Electric car pioneer Tesla is facing turbulent times as its market value falls by $700 billion when it peaks in November 2021. Despite investor concerns, CEO Elon Musk is pushing for a $45 billion repayment package. a deal that has sparked debate amid the corporation’s struggles.
Since November’s high of $409, Tesla shares have fallen 63%, falling below the $500 billion mark for the first time in a year. The decline reflects a string of setbacks, along with a drop in year-over-year sales, large layoffs and potential setbacks in the deliberate production of low-value EVs.
In an effort to secure Musk’s payout, Tesla’s board invoked shareholder approval, reigniting a contentious issue after a Delaware judge in January struck down a previous $56 billion package.
Robyn Denholm, the chairwoman of Tesla’s board of directors, emphasized that Musk has now not received repayment for the past six years due to the court order. However, several voices in the investor network question the know-how of such a huge payout given the company’s recent overall performance.
Dan Ives of Wedbush Securities acknowledges Musk’s contributions but stresses the urgency for Tesla to turn its fortunes around. It describes the current state of affairs as a critical point for an organization to transition from a success story to a story about things.
Ross Gerber, CEO of Gerber Kawasaki, echoes Ives’ sentiment, stressing the need for Tesla’s board to address governance issues. He criticizes the inappropriate way of reimbursing Musk and calls for a reconsideration of the CEO’s control over the direction of the organization.
The challenges facing Tesla go beyond past financial difficulties. Competition from China’s EV makers and stagnant EV sales growth pose massive obstacles to his bold imagination and prescient vision of an all-electric future. Recent reviews suggesting a shift away from the Model 2, a low-cost EV, toward a robotaxis focus have further fueled buyer concerns.
While Musk denies rumors of abandoning the Model 2, some investors, along with David Baron of Baron Capital Inc. they express explicit skepticism. Baron emphasizes the importance of Model 2 in Tesla’s method, warning that its termination may want to substantially adjust the financing panorama.
Gerber also expresses skepticism about Tesla’s pivot to robotaxis, saying the loss of low-cost options should undermine the employer’s financial viability. He previously urged Musk to drop a few to direct or refocus his efforts to force tangible results.
Shares of Tesla closed down 3.5% at around $149 on Thursday, reflecting continued investor concern amid the organization’s uncertain trajectory. As Tesla grapples with mounting challenges, discussions about Musk’s compensation underscore broader concerns about the employer’s governance and strategic path.
Elon Musk Net worth
Elon Musk’s net wealth has been subject to fluctuations reflective of his ventures’ successes and challenges. As of the latest reports, CEO Elon Musk’s fortune stands at approximately $150 billion, representing a remarkable ascent from his earlier entrepreneurial endeavors. However, this figure is not static, as Musk’s wealth experiences fluctuations due to various factors, including stock market performance, business ventures, and economic conditions.
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