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Elon Musk reveals new Tesla models despite tough year ahead

By Nagasunder in US Business & Employment News, posted May 17, 2023

Elon Musk unveiled two new Tesla models during the company's annual shareholder meeting in Texas but has admitted there could be a tough year ahead.

Musk did not provide specific details about the new products but stated that Tesla could potentially produce over five million units annually by combining the two models.

The company had previously outlined plans to introduce a vehicle with production costs half as much as the Model 3.

Additionally, Musk said Tesla expects to complete the engineering and design of its revamped Roadster sports car this year, with potential production starting in 2024.

The Cybertruck pickup's initial deliveries are anticipated later this year.

The shareholder meeting followed Musk's announcement Linda Yaccarino would assume the role of CEO at Twitter, allowing Musk to dedicate more time to Tesla.

Musk referred to Twitter as a "short-term distraction" and expressed confidence in its stability after implementing necessary changes.

Some Tesla investors have expressed concerns about the board's ability to keep Musk focused on the carmaker's day-to-day operations.

These concerns have been fueled by a decline in Tesla's share price, increased competition in the electric vehicle market, and Musk's involvement with Twitter. Musk also heads the rocket company SpaceX.

Tesla's board has faced criticism for not providing sufficient oversight of Musk. In April, Amalgamated Bank, which manages investments in Tesla, called on board members to improve their oversight of Musk's actions.

Amalgamated Bank's chief sustainability officer Ivan Frishberg stated concerns that the board did not adequately address CEO-related matters.

During the meeting, Musk reaffirmed that he has no plans to step down as Tesla CEO when asked by an investor.

Tesla's market value has declined by nearly 50 percent since the previous annual meeting in August 2022, primarily due to lower interest rates and softer demand.

The company experienced a 24 percent decrease in first-quarter profits, partially attributed to recent price reductions.

Tesla intends to remain aggressive with pricing, which tests investor willingness to prioritize growth over profit.

Nevertheless, Tesla remains the world's most valuable car company, valued at over $500 billion.

Musk humorously acknowledged his previous skepticism about advertising and his current ownership of a social media company that relies on ads.

He mentioned Tesla's intention to explore advertising cautiously.

In a CNBC interview following the shareholder event, Musk acknowledged limitations in expanding Tesla's presence in China, a crucial market for the carmaker.

While citing constraints on expansion, he said the issue was not related to demand but did not provide specific details about the obstacles faced in China.

Musk also expressed his expectation Beijing would eventually integrate Taiwan into China, as the island is claimed by China despite being self-ruled. He characterized the situation as inevitable.

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Former Chief Technology Officer JB Straubel was elected to Tesla's board during the shareholder meeting, succeeding independent director Hiromichi Mizuno, the former chief investment officer of Japan's Government Pension Investment Fund.

A proposal requesting Tesla to prepare and maintain a report on its key-person risk, focusing on succession planning, was rejected by shareholders. Tesla advised investors to vote against the proposal.