What may happen should Elon leave Tesla (one day and eventually)
Even if Elon is to leave Tesla today, the business should continue forward based on the plans set and systems in place (ERP, GigaFactories, AI, work processes, procurement, supply chain network and more). What is of greater concern is the culture of the business where Elon drives the First Principle, Empowerment (and how the union is not a good fit), innovation, hard work, compensation & benefits, innovation, and more.
The company should have the momentum to last for years and maybe decades. Maybe the culture can get even better. I think that Tesla China should do well. So, in terms of business operations, there should not be concerns for a while.
Elon is a dreamer who has the drive, the innovation, the conviction, and the values. If a good significant of the market attributes Tesla's success and dependency on Elon, they may cash out. This may not apply to some of us.
What follows should be scrutiny of the subsequent earnings. If expectations can be managed, the impact on the price would be lesser. Fortunately, Elon has stepped on some major news agencies who would have a feast dampening the "outlook" of Tesla. Other products in the pipeline would still be released, just not sure at what costs.
Business continuity
Elon drives both the effectiveness and efficiency of Tesla. What could change in his absence? How would the staff embrace the new CEO after Elon? Comparison is for the weak but is unavoidable. Tom Zhu has been touted as a likely successor because Elon has worked with him in Tesla China. Will the rest of the countries be able to embrace Tom? Will racism and bias affect the new leadership? Tesla may slip into a turbulent time following his departure, especially for the stock price.
There may not be operational concerns for years. But Elon is unique like every one of us. Tesla would be similar but not the same. Elon is a polarizing figure. This implies that more companies may be willing to work with Tesla following his departure.
Eventually, Tesla’s success boils down to Tesla’s systems, his “next in line” and management. But the media should enjoy a field day bashing the company. To me, there are not many other businesses like Tesla but no empire lasts forever.
How to exit our positions?
Profits are not profits till they are realized. It is the same for losses. At some point, we will need to take our profits (or cut our losses). Thus, I do recommend an investing strategy to include both entry and exit. Usually, my considerations are tied to business fundamentals - which can be found in their financial statements. Other factors like competitive advantages, management, branding and more. For this season, the macro consideration is a part of my investing approach. Due to the macro frailty, I have not been loading up any long-term investments except for some defensive stocks.
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