- Tesla’s chief officer over China has been given a large promotion. Tom Zhu takes over the electric vehicle maker’s U.S. assembly plants and sales operations in North America and Europe.
- Numerous analysts and investors have been calling for Elon Musk to reign in his focus as the CEO has been caught up with other affairs like his purchase of Twitter.
- Tesla recently revealed that they delivered 405,278 vehicles in the fourth quarter of 2022, which was below Wall Street’s estimate as the company’s downfall continues.
Tesla has been in the news over the last few months for various reasons, ranging from the AI Day (where they launched a humanoid robot, sort of) to the antics of CEO Elon Musk’s purchase of Twitter.
In the most recent news, Tom Zhu has been promoted to the second-highest position in the company after Elon Musk.
According to a recent exclusive from Reuters, it was revealed that the chief for China, Tom Zhu, was promoted to overseeing Tesla’s U.S. assembly plants and sales operations in North America and Europe. Zhu’s title of Vice President for Greater China has remained the same, and he will be taking on these additional responsibilities on top of his current role. We’re going to look at the promotion of Tom Zhu to see what this means for Tesla moving forward.
Who is Tom Zhu?
Tom Zhu is now the highest-profile executive at Tesla after Elon Musk. In an interesting contrast to Elon Musk, Tom Zhu has actually made very few public appearances since joining the electric vehicle maker in 2014.
There isn’t much public information about his personal life or even his age out there. Reports indicate that he was born in China, but there’s no confirmation as to whether he still has Chinese citizenship since he also has a passport from New Zealand. Zhu has been credited for how strongly the Shanghai plant was able to rebound after COVID lockdowns in China halted production for many companies.
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His social media accounts state that he earned his bachelor’s degree from the Auckland University of Technology in 2004 and an MBA from Duke University. Before his tenure at Tesla, Zhu was running a project management consulting firm where he advised Chinese contractors looking to expand overseas.
Stories have emerged that during the two-month COVID lockdown in Shanghai, Zhu was one of the first employees to begin sleeping in the factory so things could continue running smoothly. With a buzz cut and a tendency to wear Tesla-branded fleece jackets, Zhu is known for his modest living situation as he has resided in a government-subsidized apartment near the Shanghai Gigafactory. There’s no indication whether Zhu will be required to relocate due to this promotion.
What Does This Promotion Mean?
Tom Zhu will now take control of Tesla’s top production plans as the EV maker prepares to launch the Cybertruck and a new version of its Model 3 sedan. Tesla has also hinted at producing a cheaper version of its electric vehicle, but no other details have been disclosed.
One can only speculate what this means for Elon Musk, who has been caught up with Twitter for the past few months. Many investors and analysts have grown concerned over how involved Musk has become with all of the drama behind the social media platform.
Who will report to Tom Zhu?
Tesla’s country managers in China, Japan, Australia, and New Zealand will continue to report to Zhu. The Tesla managers that will now be reporting to Zhu include:
- Jason Shawhan, director of manufacturing at the Texas Gigafactory
- Hrushikesh Sagar, senior director of manufacturing from Tesla’s Fremont factory
- Joe Ward, vice president of Europe, the Middle East, and Africa
- Troy Jones, vice president of North America sales and service
- There still hasn’t been a direct report from the Berlin plant announced
We will update this information if a public organization chart is released or updated in the coming months.
The Success of Tesla in China
While discussing Tom Zhu’s promotion, we can’t ignore the importance of Tesla’s success in China. Back in 2019, the Shanghai Gigafactory was built in 10 months, and it was 65% cheaper to do so than the Model 3 production plant in the U.S.. A few years later, and this became the biggest EV production plant in the world. When Tesla delivered 936,000 vehicles worldwide in 2021, it was reported that more than half of these came from the Shanghai factory.
What’s Happening With Tesla Stock?
We’ve been covering Tesla’s stock extensively, and the company hasn’t been doing well as the share price continues to plummet. Tesla’s stock price is currently at $113.06, down about 68% from one year ago. Investors have become frustrated as Tesla continues to lose its market cap.
While we often cited the challenging macroeconomic landscape for many stock prices falling sharply in the last year, there have been other issues impacting Tesla aside from the pending recession that we can’t ignore.
Elon Musk’s Twitter Takeover
Just a few months ago, Musk was heavily involved at Tesla’s AI Day, where the company was focused on recruiting the top talent in the field while discussing the future possibility of a robot tax service.
These days, Musk has been involved with Twitter and various controversies surrounding that platform. While the social media antics amuse some, investors are growing tired of them. Musk’s transition to his Twitter ownership has been bumpy, with many major advertisers pulling out of the platform due to his decisions. As Twitter continues to lose money, Musk has diluted his focus by spending time bringing the platform back to where it was rather than devoting energy to his role as CEO of Tesla.
Expectations are not being met
Elon Musk and Tesla have been making many bold promises that haven’t come to fruition yet as investors patiently wait for results. Recently, Tesla revealed that they had delivered 405,278 vehicles in the fourth quarter of 2022, which was below Wall Street’s estimates. On top of this, the Tesla Cybertruck was supposed to begin production in 2021, but it has been revealed that production won’t begin until 2023. The Tesla Semi didn’t start getting delivered until 2022 despite promises to roll out the product in 2019.
Issues at the factory in China
Tesla published a report in late December stating the company would run at a reduced capacity at its Shanghai plant. Some analysts raised concerns over the decrease in capacity, citing that it could be due to decreasing consumer demand as fears of a recession loom over us.
All of this negative information has led to investors selling off shares of Tesla, and there are growing fears that the company will have an uphill battle to return to its former glory.
How Should You Be Investing?
As Tesla’s share price indicates, the company has seen better days, and investors are discouraged. As Tesla’s stock continues to drop, some analysts are optimistic that the company can rebound in 2023. Many major innovations could be hitting the market in the near future, but there are still concerns over investing in clean energy in the short term.
If you’re feeling skittish about investing in EVs or clean tech, we have good news. Q.ai offers Investment Kits that monitor and adjust weekly to market changes utilizing AI technology. One of the Investment Kits available is specifically focused on Clean Tech. You can also activate Portfolio Protection at any time to protect your gains and reduce your losses, no matter what industry you invest in.
Tesla stock has been sharply declining over the past year, and there are no guarantees that the company will bounce back any time soon. The harsh reality is that investors in Tesla could continue to lose more money in 2023 as Elon Musk hasn’t indicated if he will be stepping away from Twitter. We urge you to conduct your own due diligence before investing in the electric vehicle maker, even if you’re a proponent of the clean energy revolution.
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