Cofounder Vinay Hiremath of Loom, which Atlassian purchased for $975 million in 2023, wrote a blog post detailing his experiences and fears following the sale of his profitable firm. In a blog post titled “I Am Rich and I Have No Idea What to Do with My Life,” he recounted the different interests he examined after learning he no longer needed to work for money anymore. He detailed his experiences, including rejecting a $60 million job offer, quitting a relationship, and making futile attempts at robotics and government reform.
I’m in the completely unrelatable situation of never having to work again after selling my business. In a depressing manner, everything seems like a side mission. Despite having limitless freedom, I am unsure of how to use it. “This post isn’t meant to garner sympathy or boast,” he stated.
Recalling the Hard Times
Despite being offered a possible $60 million compensation as CTO, Hiremath struggled to stay with the acquiring business, as he disclosed in the blog post. “What is the point of money if it is not for freedom?” he said, rejecting it. The Loom cofounder went on a journey to the Himalayas with no prior expertise, but it ended abruptly when he became ill and needed to be rappelled down a mountain. His buddies encouraged him to join the Department of Government Efficiency (DOGE) and work for Vivek Ramaswamy and Elon Musk after he recovered. Hiremath was able to secure the job, but he left after only four weeks after deciding it wasn’t a good fit.
“I therefore cancelled my plans to go to Washington, DC, and set out on a mission to save our country alongside some of the most intelligent people I’ve ever encountered after four demanding and intoxicating weeks.” He added, “And I purchased a one-way ticket to Hawaii.”
Hiremath concluded his blog post by stating that he is studying physics in the jungles of Hawaii. He intends to launch a business that produces tangible goods. He stated that he is content that his new business does not have to duplicate Loom’s success.
About Vinay Hiremath
Born in 1991, Vinay Hiremath dropped out of the University of Illinois at Urbana-Champaign after just two years. He relocated to Palo Alto, California, in order to pursue his love of startups. In 2018, Forbes listed him as one of the 30 under 30.
His first noteworthy job was as a software developer at Backplane, a well-funded Silicon Valley firm that focused on creating online communities. During their tenure at Backplane, Shahed Khan was introduced to Vinay Hiremath, with whom he subsequently co-founded Loom. Vinay Hiremath has also made investments in start-ups such as Enterpret Company.
He co-founded Loom with Joe Thomas and Shahed Khan in the early 2010s. Users of the video-sharing website Loom can produce and distribute short videos. Forbes claims that it currently serves over 14 million people and 2 lakh enterprises.
In its initial stages, Loom was mere weeks away from bankruptcy. Hiremath used all of his credit cards to keep the business solvent. As co-founder and former CTO of Loom, he grew the company from zero to 250 employees, helped raise $200 million in funding, and increased the number of users to over 30 million worldwide.
On December 18, 2024, sources notified a media outlet that Manipur’s security forces had retrieved Starlink internet devices from the Imphal East district, along with sniper guns, pistols, grenades, and other weapons. According to the report, the retrieval took place on December 13 during a concerted operation in multiple districts, including Churachandpur, Chandel, Imphal East, and Kangpokpi. The first satellite constellation in the world, Starlink is owned by US tech tycoon Elon Musk’s aerospace company, SpaceX, and offers broadband internet anywhere in the world where the service has a licence to operate.
Refuting the Claims
When asked if militants in India use Starlink, Musk responded that the claims are “false” and that Starlink satellite beams are switched off over India. Security authorities said the recovery of the Starlink gadget has led the appropriate agencies to look into how the technology got to the state that is riven by conflict. Starlink is not authorised to conduct business in India. The discovery of sophisticated satellite internet gear represents a concerning increase in insurgent capabilities, even though such seizures usually contain weapons and ammunition. The insurgents’ use of Starlink, which offers high-speed satellite internet, suggests a possible change in their operating approach by allowing them to get past conventional communication obstacles.
The Security Consequences of Startlink
In India’s insurgency-prone areas, Starlink’s capacity to deliver dependable internet connection in isolated and disconnected locations presents a special risk. The satellite internet provides end-to-end encryption, which makes it more difficult for intelligence services to monitor rebel conversations than traditional communication systems that are susceptible to disruption or interception. The Revolutionary People’s Front (RPF) and its armed component, the People’s Liberation Army (PLA), one of the most active rebel groups in Manipur, were identified by markings on the discovered device.
Given that Starlink does not currently have a satellite broadband licence in India, the use of such technology sparked concerns about how the terrorists obtained the gadget. Security experts think that in order to get around restrictions, the device might have been smuggled into the nation or activated using phoney geotagging. According to a senior officer, this is more than just a technological seizure; it’s a window into the evolution of insurgency groups. The official also noted that the ability to access high-speed internet from distant locations alters the dynamics of coordination and communication for these organisations.
Additional Consequences of Security Agencies
Counterinsurgency operations face a number of difficulties when militants use satellite internet. Now, insurgent organisations may share real-time intelligence, run propaganda campaigns, and more efficiently coordinate operations across vast places.
Conventional techniques for tracking insurgent communications, like phone interceptions and internet usage surveillance, might lose their effectiveness. Instead of depending on local networks, rebels may use Starlink to communicate directly with outside organisations, sponsors, or supporters.
The civilian population may potentially be at risk from this trend, according to security experts. Insurgents’ unfettered access to the world internet creates opportunities for cyberattacks, the dissemination of false information, and even recruitment efforts aimed at young people who are particularly vulnerable.
Indian police are now keeping an eye on Elon Musk’s Starlink after drug smugglers allegedly used one of its internet service devices to transport $4.25 billion worth of cocaine from Myanmar into Indian waters. According to reports cited by a media house, police officers in the Andaman and Nicobar Islands have served Starlink with a legal notice requesting the identity of the buyer of the gadget that enabled the peddlers to smuggle illegal goods into the nation by water. The payment method used to buy the Starlink Mini device connected to the drug smuggling case, registration information, and usage history are among the other elements the police are looking for.
Police Found Satellite Internet Device
Six Myanmar nationals were arrested by the local police in November for carrying more than 6,000 kg of meth on a boat. On the same boat, the police officers discovered the satellite internet gadget. The case’s senior police officer went on to say that the incident sparked “alarm bells” because it was the first time that drugs were smuggled into Indian waters using a Starlink device to cross the deep sea. This development coincides with Starlink’s application for a government licence to provide its satcom services in the nation. It is already involved in a dispute with two of the biggest telecom companies, Bharti Airtel and Reliance Jio, regarding the distribution of satcom spectrum.
Tug of War Between Companies Over Allocation of Spectrum
Airtel and Jio have requested an auction of the satcom spectrum, while Starlink and Amazon Kuiper have demanded that the spectrum be distributed administratively. It is important to remember that Starlink has not yet received the Centre’s security authorisation to begin offering satellite broadband services in India. The government wants the business to guarantee that data processing and storage would take place locally.
This comes after Jyotiraditya Scindia, the minister of communications, stated last month that satellite service spectrum will be distributed administratively but at a “cost” that would be determined by TRAI following thorough discussions with relevant parties. Chandra Sekhar Pemmasani, the Minister of State (MoS) for communications, stated earlier this month that satcom should be viewed as an adjunct to terrestrial networks like 5G and 6G in order to close the digital gap and improve last-mile connectivity in India.
