Musk also recently lied by claiming that every other automaker is doing badly in Europe right now, which is not only false, but all-electric vehicle sales are surging. The US is Tesla’s only somewhat healthy market, and this is expected to change in 2026 with the removal of the federal tax credit and the phasing out of regulatory credits over the next few years. Things are about to get worse if nothing changes, and as much as some shareholders want to believe it, autonomous driving is unlikely to save Tesla’s financials anytime soon. Tesla Master Plan Part 4 1- Fire Elon Musk and the board This is the most challenging part of the whole plan, and unfortunately, nothing else works without it. Unless maybe it is revealed that Elon Musk was held against his will in a basement somewhere since 2020 and replaced by an evil clone. Unlikely. I say it’s challenging because Tesla shareholders and the board are the only ones that can make it happen, and they are currently completely disincentivized to do it. That’s because the majority of Tesla’s current valuation (trading at nearly 200 times earnings) is based on Musk’s false promises, hype, and made-up projections about multi-trillion-dollar new ventures. If they fire him, the stock would revert to trading on fundamentals, which would result in a significant decline. However, those fundamentals would likely improve without Musk and his brand destruction. I previously referred to this as the Tesla shareholders’ dilemma, and ultimately, it’s Tesla’s biggest challenge right now. Again, I completely understand that there’s no desire from the shareholder base to do that now due to the short-term impact on Tesla’s valuation. Still, they need to ask themselves: “How long can Tesla maintain this valuation if fundamentals don’t start to recover?” There’s no sign of recovery; everything suggests that things will worsen soon, and autonomy is unlikely to contribute positively anytime soon. I know this is the hard part, but I think more shareholders are going to start seeing problems now that ‘Robotaxi’ has been launched, sort of, and it will become clear that Tesla is facing many of the same bottlenecks in scaling as Waymo, which has a significant head start. At some point, Musk will run out of people who believe that Tesla’s vision-only approach is a magic weapon for scaling autonomy, and those who do see the light on this issue will not return to the cult. Yes, Tesla’s stock will drop if that happens and Musk is ousted, but the stock will eventually drop regardless if the fundamentals don’t start to recover soon. The board, which has been protecting Musk and allowed multiple breaches of fiduciary duty, should also be ousted for meaningful change to happen. Suprinsgly, Tesla has yet to announce its 2025 shareholders meeting, which is the only opportunity for shareholders to vote out board members and attempt to change the leadership at Tesla. Usually, it happens in June or July. 2- Make things right with customers and shareholders After Musk is gone, this needs to be the first step in regaining customer trust and rebuilding demand. Tesla needs to offer to reimburse everyone who bought the Full Self-Driving (FSD) package and also make a permanent open offer to transfer FSD to new cars with the latest FSD hardware – even with a discount on top. The caveat here is that the new “FSD”, or whatever you want to call it, doesn’t come with the promise that it will eventually turn into unsupervised self-driving. This can still be the ambition (on new hardware, as I don’t believe HW4 will ever support level 4 self-driving outside of a geo-fenced area with teleoperation), but it’s not something that owners should be expecting. Tesla has done a lot of great work in autonomous driving, but it has made promises that it can’t keep and set expectations that have created complacency, which in turn resulted in safety issues. The company should continue developing ADAS and autonomous driving systems, but it should be way more cautious about setting expectations, and it should be more transparent with its data. The fact that Tesla never released any FSD data other than its cumulative mileage still shocks me. I would also like to see Tesla make things right for shareholders by suing Musk and the board for having frequently misled them with outright lies and threats, as previously explained. It would undoubtedly be a lengthy legal battle, but if successful, Tesla could recover billions of dollars that Musk and the board had taken from Tesla. For context, Musk has made more money from Tesla, about $40 billion, by selling stocks, than Tesla made in net income throughout its entire existence: about $34.5 billion. As for the board, they pocketed over $1 billion. 3- Buy Redwood Materials and Heron Power with stock deals to regain top talent and expand Tesla has experienced a significant and ongoing exodus of talent for years, but this trend has accelerated substantially over the last year. Ultimately, a company is only as good as its people. There’s still top talent at Tesla. Some are Elon loyalists who could be problematic, but others are simply talented employees and engineers who seek the opportunity to work on cutting-edge technology and share Tesla’s mission. Nonetheless, the talent exodus has had a significant impact, and Tesla’s pace of innovation has dropped significantly. With Musk gone, Tesla will need new leadership, and it should be easier to hire top talent with the polarizing CEO no longer at the helm. However, acquisitions or mergers could be considered to speed up the reintegration of top talent. I think the top targets should be Redwood Materials and Heron Power. It would bring JB Straubel and Drew Baglino, arguably the two most impactful engineers in Tesla’s 21-year history, back into Tesla’s engineering leadership. The Redux Recycling crew, now part of the Redwood family / Credit: Redwood Materials Approximately 120 employees of Redwood Materials were former Tesla employees, including many who Straubel handpicked for their notable impact on Tesla. On a smaller scale and more recently, Baglino did the same with Heron to build new solid-state transformers. He recruited many veteran Tesla engineers, especially in the energy and power electronics departments. Redwood has also recently launched a new energy storage business, in addition to its battery recycling and battery material manufacturing operations. It has become a direct competitor to Tesla Energy. Both Redwood and Heron could help push Tesla’s energy business to the next level and keep the company’s only growing division growing. This can be achieved through all-stock transactions. It wouldn’t cost the company anything, and it would help quickly reshape the shareholder base at Tesla. 