4 Notable Questions Raised At Tesla’s Annual Shareholder Meeting


On Tuesday, Tesla (NASDAQ:) hosted its annual shareholder meeting in California. Shareholders were able to ask CEO Elon Musk questions about the company’s problems and hear what the proposed solutions might be. As well, it was an opportunity for the Tesla’s new Chairperson, Robyn Denholm, to speak for the first time. In addition there was a vote on governance issues.

Here are our top four takeaways from the meeting:

1. What Demand Problem?

One of the most pressing issues for Tesla over past months has been questions regarding demand for its cars. Currently, Tesla’s SEC filings reveal that the company has manufactured about 23,000 more cars than it has sold, indicating there could actually be a demand problem.

After years of effort and billions invested in infrastructure, any doubt regarding desire in the marketplace for Tesla automobiles is bound to pressure the stock. On Tuesday, Musk unequivocally addressed those concerns:

“I want to be clear, there is not a demand problem. Absolutely not.”

Of course, investors have already learned they can’t take Musk’s word as gospel.

Even though the stock rallied 3% after the meeting in after-hours trade on Tuesday, shares fell 3.6% during yesterday’s session as concerns about Tesla persist.

Whether there’s really a demand problem will inevitably show up in the company’s quarterly sales figures, so regardless of Musk’s assurances, more details will come to light when the company’s next earnings report is released at the end of July.

Since Tesla’s stock tends to be volatile, expect significant volatility once the facts are released.

2. Mining Business Next?

According to Musk, sourcing the components such as nickel, copper and lithium necessary for lithium-ion battery cell production—key to powering Tesla’s electric vehicles—is now one of its biggest challenges, hindering the company’s ability to scale the operation even further. Indeed, Tesla began manufacturing batteries at its Nevada plant partly to help meet production targets.

But electric vehicle batteries need minerals, so the next logical step, at least in Musk’s mind, is to expand into mineral mining. On Tuesday, Musk claimed that once battery production was up and running, “[Tesla] might get into the mining business, I don’t know, maybe a little bit at least.”

Tesla already has a tradition of vertical integration: it produces, serves, and fixes all of its cars itself. The financial benefits of such an effort aren’t clear yet, but it does fit the corporate mindset of controlling all logistics associated with its products. As such there’s an odd sense to Musk sticking to this mandate, by planning to control yet another link in Tesla’s supply chain.

3. Reliable Timeframes For Autonomous Driving Functions?

In late April, Tesla held its “Autonomy Investor Day.” At that event it revealed some of its ambitions regarding self-driving Tesla vehicles, as well as robotaxis.

According to Musk, Tesla owners will be able to enjoy autonomy with supervision by the end of 2019. This would mean the cars will be self-driving, but the human driver will still be required to pay attention and ‘supervise’ the function. Autonomy without supervision will be up and running “sometime next year”—pending regulatory approval, of course.

During Tuesday’s Q&A session, Musk was also asked about the advanced summon feature, which would enable a car to be ‘called’ to a location, for example driving from a parking spot to where the driver was waiting for it. In November 2018 this was something Musk said would be available in six weeks. The questioner called Musk out on not adhering to the timeframe. Musk’s reply: “sometimes [I’m] a little optimistic about timeframes. It’s time you knew.”

Musk also clarified his previous comments concerning Tesla having a fleet of one million robotaxis by 2020. Now, he says what he meant was if all Tesla owners upgraded their onboard computers, the company would have produced one million cars with self-driving capabilities by then.

4. Less Power For Tesla’s Principal Stakeholder?

Among the proposals voted upon on Tuesday, there was a suggestion to shorten board member tenure to two years instead of three, and to allow corporate measures to be approved with a simple majority, rather than the current need for a supermajority (two-thirds of all outstanding shares).

Both changes were proposed after Musk’s latest run-in with the SEC. Right now, Musk owns about 20% of Tesla’s outstanding shares, giving him quasi-veto power over any decision.

Both proposals were approved by 99% of the voting shareholders, but the supermajority necessary wasn’t achieved, so both proposals were officially rejected. It’s unclear if Musk participated in the vote, but the outcome means shareholders still have no way of diminishing Musk’s voting power, should they feel the need.


Musk had a good showing overall, and his words were received by an enthusiastic crowd, even though the stock has lost 37% of its value year-to-date. That’s vintage Tesla—and Musk. The words are often highly encouraging but the numbers and deadlines don’t live up to the hype. Investors will have to wait for the company’s Q2 report to be able to evaluate where the business is headed next.

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