Earlier this month, the director of Starlink Satellite Communications, Parnil Urdhwareshe, stated during the open house that Indian consumers desire satellite broadband services and that these “intelligent consumers” are entitled to select an operator that will offer them a high-quality, reasonably priced service. He noted that Starlink’s website easily provides costs for any country and that the company takes pride in making satellite broadband accessible to those who have not yet had it.
After the company’s worldwide ad sales team was fired by the new management led by Elon Musk, Twitter Communications India, now a part of X Corp. (previously Twitter), had a steep decline in net profit and revenue in the most recent fiscal year. This decline was mostly caused by a fall in ad revenues.
The company’s net profit fell 90% to INR 3 crore from INR 30 crore the year before, according to its regulatory filings. Additionally, revenue dropped 90% from INR 208 crore to INR 21 crore. With an estimated 25 million users, Twitter’s revenue in India is primarily derived from advertising.
Cutting Down on Expanses and Workforce
As it laid off almost all of its Indian personnel, which had previously consisted of more than 200 workers, the company reduced employee benefit costs by 95%, from INR 130 crore to INR 6 crore. The overall expenses then dropped from INR 168 crore to INR 19 crore, an 89% decrease.
In October 2022, Musk successfully paid $44 billion to acquire Twitter, which he later rebranded as X. Musk enacted significant changes around the world after the takeover, including widespread layoffs that had a significant effect on the ad sales teams, particularly in India.
A steep drop in revenue was caused by the combination of firing the ad sales teams and international businesses abandoning the platform, partly as a result of disagreements with Musk. Without an active sales force to keep up with clients and draw in new business, Twitter’s ad income in India plummeted, resulting in sharp drops in profitability and earnings, according to a digital advertising specialist. This illustrates the wider difficulties X Corp has had around the world as it attempts to manage the consequences of internal reorganisation while putting new plans into action under Musk’s direction.
Adding More Pain to the Agony
To make matters worse for the company, X has even sued multinational advertisers like Unilever and Mars for disregarding the platform under Musk. A net 26% of marketers stated that they intended to cut back on their X ad spending in 2025, the largest pullout from any significant worldwide ad platform to date, according to Kantar research.
The ongoing disputes with Musk caused several international businesses to halt their advertising in India, according to experts. Even in India, many brands are refraining from advertising on X because of the platform’s contentious character and worries about brand protection. When it comes to social media advertising, YouTube, Facebook, and Instagram are usually given preference over X by advertisers, noted a digital market expert.
Elon Musk applauded the Indian government’s choice to utilise an administrative process instead of an auction to distribute satellite broadband spectrum. Starlink, Musk’s satellite internet startup, is expected to benefit from this action as it eliminates the need for competitive bidding to obtain spectrum in the nation.
Jyotiraditya Scindia, India’s Minister of Telecom, stated at a New Delhi event that the telecom regulator will decide pricing and that spectrum allocation will take place administratively. Scindia stressed that this strategy is in line with global norms, saying, “If you do decide to auction it, then you will be doing something that is different from the rest of the world.”
The choice was made in the midst of discussion about how satellite spectrum should be distributed in India, which is essential for the launch of satellite-based internet services there.
Musk stated on X (previously Twitter) that he will try his hardest to use Starlink to help the people of India. In addition, he observed that the International Telecommunication Union (ITU), a United Nations agency responsible for satellite communications, has long designated this form of spectrum for shared use among satellite operators and that an auction for the spectrum would be unprecedented.
Reliance Still Pushing for Auction
Even if Musk’s Starlink is in favour of administrative allocation, India’s telecom behemoths are against the move. The billionaire Mukesh Ambani’s company Reliance had previously contested the regulatory consultation procedure, claiming that an auction is required to guarantee fairness. They think satellite companies, particularly those hoping to service affluent urban areas, ought to buy spectrum just like regular telecom companies.
The auction approach was also supported by Sunil Mittal, the chair of Bharti Airtel and co-chair of Eutelsat. Speaking at the event in New Delhi, Mittal stated that satellite businesses that want to enter the urban market should purchase spectrum in the same way that telecom companies do.
The ITU’s criteria for shared spectrum allocation for satellites are widely adhered to globally, thereby endorsing the position of Musk and other satellite operators. But domestic telecom giants like Airtel and Reliance are worried about keeping the playing field equitable. They contend that, given the rising demand for satellite internet services in cities, auctioning will bring justice and transparency to the distribution of spectrum.
OneWeb, an Airtel-partnered subsidiary of Eutelsat, had also voiced requests in its representations to the Indian government earlier in 2023 regarding the auctioning of satellite spectrum. Global satellite providers, such as Starlink and Amazon’s Project Kuiper, meanwhile, maintain their support for administrative distributions since they see spectrum as a common resource.
Elon Musk has highlighted the revolutionary power of artificial intelligence (AI) as well as the dangers it could cause to humanity in two separate scenarios. Earlier, Musk, the CEO of Tesla, gave an interview to the podcast titled “All In” in which he discussed his thoughts on the development of artificial intelligence and humanoid robots.
With the assertion that the technology has an 80% chance of being beneficial to society, he proposed that AI technologies would soon be able to outperform humans in practically all tasks. In addition, he offered a stern warning, suggesting that there is a 20% chance of “human elimination” as a result of the unrestricted development of artificial intelligence.
“Elon Musk’s prediction of an 80% chance of AI success and a 20% risk of human extinction captures the dichotomy of our technological progress. These percentages represent not just a prediction, but a critical turning point in our relationship with artificial intelligence. On the one hand, 80% represents AI’s immense potential for revolutionizing industries, solving complex problems, and improving our daily lives. With innovation comes the promise of smarter healthcare, cleaner energy, and unprecedented connectivity, which could usher in a new era of prosperity,” said Manish Mohta, Founder of Learning Spiral.
Sharing his views on the topic, Bhaskar Ganguli, Co-Founder & Director Marketing, Mass Software Solutions stated, “Elon Musk’s recent comment concerning AI emphasises its potential as a double-edged sword. The IT industry is grappling with improving operations management and problem resolution in complicated IT settings. AI, a key breakthrough, provides solutions, having already achieved progress in a variety of disciplines. However, the progress of artificial intelligence raises concerns about repercussions that may lead to the situation such as loss of job opportunities, gradual loss of privacy, and development of autonomous weaponry.”
However, he further mentioned that maintaining a balanced perspective is vital while considering the potential repercussions and opportunities presented by AI. Notably, everyone is accountable for aiding in the advancement of AI in an ethical, responsible, and societally appropriate manner.
Vipin Vindal, CEO, Quarks Technosoft, opined that Elon Musk’s prediction of an 80% success rate for AI and a 20% risk of human extinction serves as a timely reminder of the potential benefits and challenges associated with artificial intelligence. While AI has demonstrated remarkable capabilities in various domains, its development requires careful consideration of ethical implications and potential unintended consequences. A 2023 Oxford study estimates that there’s a 50% chance of AI exceeding human capabilities across all tasks within 45 years. To mitigate risks and ensure AI’s positive impact, it’s imperative to invest in research on AI safety and alignment, establish international standards for AI ethics, and develop robust regulatory frameworks.