4 – Back to the basics: expand the line-up with great and efficient electric vehicles The EV business is significantly tougher than the energy business for Tesla, particularly in terms of demand and growth. Musk has been betting everything on autonomous driving, but the result is that the lineup has been neglected, with only a single new vehicle introduced in the last five years: the Cybertruck, which has been a commercial flop. I don’t claim to have a silver bullet here, nor any groundbreaking solutions, but there are several things the automaker could do to return to growth. Obviously, I think Musk being out of the equation alone should help with demand. However, I think Tesla’s problem is way bigger: it needs a significant refresh to its lineup. First off, Tesla execs plead with Musk not to cancel the “$25,000 Tesla” or Model 2, or whatever you want to call it. I think you have to reconsider that vehicle program right away. I am confident that there could be other EV programs or changes to existing ones that Musk shut down amid his focus on autonomous driving at Tesla. Those should also be reconsidered. The Cybertruck should either be scrapped in favor of a more traditional-looking all-electric pickup truck or undergo a major update. It has been a commercial flop, but there’s no denying that it garnered a lot of interest at some point. The fact that it was launched with a lot less range and a higher price is the main reason it flopped. If that can be addressed, perhaps by utilizing different battery cells than Tesla’s own 4680, which fell short of the performance announced at Tesla’s Battery Day in 2020, it should be considered. I’d also love to see Tesla bring some of the advancements brought to market in the Cybertruck program to other vehicles. For example, the steer-by-wire and 48-volt electronic architecture should already have been introduced in the Model S and Model X. Tesla’s pace of innovation has slowed significantly in recent years, but the automaker still maintains a lead in efficiency among most of its competitors. I’d love to see Tesla utilize that to cover more automotive segments. 5 – Autonomous vehicles Autonomous driving should still be a critical priority program at Tesla, but I think it should be revised. Musk backed the entire company into a corner by trashing lidar sensors for years and insisting that vision-only was the best approach. Before he blocked me and Electrek, he actually told us in DMs that he agreed that high definition radars combined with computer vision would be safer than just vision, but he didn’t believe such a radar existed (May 2021): When I shared such a radar with him, he ignored the comment. Furthermore, lidar sensors essentially function as high-definition radars, utilizing lasers instead of radio waves. However, combining all of them is even better, as each possesses its own advantages. Radar gathers vast amounts of data in waves, while lidar acts more like a scanner. Musk has repeatedly and very publicly expressed disdain for lidar sensors and for self-driving companies using the technology. He started criticizing the technology when a single sensor cost several thousand dollars and Tesla was trying to build a hardware suite that would be integrated as standard on all vehicles, even if they didn’t purchase its expensive “Full Self-Driving” package. However, lidar sensors have now become more affordable, costing only a few hundred dollars. Nevertheless, it appears that Tesla is still committed to a vision-only approach, likely due to its CEO’s very public stance against lidars. Tesla’s HW5 suite should probably include not only a more powerful computer but also the capacity to include a radar and/or a lidar sensor. 6 -Bring back a PR department Musk’s decision to dissolve Tesla’s PR department in 2020 was a terrible one, and it should be reversed as soon as possible. It led to Musk being Tesla’s sole mouthpiece, and we all know how that turned out. Tesla’s PR department was small for a company of its size and even more so for one receiving such extensive news coverage. Nonetheless, it was still successful in ensuring more accurate coverage on average. Even in negative articles about Tesla, it would try to get Tesla’s side of the story included. Now, all you have is Musk sometimes denying news articles after the fact, and he has little to no credibility doing so after he denied several news articles that turned out to be true. With Musk gone, a PR department would also be even more critical in trying to realign Tesla with its original mission to accelerate the advent of electric transportation and renewable energy. The communications around Tesla’s move should explain how those moves advanced the mission. Since Musk dissolved the department and took over communications, it appears that most communications from Tesla are focused on stock pumping rather than advancing the mission. Along with a PR department, Tesla should focus more on marketing and even advertising. Lately, Tesla appears to have fallen into the trap of legacy automakers, where electric vehicles compete with other electric vehicles. This is a dumb approach, especially in the US where EV still have an extremely low ~10% penetration rate. With the vast majority of the market still consisting of ICE vehicles, the focus of electric vehicle markets should be on this market and how to encourage people to transition to electric vehicles. Electrek’s Take Again, I’m not delusional. I understand this is all extremely unlikely to happen as Musk has an incredible hold on the Tesla shareholder base, and the stock remains high. However, shareholders could quickly turn into bagholders if Tesla’s fundamentals don’t start to turn around and the company starts losing money next year.