Elon Musk recently told the EV maker’s board that he had identified someone to succeed him as CEO.
A new face at the helm of Tesla.
This idea, which seemed absurd several months ago, is beginning to take shape in the minds of investors.
Indeed, since James Murdoch, a member of the board of directors of the electric vehicle manufacturer, indicated in mid-November that Elon Musk had told the board that he had identified someone to succeed him in the role of CEO, speculation and the craziest rumors continue to circulate.
Murdoch made this revelation during his testimony in a trial in Delaware over the 2018 pay package the company granted to Musk. The EV maker granted its co-founder a $56 billion package, but Tesla shareholder Richard Tornetta sued Musk and the board. He wants to prove that the chief executive used his dominance to obtain the unheard compensation package, a package which did not require him to work full-time.
Tom Zhu
Murdoch was asked by the plaintiff’s attorney whether Musk had ever identified someone to succeed him as CEO.
“He actually has,” Murdoch responded. He added that it happened in “the last few months.”
But he didn’t provide the name of the potential successor.
Since this revelation, the hunt for the lucky one has begun. A name has been put forward for the first time and it seems credible. It is Tom Zhu, president of Tesla (TSLA) – Get Free Report China. This is echoed by Pingwest, a publication specializing in tech coverage in China. Wall Street seems to take this hypothesis seriously.
“I put the odds at 10%,” Gene Munster, managing partner at Loup Funds, wrote on Twitter. “I’m factoring in the dynamic that Elon likes to mix things up along with Tesla’s goals to diversify away from China (the last two gigafactories have been US and Western Europe).”
Like other experts, he admits that given the importance of the Chinese market for Tesla and the electric vehicle industry — China, which seeks to reduce CO2 emissions, encourages its citizens to buy green vehicles through substantial aid and tax credits — this hypothesis is credible, but he recognizes that it would become a headache on the geopolitical level.
Sino-American relations are currently very tense, the two great powers clashing on technology and also opposing each other over the status of Taiwan.
“My guess is Tom Zhu is getting some kind of promotion, but not to CEO,” Munster said. “If he does get the CEO job, Tesla investors will likely lose sleep given the geopolitical dynamic.”
Tesla did not respond to a request for comment.
Zhu Is in Austin
In the meantime, Zhu is taking the lead at Tesla. According to Bloomberg News, Musk has just brought him from Shanghai to run the Tesla factory in Austin, which manufactures the Model Y SUV/crossover, and soon the long-awaited Cybertruck, Tesla’s futuristic pickup truck whose production should start in mid-2023.
Zhu is in Austin this week according to Bloomberg News, citing unnamed sources. He came with his team of engineers to oversee the increase in production capacity of the gigafactory in Texas. The plant has an annual vehicle capacity of 250,000 Model Y.
Zhu joined Tesla in April 2014 and soon became central to the success of Elon Musk’s group in China. He was in charge of the expansion efforts of the company’s Supercharging project. He became China Country Manager for Tesla in December of the same year.
One of his great feats happened in 2019: that year, Tesla delivered its first Model 3 sedan made in China, a year after Tesla signed an investment agreement with the local government in Shanghai for a gigafactory. Zhu was made Tesla’s Global Vice President and President of Greater China.
Since then, China and the Shanghai factory have become very important for Tesla. The vehicles produced in this gigafactory serve many Asian markets and also Europe, even if the Berlin factory inaugurated last March is set to become the main supplier of Tesla vehicles sold in the European market.
Of the 936,222 vehicles delivered by Tesla in 2021, more than half (51.7%), or 484,130, came from the Shanghai factory.
The rumors and changes come at a time when Musk is very busy revamping Twitter, which he bought on Oct. 27 for $44 billion, after six months of a battle with the former management, marked by twists and turns and a legal tussle.
The billionaire recently had confessed that, since taking over Twitter, he hardly sleeps.
“I have too much work on my plate, that’s for sure,” Musk said on Nov. 14, during an appearance at B20 Indonesia, a business conference running alongside the G20 summit in Bali. “I’m working the absolute most that I can work — morning to night, seven days a week.”
Besides Twitter and Tesla, the mogul is also the founder and kingpin of three other companies: rocket company SpaceX, The Boring Company, which digs urban tunnels, and Neuralink, a company specializing in brain microchips. Each of these companies plays an important role in their respective industry.
Altogether, Musk is the CEO of Twitter, the CEO and “technoking” of Tesla, the CEO and CTO of the U.S. defense contractor SpaceX, cofounder of Neuralink and founder of The Boring Company.
