Tesla, Inc. is an American multinational company that specializes in automotive and clean energy products. Headquartered in Austin, Texas, Tesla designs, manufactures, and sells battery electric vehicles (BEVs), stationary battery energy storage solutions ranging from home to grid-scale, solar panels, solar shingles, and other related products and services.

Formerly	Tesla Motors, Inc. (2003–2017)
Industry	Automotive Renewable energy
Founded	July 1, 2003; 21 years ago in San Carlos, California, U.S.
Headquarters	Austin, Texas , U.S.
Founders	Martin Eberhard Marc Tarpenning (See § Founding)
Area served	East Asia   Europe   Middle East   North America   Oceania    South east Asia
Key people	Robin Delhom (Chair) Elon Musk(CEO)
Products	Model S Model X Model 3 Model Y Semi Cyber truck Powerwall Megapack Solar Panels Solar Roof
Brands
Services	Charging insurance maintenance
Revenue	US$96.8 billion (2023)
Number of employees	140,473 (2023)
Owner	Elon Musk
Subsidiaries	Tesla Automation Tesla Energy

Founded in July 2003 by Martin Eberhard and Marc Tarpenning as Tesla Motors, the company was named in honor of the pioneering inventor and electrical engineer, Nikola Tesla. In February 2004, Elon Musk led Tesla's first funding round and became the company's chairman, eventually taking on the role of CEO in 2008. That same year, Tesla began producing its first vehicle, the Roadster sports car, followed by the Model S sedan in 2012, Model X SUV in 2015, Model 3 sedan in 2017, Model Y crossover in 2020, Tesla Semi truck in 2022, and the Cybertruck pickup truck in 2023. By June 2021, the Model 3 became the first electric vehicle to surpass 1 million units sold globally. In 2023, the Model Y became the best-selling vehicle globally, and by January 2024, it was recognized as the best-selling BEV in history.

Tesla has grown to become one of the most valuable companies in the world in terms of market capitalization. Since July 2020, it has held the title of the world's most valuable automaker. Tesla achieved trillion-dollar company status from October 2021 to March 2022 and regained this status in November 2024. In 2023, the company captured 19.9% of the battery electric vehicle market, and ranked 69th in the Forbes Global 2000.

Despite its financial success, Tesla has faced several legal challenges, regulatory scrutiny, and public criticism. These issues include accusations of whistleblower retaliation, worker rights violations such as sexual harassment and anti-union actions, and safety defects leading to numerous vehicle recalls. Furthermore, the company’s lack of a public relations department and controversial statements from Elon Musk, including overpromises regarding the company’s driving assistance technology and product release schedules, have also drawn attention.

History of Tesla, Inc.

Founding (2003–2004)

Tesla, Inc. was incorporated as Tesla Motors on July 1, 2003 by Martin Eberhard and Marc Tarpenning, who served as CEO and CFO, respectively. Eberhard envisioned building "a car manufacturer that is also a technology company," focusing on core technologies such as batteries, computer software, and proprietary motors.

Ian Wright was the third employee, joining shortly after the company's formation. In February 2004, Tesla raised $7.5 million in Series A funding, with Elon Musk contributing $6.5 million. Musk, who had made $100 million from the sale of his PayPal stake, became the largest shareholder and the chairman of Tesla’s board. In May 2004, J.B. Straubel joined as Chief Technical Officer. In September 2009, a lawsuit settlement allowed Eberhard, Tarpenning, Wright, Musk, and Straubel to officially be recognized as co-founders.

Roadster (2005–2009)

Elon Musk was actively involved in Tesla, though not in day-to-day operations. The company's strategy was to create a premium sports car aimed at early adopters, followed by more mainstream models like sedans and affordable compacts.

In February 2006, Musk led Tesla’s Series B funding round of $13 million, followed by a $40 million Series C round in May 2006, which attracted investors like Google’s co-founders and former eBay President Jeff Skoll. A $45 million funding round in May 2007 brought Tesla's total private financing to $105 million.

In August 2007, Elon Musk, after leading the board, asked Eberhard to step down as CEO, though Eberhard remained with the company until January 2008. Co-founder Marc Tarpenning also left in early 2008. Michael Marks served as interim CEO, and Ze'ev Drori took over as CEO in December 2007. Musk succeeded Drori as CEO in October 2008.

Tesla began Roadster production in 2008 in the service bays of a former Chevrolet dealership in Menlo Park. By January 2009, Tesla had raised $187 million and delivered 147 cars, with Musk contributing $70 million of his own funds. In June 2009, Tesla received $465 million in loans from the U.S. Department of Energy, part of the Advanced Technology Vehicles Manufacturing Loan Program, which supported the engineering and production of the Model S sedan.

IPO, Model S, and Model X (2010–2015)

In May 2010, Tesla purchased the NUMMI plant in Fremont, California from Toyota for $42 million. On June 29, 2010, Tesla went public with an IPO on the NASDAQ, raising $226 million by offering 13.3 million shares at $17 per share.

In October 2010, Tesla opened the Tesla Factory for the Model S production. By January 2012, Tesla ceased Roadster production and launched the Model S, a luxury sedan that won multiple automotive awards, including Motor Trend's Car of the Year in 2013. The Model S topped the Norwegian new car sales list in September 2013 and was the best-selling plug-in electric car globally in 2015 and 2016.

