Trump launches efficiency initiative: Tesla CEO Elon Musk announced on Tuesday that he would be turning his attention back to the electric vehicle maker, while still dedicating some time to government work under President Trump. Musk’s role as a special government employee (SGE) was initially intended to limit his government work to 130 days per year.
Allocation of Time
Musk stated that he would spend “a day or two per week on government matters for as long as the President would like me to do so, as long as it is useful.” With approximately 36 weeks left in the year, this could translate to 126 to 162 days of government work, considering he has already spent around 90 days as an SGE.
Trump launches efficiency initiative
Tesla’s Priorities
Tesla investors have been urging Musk to focus on the electric vehicle maker and execute on his ambitious plans for self-driving fleets of taxis, humanoid robots, and unsupervised full-self driving technology. Musk assured that he would allocate more time to Tesla, starting next month, and reduce his involvement with the Department of Government Efficiency (DOGE).
Government Role
As a special government employee, Musk is allowed to serve in outside roles and on boards without making public disclosures about his finances, which would be required of a typical government worker. Musk’s role in government has raised questions about potential conflicts of interest, given his involvement with various privately-held companies, including SpaceX, X, the Boring Company, Neuralink, and xAI.
Investor Reaction
Despite Tesla’s disappointing quarterly results, including a 9% decline in revenues, the company’s stock surged over 5% in after-hours trading following Musk’s announcement. Investors seemed to welcome Musk’s decision to focus more on Tesla, which could potentially alleviate some of the concerns surrounding his government role.
Concerns from Stockholders
Tesla’s investor relations team received 161 questions about Musk’s role in government, with many stockholders expressing concerns about the potential harm to the company’s reputation and brand. Some investors asked about the company’s strategy to mitigate the impact of Musk’s partnership with the current administration and whether the board was discussing Musk’s potential departure from government roles.
Financial Performance
Tesla’s quarterly results showed a decline in operating income, net income, and operating margins. However, the company’s energy revenues increased by 67% to $2.73 billion, and its cash position grew by 38% year-over-year to $37 billion.
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