A 2023 global survey conducted by Pew Research Center found that 75% of respondents believe AI will have a significant impact on their lives within the next 50 years, highlighting the need for proactive measures to shape AI’s development beneficially. To ensure that this impact is positive, it’s imperative to invest in AI safety research, establish international governance frameworks, and prioritize human values in AI design.
Tesla’s Development of “Optimus
Musk described Tesla’s creation of “Optimus,” a humanoid robot that is still in the process of being developed. He believes that this robot has the potential to revolutionise common tasks such as landscaping, babysitting, and dog walking.
His prediction was that in the not-too-distant future, these multi-functional robots, which would most likely cost somewhere around $20,000, will become an indispensable component of houses. Apparently, after these robots take over many of the duties that people no longer choose to do, “there’s no actual limit to the size of the economy,” as reported by a media house.
AI Might Become Threat to the Society
Although Musk highlighted the potential benefits and economic effects of AI, he also discussed the social issues that could arise as a result of this technology. As a result of the replacement of persons in tasks that have historically been considered fundamental to human labour, he projected that artificial intelligence and autonomous robots could lead to a “crisis of meaning” for individuals. One of the most important concerns that Musk raised in his study was the topic of what humans will do with their time in a society that is dominated by machines. He pointed out that some people may have difficulty finding a purpose in their lives.
Musk forecasted that within the next 30 years, the number of robots would significantly surpass that of humans. Despite the fact that he admitted that his estimates are typically unduly optimistic, he anticipated that it would take Tesla approximately 5 to 6 years to build one million Optimus robots on an annual basis. Musk has maintained that many people, particularly seniors, are already enjoying life outside of the working, which suggests that humans may be able to adapt to this shifting landscape. This is despite the fact that artificial intelligence presents a number of obstacles.
“Musk has long advocated for a cautious approach to AI development, warning that if not properly regulated and controlled, AI could evolve in unpredictable and potentially dangerous ways. His fear stems from the rapid advancement in AI capabilities, which could surpass human intelligence and act in ways that are not aligned with human values or safety,” stated Eric Fonseca, VP Marketing, INDOAI Technologies Pvt. Ltd.
“This dichotomy—where AI is seen as a powerful tool for good but also a potential existential threat—reflects the growing debate within the tech community. Musk’s forecast underscores the importance of ethical AI development, advocating for safety measures, global regulations, and transparent oversight to ensure that AI remains a force for progress rather than destruction,” Fonseca added further.
Musk’s Future Plans
Elon Musk, however, made passing reference to his own ambitions, suggesting that he had no plans to retire from work anytime soon, even though artificial intelligence was on the increase. There are currently 6 firms that he is involved with, one of which is his most recent endeavour, xAI, which is an artificial intelligence startup that is pitching itself as a competitor to OpenAI.
In addition, he made an understated reference to the fact that he would be willing to participate as an advisor in a government efficiency commission in the event that former President Donald Trump were to return to power.
An order effectively freezing Starlink’s finances in Brazil was issued by the country’s top court, marking a significant move against Elon Musk’s internet satellite startup.
This ruling, which was published on 29 August 2024, prohibits Starlink from engaging in any financial activities in Brazil. It is a major escalation of the continuing dispute between Musk’s businesses and the Brazilian court.
This whole thing started because Justice Alexandre de Moraes of Brazil’s Supreme Court and Musk’s social media site X (which was formerly Twitter) got into a disagreement.
Justice Moraes summoned X on 28 August 2024 and gave the platform till 29 August’s night to choose a Brazilian lawyer. In the event that X’s operations within the country are not suspended, compliance with this order is mandatory.
Starlink voiced its displeasure with the judicial procedure in a statement posted on X, asserting that the order had been secretly granted in violation of Brazil’s constitutional guarantee of due process.
The business countered that the order was flawed because it wrongly assumed Starlink should pay X’s penalty, which it claims was illegally imposed. As far as anyone can tell, Starlink plans to dispute the decision in court.
A crackdown on online communities and related issues
The Brazilian judiciary and Musk’s businesses have been at odds for a while. The Brazilian government has stepped up its attack on fake news and hate speech accounts on social media.
In the lead of these initiatives, Justice Moraes has taken a firm stance against platforms that disregard court orders meant to limit dangerous content on the internet.
Following Musk’s public vow to disobey a Brazilian court ruling that had barred specific accounts on the platform, Moraes declared in April that Musk was being investigated for obstruction of justice. The Brazilian judiciary appears to be expanding its jurisdiction to encompass Musk’s other businesses, as this fight has recently intensified to encompass Starlink.
Reaction from Musk
Millions of Brazilians depend on Starlink’s services, and the move to freeze the company’s funds in Brazil could affect them all. Forty million Brazilians, or almost 20% of the population, use X at least once a month, according to market research firm Emarketer. The move against Starlink has the ability to impede services for these customers and adds fuel to the fire between Musk’s businesses and the Brazilian government.
Elon Musk vented his anger on X, highlighting the fact that X and SpaceX are separate companies with separate stockholders. He said that the verdict was unlawful and unfairly punished other stockholders as well as the Brazilian people, and he called Moraes the “dictator” of the ruling. Global internet businesses operating in locations with varied regulatory regimes face complicated legal and ethical challenges, as Musk’s comment highlights the friction between his enterprises and the Brazilian judiciary.
Tesla Inc., the renowned electric vehicle manufacturer, is nearing an agreement with the Indian government that would allow the company to import its vehicles into the country starting next year and establish a manufacturing plant within the next two years, according to sources familiar with the discussions.
Potential Timeline and Location for Tesla’s Indian Operations
An official announcement of this collaboration is expected to be made at the Vibrant Gujarat Global Summit in January 2024. The Indian government has identified three potential locations for Tesla’s manufacturing plant: Gujarat, Maharashtra, and Tamil Nadu. These states have well-established ecosystems for electric vehicle production and export capabilities.
Investment and Procurement Plans
Tesla is anticipated to make an initial investment of approximately $2 billion in the proposed plant. The company also intends to significantly increase its procurement of auto parts from India, aiming to reach a value of $15 billion. To reduce costs, Tesla plans to manufacture some batteries in India as well.
Discussions and Opportunities
While these plans are not yet finalized, the possibility of changes remains. Elon Musk, Tesla’s CEO, previously announced in June 2023 that the company plans to make a “significant investment” in India and expressed his intention to visit the country in 2024.
Entering India’s vast market, with its growing demand for electric vehicles among the aspiring middle class, would be a significant opportunity for Tesla. The Indian government, under Prime Minister Modi, has been actively promoting domestic manufacturing of electric vehicles and encouraging the rapid adoption of cleaner transportation.
Challenges in the Indian EV Market
Despite these efforts, the electric vehicle market in India has not witnessed substantial growth. Battery-powered cars constituted only 1.3% of the total passenger vehicles sold in India last year. Consumers remain hesitant to switch to electric cars due to the high upfront costs and a lack of charging infrastructure.
