Dear Tesla Shareholder [pdf](static1.squarespace.com)
static1.squarespace.com
Dear Tesla Shareholder [pdf]
https://static1.squarespace.com/static/5d374de8aae9940001c8ed59/t/68de828992aced27fc2d217c/1759412874017/TSLA+Vote+No_Oct_2025_Final.pdf
55 comments
I used to have a lot invested in Tesla, but I sold all my shares 2 years ago. I just don't think that their valuation is justified at the current price. So it can crash and burn at any moment.
Tesla has been underperforming for a long time. If we look back to 2021, at that time Tesla had the best battery tech in the world (maybe not on the cell level, but definitely when looking at the system as a whole), the best-performing drivetrain, and generally OK cars.
Fast-forward 5 years, and Tesla's bread-and-butter Model 3 and Model Y are still using essentially the same battery tech. The range has not increased, and the cars themselves are barely any different with only some cosmetic updates. The infotaiment system is rapidly aging, and the cars lack advanced features like vehicle-to-grid.
The FSD has not materialized, and Tesla is likely on hook for billions in upgrades/refunds to pre-2019 car owners for the promised upgrades.
Other Tesla products are less than stellar. Tesla Semi has essentially disappeared, Cybertruck is barely selling (just around 4000 units in Q2!), Model 2 was canceled, and solar is essentially dead.
The battery storage is the only area that is growing robustly with a good profit margin. But Tesla doesn't have any moat there, and competitors (like BYD) are quickly catching up.
Tesla has been underperforming for a long time. If we look back to 2021, at that time Tesla had the best battery tech in the world (maybe not on the cell level, but definitely when looking at the system as a whole), the best-performing drivetrain, and generally OK cars.
Fast-forward 5 years, and Tesla's bread-and-butter Model 3 and Model Y are still using essentially the same battery tech. The range has not increased, and the cars themselves are barely any different with only some cosmetic updates. The infotaiment system is rapidly aging, and the cars lack advanced features like vehicle-to-grid.
The FSD has not materialized, and Tesla is likely on hook for billions in upgrades/refunds to pre-2019 car owners for the promised upgrades.
Other Tesla products are less than stellar. Tesla Semi has essentially disappeared, Cybertruck is barely selling (just around 4000 units in Q2!), Model 2 was canceled, and solar is essentially dead.
The battery storage is the only area that is growing robustly with a good profit margin. But Tesla doesn't have any moat there, and competitors (like BYD) are quickly catching up.
From what I can gather, the institutional shareholders that has signed this letter controls about 1-2% of the Tesla shares (roughly). Add the Norwegian Oil Fund to the mix, which will likely vote similarly and has roughly the same voting power, and we are up to 2-4%. That seems quite small.
I guess they publish this in advance in an effort to persuade other shareholders to vote similarly?
I guess they publish this in advance in an effort to persuade other shareholders to vote similarly?
> I guess they publish this in advance in an effort to persuade other shareholders to vote similarly?
Yes. Plainly apparent IMO.
The conclusion-paragraph ends with
Yes. Plainly apparent IMO.
The conclusion-paragraph ends with
“As such, we urge Tesla shareholder to vote against all directors as well as Proposals 3 and 4 at the November 6th annual meeting.”I wonder how much they own in legacy auto and oil & gas.
Genuine question as someone not from the US, who’s the average new Tesla owner these days?
Electric cars were seen as a leftist thing a few years back. If (again, as a non American) you asked me what the average car of a right wing American was, I’d say a ginormous pick up truck with a V8 ICE engine or something like that. Did that kind of person really start buying Teslas due to Musk’s close ties with the current US administration? I can’t see that. I also can’t see leftist American people buying Teslas due to environmental reasons alone despite of Musk either. So who’s buying those cars?
Purely anecdotical but I know at least one person who was going to buy a Tesla and he didn’t do it purely because of Musk. Also, the only time I got inside a Tesla was in a Cabify that took me to the airport (model 3), smooth ride but the interior was that of a cheap car from 10 years ago.
