• 3 minutes e-car sales collapse
  • 6 minutes America Is Exceptional in Its Political Divide
  • 11 minutes Perovskites, a ‘dirt cheap’ alternative to silicon, just got a lot more efficient
  • 17 hours How Far Have We Really Gotten With Alternative Energy
  • 22 hours Bad news for e-cars keeps coming
  • 12 days What fool thought this was a good idea...
  • 23 hours The U.S. Is Determined to Revolutionize Its Microchip Industry
  • 11 days A question...
  • 15 days Why does this keep coming up? (The Renewable Energy Land Rush Could Threaten Food Security)
  • 16 days They pay YOU to TAKE Natural Gas
Jon LeSage

Jon LeSage

Jon LeSage is a California-based journalist covering clean vehicles, alternative energy, and economic and regulatory trends shaping the automotive, transportation, and mobility sectors.

More Info

Premium Content

Could Tesla Thrive, Or Even Survive, Without Elon Musk?

Musk Tesla

While Tesla, Inc., will be staying on the stock market instead of securing private financing, a much larger question has come up: Will the electric carmaker’s future depend entirely on CEO Elon Musk?

An in-depth interview this month with the New York Times, along with sudden moves by Musk like leaking the potential private equity deal August 7 on Twitter, has caused great concerns among Tesla board members. Some of the board would like to explore options such as searching for a No. 2 executive to even out some of Musk’s power — and to take some of the pressure off him.

Musk’s use of the Ambien sedative and recreational drugs has broadened their concerns.

Musk had used the Times interview to stir up interest in a possible private takeover of the company — and to color the subject matter with his sense of humor. He was thinking of offering about a 20 percent price premium over where the stock had been trading, up to about $419 per share. Musk rounded it up to $420, playing off the “420” code known by veteran marijuana users.

“It seemed like better karma at $420 than at $419,” Musk said in the interview. “But I was not on weed, to be clear. Weed is not helpful for productivity. There’s a reason for the word ‘stoned.’ You just sit there like a stone on weed.”

Shareholders were concerned about the stock price slide that came from the article, as the electric carmaker continues to face exhausting challenges producing the mass market Model 3 small sedan. The company has become much more dependent on its CEO than has been the case for other automakers and other Silicon Valley tech giants. Musk is known for sleeping at the Fremont, Calif., factory, and keeping his hands in several other projects such as his SpaceX interstellar transport company. Related: Musk Scraps Plan To Take Tesla Private

It’s become nearly impossible for the public — and stock traders — to separate the man from the company. But it’s become an increasing difficult year for the company’s chief.

Along with keeping the production line ramped up to the volume promised last year, Tesla faces other pressures. One of them is an investigation by the U.S. Securities Exchange Commission over disclosures. Musk’s tweets on potentially going private increased investigations by the federal agency.

“This past year has been the most difficult and painful year of my career,” Musk told the New York Times. “It was excruciating.”

Bob Lutz, a past General Motors vice chairman and champion of the Chevrolet Volt plug-in hybrid sedan, told CNBC he believes Musk is washed out. It’s time to find the right talent to run Tesla, he said.

"I think Elon is tired. He's worn out. He's obviously got some emotional problems. He's self medicating," Lutz said. "He has shown some disturbing signs of being somewhat volatile and unstable. I think the right solution for Tesla at this point is to move him aside from day-to-day operations.”

Ford Motor Co. went through that leadership transition a few years ago when Henry Ford’s great-grandson Bill Ford stepped aside so that ex-Boeing executive Alan Mulally could run the company. Mulally was credited with leading the company through a vital transition during the “Great Recession” economic collapse that started in late 2007 and continued for about three years in the auto industry. The automaker was able to find other options besides filing for bankruptcy and taking federal bailouts like its Detroit neighbors, GM and Chrysler, were forced into during that time.

One of Tesla’s challenges lately has been keeping the talent in place. Apple has been able to attract scores of Tesla’s manufacturing, security, and software engineers, and more recently, supply chain experts. They’ll be working on Apple’s Project Titan, which may bring an electric, autonomous Apple car to the market. Some of the ex-Tesla employees will back other Apple projects involving software, displays, optics, and battery technology. Related: Can The U.S. Bring Iranian Oil Exports To Zero?

Tesla hasn't been an easy place to work, reinventing itself as a sizable car manufacturer from its previous identity as a niche market player with scores of fans including Tesla owners.

While Musk has said that the company was able to meet its promise of reaching its 5,000 Model 3 sedans built per week by the end of June, that may not be the case. Several analysts think it was overstated, with a makeshift line being set up under a tent at the Fremont plant in order to count them as being built.


For now, Musk’s name is tied into Tesla’s brand identity. Other company executives, such as chief technology officer JB Straubel and CFO Deepak Ahuja are considered vital to the company. But they’re not anywhere near the same league as Musk.

"Why would you invest in Tesla without Elon Musk?" asked Ross Gerber of wealth management firm Gerber Kawasaki, a Tesla investor. "It doesn't make sense."

By Jon LeSage for Oilprice.com

More Top Reads From Oilprice.com:

Download The Free Oilprice App Today

Back to homepage

Leave a comment
  • cowboybob on August 29 2018 said:
    The ElonCon enters the terminal phase death spiral
  • TC on August 31 2018 said:
    Article says "SpaceX interstellar transport company"

    I don't think SapceX will be going interstellar anytime soon. They currently supply the ISS space station in oribit and may eventually go interplanetary to Mars or elsewhere. But not interstellar.

Leave a comment

EXXON Mobil -0.35
Open57.81 Trading Vol.6.96M Previous Vol.241.7B
BUY 57.15
Sell 57.00
Oilprice - The No. 1 Source for Oil & Energy News