In July 2013, Tesla became a NASDAQ-100 company. Tesla Autopilot, a driver-assistance system, was announced in 2014 and shipped in all Tesla cars with hardware version 1.

In April 2015, Tesla entered the energy storage market with the launch of the Powerwall (for homes) and Powerpack (for businesses). Within a week, Tesla received orders worth $800 million. In September 2015, Tesla shipped its third vehicle, the Model X, a luxury SUV with 25,000 pre-orders at the time.

SolarCity and Model 3 (2016–2018)

In November 2016, Tesla entered the solar installation business by acquiring SolarCity in a $2.6 billion all-stock deal. The acquisition merged SolarCity with Tesla’s battery energy storage products division, creating Tesla Energy. This deal sparked controversy, as SolarCity was facing liquidity issues that Tesla’s shareholders were not made aware of at the time.

In February 2017, Tesla Motors officially rebranded itself to Tesla, Inc. to reflect its broader business focus, beyond just vehicles.

Model 3 Production Challenges

Tesla unveiled its highly anticipated Model 3 sedan in April 2016, marking its first mass-market vehicle. The Model 3 was designed to be more affordable than Tesla's previous models. The company received over 325,000 paid reservations within a week of its unveiling. To scale production and control costs, Tesla heavily invested in robotics and automation. However, these efforts led to unexpected delays and production challenges, which Musk referred to as "production hell." By end of 2018, Tesla overcame these issues, and the Model 3 became the world's best-selling electric car from 2018 to 2021.

This period put significant financial strain on the company, and Tesla became one of the most shorted stocks in the market. In August 2018, amid financial struggles, Elon Musk controversially announced on social media that he was considering taking Tesla private. The plan never materialized, leading to multiple lawsuits and an investigation by the SEC, which resulted in a $20 million fine for Musk and his resignation as Tesla's chairman, though he retained his role as CEO.

Global Expansion and Model Y (2019–Present)

Financial Success and Market Capitalization

From July 2019 to June 2020, Tesla reported four consecutive profitable quarters, making it eligible for inclusion in the S&P 500. In 2020, the company saw its share price surge by 740%. By December 2020, Tesla's market capitalization exceeded the combined value of the next nine largest automakers, positioning Tesla as the sixth-most valuable company in the U.S. The company was added to the S&P 500 on December 21, 2020.

Introduction of Model Y

In March 2019, Tesla launched its Model Y, a mid-size crossover SUV, based on the Model 3 platform. Deliveries of the Model Y began in March 2020.

Expansion of Production Capacity

Tesla expanded its global production network, opening several Gigafactories in rapid succession:

• Gigafactory Shanghai began construction in January 2019, marking the first wholly foreign-owned automobile factory in China. The factory’s first Model 3 was produced in December 2019, less than a year after groundbreaking.
• Gigafactory Berlin broke ground in February 2020, and production of the Model Y commenced in March 2022.
• Gigafactory Texas began construction in June 2020, and Model Y production started in April 2022.

Tesla also announced plans for a Gigafactory in Mexico, scheduled to open in 2025, though its groundbreaking has been delayed.

COVID-19 Impact and Legal Moves

In early 2020, the COVID-19 pandemic forced Tesla to temporarily close its Fremont Factory due to state and county restrictions. After California lifted restrictions but the county did not, Tesla sued Alameda County and resumed production on May 11, 2020. By December 2021, Tesla moved its legal headquarters to Gigafactory Texas, though it maintained a significant presence in California.

Bitcoin Investment and Controversy

In early 2021, Tesla made a $1.5 billion investment in bitcoin, and briefly began accepting it as payment for vehicle purchases. However, the company reversed this decision after concerns over the environmental impact of bitcoin mining. The decision caused a 12% drop in bitcoin’s value. Tesla later sold about 75% of its bitcoin holdings at a loss, citing concerns over profitability.

North American Charging Standard

Between May 2023 and February 2024, several major North American electric vehicle manufacturers announced plans to adopt Tesla’s North American Charging Standard (NACS) for their vehicles by 2025, which is expected to become a stable revenue source for Tesla.

Cybertruck Production and Future Plans

In November 2023, Tesla began shipping its long-awaited Cybertruck, produced at Gigafactory Texas. The Cybertruck is part of Tesla’s expansion into the pickup truck market.

Corporate Changes and Future Projections

In April 2024, Tesla announced it was laying off 10% of its workforce. By June 2024, Tesla moved its incorporation from Delaware to Texas. In October 2024, the company unveiled concept versions of two autonomous vehicles – the Cybercab and Robovan – which will be integral to a Tesla ride-hailing network expected to launch in the future.

Legal Challenges for Musk

In December 2024, a Delaware court ruled against Elon Musk's $56 billion pay package, declaring it was not properly approved by the board and did not align with performance metrics. This decision came from a lawsuit filed by Tesla shareholders, who argued that the compensation was excessive.

Automotive Products and Services

As of November 2024, Tesla offers a range of six vehicle models:

Model S: A luxury electric sedan, which has been one of Tesla’s flagship models. The Model S is known for its long range, performance, and advanced features like Autopilot and Full Self-Driving.

Model X: A luxury electric SUV with distinctive falcon-wing doors and spacious seating. The Model X shares the same platform as the Model S but offers additional features like autonomous driving capabilities and large cargo space.