Tesla’s Pricing Strategy and Import Duties
Tesla currently does not directly import cars into India due to the high import tariffs imposed. When locally manufactured Tesla cars become available for sale, they could be priced as low as $20,000, according to some sources.
Trade Minister’s Visit and Tesla’s Procurement Plans
Trade Minister Piyush Goyal, who visited Tesla’s plant in Fremont, California, stated in September 2023 that Tesla plans to nearly double its purchases of auto parts from India to $1.9 billion this year. Last year, the electric carmaker sourced parts worth $1 billion from India.
Resumption of Discussions and Potential Tax Relief
Tesla’s interactions with India resumed in May 2023 after a year-long impasse. There are now discussions about potentially lowering import taxes for international electric vehicle manufacturers for five years if they commit to establishing local factories.
Tesla’s Ambitions to Become India’s Third-Largest Car Manufacturer
Tesla is gearing up to introduce a comprehensive range of electric vehicles and establish a robust charging infrastructure in India on a large scale. The company aims to offer electric vehicles at a competitive price range, with specific pricing details yet to be finalized.
Gigafactory Location and Government Support
Should Tesla’s proposed plans materialize, the company is poised to become India’s third-largest car manufacturer, following Maruti and Hyundai. Ongoing discussions between Tesla and Indian government officials will delve into localization strategies, including the identification of a suitable location for the gigafactory.
Production Linked Incentive Scheme and FAME 3 Scheme
There are indications that India may consider implementing a second phase of the Production Linked Incentive scheme to provide support to Tesla. Government officials are also engaged in talks with the industry to explore the expansion of the FAME 3 scheme, considering that the FAME 2 scheme is scheduled to conclude in March 2024.
Market Share of Electric Vehicles in India in 2022 With Estimates Up to 2030
India’s Electric Vehicle Revolution Propelled by Affordable $10,000 Cars
India’s electric vehicle (EV) market is witnessing a remarkable surge, fueled by the introduction of cost-effective new models. Sales of passenger EVs in the country have soared to an impressive 75,000 units in the nine months leading up to September, representing a more than twofold increase from the same period last year.
While EVs still account for a modest 2.4% of the total market share, a closer examination of the underlying trends reveals a crucial insight for EV manufacturers seeking to penetrate the Indian market: An astounding 86% of all-electric cars sold this year were priced under $20,000.
This surge in demand is attributed to the introduction of several new models this year, including the most affordable option, MG’s Comet mini car, priced at less than $10,000. Tata Motors’ popular Tiago compact EV, which accounts for 39% of EV shipments, retails for around $10,500, with deliveries commencing earlier this year.
India’s EV Market Sales With Estimates Up to 2030
Dominance of Affordable Small Cars and Compact SUVs
An analysis of statistics across all drivetrains further underscores the dominance of affordable small cars and compact SUVs. Approximately 69% of cars sold in India last year were priced below $15,000, with 27% costing less than $10,000. Even top-selling combustion-engine models like Suzuki’s Swift and Wagon R retail for under $8,000.
By offering EVs at comparable prices, automakers have successfully tapped into demand from private customers, particularly those commuting in India’s urban centers. The growing popularity of battery-powered cars among ride-hailing and taxi companies is also driven by their low operating costs.
This surge in demand has prompted significant commitments from automakers to increase local EV production, with nearly $5.4 billion in investments pledged to establish or expand EV manufacturing facilities in India, as reported by BloombergNEF. These commitments come from both domestic players such as Tata Motors and Mahindra & Mahindra, as well as international players like Hyundai, Kia, and Vietnamese EV startup VinFast.
While promises to establish local battery plants are also on the rise, supported by government subsidies, one aspect of India’s EV ecosystem that lacks concerted efforts, particularly from private companies, is the charging network. Most public charging stations are currently concentrated in major cities like Delhi, Mumbai, and Bengaluru, with many designed to support electric two- and three-wheelers. To fully accelerate the next phase of EV adoption, more comprehensive efforts are needed to expand the charging infrastructure across the country.
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Tesla, recognized as the world’s most valuable automaker and maker of clean energy, is one of the most admired companies in the world for many reasons. Be it the unique features of Tesla vehicles, Tesla’s Supercharger network that has simplified charging for electric vehicles, or because of its charming CEO, Elon Musk, Tesla has gained immense popularity.
In 2003, Tesla Motors was established by a group of visionaries, including Elon Musk, Martin Eberhard, JB Straubel, Marc Tarpenning, and Ian Wright. This groundbreaking company has since achieved remarkable milestones, including reaching a historic moment in 2021 when its market capitalization exceeded $1 trillion, making it an exclusive trillion-dollar company.
In this article, let’s explore the story of Tesla, its founders, its business and revenue model, growth, and more.
Tesla – Company Highlights
Company Name
Tesla, Inc.
Headquarters
Austin, Texas, United States
Industry
Automotive, Renewable energy, Motor Vehicle Manufacturing
Founders
Elon Musk, Martin Eberhard, JB Straubel, Ian Wright, Marc Tarpenning
Tesla, develops, produces, rents, and distributes electric automobiles, as well as energy generating and storage solutions, in the United States, China, and across the world. Automotive and Energy Generation and Storage are the company’s two prominent segments. Tesla was founded in 2003.
The Automobile section sells automotive regulatory credits as well as electric cars. Tesla sells sedans and sport utility vehicles directly and through used car sales. With 45,000+ Superchargers, Tesla owns and operates the largest global, fast-charging network in the world. Tesla’s automotive segment also offers buy-financing and leasing options. By downloading the Tesla app, Tesla vehicle owners can connect their smartphones to their cars and access a wide array of features. Through the Tesla app, one can access his Tesla vehicle and energy products from anywhere.
This segment also provides non-warranty after-sales automotive assistance, as well as the sale of used vehicles, retail merchandise, and vehicle insurance, as well as the sale of products to third-party customers through its subsidiaries, services for electric vehicles through company-owned service locations, and Tesla mobile service technicians, and vehicle limited warranties and extended service contracts.
Through its online platform, stores, and galleries, as well as a network of channel partners, the Energy Generation and Storage segment designs, manufactures, installs, sells, and leases solar energy generation and energy storage products and related services to residential, commercial, and industrial customers and utilities. This sector also provides servicing and maintenance for its energy product clients, including under warranty, as well as a variety of solar financing alternatives.
Tesla Motors, Inc. was the company’s previous name until February 2017, when it changed to Tesla, Inc.
Tesla is unlike any of its peers. Tesla can address challenges differently than traditional automakers because it has done all of its software development in-house and has essentially grown up as a software and tech firm first, and an automotive second.
The international electric vehicle market is expected to increase at a CAGR of 26.8% from 4,093 thousand units in 2021 to 34,756 thousand units by 2030. Many companies are now manufacturing electric vehicles all over the world due to factors such as rising demand for low-emission transportation and governments encouraging long-range, zero-emission vehicles through subsidies and tax refunds. Countries throughout the globe have established emission reduction objectives based on their respective capabilities, which have resulted in increasing demand for electric vehicles all over the world.