Electric cars were seen as a leftist thing a few years back. If (again, as a non American) you asked me what the average car of a right wing American was, I’d say a ginormous pick up truck with a V8 ICE engine or something like that. Did that kind of person really start buying Teslas due to Musk’s close ties with the current US administration? I can’t see that. I also can’t see leftist American people buying Teslas due to environmental reasons alone despite of Musk either. So who’s buying those cars?
Purely anecdotical but I know at least one person who was going to buy a Tesla and he didn’t do it purely because of Musk. Also, the only time I got inside a Tesla was in a Cabify that took me to the airport (model 3), smooth ride but the interior was that of a cheap car from 10 years ago.
> Genuine question as someone not from the US, who’s the average new Tesla owner these days?
Just regular average people. EVs are just better than ICE cars, as long as you have charging infrastructure. And Tesla has it.
Just regular average people. EVs are just better than ICE cars, as long as you have charging infrastructure. And Tesla has it.
It’s the overlap on the Venn diagram of people who have driven one and people who think for themselves.
That's the question, isn't it?
Tesla made sure the Left hated them due to Nazi garbage from the CEO, the Right is full of coal-rolling clowns, so I have no idea who's buying them.
Tesla made sure the Left hated them due to Nazi garbage from the CEO, the Right is full of coal-rolling clowns, so I have no idea who's buying them.
The mistake is assuming that half the country is "the left" and half the country is "the right"
You're right. A large swath of people are apathetic, which basically makes them complicit with the current state of things.
I also don't count libertarians, because they are not serious people.
I also don't count libertarians, because they are not serious people.
While I may only own a small part of Tesla, as a customer of their's, I want nothing more than the company to get rid of Elon and just become a normal, better car company. While they yell about driverless cabs and robots that can serve popcorn to you, none of the music apps have gapless playback. There's multiple stretches of 100+ miles of highway around me that have no supercharging capability, and dozens upon dozens of major population centers that need to travel 150+ miles to get to a service center. You can get the Model Y in any color you want, as long as the color you want is one of the five colors it's always been available in. These and more are all real problems that they could improve to be a better car company; but they're obsessed with constantly leapfrogging themselves and throwing away every customer they've ever won, because now they're an energy company, wait no, they're a robotics company...
I've stopped recommending Tesla to people, despite driving one. The company is way too unpredictable and unstable.
I've stopped recommending Tesla to people, despite driving one. The company is way too unpredictable and unstable.
I assume the fear for stock holders is that without Elon people will evaluate the company like a regular car company and that would not be a net positive.
I think they're in some sort of stock price suicide pact at this point.
I think they're in some sort of stock price suicide pact at this point.
Fair points as a customer, but I think a stockholder would much rather Elon focus on robotics than gapless music playback.
Or just make better EVs. Tesla's not that competitive in charge speeds these days:
https://www.youtube.com/watch?v=Cy46Ag0djjk
https://www.youtube.com/watch?v=Cy46Ag0djjk
That was an extremely weird criticism.
I bet their rear passenger seats don't even have toothpick disinfection modules.
I bet their rear passenger seats don't even have toothpick disinfection modules.
This is some weird takes...
- music apps and gapless playback: basically all major car manufacturer software is trash, I'd challenge you to find a car software that's better than Tesla
- stretches without superchargers: to be clear, not stretches without places you can charge the car, right? Just places where Tesla's fast charging stations exist. Tesla has an order of magnitude more of these type of stations than any other similar network
- Service centers: I have no knowledge here. From how silly the other arguments are, I kind of assume that this isn't fully true, but I'll give you the benefit of the doubt and say it's true. Not awesome, definitely an area they need to get better in. But lets not forget, major manufacturer service centers are not exactly know for being quick/good/cheap
- Color options: I guess it would be cool to have truly custom colors, but basically every mainstream car ever has had a limited set of colors to choose from, and individual dealerships almost never have every color of that limited set available
> - music apps and gapless playback: basically all major car manufacturer software is trash, I'd challenge you to find a car software that's better than Tesla
Easy: _any_ car with Android Auto or CarPlay. Including a 10-year-old Toyota.
