Clean Technica: Elon Musk Agrees To Brazil’s Orders About X — Is There Also Hope For A Tesla Turnaround?003617

Sign up for daily news updates from CleanTechnica on email. Or follow us on Google News!

Elon Musk, CEO of X, has acquiesced to his legal team’s advice and has agreed to comply with directives from Brazil’s Supreme Court. Originally, he had refused to obey what he perceived as illegal orders to censor anti-democratic voices on his social network. Pressure finally forced Musk to give in. Could that surprising move be indicative of changes in the air at other Musk corporations? Could a Tesla turnaround be next, with its fearless leader’s refocusing, finally, on an affordable EV and a traditional pickup, among other changes?
The New York Times called Musk’s reversal in Brazil “a defeat for the outspoken businessman and his self-designed image as a warrior for free speech.”
A new Musk lawyer, Sérgio Rosenthal, explained that X planned to comply with all of the judge’s orders to take down accounts. “The goal is to regularize the company’s situation in Brazil,” he said. Later a different lawyer, André Zonaro Giacchetta, added that the conditions to return to Brazil “have already been met, but it depends on the assessment of” Brazil’s Supreme Court.
Musk, as the richest person in the world with a net worth of $239 billion, has nearly unlimited resources to litigate those whom he perceives have offended him. We know how strong Musk’s legal team can be. In August, when Musk sued a global advertising alliance and several major companies, including Unilever, Mars, and CVS Health, of unlawfully conspiring to shun his social network and intentionally drive X revenue loss through a “massive advertiser boycott,” the alliance disbanded in reaction to Musk’s allegations. The group stated that, as a nonprofit, it did not have the financial resources to continue operating while it fought X in court.
Musk’s pronounced goal when he purchased Twitter was to connect more people around the world. Much has changed in a mere few years. The Times says Musk has had to come to terms with the power struggle reality in countries other than Brazil, including India and Turkey, where his social network was also compelled to comply with orders to censor certain posts.
A Tesla Turnaround Needs Realistic & Visionary Leadership
Tesla’s sales growth of approximately 50% per year since 2013 has been accompanied by a buildout of its Supercharger network at a rate of 62%. Tesla’s vehicles generally have sports car–like acceleration, range exceeding 250 miles, hardware that enables advanced driving assistance, and 5-star crash ratings. Tesla’s vehicles also feature “over-the-air” software update capabilities that make it possible to upgrade vehicle features or, in some cases, perform recalls without visits to a service center.
These attributes set Tesla above any competitors for nearly a decade. After a buildup to successes at Tesla with the Model 3 and then with the Model Y, though, Musk seemed to become distracted by other matters, like social and cultural issues — which eventually became intertwined with politics. Unconventionality wouldn’t necessarily make him unsuitable as Tesla CEO; however, as he writes on social media and bundles his pursuit of radicalism and derision under the banner of free speech, Musk weakens his own companies’ values as he works to undermine democratic power.
Often included in the label “superstar CEO,” Musk threatens corporate governance by unduly influencing directors and their ability to faithfully discharge their fiduciary duties. The purpose of the corporation and its primary responsibilities of fiduciary duties, negotiation leverage, and contractual feasibility have all become topics of great concern due to Musk’s mercurial demeanor and his right-wing worldview.
For example, Tesla shareholders decided to reinstate the $55.8 billion Tesla pay package for Musk that Delaware Chancellor Kathaleen McCormick invalidated earlier in the year. That vote came even though a number of investment firms raised objections about senior leadership at the company and urged shareholders to vote against Musk’s 2018 option award.
Reaching a middle-income mass market is essential to the company’s stated objective to increase vehicle deliveries to 20 million by 2030. Tesla’s initial goal seemed to be to become a true mass market brand, which would be reached through consistent vehicle and software development. Yet, Tesla has not made it a habit to regularly refresh and reinvigorate the interior and exterior hardware of its models. Instead, it focuses on software updates to add features and keep the vehicles feeling renewed in other ways. As the brand matures and seeks to continue to increase its market share value, new models and reinvigorations need to become norms.
To retain his control over Tesla as a publicly listed company, Musk depends on holding a sufficient proportion of Tesla’s shares outstanding to possess the voting power to fend off predatory value extractors. During the 2023 Annual Shareholder Meeting, Musk teased a future Tesla model that would be compact and modestly priced, which was received with robust praise. Late last year, Musk made an announcement about the company’s intention to produce an affordable EV during a Gruenheide factory visit, which coincided with Tesla executive talk about a lower-cost “next-generation” vehicle during earnings calls and presentations.
Since then, however, there hasn’t been even a whisper to an anonymous source about more detailed plans for an affordable EV.
Instead, it’s all robotaxi, all the time.
Is the Robotaxi Enough to Sustain the Company’s Value — and Musk’s Interest?
Walter Isaacson’s biography of the Tesla CEO says Musk was so obsessed with robotaxis that he repeatedly vetoed his own plan to build a $25,000 electric car in favor of them.
When Tesla’s robotaxi reveal event was delayed until next month, many company advocates felt assured that Tesla needed just a little more time to finalize the robotaxis, including a limited Tesla robotaxi service. Then again, in July, JP Morgan analysts indicated that Tesla’s robotaxis and their associated revenues could be years away. Such waning confidence isn’t pervasive, however, as Cathie Wood of Arc Invest continues to see Tesla’s future based on AI and its full self-driving (FSD) technology. Ark published a report in June that included a price target of $2,600 for Tesla stock by 2029.
Experts acknowledge that Musk has made a positive impact on the EV transition thus far, playing critical roles as both financial investor and strategic decision maker in the emergence of Tesla as world leader in the development, manufacture, and delivery of EVs. Yet Musk’s commitment to growing Tesla through a continued balance of innovation and sound business practice has been tenuous due to his insistence on holding CEO positions at SpaceX and x.AI.
The extent of Musk’s voting influence to fend off a substantial Tesla redirection remains unclear. Mix in the company’s multiple lawsuits, employee reductions in force, use of stock-option grants to ensure subservience of the Tesla board of directors, and other ways that Musk wields his strategic control. Challenges in Tesla’s production processes and market competition loom darkly in these contexts.
Can Tesla reorient its specific strategic decisions, foreground its sustainability impact on the market, and moderate its futurism to match trends of the expanding EV industry? What would it take to devise a Tesla turnaround — and include technological revolutions of the sort that give energy to Musk? Could Tesla’s Board of Directors actually evaluate its leader and offer valid critiques of company performance to spur a renewal of energy and inspiration? Would solving problems that Tesla’s supply chain faces with more vertical integration be a first step in that direction?
The question remains: Can Tesla reach a maturity level while organically resettling in the key EV product category of Affordability-for-All? Can Tesla’s approach to disruptive innovation become more egalitarian and create a $25,000 model that is achievable for the masses (read: Volkswagen Bug) or a traditional pickup (read: Ford F-150 Lightning) while also being profitable for an attentive shareholder group?

Have a tip for CleanTechnica? Want to advertise? Want to suggest a guest for our CleanTech Talk podcast? Contact us here.

Latest CleanTechnica.TV Videos
[embedded content]
Advertisement

 

CleanTechnica uses affiliate links. See our policy here.
CleanTechnica’s Comment Policy

Share this story!

Go to Source