Model 3: Tesla's first mass-market vehicle, a more affordable electric sedan. The Model 3 is known for its balance of range, performance, and affordability, and has been the best-selling electric car globally since 2018.

Model Y: A mid-size crossover SUV, also based on the Model 3 platform. It shares many components with the Model 3 but offers more interior space and a higher driving position. The Model Y became another key product for Tesla after it launched in 2020.

Semi: A heavy-duty electric truck designed for long-haul trucking. The Tesla Semi has impressive performance and range specifications, designed to disrupt the trucking industry by offering lower operating costs and zero emissions.

Cybertruck: An all-electric pickup truck that was introduced with an unconventional and futuristic design. The Cybertruck is designed to be rugged and capable, with strong durability features and performance. It began shipping in late 2023 from Gigafactory Texas.

Discontinued and Upcoming Models

First-generation Tesla Roadster: The original Tesla Roadster (introduced in 2008) was the company’s first electric vehicle. It is no longer sold, having been replaced by newer models.

Second-generation Roadster: Tesla has plans to release a second-generation Roadster, which is expected to push the limits of speed and range in an ultra-high-performance sports car.

Cybercab: A concept autonomous taxi being developed as part of the Tesla Network. The Cybercab would serve as a fully autonomous ride-hailing vehicle.

Robovan: Tesla is also working on a Robovan concept, which is expected to be an autonomous electric delivery van for businesses, and part of the Tesla Network.

These vehicles align with Tesla's broader strategy to accelerate the world's transition to sustainable energy by producing electric vehicles at scale, expanding its production capacity, and incorporating cutting-edge autonomous driving technologies.

Charging Services

Supercharger Network

The Supercharger network is Tesla's proprietary high-voltage direct current (DC) fast-charging infrastructure designed to quickly recharge Tesla electric vehicles (EVs). The Supercharger network was introduced on September 24, 2012, coinciding with the launch of the Tesla Model S. Initially, it had six stations in California and Nevada, and has since expanded rapidly worldwide.

As of September 2024, Tesla operates 6,706 Supercharger stations with nearly 62,421 connectors. The network is primarily deployed in three major regions:

• Asia Pacific: Over 2,650 stations
• North America: Over 2,550 stations
• Europe: Over 1,200 stations

Since 2019, most Superchargers have the ability to output up to 250 kW. As of January 2024, about 68% of the stations have V3 or V4 stalls that support this output, enabling faster charging times.

Destination Charging Location Network

The Destination Charging network consists of slower chargers compared to Superchargers, designed for locations where Tesla owners are expected to park for several hours, such as hotels, restaurants, or shopping centers. Unlike Superchargers, Tesla does not own the Destination chargers but provides charging equipment for property owners to install and set their own pricing.

The network launched in 2014, and major businesses like Hilton Worldwide have become key providers. In 2023, Hilton announced an agreement to install 20,000 Destination Chargers across 2,000 properties in North America by 2025.

Insurance Services

Tesla offers its own vehicle insurance in the United States, a service it introduced in 2017. It was created after reports from the American Automobile Association (AAA) in 2017 found that Tesla cars were more expensive to repair and crashed more frequently than other vehicles, prompting a rise in insurance premiums.

Tesla's unique offering comes from its deep understanding of its vehicles, technology, and repair costs. Unlike traditional insurance carriers, Tesla aims to eliminate additional charges by offering more personalized pricing. This is done by using real-time driving data to assess the driving safety score and adjust insurance rates accordingly.

As of January 2023, Tesla offers insurance in the following U.S. states:

• Arizona
• California
• Colorado
• Illinois
• Maryland
• Minnesota
• Nevada
• Ohio
• Oregon
• Texas
• Utah
• Virginia

Tesla also provides insurance for non-Tesla vehicles owned by Tesla car owners, expanding its reach beyond just its own customer base.

Energy Products

Tesla Energy Overview

Tesla Energy, a subsidiary of Tesla, develops, builds, sells, and installs solar energy generation systems and battery energy storage products for residential, commercial, and industrial customers. The subsidiary was formed after the acquisition of SolarCity in 2016, merging it with Tesla's existing battery storage division.

In 2023, Tesla Energy deployed 14.7 gigawatt-hours of battery storage products, marking a 125% increase over 2022, but deployed only 223 megawatts of solar energy systems, a 36% decrease from the previous year.

Tesla Energy Products

• Solar Products: Tesla offers solar panels (manufactured by other companies), the Tesla Solar Roof (a solar shingle system), and the Tesla Solar Inverter.
• Storage Products: Tesla’s battery storage offerings include the Powerwall (for home energy storage) and the Megapack (for large-scale storage solutions).

For large-scale customers, Tesla Energy operates an online platform for automated real-time power trading, demand forecasting, and product control. As of March 2021, Tesla was managing over 1.2 GWh of storage through this platform.

For residential customers, Tesla operates a virtual power company in Texas, called Tesla Electric, which allows customers to sell excess power from their Powerwall devices back into the grid when prices are high, earning money in the process.

