Tesla’s Shareholders Saw the Return of a Co-founder

At Tesla’s annual shareholder meeting in Austin on Tuesday, five exclusive proposals dominated the conversations.

They include the CEO succession plan, the return of a co-founder, the teasing of two new electric vehicles, etc. Despite a turbulent year that saw Tesla’s brand favorability drop by 15 points, the meeting was marked by an air of optimism. Albeit, there are some concerns.

Musk Claims Succession 

Regardless of the rising concern about his diversified attention after the Twitter acquisition, the CEO of Tesla, Elon Musk, has pledged to remain at the helm of the company. Musk’s commitment sounded unwavering.

He stated that Tesla will play a crucial role in AGI and AI. He believes he needs to supervise the organization’s operations to make things flawless.

However, some investors are still wary of Musk’s debated online presence. They are also concerned about his potential distractions from Tesla’s operations.

Given these concerns, Tesla’s board has proposed to come up with a public succession plan with the current CEO and other key persons.

The behavior of the said officials has been questioned because they can potentially create a risk for the shareholders and the organization.

Tesla will declare the official vote tallies later this week. However, the board recommends shareholders vote against the key person risk proposal. Therefore, it may not pass.

The Return of JB Straubel

The shareholder meeting also marked the return of Tesla co-founder JB Straubel. He was elected as an independent board director. Attendees greeted Straubel’s return with cheers.

This seemingly testifies to his instrumental role in Tesla’s early success as CTO. It includes the development of Tesla’s battery technology and the construction of Gigafactory Nevada.

It’s likely that JB Straubel will fill the board seat previously held by Hiromichi Mizuno, the erstwhile chief investment officer of Japan’s $1.5 trillion pension fund.

This comes after Straubel’s departure from Tesla in 2019 when Drew Baglino, the vice president of technology, replaced him.

Despite the high-stakes discussions and updates, Tesla’s stock performance remained relatively flat. It raised only about 1% in after-hours trading following the meeting.

This lackluster investor reaction might be attributed to the meeting’s focus. It was on reiterating highlights from the past year rather than unveiling significant news.

However, Musk teased the development of two new electric vehicles.

Besides, he updated on  Cybertruck and Roadster. He also shared his macroeconomic expectations for the coming year.

When Musk completed his Twitter acquisition in late October, Tesla shares were valued at $228.52. As of the close of the meeting on May 16, shares were priced at $166.52.

The downward trend in Tesla’s stock price in the wake of Musk’s Twitter acquisition might reflect investor concerns about his ability to effectively manage both entities simultaneously.