Easy: _any_ car with Android Auto or CarPlay. Including a 10-year-old Toyota.
If Elon leaves, Tesla is cooked. Tesla nosedives every time his focus is on something else which is what's happened since he purchased Twitter, became a political activist and then left to work with Trump. The only reason Tesla trades at such high valuation is because of Elon and the cult following he built around the vision for the company. As soon as he's out of there the stock will lose all of its premium. Institutional investors like Ron Baron who are open supporters of Elon's vision will leave and the business will go to carmaker-like or negative margins. There is absolutely no evidence that Tesla can function at all without Elon but there is plenty of it floundering when he's not focused on it.
This sounds like all upside for the company eventually if it actually is capable of being a good car company. The stock goes down to the price of a car company and the company needs to focus on making good cars instead of wildly flailing around to different distractions.
So you're saying that existing shareholders should vote to shelve the company's plans to expand into autonomous driving, robotics and energy storage and convert the company into a traditional car company?
Yes. Camera only self driving is proving out to be a failure and the two other aspects should have been part of a different company. I don't own stock in Tesla so I don't care if the price drops while the company becomes a car company again.
Musk's focus is always on something else. He doesn't work much at Tesla anymore. Tesla employees call him a "pigeon CEO":
https://electrek.co/2024/04/22/elon-musk-pigeon-ceo-former-t...
https://electrek.co/2024/04/22/elon-musk-pigeon-ceo-former-t...
> There's multiple stretches of 100+ miles of highway around me that have no supercharging capability
Genuinely curious where this is? It's not anywhere on the US Interstate Highway network for sure (OK, fine maybe there are a handful of 120 mile stretches here and there). There are holes in the middle of the interior west, but you have to work really hard to get 100 miles from a supercharger.
I mean, there are always legitimate criticisms to be made, but the breadth of the charging network is... quite frankly the best in the world?
Genuinely curious where this is? It's not anywhere on the US Interstate Highway network for sure (OK, fine maybe there are a handful of 120 mile stretches here and there). There are holes in the middle of the interior west, but you have to work really hard to get 100 miles from a supercharger.
I mean, there are always legitimate criticisms to be made, but the breadth of the charging network is... quite frankly the best in the world?
There are more divided highways than interstates. There are US highways like US-101 or states ones like CA-99. Also, all of the US and state highways are called highways, at least when not in towns, not just divided ones.
There are areas of the west that have enough coverage for driving through but not for trips. You would be pushing it visiting the Wallowa Mountains in Oregon cause La Grande or Joseph only have slow chargers. Another is the "Loneliest Road in America", US-50 in Nevada, has 285 mile gap.
There are areas of the west that have enough coverage for driving through but not for trips. You would be pushing it visiting the Wallowa Mountains in Oregon cause La Grande or Joseph only have slow chargers. Another is the "Loneliest Road in America", US-50 in Nevada, has 285 mile gap.
> There are US highways like US-101 or states ones like CA-99.
Neither of which has anything but a vanishing fraction of areas more than 100 miles from a supercharger.
Your other examples are real, though pretty spun. It's true! There are a handful of remote[1] areas[2] where EVs are still going to be... well, "less convenient" than a gas car. You can absolutely visit the Wallowas or transit Nevada in your Tesla, and people do.
Claiming "The USA is really big and has a lot of uninhabited desert" as evidence for corporate mismanagement of Tesla is... really weird, honestly.
[1] Just checked: the Pendleton charger to Wallowa Lake is 110 miles. So... not really "pushing it" except in a SR model 3.
[2] They didn't name it "loneliest" because of EVs!
Neither of which has anything but a vanishing fraction of areas more than 100 miles from a supercharger.