Established firms such as Tesla (US), BYD (China), Volkswagen AG (Germany), BMW Group (Germany), and Nissan Motors(Japan) lead the electric vehicle market. These businesses also provide a wide range of products and services to the automobile sector. These corporations have extensive global distribution networks and invest extensively in R&D to generate new goods.
Tesla – Name and Logo
Tesla Logo
It has long been assumed that Tesla’s logo symbolizes the cross-section of an electric motor initially conceived by the company’s namesake, scientist, and inventor Nikola Tesla, rather than merely a fancy ‘T.’
Elon Musk revealed to a curious Twitter user that the Tesla logo is meant to reflect the cross-section of an electric motor. The primary body of the “T” appeared to depict one of the poles that protrude from a motor’s rotor, with the second line on top symbolizing a part of the stator, according to Elon Musk.
Tesla – Founders and Team
Elon Musk, Martin Eberhard, JB Straubel, Ian Wright, and Marc Tarpenning founded Tesla in July 2003.
Elon Musk
Elon Musk – CEO and Co-Founder, Tesla
Elon Musk co-founded Tesla and currently oversees its product strategy, which includes the design, engineering, and production of more and more economical electric automobiles for ordinary folks. Musk holds a B.A. in physics from the University of Pennsylvania and a B.S. in business from the Wharton School of the University of Pennsylvania. He has served as Tesla’s Chief Executive Officer since October 2008 and has been a member of the Board since April 2004.
In addition to his role at Tesla, Musk has also been Chief Executive Officer, Chief Technology Officer, and Chairman of SpaceX, a rocket and spacecraft manufacturing company, since May 2002. He was Chairman of the Board of SolarCity Corporation, a solar installation company, from July 2006 until its acquisition by Tesla in November 2016. Furthermore, Elon Musk completed his acquisition of Twitter in October 2022 and served as its CEO until he stepped down from his role in June 2023, succeeded by Linda Yaccarino. During this period, Elon implemented several reforms and management transitions, notably renaming the platform from “Twitter” to “X” in July 2023.
He is also a founder of The Boring Company and Neuralink Corp. Prior to his endeavors at SpaceX, Musk co-founded PayPal and Zip2 Corporation.
JB Straubel
JB Straubel is the founder and CEO of Redwood Materials, a Nevada-based firm that is creating a sustainable future by developing circular supply chains, converting trash into profit, and preventing new product environmental consequences before they occur. JB spent 15 years with Tesla as a co-founder and CTO before launching Redwood in 2017.
JB established one of the greatest engineering teams in the world at Tesla, where he oversaw cell design, supply chain, and the original Gigafactory idea all the way through the Model 3 production ramp. From prototype automobiles to mass production and GWh-scale, JB was directly involved in R&D, team creation, and operational expansion. JB graduated from Stanford University with a Bachelor of Science in Energy Systems Engineering and a Master of Science in Energy Engineering.
Marc Tarpenning
Clearpath Robotics, a developer of autonomous vehicles for industrial research and development, has Marc Tarpenning on its advisory board. He also serves as an advisor to a number of other businesses. He was previously a mentor at Greenstart.
Marc is a Venture Partner at Spero Ventures. Before joining Greenstart, he was an entrepreneur in residence at Mayfield Fund. Prior to that, he co-founded Tesla Motors and served as its vice president of engineering. He also worked with Packet Design, NuvoMedia, and Gemstar-TV Guide as an executive. Tarpenning graduated from the University of California, Berkeley, with a bachelor’s degree in computer science.
Martin Eberhard
Martin Eberhard is an engineer, a seasoned Silicon Valley entrepreneur, and a 17-patent inventor. Eberhard completed a BS in Computer Engineering and an MS in Electrical Engineering from the University of Illinois at Urbana-Champaign in 1982 and 1984, respectively. He was recently honored by The University of Illinois with the Distinguished Alumni Award and an Alumni Award for Distinguished Service. Tesla Motors was formed in 2003 by Eberhard and his colleagues, and Eberhard served as its CEO until November 2007.
Eberhard worked for Volkswagen for two years after leaving Tesla Motors as Director of EV Development. He has given talks all around the world about the reasons and ways for decreasing carbon emissions, the advantages of the electric drive over alternative automobile technologies, entrepreneurship, and the need for more young people to pursue science and engineering degrees and careers. He presently sits on the boards of directors and advisory boards of many early-stage Silicon Valley startups.
Ian Wright
Ian Wright is a New Zealander by birth. In 1993, he moved to California, where he lived next door to Tesla creator Martin Eberhard. Wright became one of the founders of Tesla. He worked with optical switching systems at Altamar Networks until the company went out of business, after which he chose to create his own.
Vaibhav Taneja
Vaibhav Taneja – CFO, Tesla
In August 2023, Indian-origin Vaibhav Taneja assumed the role of Chief Financial Officer at Tesla, succeeding Zachary Kirkhorn and further strengthening the company’s exceptional leadership team. Before his appointment as Tesla’s CFO, Vaibhav demonstrated his financial acumen as Tesla’s Chief Accounting Officer. He has also significantly contributed as Corporate Controller and Assistant Corporate Controller at Tesla since February 2017. Prior to his tenure at Tesla, Vaibhav played a pivotal role in various finance and accounting capacities at SolarCity Corporation.
Vaibhav has a Bachelor of Commerce degree from Delhi University, and he also holds the esteemed designation of being a Certified Public Accountant.
Tesla – Startup Story and History of Tesla Cars
Martin Eberhard and Marc Tarpenning launched Tesla (as Tesla Motors) on January 1, 2003, in San Carlos, California. After General Motors recalled all of its EV1 electric cars in 2003, the founders were encouraged to create the firm. The AC Propulsion tzero, an electric sports car manufactured by the US-based company AC Propulsion, was the inspiration for the Roadster, the company’s first automobile.
Ian Wright came on board as the third employee a few months later. In January 2004, the three started seeking funding and met Elon Musk, who provided US$6.5 million of the original (Series A) US$7.5 million round of investment and became chairman of the board of directors in February 2004. Eberhard was then named CEO by Musk. J.B. Straubel was hired as the fifth employee in May 2004. Eberhard and Tesla reached a court settlement in September 2009 that permits all five co-founders (Eberhard, Tarpenning, Wright, Musk, and Straubel) to use the term “co-founder.”
Musk took an active part in the firm, overseeing the Roadster’s product design in great detail. Musk was the one who insisted on a carbon-fiber-reinforced polymer body from the start, and he directed the design of components ranging from the power electronics module to the headlights and other aesthetics, according to Eberhard. Musk earned the Global Green 2006 product design prize, awarded by Mikhail Gorbachev, for his design of the Tesla Roadster. He also received the 2007 Index Design award for his design of the Tesla Roadster.
Tesla’s vision is to create the most compelling car company of the 21st century by driving the world’s transition to electric vehicles, while its mission is “to accelerate the advent of sustainable transport by bringing compelling mass-market electric cars to market as soon as possible.”
Tesla – Business Model and Revenue Model
Tesla’s business model was reinforced once the company established its brand and developed and delivered its prototype car to the market. Tesla’s business model is built around a three-pronged strategy for selling, repairing, and charging its electric automobiles.
