Musk's golden touch is on the line. Tesla needs him to do what he does best — sell a pen

The Print

5 days ago

In the letter , the board said Tesla was at an 'inflection point' and needed to incentivise Musk to remain at the helm. The result: a multi-billion-dollar payout, provided the 54-year-old continues in a leadership role for at least two years. Never mind a previous $50-billion performance award stuck in court over allegations that Musk unduly controls the board.
A letter to shareholders from the EV giant's board of directors, a $29-billion pay deal for the world's richest man, and his unusual break from controversy all fuel this theory, and the corollary.
Tesla needs Elon Musk more than ever before. And, arguably, Musk needs Tesla just as much.
So, what drove Tesla to this turning point? The US automaker's sales have been sliding globally, profits have been shrinking, and its brand loyalty is traversing a rough patch. It would appear that Musk's politics has something to do with this.
Tesla's image took a hit when Musk endorsed US President Donald Trump last summer. According to S&P Global Mobility data published by Reuters, Tesla's customer loyalty peaked in June 2024. At this point, 73 per cent of Tesla-owning American households bought another Tesla. A month later, that loyalty began sliding. This was around the time Musk endorsed Trump after an assassination attempt on the Republican leader.
By March this year, the loyalty figure had dipped to 49.9 per cent, weeks after Musk launched the Trump administration's Department of Government Efficiency (DOGE). But weeks later, as Musk and Trump had an ugly public falling-out, this number began rising again — 57.4 per cent in May. And numbers, as they say, don't lie.
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Musk, the man who can sell a pen
Since that rage-fuelled spat with the US President — which, if one were to go by the fate of Trump's previous key advisers, was coming all along — Musk appears to have hunkered down, focussing on his businesses and building silently.
Once labelled a billionaire-genius out to save the world, Musk has fast gone on to be called a mad scientist with questionable intent.
Like him or hate him, the father of 14 (at last count) has the golden touch every entrepreneur desires — the ability to pull successful brands out of thin air.
After he birthed Tesla, which says it's more than just an automaker, Musk spawned the following: SpaceX, which pioneered reusable rockets; Neuralink, which conducts cutting-edge brain research; xAI, focussed on superintelligence after the once-co-founder of OpenAI fell out with Sam Altman; and X.com in 1999, which became the foundation of PayPal.
In fact, Musk closed one giant loop when he acquired Twitter and renamed it as X, which he calls the 'everything app'.
But the mark of his true genius lies in a little-known company. Stuck in Los Angeles traffic in 2016, the billionaire founded The Boring Company. On a whim, he started the project to tackle urban congestion. While it hasn't made deep inroads, that won't be the right place to look.
As he launched The Boring Company, Musk created and advertised a novelty product called 'Not-a-Flamethrower', an unlikely masterstroke. And it was exactly a flamethrower, in a sense. The man who often calls himself the 'Memelord' sold thousands of units in just four days and turned it into a viral sensation. And more than mere optics, he raised $10 million for the company. It's clear that the man can sell a pen.
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Tesla needs Musk to do it again
But the Memelord is as human as ever, with his flaws and faults. And he needs Tesla as much as it needs him.
For one, Tesla forms the financial core of his fortune, the biggest pile of individual wealth in the world. A sizeable portion of Musk's wealth is tied to Tesla's stock, which has taken a battering this year. On an earnings call earlier this year, he admitted there could be 'a few rough quarters' ahead, with Trump having withdrawn incentives for EV makers.
But a good business doesn't run just on a financial core. It also runs on good and effective optics. Tesla is the mainstay, the motherboard, if you will, the base on which Musk was able to sprout his other businesses. For the world, Tesla wrapped Musk in an aura blanket of a visionary and a global business leader. It also gave him the badge of 'trying to save the world'. Which successful billionaire who has done it all doesn't want that in their shelf?
It may appear that the Tesla board doesn't want Musk to lose interest and incentive as he fuels his other endeavours. But, in reality, Musk can't afford to lose interest. He has too much riding on Tesla.
The company's loyalists argue the last word on the brand hasn't been spoken yet. Even in the face of sliding financial health, Musk has said that autonomous robotaxis and humanoid robots could make Tesla 'the most valuable company in the world'. At the same time, he is also making moves to sell energy in the UK. Basically, doing what he knows best. Build and sell.
Going forward, Musk will likely stay away from politics; someone else's politics anyway. He is nothing if not trigger-happy. And one can't rule out his own political quest — this time, not hinging on a leader whose stock fluctuates by the minute.
Though divided in personal equations, Trump and Musk still stand united against a common adversary. The US President is locked in a who-blinks-first trade standoff with Beijing, while Musk's Tesla has been overtaken by Chinese giant BYD in total vehicle sales. If Musk wants to come out on top, he will have to do it one more time. He will have to pull a great idea out of a hat.
Nisheeth Upadhyay is Editor (Operations) at ThePrint. His X handle is @Nisheeth_U. Views are personal.
(Edited by Prashant)