Business Strategy

Tesla’s approach to the electric vehicle (EV) market is built on a progressive pricing strategy. Initially, Tesla focused on high-price, low-volume sports cars (e.g., the Roadster), targeting customers less sensitive to price. This allowed Tesla to lower the cost of batteries over time, enabling the development of more affordable vehicles such as the Model S and Model X. With the introduction of the Model 3 and Model Y, Tesla moved toward higher-volume production at lower prices, targeting the mass market.

Tesla's production model is unique in that it directly sells vehicles to consumers through its website and company-owned stores rather than relying on franchised dealerships. This method allows Tesla to control the customer experience and avoid traditional dealer markups. The company also operates nearly 400 stores and galleries in over 35 countries, usually located in high-traffic areas such as malls and shopping districts.

Vertical Integration

Tesla is often described as vertically integrated, meaning it designs and manufactures many key components in-house, including batteries, motors, and software. This approach contrasts with most automotive companies that typically outsource many components.

Tesla also encourages competitors to license its technology, aiming to accelerate the global transition to sustainable energy. The company has agreements that prevent competitors from filing patent lawsuits against Tesla, while still retaining control over intellectual property such as trademarks and trade secrets.

Expansion Plans and Strategic Shifts

• Indian Market Expansion: On April 15, 2024, Tesla reached a deal with Tata Electronics to supply semiconductor chips, marking a step into the Indian automotive market.
• Gigacasting Shift: On May 2, 2024, Tesla abandoned its plans for next-generation gigacasting, a cutting-edge manufacturing technique. Instead, the company opted for its more proven method of casting vehicle underbodies in three pieces. This strategic shift highlights Tesla's focus on self-driving vehicles and adapting to market challenges.

Technology

Battery Technology

Tesla is highly vertically integrated in its battery development, producing many key components in-house and sourcing from suppliers. As of 2023, Tesla uses four different battery cell form factors:

• 18650: First used in the Roadster, these cells are smaller and require a large number to form a battery pack. They are sourced from Panasonic and are used in the Model S and Model X.
• 2170: Introduced for the Model 3 and Model Y, these cells offer a higher capacity and fewer cells per pack. Tesla sources these from Panasonic and LG Energy Solution.
• 4680: A larger, more energy-efficient cell designed and built in-house by Tesla, currently used in Model Y and Cybertruck. Tesla has production lines in Fremont, Nevada, and Texas for these cells.
• Prismatic: Rectangular lithium iron phosphate (LFP) cells are used in entry-level Model 3 and Model Y vehicles. These cells are less energy-dense but cheaper to produce, sourced from CATL.

Tesla also invests heavily in battery research, collaborating with Dalhousie University and acquiring companies like Maxwell Technologies and Hibar Systems.

Software

Tesla leads the industry in over-the-air software updates, delivering new features and fixes to vehicles without requiring a visit to a service center. This integrated approach gives Tesla control over vehicle functionality, such as software locks for heated seats and Full-Self Driving (FSD) features, which can be activated through software updates or purchased upgrades.

Motors

Tesla manufactures two types of electric motors:

1. Induction Motor: Used in earlier models like the Model S and Model X, this motor relies on electromagnetic induction to generate torque.
2. Internal Permanent Magnet (IPM) Motor with Synchronous Reluctance (SynRM): Introduced in the Model 3, this motor provides excellent starting torque but is more efficient at high speeds. It is used in the Model 3, Model Y, and expected in the Tesla Semi.

North American Charging Standard (NACS)

Tesla developed the NACS, a charging connector system used across all its vehicles in North America since 2012. In 2022, Tesla opened the system to other manufacturers, and by 2025, many electric vehicles and charging network operators plan to adopt the NACS.

Autopilot and Full-Self Driving (FSD)

Tesla’s Autopilot is an advanced driver-assistance system offering Level 2 automation, with features like Autosteer and traffic-aware cruise control. Full-Self Driving (FSD) adds more capabilities, including semi-autonomous navigation, lane change assistance, self-parking, and summon. Tesla's ultimate goal is to achieve Level 5 autonomy, but challenges remain, including regulatory approval and technological hurdles. Despite the promise, Tesla's approach has faced criticism due to accidents involving Autopilot and FSD and the decision to let untrained consumers test these features.

Glass

Tesla produces roof glass for the Model 3 and solar shingles for the Solar Roof, leveraging the Tesla Glass technology group established in 2016.

Robotics and Automation

Tesla has made significant investments in robotics for vehicle assembly. Between 2015 and 2017, the company acquired automation firms like Grohmann Automation and Perbix Machine Company. However, heavy reliance on robotics initially slowed production, leading to a shift toward Giga Presses, massive casting machines that create large, single-piece underbodies. While these presses reduce costs and factory space, critics argue that fewer components make the vehicles harder or more expensive to repair.

Additionally, Tesla has been developing Optimus, a humanoid robot designed to leverage Full-Self Driving technology for automating tasks, including in Tesla factories to address labor shortages.

Facilities

As of October 2024, Tesla operates seven large factories and about a dozen smaller factories across the globe. These facilities play a crucial role in the production of vehicles, batteries, and energy products.

