It’s not new for Elon Musk to be in the news constantly, he has been there in the past for all the good reasons and some weird ones too. But for the past two months, the Tesla CEO is making headlines for probably some of the most controversial decisions of his career. The latest one of course, is that one tweet that has resulted in him to forcefully quit as the chairman of Tesla.
It all started with his one tweet which he posted while on his way to the airport about taking Tesla private at $420 per share and claiming that he has the ‘funding secured’. This tweet didn’t only set the Tesla shares on a roller-coaster ride but also upset the investors who were not even considered before making this announcement.
Some reports suggest that Musk’s tweet even disappointed the potential investors from Saudi who had allegedly agreed to make more than a billion dollar investment in the firm. Instead of choosing a company with a controversial leader, the Saudi investors later invested a billion dollars in another electric car company and Tesla’s potential rival Lucid Motors.
Am considering taking Tesla private at $420. Funding secured.
— Elon Musk (@elonmusk) August 7, 2018
It has been seen over the years that Elon Musks is a stubborn man and doesn’t think twice before making any big decisions. Though such big risks have resulted in massive successes in the past, it has totally backfired this time. The typical Elon Musk would have never settled a deal with anyone. But this time, he made a thoughtful decision of stepping down as a chairman because the fraud allegation by SEC was serious and could have harmed Tesla very badly including a possibility of the total exit of him from the company. By settling down the matter, Musk has smartly secured his chief executive post.
This set of events makes us look back at Elon Musk’s time at Tesla and how much things have changed since the beginning. Born in Pretoria, South Africa, Elon Musk had interest in computers and electrics from the beginning. His entrepreneurial journey started with his first company Zip2 which he sold earlier and went on to found PayPal, the company that changed the course of his career.
PayPal was eventually bought by eBay for $1.2 billion out of which $165m went to Musk’s pocket. He used that money to invest in Tesla and SpaceX, and that was the beginning of this journey. Musk started as a chairman of Tesla and later become the CEO of the company in 2008. At that time, Tesla was struggling due to high manufacturing costs and losing money like anything.
Things kept getting better with time and Tesla gained popularity among the car-lovers due to its high-quality products and modern technology, including the autopilot feature. It wouldn’t be wrong to say that Tesla pushed the electric car revolution in the automotive industry early by about five to seven years. Elon Musk, meanwhile, kept making innovations with Tesla, SpaceX and some all-new inventions like the boring company, solar city and even the kiddish ‘not a flamethrower’.
Today, Tesla stands as one of the most promising companies in the automotive world and it is going to dominate even more in the coming times. However, Musk’s sudden exit as a chairman may affect the risk-taking ability of the company as the new chairman is most likely to put the investors’ money at the top priority. The decision is also going to end Elon Musk’s sole decision making power on the company.
After being criticized heavily on the tweet, many board members of Tesla suggested to separate the CEO and the Chairman post but Musk clearly said that he is not looking for any number 2 at Tesla. Ironically, he has to make way for the new ‘independent’ chairman by himself.
As a car manufacturer, Tesla has a lot going on currently and a lot of things are in the pipeline too. The demand and sales of the Model 3 are booming and the company is trying to match the production with the number of orders and make the deliveries smoother. On the other hand, the company has also developed the electric supercar Tesla Roadster which is its attempt to attract the hard-core petrolheads.
Such shuffle in the leadership is likely to affect the company but not to forget, Elon Musk is still the in-charge of Tesla’s day-to-day operations. It will be interesting to see how Musk takes on this new challenge and how his equations with the new leadership go.
The deal also includes a condition that Mr Musk will have to comply with company communications procedures when tweeting about the firm. Which means now we might get lesser headlines from the Tesla CEO.