Tesla CEO Elon Musk points while visiting Tesla’s Gigafactory construction site in Gruenheide near Berlin, Germany, August 13, 2021.
Patrick Balloul | Reuters
At Tesla’s 2022 shareholder meeting on Thursday, investors asked CEO Elon Musk how the company plans to spend its money in the coming years, and about his global economic outlook.
Musk joked that “making macroeconomic forecasts is a recipe for disaster” but nonetheless estimated that we are “passing the previous inflation peak” and we are likely to see a “relatively mild recession” lasting about 18 months.
The CEO based his economic analysis on the commodity prices that Tesla is required to pay for the materials and goods it needs to make electric cars.
“We’ve gotten a fair amount of insight into the direction of prices for things over time because when you make millions of cars, you have to buy the goods several months before you need them,” he said.
In the second quarter of 2022, Russia’s war on Ukraine and the ongoing COVID-19 pandemic in China crippled Tesla’s Shanghai plant, exacerbating a supply chain crisis, parts shortages and labor problems across the auto industry.
Musk was also asked how Tesla plans to use its capital in the coming years. The CEO said that Tesla will essentially increase its capital expenditures and spending on research and development “as fast as possible without wasting it.” “Sort of a share buyback is possible,” he added, depending on what Tesla’s future cash flow looks like.
Musk, who is also the CEO of SpaceX, said he “didn’t want to commit” to buying back Tesla stock just yet, and that a force majeure event somewhere could change the equation. However, he reiterated that if Tesla’s future cash flow looks strong, and the world is “relatively stable,” “share buybacks will be on the table.”
20 million cars per year in about 12 plants by 2030
Overall, Tesla aims to produce 20 million cars a year by 2030, which is a lofty goal, and Musk said he thinks this will take about a dozen plants, with each plant producing 1.5 million to 2 million units a year.
Tesla currently operates vehicle assembly plants in Shanghai; Fremont, California; Austin, Texas; Outside of Berlin, Germany. It also produces batteries at a plant in Sparks, Nevada that works jointly with Panasonic.
Musk said Thursday that Tesla recently produced its 3 millionth car, and it hopes to announce a new factory site later this year.
Meanwhile, the company only recycles 50 car battery packs a week in Nevada, Musk revealed Thursday, explaining that the number is so low because most battery packs from Tesla cars are still in use today.
During the shareholder meeting, the famed CEO also reiterated promises he made in the past, including that Tesla is moving closer to the goal of its “resolution of autonomy,” offering a self-driving vehicle capable of operating as an exponential robot without any driver behind the car. wheel.
He delighted shareholders by researching their contributions on where to set up Tesla’s next plant (many shouted “Canada”) and telling the seemingly roomful of retail investors that they understood the company better than financial professionals including Wall Street analysts.
But he also revealed some disappointing news to shareholders, repeating that Tesla aims to produce the Cybertruck in mid-2023, but won’t be able to sell it with the same specifications and prices that were originally offered when the company unveiled the concept truck in 2019.
“I think there’s no way to predict the inflation we’ve seen,” Musk said of the expected high price of Cybertruck. Tesla will “install production equipment, tools and all, starting in the next two months” at its plant in Austin, Texas where Thursday’s shareholder meeting took place.
3 million job applications
Musk boasted at the meeting that Tesla, and reusable rocket company SpaceX, are two of the places engineering students most want to work in today. He said Tesla received 3 million job applications last year. He also revealed, “We allow people to move from one company to another if they wish,” referring to his two companies. “That’s great. We support that.”
Audience members at the face-to-face meeting were chosen by a random drawing, while others followed the live video broadcast over the Internet. Live event attendees voiced vocal criticism of shareholders who made proposals that Tesla’s board of directors did not agree to approve.
One contributor took the microphone during a question-and-answer session, gave up his opportunity to ask Elon Musk a question, and instead criticized the media for their treatment of Musk and thanked the CEO for “making the world a better place.” The contributor also said hello to his 6-year-old who said he was watching the work event back home. Warmly received.
Tesla Ball and Managing Partner of the Future Fund, Gary Black, asked Musk if he could leave his position as CEO at Tesla. Musk said that because of all the great people in his organization, he thought Tesla would be fine even if he was “kidnapped by aliens.”
He later confirmed, “I’m not leaving to be clear.”