Major Tesla Factories

1. Fremont Factory (California, USA): Tesla's first major factory, producing the Model S, Model X, Model 3, and Model Y. It has also served as the base for early battery production.
2. Gigafactory Nevada (USA): This factory focuses on the production of batteries and energy products like the Powerwall and Solar Roof. It's one of the world's largest battery production sites.
3. Gigafactory Shanghai (China): Tesla's first manufacturing plant outside the U.S., producing the Model 3 and Model Y for the Chinese and global markets.
4. Gigafactory Berlin (Germany): The European production hub for the Model Y, with plans to scale to produce a wide range of vehicles.
5. Gigafactory Texas (USA): A major site for Model Y production, Cybertruck, and 4680 battery cells.
6. Gigafactory Mexico (Planned): Tesla has announced plans for another Gigafactory in Mexico, aimed at expanding production and boosting global market share.
7. Gigafactory India (Planned): Tesla is working on establishing a factory in India to produce affordable electric vehicles for the local market.

Smaller Factories

Tesla operates numerous smaller facilities that focus on various production needs, including battery components, vehicle parts, and other accessories essential for vehicle and energy product assembly.

Retail and Service Locations

Tesla also has a significant global presence through its 1,300+ retail stores, galleries, and service locations. These locations not only sell vehicles but also provide essential services like:

• Vehicle delivery
• Repairs and maintenance
• Body shop services

These stores and service locations are strategically placed in high-traffic areas, often within shopping malls or retail districts, to make Tesla’s offerings more accessible to customers worldwide.

Lawsuits and Controversies

Sexual Harassment

• In 2021, several women accused Tesla of fostering a culture of sexual harassment and discrimination at its Fremont factory. Allegations included catcalling, unwanted advances, groping, and general mistreatment.
• Victims feared retaliation and avoided reporting incidents to Human Resources, as supervisors were reportedly involved in the misconduct.
• Some pointed to CEO Elon Musk's behavior and comments, linking them to the culture of harassment.
• In May 2022, a California judge allowed a sexual harassment lawsuit to proceed to court, rejecting Tesla's bid for closed-door arbitration.

Labor Disputes

• United States:
  • Tesla faced scrutiny for its use of non-disclosure agreements (NDAs), with concerns raised by the National Highway Traffic Safety Administration (NHTSA) in 2016 and 2021.
  • Between 2014 and 2018, the Fremont Factory had multiple Occupational Safety and Health Administration (OSHA) violations, and Tesla was accused of underreporting injuries to downplay safety issues.
  • A whistleblower complaint in 2019 accused Tesla of hacking employees' phones and failing to report illegal activities.
  • In 2019, a California judge ruled that Tesla executives violated labor laws by interfering with unionization efforts, and in 2021, the National Labor Relations Board ruled against Elon Musk, ordering the reinstatement of a fired employee involved in union activities.
  • The California Civil Rights Department filed a lawsuit in 2022 regarding racial harassment at the Fremont factory.
• Europe:
  • In October 2023, a strike was initiated by IF Metall in Sweden over Tesla's refusal to sign a collective agreement, affecting mechanics at Tesla service centers.
  • In September 2024, the Berlin-area factory faced criticism for conducting unannounced home visits to employees on sick leave in an attempt to curb absenteeism.

Fraud Allegations

Financial Reporting:

• Concerns over Tesla's financial reporting arose, with accusations of creative accounting and violations of Generally Accepted Accounting Principles (GAAP). In 2019, hedge fund manager David Einhorn accused Musk of "significant fraud."
• Tesla faced scrutiny for earning Zero Emission Vehicle credits from a battery-swapping technology that was never made available.
• A consolidated shareholders lawsuit alleged that Musk and the Tesla board overpaid for SolarCity, ignoring conflicts of interest and failing to disclose key facts. In 2022, Musk won the case.

False Statements and SEC Investigation:

• In 2018, Musk's tweet about taking Tesla private at $420 caused stock price volatility and led to an investigation by the US Securities and Exchange Commission (SEC).
• Musk settled fraud charges, agreeing to have his tweets reviewed by Tesla's in-house counsel, stepping down temporarily as chairman, and paying civil penalties.
• In February 2023, a California jury found Musk and Tesla not liable in a class-action lawsuit related to the take-private tweet.

Model 3 Production Figures:

• Tesla was investigated by the FBI in 2018 over Model 3 production figures, suspected of misleading investors and making impossible projections.
• In May 2024, Reuters reported that US federal prosecutors were investigating Tesla over possible securities or wire fraud related to Autopilot and Full Self-Driving claims.

Tesla US Dealership Disputes

• Tesla operates a direct sales model through its website and company-owned stores, bypassing franchised dealerships. This approach has led to legal challenges, particularly in the United States, where certain states prohibit manufacturers from directly selling to consumers.
• Dealership associations have filed lawsuits to prevent direct sales, arguing that the franchise system benefits consumers by promoting competition among dealers, thus lowering prices. They also claim that direct sales would harm dealerships' interests.
• The Federal Trade Commission (FTC) supported the direct sales model, claiming that it could lead to an 8% savings on vehicle prices for consumers.

Intellectual Property

• In January 2021, Tesla sued former employee Alex Khatilov for allegedly stealing company information related to Warp Drive software. The case was settled in August 2021 through mediation.
• Tesla has also taken legal action against former employees who left to work for rival companies, such as XPeng and Zoox. In one case, Guangzhi Cao, a Tesla engineer, was accused of uploading Tesla's Autopilot source code to his iCloud account. The case was settled in April 2021, with Cao agreeing to compensate Tesla monetarily.