Tesla’s business strategy prioritizes the installation of charging stations. That might be the most significant impediment to the widespread adoption of electric automobiles. Tesla’s business model has been expanded to include energy storage devices for households and businesses. Tesla’s sales and servicing are handled directly by the company, rather than via licensed dealerships.
Tesla sells directly to consumers, unlike other automobile manufacturers that sell through franchised dealerships. It has established an international network of company-owned showrooms and galleries, the majority of which are located in major cities. Tesla thinks that by owning the sales channel, it would be able to accelerate the development of its products. More significantly, it improves the purchase experience for customers. Tesla showrooms, unlike automotive dealerships, are free of possible conflicts of interest. Customers solely deal with Tesla sales and service representatives. The direct selling of its products to the customers, its international network of showrooms and galleries, and the development of innovative products that are fuel-efficient and future-proof are some of the reasons that can answer if you are wondering why Tesla is successful.
Panasonic is a prominent Tesla partner and the company’s primary battery cell developer.
The following is a list of alleged main suppliers for Tesla’s manufacturing production, as well as the components they provide:
AGC Automotive: windshields
Brembo: brakes
Fisher Dynamics: power seats
Inteva Products: instrument panel
Modine Manufacturing Co.: battery chiller
Sika: acoustic dampers
Stabilus: liftgate gas spring
ZF Lenksysteme: power steering mechanism
Tesla – Subsidiaries
Following are five major subsidiaries of Tesla
Solar City Corp.
SolarCity was created in 2006 by two cousins of Elon Musk, namely Peter and Lyndon Rive. Musk was the one who came up with the idea for the firm, as well as provided the initial operating money and served as its chairman. SolarCity produces, installs, and sells solar energy systems, as well as solar-generated power. Tesla announced in August 2016 that it has finalized an agreement to buy SolarCity, with the deal set to close later that year.
Maxwell Technologies Inc.
The business was established in 1965. It specializes in ultracapacitors, which are energy storage devices that can hold several times more energy than normal capacitors. Its products are utilized in transportation, industrial, and grid energy storage, among other applications. Tesla purchased Maxwell in May 2019. Musk has previously stated that ultracapacitors will be a game-changer in the manufacturing of electric automobiles.
Grohmann Engineering GmbH (renamed Tesla Automation)
Klaus Grohmann created Grohmann Engineering in 1963 in Germany. The firm specializes in automated manufacturing system design and development. When Tesla announced its acquisition of Grohmann in November 2016, the company had 700 workers and had grown at a 6% annual pace over the previous 20 years. In January 2017, Tesla paid $135.3 million for the company.
Perbix Machine Co. Inc.
Perbix is a company that specializes in developing and producing specialized, highly automated production equipment. It was formed in 1976. Tesla bought the company in 2017. Tesla had bought Grohmann Engineering, a German-based company in a similar field, earlier in 2017. With the purchase of Perbix, Tesla will be able to manufacture more of its car parts in-house, giving them greater control over auto manufacturing. The acquisition was another move in Tesla’s drive to streamline and speed the production process of its electric vehicles, after the Grohmann acquisition.
Hibar Systems Ltd.
Hibar Systems was formed in 1974 in Canada. The firm specializes in high-precision dispensing pumps and filling systems, such as automated vacuum filling systems for lithium-ion batteries used in electric vehicles. Because Tesla made no statement about the transaction, it’s unclear when it happened. According to multiple U.S. and Canadian outlets, In October 2019, Tesla showed Hibar as one of its companies in an October 2 file with the Canadian government. Tesla’s interest in the company is very obvious. Hibar will enable the electric car manufacturer to develop its own battery cells. This decision will help Tesla reduce critical operational expenditures and reduce its reliance on Panasonic Corp., with which it owns and manages a Nevada-based battery manufacturing in partnership.
Tesla – Acquisitions
Below are the details of Tesla’s acquisitions:
Acquiree Name
About Acquiree
Date
Amount
Wiferion
A leading solution provider for mobile wireless power supply for electric industrial vehicles.
Jun 26, 2023
Springpower
Springpower is a manufacturing company providing clean cathode material to battery manufacturers.
May 4, 2021
–
ATW Automation
ATW Automation is a supplier assembling battery modules and packs for the auto industry.
Oct 2, 2020
–
Hibar Systems
Hibar Systems is an Ontario-based company that specializes in battery manufacturing.
Oct 4, 2019
–
DeepScale
DeepScale is a technology company that develops perceptual systems for semi-autonomous and autonomous vehicles
Oct 1, 2019
–
Maxwell Technologies
Maxwell Technologies manufacturing and marketing energy storage and power delivery solutions for automotive.
Feb 4, 2019
$218 million
Perbix
Perbix is a maker of highly automated manufacturing equipment.
Nov 6, 2017
–
Grohmann Engineering
Grohmann Engineering is a German engineering organization that specializes in electronics, automotive, biotech, life science.
Nov 8, 2016
–
SolarCity
SolarCity provides solar energy services to homeowners, businesses, government, and non-profit organizations
Jun 22, 2016
$2.6 billion
Riviera Tool LLC
Manufacturer of stamping die systems used to form sheet metal parts.
May 8, 2015
–
Tesla sold Wiferion to PULS on September 12, 2023, a supplier of DIN rail power supplies. Wiferion is a wireless charging firm that Tesla purchased in June 2023 for an undisclosed sum.
Tesla – Funding and Investors
Tesla has raised a total funding of $19.2B in funding over 36 rounds. Below are some recent rounds of funding raised by the company.
Date
Round
Amount
Lead Investors
Jun 30, 2022
Post-IPO Equity
$20 million
–
May 9, 2020
Post-IPO Debt
$565 million
Industrial and Commercial Bank of China
Dec 23, 2019
Post-IPO Debt
$1.4 billion
–
Oct 6, 2019
Post-IPO Debt
$700 million
China Merchants Bank
May 14, 2019
Post-IPO Equity
$860 million
–
May 14, 2019
Post-IPO Debt
$1.8 billion
–
Mar 8, 2019
Post-IPO Debt
CN¥3.5 billion
–
Aug 7, 2018
Post-IPO Secondary
$2 billion
–
Feb 2, 2018
Post-IPO Debt
$546 million
–
Dec 7, 2017
Grant
$2.3 million
Massachusetts Clean Energy Center
Mar 28, 2017
Post-IPO Secondary
$1.7 billion
Tencent
Tesla – Investments
Here are the details of Tesla’s investments:
Date
Organization Name
Round
Amount
Nov 16, 2022
Aescape
Series A
$30 million
Jul 24, 2022
Coredax
Venture Round
₩22 billion
Jan 20, 2018
Zola Electric
Series D
$55 million
Tesla – Growth
Tesla has made quite a revolution in the automobile and vehicle industry. The Austin, Texas-based company designs and produces electric vehicles, batteries, solar panels, solar roof tiles, and numerous other related products and services. In a significant growth moment, Tesla briefly joined the trillion-dollar club in October 2021, propelled by a 10% stock surge following exciting announcements. It is, therefore, hailed as one of the world’s most valuable companies, along with being the most valuable automaker across the globe.