Your other examples are real, though pretty spun. It's true! There are a handful of remote[1] areas[2] where EVs are still going to be... well, "less convenient" than a gas car. You can absolutely visit the Wallowas or transit Nevada in your Tesla, and people do.
Claiming "The USA is really big and has a lot of uninhabited desert" as evidence for corporate mismanagement of Tesla is... really weird, honestly.
[1] Just checked: the Pendleton charger to Wallowa Lake is 110 miles. So... not really "pushing it" except in a SR model 3.
[2] They didn't name it "loneliest" because of EVs!
It’s nice to see karma at work
Coverage:
Elon Musk's $1T pay plan faces pushback from investors, state officials
https://www.reuters.com/business/autos-transportation/elon-m...
Elon Musk's $1T pay plan faces pushback from investors, state officials
https://www.reuters.com/business/autos-transportation/elon-m...
$1 Trillion to wreck a company. ROFL.
Tesla shareholders are the absolute worst bag holders. So vigorously defending a company that could not care less if they lived or died literally, as long as they keep buying unsafe garbage with less range than touted, months-long delays for some repairs, hiding crash data because it made Tesla look bad, beta testing driver-less mode in a way that endangers everyone else, switching to driver mode a split-second before a crash to insulate them from lawsuits, did I mention the fucking Nazi running it?
Oh and how's FSD going? lol
Tesla shareholders are the absolute worst bag holders. So vigorously defending a company that could not care less if they lived or died literally, as long as they keep buying unsafe garbage with less range than touted, months-long delays for some repairs, hiding crash data because it made Tesla look bad, beta testing driver-less mode in a way that endangers everyone else, switching to driver mode a split-second before a crash to insulate them from lawsuits, did I mention the fucking Nazi running it?
Oh and how's FSD going? lol
21st century, where a CEO of a major company doing Nazi salutes is not enough to fire him. How did we get here?
>the Board remains fixated on pleasing Mr. Musk
They state this as if it’s a problem, but it’s a fantastic thing for the company and the stock.
In the counterfactual world where the board did not do this and Musk left, Tesla would be way worse off. There’s also the theory that a new board could treat Musk badly or cut him loose and the company would do better, but I don’t buy that for a second. Put plainly, delusion runs rampant among Musk haters and that must be the reason this letter even exists. Or, some of them may be shorting and trying to avoid the day of reckoning.
And sure, his outspoken personality turns off a lot of people, but that is in the noise compared to the positive execution impacts he has.
They state this as if it’s a problem, but it’s a fantastic thing for the company and the stock.
In the counterfactual world where the board did not do this and Musk left, Tesla would be way worse off. There’s also the theory that a new board could treat Musk badly or cut him loose and the company would do better, but I don’t buy that for a second. Put plainly, delusion runs rampant among Musk haters and that must be the reason this letter even exists. Or, some of them may be shorting and trying to avoid the day of reckoning.
And sure, his outspoken personality turns off a lot of people, but that is in the noise compared to the positive execution impacts he has.
This letter sounds like it's written by an activist, not an investor.
I was thinking the same thing, a lot of people have an interest in Tesla failing, no surprise here
Ridiculous and biased article. Elon gets ZERO compensation if Tesla doesn't do stellar performance. Any tesla shareholder knows how Tesla is structured (Elon-focused) so just don't buy the stocks if you don't like Elon.
It also fails to completely mention Tesla stock's currently at an all time high.
It also fails to completely mention Tesla stock's currently at an all time high.
The US has some broken incentives where if a small company fails then it hurts the shareholders but if a large company fails, it's "too big to fail" and ends up getting bailed out by the government. That's why it's worrying how Tesla is growing unsustainably. If the risk pays off then shareholders reap the benefits but if it crashes and burns then everyone takes a hit.
The automakers that got bailed out had large unionized workforces and franchised dealer networks, both of which are very politically active and neither of which Tesla has.
Well, he should be getting a negative amount considering how his actions have effected the stock price.
He's a liability.
He's a liability.
> Any tesla shareholder knows how Tesla is structured (Elon-focused) so just don't buy the stocks if you don't like Elon.
