Elon Musk has made plenty of headlines for how he handles his role as Tesla CEO, and one former industry executive doesn't think the world's richest person will remain with the electric vehicle giant.
What's happening?
Bloomberg said that while promoting a book he wrote, ex-Stellantis CEO Carlos Tavares told French financial newspaper Les Echos "that BYD Co. is more efficient and cost-competitive than Tesla" and that Musk "will opt to prioritize other pursuits."
"We can't rule out that at some point, he'll decide to leave the automotive industry to refocus on humanoid robots, SpaceX, or artificial intelligence," said Tavares, who had his own rocky ride as an EV exec, resigning in December as a search began for his successor. He had overseen the successful merger of Peugeot-Citroën and Fiat-Chrysler in 2021, after revitalizing the former upon taking the helm in 2014.
The Tesla board is trying to keep Musk in place with a $1 trillion pay package, acknowledging that his other pursuits seem more important to him. Tavares has been criticized for his own lofty pay rate and large severance deal.
"Tesla's stock market value loss will be colossal because this valuation is simply stratospheric," Tavares said. "I'm not sure that Tesla will still exist in 10 years. It's an innovative group, but they'll be beaten by BYD's efficiency."
In his book, he also questioned Stellantis' staying power because of its competing interests in France, Italy, and the United States, per Bloomberg.
Why is this important?
Tesla has struggled while Musk divides his attention among multiple endeavors, which included a role in the Trump administration. That and his involvement in European politics seemed to tank sales, and Tesla vehicles, charging stations, and dealerships were vandalized and protested as well. Other EV brands, especially those in China, where BYD is a leader, have also closed the gap on the trailblazer.
Under Tavares, Stellantis' market share, profits, and stock value dropped, too.
"It's not every day a person skips out of work, leads a company into a massive sales slump, then gets offered a bonkers raise for the effort," CarBuzz said of the $1 trillion proposal for Musk. "It's the kind of bats*** crazy logic that either defies the odds and works like magic, or eventually collapses into a black hole of bankruptcy."
What's being done about Musk and Tesla?
Shareholders will vote Thursday. Advisory firms have recommended "no" ballots, but approval seems inevitable. Though Tesla needs a turnaround, committing so much to Musk — who, despite his sterling reputation as an innovator, has a history of making promises with no basis in reality — could push it further in the wrong direction.
Politics aside, bad news for Tesla — or any EV manufacturer, for that matter — is bad news for the industry, with the potential to slow the adoption of cleaner machines that can improve human health, save drivers money, and mitigate climate risks.
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