Shareholders restore confidence in Musk (for now)
In an annual shareholder meeting on Tuesday, Tesla shareholders voted to keep Elon Musk as chairman of the board.
Shareholders brought the vote to the table following a struggling 2018 for the company. Tesla has struggled to meet production expectations for the Model 3, leaving thousands of buyers waiting for their car. In addition to this, the company has also faced allegations of dangerous working conditions, discrimination, and safety investigations.
Shareholder Jing Zhao brought up the proposal and commented this:
Although the current leadership structure, in which the positions of Chairman and CEO are held by one person, could provide an effective leadership for Tesla at the early stage, now in this much more highly competitive and rapidly changing technology industry, it is more and more difficult to oversee Tesla’s business and senior management (especially to minimize any potential conflicts) that may result from combining the positions of CEO and Chairman.
Before Wednesday, the company’s stock was down 9% in 2018, and although this may seem like a small margin, the share value for a company that continues to expand develop should only increase. However, after the news of Musk’s resumed position as chairman, Tesla’s shares rose 7% on Wednesday.
People like entrepreneur and professor Steve Blake believe that if Musk continues to focus on executing his ideas, he will have more success. However, focusing on the ideation and long-term dreams for the company will never increase profits for the company. One has to deliver on the ideas around which they design their business.
Musk claims that the firm will be able to produce 5,000 Model 3’s monthly by the end of June. Will he be able to deliver? Only time will tell, but his execution is crucial for not only his, but also the company’s, future.
Featured image via Flickr/OnInnovation