Misappropriation

• In 2018, a class-action lawsuit accused Elon Musk and the Tesla board of breaching fiduciary duties by approving Musk's stock-based compensation plan. Musk received a payout exceeding $700 million in May 2020.
• In July 2023, Tesla board members returned $735 million to settle a claim involving the misappropriation of stock options granted to Musk, his brother Kimbal Musk, and Larry Ellison from 2017 to 2020.

Environmental Violations

• In 2019, Tesla faced fines from the Environmental Protection Agency (EPA) for hazardous waste violations from 2017. Tesla also negotiated penalties for environmental violations at its Fremont factory related to the paint shop and several fires.
• Martin Tripp, a former Tesla employee, leaked information about raw material waste at the Nevada Gigafactory and later claimed Tesla's security team falsely accused him of planning a mass shooting. A court ruled in favor of Tesla in September 2020.
• In January 2024, Tesla settled a lawsuit with 25 California counties for illegally disposing of hazardous waste, agreeing to pay $1.5 million and implement new training and audits.

Property Damage

• Walmart filed a multi-million-dollar lawsuit in 2019, alleging that Tesla's negligent installation and maintenance of solar panels caused roof fires at seven Walmart stores. The case was settled in November 2019.
• In April 2021, a Norwegian judge found Tesla guilty of throttling charging speeds through a 2019 software update, resulting in a $16,000 payout to 30 customers.

Racism and Workplace Harassment

• Tesla has faced multiple complaints regarding workplace harassment and racial discrimination, especially at its Fremont plant. Claims have been made by former Black employees who described the environment as racially segregated and discriminatory.
• A 2021 lawsuit filed by the California Department of Fair Employment and Housing alleged that Tesla discriminated against its Black workers. In July 2021, former employee Melvin Berry was awarded $1 million in arbitration for racial discrimination.
• In October 2021, a jury awarded $137 million in damages to Owen Diaz for facing racial harassment at Tesla's Fremont facility during 2015–2016. The damages were later reduced to $15 million, but Diaz rejected the offer and pursued a new trial, which resulted in a $3.2 million award in April 2023.
• Tesla has often used arbitration agreements to keep such cases out of public court trials, with many cases being settled behind closed doors.

Tesla's COVID-19 Pandemic Response

• Initial Response and Controversy: Tesla's response to the COVID-19 pandemic in the U.S. drew significant criticism, especially from Elon Musk. In March 2020, Musk sought to have Tesla's Fremont Factory in Alameda County, California exempted from the region's stay-at-home orders.
• Musk referred to the public health measures as "fascist" and dismissed concerns about the pandemic, even predicting that there would be zero cases by April 2020. His comments led to backlash from public health experts.
• In April 2020, during an earnings call, Musk referred to the response as "dumb" and continued to downplay the seriousness of the situation.

Fremont Factory and Reopening

• In May 2020, while local officials in Alameda County were negotiating a safe reopening plan for Tesla's Fremont facility, Musk defied local government orders and restarted production at the plant on May 11, a week before it was authorized to reopen.
• Tesla sued Alameda County over the stay-at-home order but backed down after gaining approval to reopen the Fremont Factory.
• Tesla outlined a safety plan for returning employees to work in June 2020 but faced internal criticism from employees who felt the measures were insufficient to protect their health.

Employee Concerns and Dismissals

• Musk's Message to Employees: In May 2020, Musk told employees they could stay home if they felt uncomfortable returning to work. However, in June 2020, Tesla dismissed an employee who publicly criticized the company for inadequate safety measures at the Fremont Factory.
• Additional employees claimed they were laid off for staying home due to COVID-19 fears, although Tesla denied these allegations and stated that the employees remained on the payroll.
• Despite Tesla's efforts, COVID-19 cases at the Fremont Factory grew from 10 cases in May 2020 to 125 cases by December 2020, totaling around 450 cases out of 10,000 workers (4.5%).

Tesla in China

• In China, Tesla received significant government support. An executive described the company's return to work as being aided by a "flashing-sirens police escort" rather than official approval.
• Tesla was granted special treatment in China, including tax breaks, cheap financing, and rapid construction of its Giga Shanghai factory.
• Musk has often praised China's government policies, which has been controversial due to rising tensions between the U.S. and China, human rights concerns in Xinjiang (with the persecution of Uyghurs), and alleged abuses in Hong Kong. Musk's stance was criticized by those who believe he downplays these human rights issues in favor of business interests.

Tesla Criticism

Data Privacy

• Mozilla Foundation Review: Tesla was only the second product ever reviewed by the Mozilla Foundation, which highlighted significant privacy concerns with the company's handling of user data.
• Lawsuit in 2023: In 2023, a Tesla owner filed a lawsuit after Reuters reported that Tesla employees were sharing "highly invasive videos and images" captured by customers' car cameras.
• Whistleblower Data Leak: In late 2023, former employee Lukasz Krupski leaked internal data revealing serious lapses in data protection. This data, which included sensitive information about current and former Tesla staff (e.g., passport numbers, medical details, and salaries), was readily accessible to most employees in Tesla's internal systems.
• Regulatory Investigation: In November 2023, the Dutch Data Protection Authority began investigating whether Tesla violated privacy laws due to the lack of internal security measures for handling sensitive personal data.

