Allen Root, senior author of Barron, on what’s in store for Tesla in 2023 after stocks plummeted on The Claman Countdown.
According to several news reports, billionaire Elon Musk may already have chosen his successor at Tesla.
Tom Zhu Xiaotong, Tesla’s vice president in charge of Asia-Pacific, is set to succeed Musk as the company’s electric vehicle and clean energy company’s global CEO.
The reports come from a December article published by Chinese news outlet PingWest detailing Tesla’s intentions to promote Zhu to global CEO.
On Tuesday, Portal exclusively reported that Zhu was promoted to directly oversee Tesla’s US assembly plants and sales operations in North America and Europe, citing an internal release of reporting lines verified by the news organization.
The move makes Zhu the highest-profile executive at Tesla after Musk.
Tesla stock extends decline into new year and is ‘held for the long term’
Who is Zhu?
Tesla’s China CEO Tom Zhu speaks at a handover ceremony for Chinese-made Tesla Model 3 vehicles at the U.S. electric carmaker’s Shanghai Gigafactory in Shanghai, China, December 30, 2019. (Portal/Yilei Sun/File Photo / Portal Photos)
Portal described him as an easy-going manager who wears a buzz cut, prefers Tesla-branded fleece jackets and lives in a government-subsidized apartment a 10-minute drive from the Shanghai Gigafactory.
During Shanghai’s two-month COVID lockdown, he was among the first employees to sleep at the factory as they tried to keep it running, people who work with him said. Under his leadership, the Tesla Shanghai factory recovered strongly from the COVID lockdowns in China.
Zhu and a team of his reports were brought in by Tesla late last year to troubleshoot production issues in the U.S., raising expectations among his then-colleagues that he was being groomed for a larger role.
He was born in China but now holds a New Zealand passport. Zhu joined Tesla in 2014. Before that, he was a project manager at a company started by his MBA classmates at Duke University, advising Chinese contractors working on infrastructure projects in Africa.
TESLA TAKES A $2.2 MILLION ROAD DUE TO ITS VEHICLES OVER-RANGE: REPORT
What do analysts say?
Tesla stock has fallen again in 2023 on rumors of Musk stepping down as CEO (Getty Images/AP/Getty Images)
On Wednesday, Wedbush chief executive Dan Ives said in a company report, “Musk controls the fate of Tesla, this is a moment of truth for Musk to direct damage control now or the brutal pain will continue.”
“While China CEO Tom Zhu is clearly taking on a bigger role at Tesla, Musk needs to take a more hands-on approach in 2023 as the Twitter distraction coupled with this current demand situation creates a perfect storm for the stock,” he continued.
Given investor perceptions that Musk is thinning out in additional roles, particularly his status as CEO of Twitter, Tesla stock is down over 53% over the past three months and another 35% over the last month.
ELON MUSK CUT OFF OFFICE SPACE AT TWITTER HEADQUARTERS IN SAN FRANCISCO
Tesla’s lackluster deliveries sparked Tuesday’s sell-off, will it continue?
| ticker | security | Last | change | change % |
|---|---|---|---|---|
| TSLA | TESLA INC. | 113.64 | +5.54 | +5.12% |
As rumors swirl about Musk’s possible departure, the company’s fourth-quarter delivery report showed the electric-vehicle maker missing analysts’ estimate by about 13,000. Tesla delivered 405,000 vehicles in the quarter, falling short of the consensus forecast of 418,000.
Ives said in the report that Tesla stock “has a black cloud forming over history now.”
The biggest concern for Tesla is that demand from China will slacken at a time when domestic electric vehicle competition is steadily increasing, he added. “This is a fork in the road ahead for Tesla that will either lay the foundations for its next growth chapter or continue its descent from the top of the pole, with Musk leading the way down.”
Portal contributed to this report.
CLICK HERE TO READ MORE ABOUT FOX BUSINESS
Future Fund Managing Partner Gary Black and Barron Senior Special Writer Allen Root discuss how Elon Musk’s Twitter uproar is negatively impacting Tesla stock in The Claman Countdown.