January 23rd, 2024]
- Elon Musk Just Demanded 25 Percent of Tesla Stock. Here's Why That's Not as Crazy as It Sounds - Inc. - January 23rd, 2024 [January 23rd, 2024]
- Elon Musk lays wreath at Auschwitz after private tour with Ben Shapiro and European rabbi - Baptist News Global - January 23rd, 2024 [January 23rd, 2024]
- Elon Musk denies AI startup has raised $500M of $1B goal - Fox Business - January 23rd, 2024 [January 23rd, 2024]
- Elon Musk's Tesla Confronts 'Black Cloud': Q4 Earnings Must Draw 'Line In The Sand Around Margins,' Analy - Benzinga - January 23rd, 2024 [January 23rd, 2024]
- Elon Musk visits Auschwitz, says he was 'naive' about antisemitism: 'Two-thirds of my friends are Jewish' - New York Post - January 23rd, 2024 [January 23rd, 2024]
- Elon Musk pledges to fund any Irish legal challenges to hate speech legislation - The Irish Times - January 23rd, 2024 [January 23rd, 2024]
- X appears to be juicing MrBeast's views as Elon Musk tries to woo the YouTuber to the platform - Mashable - January 23rd, 2024 [January 23rd, 2024]
- Elon Musk Wants You to Use Neuralink to Lose Weight. That's a Bad Idea. - The Daily Beast - December 27th, 2023 [December 27th, 2023]
- Twitter Violated Contract by Withholding Employee Bonuses, Judge Rules - The Daily Beast - December 27th, 2023 [December 27th, 2023]
- How Elon Musk Made Himself the Internet's Main Character in 2023 - Vanity Fair - December 27th, 2023 [December 27th, 2023]
- Elon Musks X Breached Twitter Worker Contracts By Refusing Bonuses, Judge Rules - Forbes - December 27th, 2023 [December 27th, 2023]
- Elon Musk's X accused of not paying employee bonuses after promising them verbally, to face court battle - India Today - December 27th, 2023 [December 27th, 2023]
- How Elon Musk became the world's most famous poster - Business Insider - December 27th, 2023 [December 27th, 2023]
- Sam Altmans OpenAI to be second-most valuable U.S. startup behind Elon Musks SpaceX based on early-talks funding round - Fortune - December 27th, 2023 [December 27th, 2023]
- Judge rules that Twitter violated contract when it withheld millions of dollars in bonuses - Courthouse News Service - December 27th, 2023 [December 27th, 2023]
- Elon Musk reveals production plans of low-cost Tesla model: The revolution [of] that car will blow peoples minds - Yahoo - December 27th, 2023 [December 27th, 2023]
- Tesla in 2024 will have 'moving pieces' from the Cybertruck to EV pricing - Austin American-Statesman - December 27th, 2023 [December 27th, 2023]
- Hyperloop, Elon Musks Pipe Dream, Bites the Dust - Rolling Stone - December 27th, 2023 [December 27th, 2023]
- The best books that CEOs read in 2023 from Airbnbs success story to Elon Musks biography - Fortune - December 27th, 2023 [December 27th, 2023]
- Elon Musk's Feud With Disney CEO Bob Iger Spills Over to Tesla - Observer - December 27th, 2023 [December 27th, 2023]
- Musk and Tesla are battling unions across Scandinavia. What comes next in the labor dispute? - The Associated Press - December 27th, 2023 [December 27th, 2023]
- From AI and inflation to Elon Musk and Taylor Swift, the business stories that dominated 2023 - The Associated Press - December 27th, 2023 [December 27th, 2023]
- Elon Musk Calls It 'Insane' -- But What Does the World Think? - Inc. - December 27th, 2023 [December 27th, 2023]
- How Donald Trump and Elon Musk killed Twitter, with Marty Baron and Zoe Schiffer - The Verge - December 27th, 2023 [December 27th, 2023]
- Hyperloop One to Shut Down After Failing to Reinvent Transit - Bloomberg - December 27th, 2023 [December 27th, 2023]
- Tesla Stock 2024 Forecast: Will the Elon Musk-Run Company Break Out to New Highs? - Nasdaq - December 27th, 2023 [December 27th, 2023]
- 49% of Americans dislike tech billionaires, but you probably still want to be like themhere's why, say experts - CNBC - December 27th, 2023 [December 27th, 2023]
- Startup that tried to realize Musk's hyperloop dream is shuttering - Business Insider - December 27th, 2023 [December 27th, 2023]
- The year of social media soul-searching: Twitter dies, X and Threads are born and AI gets personal - The Associated Press - December 27th, 2023 [December 27th, 2023]
- Elon Musk wants Grok to be the 'funniest' AI chatbot - Business Insider - December 27th, 2023 [December 27th, 2023]
- Musk's Erratic Behavior May Be Caused By Escalating Drug Use, Associates Say - The Daily Beast - August 24th, 2023 [August 24th, 2023]
- Keith Lee pitches Mr. Beast fight on Elon Musk vs. Mark Zuckerberg card - MMA Fighting - August 24th, 2023 [August 24th, 2023]
- Elon Musk Is Apparently Making the US Government Quite Nervous - Futurism - August 24th, 2023 [August 24th, 2023]
- Elon Musk Says He 'Looks Forward' To Visiting India In 2024 - Benzinga India - August 24th, 2023 [August 24th, 2023]
- Elon Musk, Sundar Pichai Applaud Chandrayaan-3's Landing on ... - The Weather Channel - August 24th, 2023 [August 24th, 2023]
- Tesla CEO Elon Musk still isn't ready to release hard information on ... - Longview News-Journal - August 24th, 2023 [August 24th, 2023]
- Mark Zuckerberg vs Elon Musk: clash of the tech egos - Financial Times - July 9th, 2023 [July 9th, 2023]
- "I Look..": How Elon Musk Reacted To His Viral Childhood Pic - NDTV - July 9th, 2023 [July 9th, 2023]
- Elon Musk believes Tesla will have 'level 4 or 5' self-driving this year ... - Electrek - July 9th, 2023 [July 9th, 2023]
- Arnold Schwarzeneggers Son Already Gives Up, Amid Elon Musk and Mark Zuckerberg Rigorously Hustling to Outdo Each Other: Honestly Dont Think I Have It... - July 9th, 2023 [July 9th, 2023]
- Elon Musk Responds To His Parody Account's "Lizard Boy" Tweet - NDTV - July 9th, 2023 [July 9th, 2023]
- Musk sues law firm for $135m bill on Twitter deal - The Australian Financial Review - July 9th, 2023 [July 9th, 2023]
- `Insane`: Elon Musk Reacts To His Viral Baby Picture, Netizens Say This - Zee News - July 9th, 2023 [July 9th, 2023]
- Mark Zuckerberg Trolls Elon Musk Over Threads With First Tweet ... - The Daily Beast - July 9th, 2023 [July 9th, 2023]
- An Elon Musk-Controlled Charging Network Imperils The EV ... - Jalopnik - July 9th, 2023 [July 9th, 2023]