Trouble at Tesla?

12 August 2007

Matt Nauman, motoring editor at silicon valley newspaper the San Jose Mercury News, reports in his blog that electric sports car maker Tesla Motors will announced a new chief executive tomorrow. Co-founder and current CEO Martin Eberhard will become "president of technology" to make way for Michael Marks - the former chief of electronic component maker Flextronics and an early investor in Tesla.

There aren't that many reasons why CEOs get replaced. The individual involved might genuinely want to spend more time with their family - true in about 0.001% of cases. It may be that some indiscretion either financial or personal has taken place, but there's no sniff of that here as Eberhard is to remain with the company. The firm might want to portray to investors that a safer pair of hands is at the tiller, particularly at a delicate juncture - and that's possible in this case, given that the firm is poised to move from its research to its retail phase. But the most likely reason is that the old CEO simply failed to deliver on some key aspect of the business plan.

If that last reason is genuinely the case, then we can expect more bad news from Tesla tomorrow, or shortly after. At a guess, deliveries of the first vehicles will be significantly delayed.

Tomorrow's press release will make for interesting reading. Whatever it says won't necessarily be true, of course, but it'll be interesting nonetheless.

Update, Monday 13 August: Tesla's press release says Marks' "depth of experience in manufacturing, operations and logistics will be invaluable to Tesla as we prepare to start production of the Tesla Roadster". This indicates that the firm is looking for the safe pair of hands to handle the transition. This is just PR, mind, so there may still be climbdowns on past predictions to come...

2nd update, Monday 13 August: Various sources are today quoting an email, apparently sent by Eberhard to customers, and drawing the conclusion that delays are the unpleasant order of the day: "We are still planning to start production of the Roadster by the end of next month and deliver the first cars to customers this fall. We have a good chance of meeting this goal, but to be fully transparent, I want you to know that while it is within our reach, it is not yet fully within our grasp." That's CEO-speak for, "Er, it's gonna be late. Sorry."

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