Elon Musk’s role as chairman and CEO of Tesla remained intact after Tuesday night’s annual shareholder meeting, where a proposal to split the duties between two people sank once it came to a vote. Three directors, including Musk’s brother Kimbal, also saw re-election last night, despite protests from some shareholders who feel they lacked experience.
With the challenge to Musk’s dominance squashed, it was then time to do the thing he does best: placate investors with assurances and rosy production timelines. Anyone interested in a Model Y?
The fourth model in the automaker’s lineup — a crossover — will go into production in the first half of 2020, Musk claimed, with the public unveiling occurring next March. (The meeting included an new teaser of the Model Y, seen above.) A semi truck and resurrected Roadster will also begin production at that time, he said.
Cue jokes about bridges and swampland.
Before any of this can occur, Musk needs to build the necessary capacity and work out production troubles for the existing Model 3, which started production last summer. A reports continue cropping up, detailing safety issues and assembly line snafus, Musk claimed the company was well on its way to reaching its deferred goal of 5,000 Model 3s per week by the end of June.
It’s “quite likely” the goal will be reached, the CEO claimed. Some investors question the reliability of the figure, as the company is known to build a large number of cars in short bursts, with slow periods in between. Musk says there’s a third assembly line in the works to boost capacity. Should the company achieve its target, construction of pricier dual-motor and performance models should commence in July, with the base, $35,000 Model 3 variant appearing in small numbers late this year. Full production of that sedan won’t reach volume production until the first quarter of 2019, Musk said.
As for the troubling reports about the goings-on at Fremont Assembly, Musk said most injuries are the result of repetitive stress and back strain, not accidents. He then became emotional.
“At Tesla we build our cars with love,” Musk told the shareholders. “At a lot of other companies, they’re built by marketing or the finance department and there’s no soul. We’re not perfect but we pour our heart and soul into it and we really care.”
One shareholder in the audience expressed concern as to whether the company’s option of a “vegan” car (no animal products used in its manufacture) was truly vegan. As an online pundit stated, that might have been the moment we reached “peak California.”
For nervous investors, Musk had reassuring words. The company has no plans to raise debt or equity, he said, and expects “positive GAAP net income and positive cash flow in Q3 and Q4.” Many investors worry about the company’s sustainability, given the clip at which Tesla burns through cash.
As we wait to see whether these predictions and assurances pan out, there could be news on the China front in as early as a month’s time. Musk wants a Tesla/battery assembly plant in Shanghai, and it seems there’s already some groundwork in place. Another plant, this one in Europe, could start construction by the end of this year, Musk said.