Short Sellers and Criticism of Tesla's Stock

• Short Selling (TSLAQ): The group TSLAQ consists of short sellers and Tesla critics who seek to affect Tesla's stock price. In January 2020, 20% of Tesla's stock was shorted, the highest of any stock in the U.S. at the time.
• Losses for Short Sellers: By early 2021, short sellers had incurred $40 billion in losses in 2020 as Tesla's stock price skyrocketed.
• Michael Burry's Position: Michael Burry, who was portrayed in The Big Short, had previously shorted Tesla through his firm Scion Asset Management, but closed his position in October 2021.

Tesla's Mission and Strategic Intentions

• Electric Revolution or Business?: Jamie Kitman, an automotive journalist, questioned whether Tesla's true mission was truly about advancing the electric vehicle (EV) revolution. Kitman noted that multiple automotive manufacturers approached Tesla for EV technology, but Tesla instead offered them the opportunity to purchase regulatory credits. This suggested that Tesla may have been more focused on profits from credits rather than driving a broad electric vehicle transition.

Giga New York Audit

• 2020 Audit by New York Comptroller: A 2020 audit by the New York State Comptroller raised concerns about Tesla's Giga New York factory project. The audit found red flags such as the lack of basic due diligence in the project and that the factory only generated $0.54 in economic benefits for every $1 spent by the state, calling into question the economic viability of the project.

Production Delays

• Repeated Delays: Musk has faced repeated criticism for pushing back production and release dates for Tesla vehicles and projects. In 2016, Musk had missed 20 projections regarding timelines for product rollouts.
• Model 3 Delays: In October 2017, Musk predicted that the Model 3 production would reach 5,000 units per week by December, but he later revised the target to "sometime in March" 2018.
• Supercharger Delays: Other projects, like converting supercharger stations to solar power, have also faced significant delays, prompting Musk to acknowledge in 2018 that "punctuality is not my strong suit" and noting that "I never made a mass-produced car. How am I supposed to know with precision when it's gonna get done?"

Tesla Vehicle Product Issues

Recalls

Tesla has faced several recalls related to vehicle safety and technical issues:

• 2017 Recall: Tesla recalled 53,000 vehicles (70% of the 2016 sales) due to faulty parking brakes that could prevent the car from moving.
• 2018 Recall: 123,000 Model S cars (pre-April 2016) were recalled due to corrosion-susceptible power steering bolts that could fail, requiring increased force to steer.
• 2020 Recalls: Tesla recalled 50,000 Model X and Y vehicles in China due to suspension issues, followed by an investigation into 115,000 vehicles in the U.S. for front suspension safety problems.
• 2021 Recalls:
  • In February, 135,000 Model S and X vehicles were recalled for touchscreen failures due to a flash memory device wearing out prematurely.
  • The German Federal Motor Transport Authority (KBA) ordered a recall of 12,300 Model X cars for body moulding issues.
  • 5,974 electric vehicles were recalled due to loose brake caliper bolts potentially leading to tire pressure loss.
• December 2021: Tesla recalled 475,000 vehicles in the U.S. for rear-view camera and trunk issues.
• 2022 Recall: Tesla recalled nearly 1.1 million vehicles due to potential issues with the automatic window reversal system.
• February 2023: Tesla recalled 360,000 vehicles due to issues with its Full Self-Driving (FSD) software.
• December 2023: Tesla issued a 2.03 million vehicle recall due to Autosteer issues, affecting all vehicles equipped with this feature from 2012–2023.

Fires

• Model S Fires: In 2013, a Model S caught fire after hitting road debris. Tesla confirmed the fire started in the battery pack. Following several fire incidents, Tesla improved its battery pack protection and extended warranties for fire damage.
• NHTSA Investigation: In 2019, the NHTSA opened an investigation into potential battery defects in 2012–2019 Model S and X vehicles that could lead to non-crash fires.

Autopilot Crashes

• Fatalities: Several fatal crashes occurred involving Tesla’s Autopilot feature:
  • In 2016, a Model S driver died after a collision with a tractor-trailer while in Autopilot mode.
  • In 2018, a Model X driver died after the vehicle malfunctioned in Autopilot mode.
• NHTSA Investigations: The NHTSA initiated at least 30 investigations into Tesla crashes involving Autopilot. Some investigations involved fatalities and collisions with emergency vehicles. In September 2021, the NHTSA expanded its investigation into 830,000 Tesla vehicles to explore human behavior risks related to Autopilot.

Software Hacking

• 2015 & 2016 Hacks: Security researchers demonstrated the ability to take control of a Tesla Model S by hacking its entertainment system, both with physical access (2015) and remotely (2016). Tesla responded promptly by releasing security patches.
• Cryptocurrency Mining Incident: In 2018, an Amazon Web Services account of Tesla’s was exploited for cryptocurrency mining, but no vehicle safety or privacy was compromised. Tesla secured the system and rewarded the researchers.
• NFC Vulnerabilities: In 2022, researchers discovered vulnerabilities in Tesla’s NFC card system that allowed attackers to enroll new keys for vehicles.

Phantom Braking

• Reports of Phantom Braking: Tesla drivers reported sudden, unintended braking, especially after Tesla removed radar sensors from Autopilot in May 2021. NHTSA opened an investigation, and a class action lawsuit was filed.
• 2023 Investigations: Internal data leaks revealed 1,000+ accident reports involving phantom braking and unintended acceleration. Dutch authorities are investigating potential privacy violations.

