Tesla shareholders reject bid to strip Musk of chairman role

Elon Musk co-founder and CEO of Tesla Inc

Elon Musk co-founder and CEO of Tesla Inc

A previously reported shareholder proposal to force Tesla to have an independent chairman of the board, a position now held by Tesla co-founder and CEO Elon Musk, didn't pass a shareholder vote.

Tesla, which has talked about building a factory in Europe for years, plans to announce a location later this year, Mr. Musk said. The company has already demonstrated the ability to make 500 cars a day, or 3,500 a week, and should able to boost production even further in coming weeks.

"But I think we're getting there", he added.

Tesla failed to hit its Model 3 production deadline of 5,000 cars a week in December 2017 which has resulted the company not being able earn profit on the vehicle. "We will honor that promise".

He indicated Tesla aims to build 10,000 Model 3 cars a week next year. Earlier this week, analytics firm Second Measure put out a report saying that nearly 25 percent of the $1,000 deposits put down on Model 3 cars have been refunded as consumers have exhausted of waiting for their vehicles to be delivered. "The approach to automation that we have taken in some cases has worked, and some cases hasn't". "One of the biggest mistakes we made was trying to automate things that are super easy for a person to do, but super hard for a robot to do".

"To ensure that Tesla is well prepared for the future, we have been undertaking a thorough reorganization of our company", the memo obtained by AFP said.

Tuesday's vote also determined the fate of three members of Tesla's board of directors: Antonio Gracias, a private equity investor; Kimbal Musk, Elon Musk's brother; and James Murdoch, the chief executive of Twenty-First Century Fox. CtW Investment Group, a union pension fund adviser, had called upon Tesla shareholders to vote against the three directors with the argument that Tesla's board of directors isn't doing enough to oversee Musk.

Shareholders are also voting on the reelection of 3 board members and it looks like they are all going to be officially reelected.

"The complexity of large-scale manufacturing and the challenges of successfully commercializing new technologies and new manufacturing and marketing techniques suggest that shareholders would be better served by having Musk focus on running the company, and allowing an independent director to run the board", ISS wrote.

In April shareholder Jing Zhao tabled the suggestion to split the chairman and chief executive position, while also saying that Musk's involvement with SpaceX and the Boring Company could create possible sources of conflicts for Tesla down the road.

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