At Tesla’s annual shareholder meeting, CEO Elon Musk announced that the company would be promoting its vehicles for the first time. Musk acknowledged that electric car manufacturers were not immune to the challenging economic environment, and that the next 12 months could prove to be difficult. Speaking at the meeting in Austin, Texas, Musk discussed the demand for cars that generate greater revenue than their competitors during the economic downturn, and the importance of cobalt as a key raw material for Tesla’s batteries. He also confirmed that the company would conduct a third-party audit of the mine supplying Tesla’s cobalt.
Despite Tesla’s position as the leader in the electric-vehicle market, the company has had to contend with tough times recently. Musk stated that Tesla will attempt to promote its cars in a way it has never done before. Shareholders voted to appoint JB Straubel, Tesla’s co-founder and former chief technology officer, to the board. Proxy advisor Glass Lewis had recommended that investors vote against Straubel’s appointment due to concerns about his independence. Additionally, a proposal to publish a report aimed at establishing a succession plan for Musk was rejected.
Musk has faced investor pressure to address concerns about a lack of a clear successor, slowing demand, delays in new models, and his involvement with social media platform Twitter. Musk has recently appointed Linda Yaccarino, formerly of NBCUniversal Media, as CEO of Twitter to focus on the technology and products the company produces. Musk announced in April that he would prioritize sales growth over profits after the company failed to meet its profit margin targets due to aggressive price cuts.
Tesla shareholders voted in favor of the board’s recommendations on almost every bill on Tuesday. The meeting was attended by shareholders who won invitations by lottery and was live-streamed. Tesla shares closed flat at $166.52 on Tuesday but rose 0.6% in after-hours trading. Musk’s Twitter distractions and concerns about slowing demand for electric cars have hit the stock, sending it down around 60% from its all-time high in November 2021.
While there are concerns about the lack of oversight over the use of Tesla stock as collateral for loans by Musk and his brother, Kimbal, shareholders also re-elected Musk and Chairman Robin Denholm as board members. Tesla director James Murdoch testified in court in November that Musk had identified a potential successor to himself. According to Gene Munster, Redwood Materials’ CEO of battery recycling and materials company, JB Straubel is being considered as a possible successor to Musk. The Wall Street Journal has reported that Tesla board members are discussing CFO Zach Kirkhorn as a possible CEO.