Tesla held its annual shareholder meeting after the bell on Tuesday, during which the company dealt with a variety of items, including the composition of the board of directors, shareholder voting on a variety of actions, long-term planning, and the return of a former Tesla executive as a freshman. Member of the Board of Directors.
For the third time, Tesla held its annual meeting at the Giga Austin plant in Texas, where the company also presented data and information on topics such as vehicle production goals and roadmap, clean energy initiatives as mentioned in Tesla’s Master Plan 3, and software development projects such as Fully Self-Driving (FSD) Beta. , and even the robot Optimus.
The timing of this year’s meeting, which has been pushed forward by two months compared to last year, has angered some investors who felt Tesla didn’t give them enough time to bring measures to shareholders for a vote at this year’s meeting. With that in mind, here are the main points made at today’s meeting.
Board composition and commentary
JB Straubel
JB Straubel has been voted a new member of Tesla’s board of directors, as the co-founder and former chief technology officer of Tesla. Straubel left the company in 2019 to start his own battery recycling company, Redwood Materials. There was talk that Straubel would provide a steady hand on the board due to Musk’s mercurial nature.
Robin Denholm
Robyn Denholm was voted for another term as president, spanning three years. Denholm and the current board have been criticized in the past for their inability to control CEO Elon Musk and focus his attention on Tesla first and foremost. Proxy advisory firm ISS has recommended that Tesla investors vote against its re-election to the board of directors ahead of Tuesday’s meeting.
Elon Musk
Not much surprise, CEO Elon Musk retained his seat on the board for another term. In his address to shareholders, Musk announces the start of Tesla’s new generation engine, as he sees the global economy changing after 12 months. The end-to-end refined FSD program will be controlled by a neural network AI model, and the Tesla Model Y will be the world’s best-selling car. Following on from comments made by Denholm, Musk said Tesla will begin rolling out “production e-trucks” later this year.
Musk also teased that the company is working on two new car products, one of which is known as the new third-generation platform; The second could be the newly updated Model 3 sedan. Musk said he sees 5 million unit volume annually between the two models.
Regarding succession, Musk said he has no plans to step down as CEO of Tesla.
In an extended interview with CNBC’s David Faber following the shareholder meeting, Musk said that executives receive a report every day on sales data from around the world and use that data when adjusting price to maximize supply and demand. Musk warned that the company doesn’t want to overreact to real-time Tesla buying data, and that Tesla isn’t the only automaker frequently adjusting prices; Musk said other automakers are doing the same thing through incentives.
Speaking of advertising, Musk said he was surprised by shareholder enthusiasm at the prospect of making ad spending. “It’s an experiment worth trying,” Musk told Faber, as long as it works.
Musk also told Faber that he sees the value of its autonomous software increasing the value of a car by 5 times its normal value. This, he said, means selling cars at “software margins”. Musk indicated earlier at the annual meeting that he saw the long-term gross margin for his FSD program eventually reach 80%.
Regarding China and its prospects, Musk said the company is not constrained by demand, but constrained by supply when it comes to the amount of vehicles it can produce from Giga Shanghai.
Musk was more optimistic when it came to Tesla’s business prospects in China versus Taiwan, with the expectation that he sees a Chinese invasion of the country as “inevitable.”
shareholder proposals
Key Person Risk Suggestion Speaking of succession, this proposal demanded a publicly available report identifying “key persons and actions to mitigate the effects of their possible loss.” The proposal focused primarily on CEO Elon Musk, asking for “a clear general plan or strategy for succession to mitigate the effects of his loss.” Shareholders voted against the motion.
Proposal to conduct a third party report on child/forced labor in the supply chain Although shareholders rejected the offer, Elon Musk said the company would conduct a third-party audit of cobalt suppliers, though he stressed that the company does not use much cobalt in its batteries.
This story is evolving.
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Pras Subramanian is a correspondent at Yahoo Finance. You can follow it Twitter and on Instagram.
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