Tesla captured 23% of the battery-electric (purely electric) market and 16% of the plug-in market in 2020 by emerging as the company with the most worldwide sales of battery-electric and plug-in vehicles.
Along with the cars that Tesla has developed, the company also developed the Tesla “Cybertruck”, which is designed as the truck of the future.
Cybertruck is an upcoming all-electric battery-powered light commercial vehicle. Also known as Cybertruck, Cybertrk, or Tesla Truck, it is designed by Franz Von Holzhausen, the man behind the famous models of Tesla like the Tesla Model S, and Model X. Sahm Jafary was also involved in its design. Originally announced in 2019, Tesla Cybertruck aimed to roll off the production lines by late 2021, however, due to some delays, it has been pushed to late 2022. This super truck is expected to be launched in India by December 2023.
Cybertruck by Tesla
Features and Dimensions
Dimensions:
Length – 231.7 in (5,885 mm)
Width-79.8 in (2,027 mm)
Height – 75 in (1,905 mm)
Features:
Cybertruck is a commercial vehicle. It is an M-segment {European Segments for passengers described as “multi-purpose vehicle”) and large – pickup truck for North America.
It has a rear-motor wheel drive, dual and tri-motor. Cybertruck has a full-width Led headlight bar, an auxiliary strip for off-road driving hidden at the top of the windshield.
The body is constructed of a thick sheet of stainless steel, which has been cold-rolled 30 times. It is scratch and dent resistant and can withstand a 9 mm-firearm round.
Cybertruck doesn’t have a traditional hoop. It has a steering wheel model after the type of aircraft Yoke with grips at 9 and 3 ‘0 clocks.
It offers a camping package that includes a polygonal tent to match its styling, a raised sleeping floor for the bed, and a slide-out electric stove, which runs off the battery pack.
It has a three-across front seating and a center jump set that turns into an arrest when not in use. Cybertruck also has a covered bed with a trunk on the floor and a “frunk” under the hood, each of the rear roof butterness hides storage compartments beneath the doors.
The powdered bed is very strong and one can walk over it. It fully retracts into the space between the bed and the cabin when it is opened.
Specifications:
250kW + supercharging capability
Autopilot, Adaptive, and Air Suspension
On-board 120 /240 VC
100 cubic feet of storage space
6.5 ft long cargo area
With 45,000+ Superchargers, Tesla owns and operates the largest global, fast-charging network in the world. Tesla was expected to launch in India somewhere between 2022-2024, where the company might have made around 5 of the Tesla cars – Model 3, Model Y, Model X, Model S, and Cybertruck, available in India. However, this plan of foraying into the Indian market has been put on hold, as per the reports dated May 17, 2022. This is because Tesla wanted the Indian government to lower the import taxes, which the government rejected. Tesla has also acknowledged some hurdles that are there in the way of Tesla’s India launch. The Elon Musk-headed company is now looking to foray into Indonesia for manufacturing, reports reveal.
In 2022, Tesla generated approximately $81.5 billion in total revenue, securing the 50th spot on the Fortune 500 list, a ranking based on US company revenues. This marked a notable increase of over 50% from the previous year.
The predominant share of Tesla’s revenue originates from vehicle sales and associated features, including full self-driving upgrades. Notably, around 17.5% of their 2022 revenue, equivalent to $14.3 billion, stemmed from other sources. Automotive sales constituted a significant portion, amounting to $67.2 billion, encompassing various models like the Model S, Model X, Semi, Model 3, and Model Y, alongside access to FSD features, internet connectivity, and software updates.
Tesla’s Plans to Launch in India
Tesla had planned to launch in India for quite some time now but the Elon Musk-headed company has had numerous disagreements with the Narendra Modi-led government. High import taxes was the first among the issues pointed out by Tesla. The company, thus, wanted to get the import taxes on its electric vehicles reduced. However, that was not the norm of the government and had also led to objections given by the Indian manufacturers of EVs, who mentioned that it would deter the Indian government’s investment in domestic manufacturing. The Indian policy head Manuj Khurana also conducted closed-door meetings, where he argued on behalf of the company that the import taxes were very high. However, this went to no avail with Manuj Khurana finally resigning.
Another issue around which numerous rumors and arguments surfaced is whether Tesla would set up manufacturing plants in India. However, Musk previously cleared all the confusion associated with that by mentioning that Tesla would not step in to manufacture in India before it is allowed to sell and service imported cars in the country.
Tesla has seen a range of lawsuits filed against the company. Besides, numerous statements against the brand, and controversies surrounding the Tesla CEO and his talks, circulate throughout the year. Creative accounting allegations, whistleblower retaliation, worker rights violations, and numerous unresolved, dangerous technical defects involving the Tesla vehicles are there still.
Tesla has been developing self-driving software that may be used not only in its own cars but also by other automakers that wish to include autonomous driving capabilities in their vehicles. One issue is that other businesses are developing extremely powerful self-driving technology, maybe even ahead of Tesla’s software. Alphabet’s autonomous driving software is one example. Also, that translation isn’t yet apparent in terms of selling this technology to other automobile makers.
Tesla auto-pilot mode has already met with numerous accidents, most of which still remain under the cover. This is the reason why NHTSA ordered Tesla in September 2021, to submit all the data associated with the sold US vehicles that are fitted with the auto-pilot function. The National Highway Traffic Safety Administration has already been investigating traffic deaths involving the use of autopilot vehicles, which is what fueled this move.
Besides, competition is also growing for Tesla as more electric vehicle manufacturers are entering the market.
Tesla Layoffs
Tesla fired 229 employees from its autopilot team, as per reports dated July 14, 2022. The Autopilot team of Tesla consisted of 276 employees in total. Here, the remaining 47 employees, who will stay at the company, will be moved to the Buffalo Autopilot office of Tesla. These employees actually operated from the San Mateo, California office of Tesla. Andrej Karpathy, the Tesla director of AI, also quit his position without disclosing any specific reasons. Earlier in June 2022, around 500 employees of Tesla were fired from its Nevada office against which, the Tesla employees filed a lawsuit that alleged that Tesla’s “mass layoff” violated federal laws because the company didn’t give the employees advance notice. Tesla had to cut staff by around 10% then, as reported by Tesla chief Elon Musk in June 2022.
Tesla – Future Plans
Tesla is unquestionably more than a vehicle manufacturer. While Tesla’s major focus remains on electric vehicles, Elon Musk and his excellent staff have been discreetly moving into other businesses.
Tesla also intends to produce a big number of automobiles. As expressed by Musk on Twitter, Tesla expects to produce 20 million cars per year by 2030, a quantity that would need “consistently superb execution.” In a series of tweets, he predicted that the market for new electric vehicles will reach 30 million per year in five to seven years.
Musk has a big plan to get the globe to switch to sustainable energy. During his Battery Day talk, he explained how increased battery production might cover energy consumption and help the global shift to renewable energy sources. The idea is ambitious: switching all automobiles to electric would necessitate a 100-fold increase in output.
