Tesla Motors and CEO Elon Musk have done what many entrepreneurs have only dreamed of, bringing something completely new to the automotive market and making a success of it. The beginnings were rocky, and stock prices were stagnant for several years. Since early 2013, though, things have been generally on the rise, with the release of new models, and sometimes dropping, because investors are fickle beasts in earshot of the media. Most recently, a Musk Tweet has caused quite the uproar, the consequences of which are still unfolding.
August 7, 2018, Musk tweeted “Am considering taking Tesla private at $420. Funding secured,” to which the Federal Security and Exchange Commission (SEC) responded with a securities fraud lawsuit. Amongst the back-and-forth between the SEC, Tesla’s lawyers, Tesla’s board, and CEO Elon Musk, stock prices have been waffling, down to a new low of $250 per share (as of the time this article was written). What do the experts think about Tesla, Musk, and the future of the company?
- Ask around, and conversation ranges from outright accusations of malintent to incredulous praise for Musk’s business practices.
- ABR Investment Strategy’s Brad Gastwirth says “Musk is a visionary who’s done quite well with many of his ideas,” and hopes to see Tesla continue Tesla Model 3’s forward momentum.
- Loup Ventures’ Gene Munster hopes that, free of Musk’s influence, the board will take the opportunity given them to bring in some new blood and regain investor confidence.
- The Revs Institute’s Paul Ingrassia thinks that, Musk as CEO, albeit not Chairman of the Board for three years, is going to exert too much influence on company operations.
- Blaine Capital CIO Bill Smith comes right out and accuses Musk as a liar, “willing to do or say anything at any time” to keep stock prices high, and the Tweet was just one example of such meddling.
- Virgin founder Richard Branson, a Musk friend with similar business interests, says Musk ought to step back and let Tesla run itself, if not for Tesla, at least for his own health and well-being. Musk might do better as the visionary creator he is than managing the companies he’s developed.
Musk is indeed a “oversized” personality, bigger than life and an impressive presence, but maybe he has a right to be so. Can we always agree with his methods? No, but then Musk is in a league with few others. The legal implications of Musk’s statements, purposefully misleading or not, make investors and regulators alike queasy. While we can’t vouch for the trustworthiness of Musk’s statements on social media or elsewhere, it’s safe to say there is a big difference between Musk and Tesla. If separated, could Musk be happy as a visionary creative? Musk sold PayPal and PayPal’s gone on to great success. Maybe it’s time to let Tesla do the same? Could the same be said for SpaceX, The Boring Company, and SolarCity?