So Tesla is not a car manufacturer, but a cult of personality?
So Tesla is not a car manufacturer, but a cult of personality?
Tesla is a car manufacturer, but Tesla stock valuations are not based on that fact.
This makes me think that executives in the manufacturing sector should be paid in kind AKA in product, if that is the hot stuff that they claim they'd have zero problems selling the product on the secondary market and collect dollars
[deleted]
Elon Musk currently owns 12% of Tesla. Claiming he gets “ZERO compensation” outside of stellar performance is nonsense. If Tesla actually reached a 8T dollar valuation his net worth would increase to 1T dollars without any additional grants or investor dilution.
He currently directly shares 12% of the growth of Tesla, far more than most executive teams which are viewed to be adequately aligned with far less ownership. Claiming there is no incentive to perform is nonsensical and incoherent.
He currently directly shares 12% of the growth of Tesla, far more than most executive teams which are viewed to be adequately aligned with far less ownership. Claiming there is no incentive to perform is nonsensical and incoherent.
I'm struggling to understand how you interpreted the GP to be in contradiction with you, unless you are just reinforcing what they said?
The GP was arguing that unless Elon Musk is given a additional 12% of the company, increasing his total ownership to 25%, he has zero incentive to raise the value of Tesla to a 8 trillion dollar valuation as he is not being “compensated” for his work.
I am pointing out that if he raised the value of Tesla to 8 trillion dollars he would earn ~800 billion dollars even without any further grants. Earning more money than anybody else has on the planet is about the absolute furthest thing from being “uncompensated” you could be. Giving him a additional 12% of the company on top of that would mean he is earning 1.8 trillion dollars from his actions instead of just 800 billion dollars.
I am pointing out that if he raised the value of Tesla to 8 trillion dollars he would earn ~800 billion dollars even without any further grants. Earning more money than anybody else has on the planet is about the absolute furthest thing from being “uncompensated” you could be. Giving him a additional 12% of the company on top of that would mean he is earning 1.8 trillion dollars from his actions instead of just 800 billion dollars.
He may be incentivized, but it is not “compensation” if he already owns it IMO.
So if I get 12% of the profit from music sales that is not “compensation”? Share ownership is, at its foundation, a profit (and asset) sharing agreement.
You are getting confused by the fact that this class of profit sharing agreement can be easily sold for its expected net present value of all future cash flows and that they frequently retain earnings in tax advantaged forms instead of directly distributing their generated income in highly taxed forms.
You are getting confused by the fact that this class of profit sharing agreement can be easily sold for its expected net present value of all future cash flows and that they frequently retain earnings in tax advantaged forms instead of directly distributing their generated income in highly taxed forms.
1. Elon could quit and do zero work and he would still own the 12%. So what is his compensation for the extra work?
2. If you owned $10M worth of shares of TSLA from your personal investments, and applied to work at TSLA, would it be reasonable to deny you any compensation since you are already incentivized and share in the success?
This is not to comment on what the right pay package is; perhaps the proposed one is far far too rich, but that's a separate question to whether his existing assets are compensation or not.
2. If you owned $10M worth of shares of TSLA from your personal investments, and applied to work at TSLA, would it be reasonable to deny you any compensation since you are already incentivized and share in the success?
This is not to comment on what the right pay package is; perhaps the proposed one is far far too rich, but that's a separate question to whether his existing assets are compensation or not.
1. 12% of the increased profits. If we used your logic then we would conclude that 100% owners of businesses are not being compensated for their work. They are literally being compensated all of the profit and asset growth.
2. Yes, it is fairly common to “compensate” executives primarily in the form of their own stock appreciation [1]. Mark Zuckerberg receives 1$ in salary, options, stock awards, with only a tiny 20 M$ as reimbursements to avoid running afoul of tax law [2]. Larry Ellison [3] got only 8 M$. Michael Dell only got 3 M$ [4]. Andrew Jassy only 1 M$ [5]. Should I keep going?