Moreover, Tesla is on course to double the output of its Berlin plant, envisioning a capacity of one million electric vehicles annually. This strategic move positions it as a major player in Europe’s electric vehicle landscape, addressing challenges faced by German automakers in adapting to the electric revolution.
By January 2024, the Indian government hopes to expedite the approval process for Tesla’s possible admission into the India.
FAQs
What does Tesla do?
Tesla, develops, produces, rents, and distributes electric automobiles, as well as energy generating and storage solutions, in the United States, China, and across the world.
Who is Tesla named after?
Tesla is named after the inventor and electrical engineer Nikola Tesla.
Who founded Tesla?
Elon Musk, Martin Eberhard, JB Straubel, Ian Wright, and Marc Tarpenning are the Tesla founders, who founded Tesla in 2003.
Tesla’s business model is built around a three-pronged strategy for selling, repairing, and charging its electric automobiles.
Which companies do Tesla compete with?
Tesla’s top competitors include Ford Motors Co., General Motors Co., Li Auto, Nikola Corp., Canoo Inc., Volkswagen, and BYD Company.
Who is the new Tesla CFO?
Indian-origin Vaibhav Taneja is the new CFO of Tesla. His appointment comes as the previous finance chief, Zachary Kirkhorn, announced his decision to step down.
Why is Tesla successful?
Tesla’s success can be attributed to its innovative leadership, groundbreaking technology, and transformative impact on the electric vehicle market.
Hailed as one of the world’s most valuable companies, Tesla Inc., is currently the world’s most valuable automaker as well. An American multinational headquartered in Austin, Texas it functions in the automotive, artificial intelligence, and clean energy space. Tesla’s product repertoire boasts of designing and manufacturing electric vehicles (cars & trucks), battery energy storage (home to grid-scale), solar panels and solar roof tiles, and related products and services. In the year 2021, Tesla Inc. recorded the most worldwide sales capturing 21% of the battery-electric market and 14% of the plug-in market. Tesla Energy, a subsidiary of Tesla Inc., develops and installs photovoltaic systems in the US. The company is also one of the largest global suppliers of battery energy storage systems.
The company was incorporated as Tesla Motors, Inc., on July 1, 2003, by Martin Eberhard and Marc Tarpenning, who also served as CEO and CFO respectively. It was Eberhard’s vision to build a car manufacturer that was also a technology company with its core technologies as the battery, computer software, and proprietary motor. Their third employee, Ian Wright, joined the team a few months later. It was in February 2004 when the company raised USD 7.5 million in Series A funding that included USD 6.5 million from the enigmatic Elon Musk. With the highest amount contributed, Musk assumed the position of Chairman of the Board of Directors as he became the largest shareholder of Tesla. A couple of months later, by May 2004, J.B. Straubel joined the company as the Chief Technical Officer.
It was in September 2009 that a lawsuit agreement by Eberhard and Tesla allowed all five – Martin Eberhard, Marc Tarpenning, Ian Wright, Elon Musk, and J.B. Straubel, to call themselves the co-founders of Tesla Motors Inc.
Tesla’s Products and Expansion
The first car that Tesla officially revealed to the public was the Roadster in July 2006 and began its production in 2008. Two years later, the company purchased the Tesla Factory in Fremont from Toyota for USD 42 million. This was to begin the production of their new offering – Model S. In June of the same year, Tesla Inc. also went public through its IPO on NASDAQ. Tesla launched its second car, the Model S luxury sedan in June 2012 which went on to become the first electric car to top the monthly sales ranking within the country.
By the year 2015, Tesla entered the energy storage market and unveiled Tesla Powerwall and Tesla Powerpack battery packs. By September of the same year, the company also began shipping its third vehicle – Tesla Model X, the luxury SUV.
Tesla acquired SolarCity and entered the photovoltaics market in November 2016 and changed its name to Tesla Inc., in February 2017 to reflect on its expanding business. In 2017, the company also began selling its fourth vehicle model called the Model 3 sedan, which became the world’s best-selling plug-in electric car for 2018.
It was in the year 2019 that Tesla opened its first Gigafactory in Shanghai, China marking its first foray into global expansion. By 2020, it also began constructing its new Gigafactory in Berlin, Germany, and one more in Texas, United States. The same year it also began delivering its fifth vehicle model – the Model Y crossover. By July 2020, Tesla Inc. became the world’s most valuable automaker by market capitalization by reaching a valuation of USD 206 billion. The company also became eligible for inclusion in the S&P 500 index after it reported consistent profits for four consecutive quarters between July 2019 and June 2020 and was added in December 2020. By October 2021, Tesla’s market capitalization reached USD 1 trillion and in March 2022 launched its new car factory in Berlin which is the largest for electric vehicles in Europe.
Tesla and India
In the year 2021, Tesla officially incorporated an Indian company in Bengaluru as Indian government officials stated that due consideration was being given to Tesla’s proposal of a sharp reduction in import duties for electric cars. However, even after all this time, the company is yet to move forward with service centers and supercharger stations.
Elon musk took to Twitter and posted – “Tesla will not put a manufacturing plant in any location where we are not allowed to first sell and service cars.”
This tweet came in response to the Indian government’s non-acceptance of Musk’s demand of reducing import duties on Tesla vehicles. Currently, India levies a 100% tax on imported cars costing upwards of USD 40,000 and 60% on cars that are valued at less than USD 40,000. These import taxes are inclusive of insurance and shipping expenses.
Elon Musk blames ‘government challenges’ for Tesla’s India delay
Nitin Gadkari, Minister of Road Transport and Highways of India clarified at the ‘Raisina Dialogue 2022’ held in April 2022 that it cannot be a good proposition for India if Musk wants to manufacture Tesla cars in China and sell in India. He went on to say – “Our request to him is to come to India and manufacture here. We have no problems. The vendors are available, and we offer all kinds of technology and because of that, Musk can reduce the cost. India is a huge market and offers good export opportunities too. Musk can export Tesla cars from India.”
In another interview with a media channel, Gadkari said – “Elon Musk is welcome in India. However, it will not be possible if he only manufactures in China and wants a concession for marketing in India.” He went on to say that Tesla can avail of all concessions and other benefits only if it manufactures its cars in India.
In response to this Musk tweeted – “Tesla isn’t in India yet due to challenges with the government.” He went on to clarify that he is ready to launch cars in India but the country’s import duties on EVs, according to him, are the highest in the world.
Conclusion
Between the years 2015 and 2020, Tesla expanded quickly, successfully acquiring many companies and increasing capabilities in battery technology. The company also increased its global presence within that time frame. However, the Indian government is maintaining a firm position regarding Tesla’s Indian foray. Union Minister Mahendra Nath Pandey, in July 2022, categorically said that Tesla can only come to India if it complies with the Atmanirbhar Bharat policy of the country. Hopefully, both parties can reach a mutually beneficial resolution soon.
FAQs
What are the primary reasons for Tesla’s delayed entry into the Indian market?
The primary reasons for Tesla’s delayed entry into the Indian market are high import duties, lack of charging infrastructure, and regulatory hurdles.
What steps can Tesla take to overcome the challenges of entering the Indian market?
Tesla can take several steps to overcome the challenges of entering the Indian market, including:
Nitin Konde