Driving Range Performance

• Complaints About Range: Many Tesla owners reported that the actual driving ranges of their vehicles did not match the advertised range or the range displayed on in-dash meters. Tesla faced regulatory fines in South Korea for exaggerated range estimates.

Vehicle Sales and Market Share

• 2023 Sales: Tesla was the world's best-selling battery-electric car manufacturer, with a 19.9% market share and 1.8 million vehicles delivered.
• 2024 Production: Tesla produced its six millionth car in March 2024.
• Sales Leadership: BYD briefly overtook Tesla in Q4 2023 for EV shipments, but Tesla regained the top spot in Q1 2024.

Tesla Financial Performance

2021 Financials

• Net Income: Tesla reported a net income of $5.52 billion for the fiscal year 2021.
• Annual Revenue: Tesla's annual revenue reached $53.8 billion, marking a 71% increase compared to the previous year.
• Regulatory Credits: Tesla earned $314 million from selling regulatory credits to other automakers, which helped them meet government pollution standards. However, this revenue stream has become a smaller percentage of Tesla’s total revenue over time.

Sales by Business (2023)

• Automotive: Tesla generated $90.7 billion in revenue from automotive sales, accounting for 93.8% of total sales.
• Energy Generation and Storage: Tesla earned $6.0 billion from its energy generation and storage segment, making up 6.2% of the total sales.

Sales by Region (2023)

• United States: $45.2 billion in revenue, representing 46.7% of total sales.
• Other Countries: $29.8 billion, accounting for 30.8% of total sales.
• China: $21.5 billion in revenue, contributing 22.5% to total sales.

Cash on Hand

• At the end of 2021, Tesla had $17.6 billion in cash, which was a decrease of $1.8 billion from the end of 2020.

Cryptocurrency Investment

• In February 2021, Tesla revealed it had invested $1.5 billion in Bitcoin. This decision sparked debates as it seemed counter to Tesla's environmental goals, considering Bitcoin mining’s high energy consumption.
• Despite the criticism, Tesla profited more from its Bitcoin investment in 2021 than from selling cars in 2020, benefiting from the surge in Bitcoin's price after the investment.

Tesla Corporate Affairs

List of Chief Executives

• Martin Eberhard (2004–2007)
• Ze'ev Drori (2007–2008)
• Elon Musk (since October 2008)

List of Board Chairs

• Elon Musk (2004–2018)
• Robyn Denholm (since November 2018)

Board of Directors Criticism

Tesla has faced criticism over the composition of its board, particularly regarding the lack of independent directors.

In April 2017, a group of influential investors, including the California State Teachers' Retirement System, publicly requested that Tesla add two independent directors who had no ties to Elon Musk.

The investors expressed concerns that five of the six non-executive directors at the time had personal or professional ties to Musk, which could compromise their ability to provide independent judgment. The board members at the time included:

• Brad Buss (former CFO of SolarCity)
• Steve Jurvetson (venture capitalist and board member of SpaceX)
• Kimbal Musk (Elon Musk's brother)
• Ira Ehrenpreis and Antonio Gracias (investors in SpaceX).

Elon Musk initially responded dismissively, suggesting investors buy Ford stock instead. However, he later agreed to add two independent members, Kathleen Wilson-Thompson and Larry Ellison, to the board by the end of 2018.

In August 2022, Larry Ellison stepped down from the board, and in 2023, former Tesla CTO J. B. Straubel was elected to the board after leaving the company in 2019.

Criticism of Lack of Automotive Experience

Another criticism of Tesla’s board is that most of its independent directors lack experience in the automotive industry. The exception is Robyn Denholm, who served in finance and corporate reporting roles at Toyota Australia from 1989 to 1996.

Other Former Board Members

• Steve Westly (businessman)
• Herbert Kohler (executive at Daimler)
• Linda Johnson Rice (CEO and Chairwoman of Johnson Publishing Company)
• Hiromichi Mizuno (United Nations Special Envoy on Innovative Finance and Sustainable Investments)

References

• (No date) Model Y juniper in black! : R/teslamotors. Available at: https://www.reddit.com/r/teslamotors/comments/1hz5u38/model_y_juniper_in_black/ (Accessed: 13 January 2025).
• The history of Elon Musk’s tesla (2024) Quartz. Available at: https://qz.com/tesla-elon-musk-ev-auto-industry-history-1851366760 (Accessed: 13 January 2025).
• Howdy, Tesla! (no date) Austin Chamber of Commerce. Available at: https://www.austinchamber.com/blog/howdy-tesla (Accessed: 13 January 2025).
• Tesla Cybertruck, Elon Musk’s latest gamble, set to debut (2023) www.ndtv.com. Available at: https://www.ndtv.com/world-news/tesla-cybertruck-elon-musks-latest-gamble-set-to-debut-4620587 (Accessed: 13 January 2025).
• www.ETEnergyworld.com (2022) Tesla ranks low on EV quality, battery vehicles more problematic: Report - ET energyworld, ETEnergyworld.com. Available at: https://energy.economictimes.indiatimes.com/news/power/tesla-ranks-low-on-ev-quality-battery-vehicles-more-problematic-report/92563069 (Accessed: 13 January 2025).