[1] https://en.wikipedia.org/wiki/One-dollar_salary
[2] https://www.salary.com/research/executive-compensation/mark-...
[3] https://www.salary.com/research/executive-compensation/lawre...
[4] https://www.salary.com/research/executive-compensation/micha...
[5] https://www.salary.com/research/executive-compensation/andre...
2. Yes, it is fairly common to “compensate” executives primarily in the form of their own stock appreciation [1]. Mark Zuckerberg receives 1$ in salary, options, stock awards, with only a tiny 20 M$ as reimbursements to avoid running afoul of tax law [2]. Larry Ellison [3] got only 8 M$. Michael Dell only got 3 M$ [4]. Andrew Jassy only 1 M$ [5]. Should I keep going?
[1] https://en.wikipedia.org/wiki/One-dollar_salary
[2] https://www.salary.com/research/executive-compensation/mark-...
[3] https://www.salary.com/research/executive-compensation/lawre...
[4] https://www.salary.com/research/executive-compensation/micha...
[5] https://www.salary.com/research/executive-compensation/andre...
Your links are misleading:
- Jassy: "When Jassy became CEO in 2021, he received a special stock award with a total value of $212 million. This award vests over 10 years..." - Ellison: "Founder, chairman and CTO Larry Ellison was awarded $138.6 million in the year ended 31 May 2022...However the bulk of the headline-grabbing figures, some $129.3 million of the total awards for both the CTO and CEO, will not be realized for a further three years. The performance-based stock options (PSOs) were granted in May 2018 and were supposed to vest in May 2022 "at the earliest" but were expected to take five years."
Zuckerberg may have agreed to forego additional equity comp, but he is a rare exception. Most executives receive new equity grants, subject to vesting, as compensation, even if they already own a lot of stock, as the stock they already own is not compensation for work.
- Jassy: "When Jassy became CEO in 2021, he received a special stock award with a total value of $212 million. This award vests over 10 years..." - Ellison: "Founder, chairman and CTO Larry Ellison was awarded $138.6 million in the year ended 31 May 2022...However the bulk of the headline-grabbing figures, some $129.3 million of the total awards for both the CTO and CEO, will not be realized for a further three years. The performance-based stock options (PSOs) were granted in May 2018 and were supposed to vest in May 2022 "at the earliest" but were expected to take five years."
Zuckerberg may have agreed to forego additional equity comp, but he is a rare exception. Most executives receive new equity grants, subject to vesting, as compensation, even if they already own a lot of stock, as the stock they already own is not compensation for work.
Larry Ellison received 138.6 M$? Wow, that might fill up his piggy bank right next to his, let's see... ~400 billion dollars and ~300 billion dollars of stock appreciation based compensation since 2021. That is almost, gonna need to bring out the calculator for numbers this small... 0.04% of his compensation.
Can you explain how this is not, as I said: "primarily in the form of their own stock appreciation"? Also crickets on how your interpretation means that sole proprietorships and fully owned businesses are not being compensated for their work. The only reason it looks like such compensation is uncommon is because executive teams in long-standing companies that have long since lost their founders, common of publicly traded companies, infrequently have enough prior stake to justify such forms of compensation which is absolutely not the case for Elon Musk who currently owns 1/8 of Tesla's growth and profits.
Can you explain how this is not, as I said: "primarily in the form of their own stock appreciation"? Also crickets on how your interpretation means that sole proprietorships and fully owned businesses are not being compensated for their work. The only reason it looks like such compensation is uncommon is because executive teams in long-standing companies that have long since lost their founders, common of publicly traded companies, infrequently have enough prior stake to justify such forms of compensation which is absolutely not the case for Elon Musk who currently owns 1/8 of Tesla's growth and profits.
The only reason you would invest in a company like Tesla at this price is because they have a CEO capable of 10x that is aggressively moving into other markets and not because you think they should become a docile car company and fix a few small things here and there.
I’m an investor because I want to see them go into semi’s and automation etc.