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Meanwhile, over at Tesla… here comes the electric bakkie, and a setback for company directors

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Shapshak is editor-in-chief of Stuff.co.za and executive director of Scrolla.Africa

Getting the first model off the production line is a significant step, but it’s unlikely to be a fully ready production model. It’s more likely a so-called ‘production intent’ car used to test if the production line is ready.

In a sea of bad news for Elon Musk, there was one piece of good news: Tesla has started making its electric bakkie.

The Cybertruck, as it’s called, is a futuristic-looking pickup that was first announced in November 2019.

The Tesla CEO’s unveiling of it featured what is now a meme when he was trying to demonstrate how tough the car’s glass was. A steel cannonball was hurled against the window, which promptly smashed, and Musk blurted out, “Oh my fucking god”, to riotous laughter.

This week Tesla announced, on Twitter, obviously: “First Cybertruck built at Giga Texas!” referring to its Gigafactory construction site. “Congrats Tesla Team!” Musk retweeted.

Getting the first model off the production line is a significant step, but it’s unlikely to be a fully ready production model. It’s more likely a so-called “production intent” car used to test if the production line is ready.

Musk told a shareholder meeting in May that the Cybertrucks should be ready by September.

“We’ll start production later this year and we’ll start handing over cars later this year,” he said of the electric vehicle originally slated to cost $40,000.

“I’d say a quarter million a year is a reasonable guess and it might be 500,000, I don’t know,” Musk said, warning that its price may go up. 

“We’ll make as many as people want and can afford. It’s going to be hard to make the cost affordable because it is a new car, new manufacturing method, so in the grand scheme of things relative to the production rate of all the other cars we make, it will be small. But still very cool.”

This comes as Tesla’s directors will give back $735m in bonuses after a US court ruled this week to settle a shareholder dispute that was filed in 2020. This affects Musk, his brother Kimbal, Oracle co-founder Larry Ellison and other directors who will not receive compensation for being on the board for three years, ending in 2023.

“Musk has installed his family and friends on the company’s board and through them he dominates and exercises control over Tesla and is able to avoid independent oversight of the way he runs the company,” according to the lawsuit.

“In return, with Musk’s blessing and vote as a director, the director defendants have consistently paid themselves unfair and lavish compensation every year from 2017 through 2020. Their disloyal, self-interested compensation determinations have deprived the company of tens – if not hundreds – of millions of dollars.”

This ruling – in which the directors “deny any and all allegations of wrongdoing, fault, liability or damage whatsoever” – doesn’t affect Musk’s own very generous $56bn remuneration deal. This is also the subject of another shareholder court case which began last year and is expected to be finalised soon.

Musk sold $15bn in Tesla stock and used more as surety for his $44-billion purchase of Twitter, which he has admitted is now worth half of that.

As US advertising revenue has crashed by nearly 60% in a five-week period this year, one investor wrote down their stake by 47%. 

“We take fair valuation very seriously and absolutely have had to write that [Twitter] down,” ARK Investment Management chief executive Cathie Wood told the Wall Street Journal.

Tesla shares tanked 65% from the time he announced his Twitter plans to December. That’s a whopping $705-billion, according to Forbes. It has also cost Musk his title as the world’s richest person, although I’m sure he isn’t heartbroken to be number two.

But he now has at least one Cybertruck on the road, and that bakkie may have a lot to do with Tesla’s stock rebounding – if Musk can pull off his optimistic predictions. Watch Twitter for details. DM

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  • Bruce Sobey says:

    You may not like Musk, but you should at least try to give an accurate report. Tesla shares dropped 65% in December to a low of about $110, but it is mischievous not to report that since then they more than doubled to around $290.

  • Pierre Joubert says:

    Great admiration for Musk, Pretoria booitjie, my hero, he didn’t just go on holiday with the money he got for Paypal, in the true spirit of the Parable of the Talents, he went to Mars. Took a lot of effort to get there.

    And I thank Musk for the choice of name to honour Nicola Tesla, the man who gave the world alternating current, that allowed electricity to be spread accross the world for all to use, which his rival, famed inventor of the light bulb, Thomas Edison, could not do, but in a way Tesla was snubbed and he died a pauper. While other great discoverors names are in daily use, like when you buy a 12 Volt battery, a 15 Amp plug, or a 100 Watt kettle

    But I was amazed when he lost his cool buying Twitter, just couldnt believe a clever man can do such a dumb thing

    And very disappointed about the nepotism, not just it per se`, but the way he abused it. Im sure he doesn’t vote ANC

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