Tesla Board Of Directors Shakeup: How Will This Affect Company?

Tesla has announced that four of its directors left the company on April 19. While it obviously reduces the board down to seven members, it does allow its current head, Elon Musk, some more power over the company. Here’s what we know about this development.

According to CNN, Tesla has parted ways with the four directors as it wants to “streamline” its corporate oversight. The company noted that it had directors with overlapping specialties to allow the company to work faster and efficiently.

Meanwhile, two directors also agreed not to be reelected for their position and are now slated to leave the company by 2020 or 2021. Tesla noted that the directors declined the position not because of a conflict or misunderstanding with the company. After the shakeup, only 7 directors remain in their position.

While Tesla is making this move to improve efficiency, some of their investors are worried as most of the remaining directors are aligned with Tesla CEO Elon Musk. While Musk has a well-known public and social media presence, the investors want some more control over the CEO.

Previously, Musk and Tesla added two new board members as part of a settlement deal with the Security and Exchanges Comission. The new members were placed in order to keep Musk in check after SEC accuses the CEO of potentially lying to investors about turning the company into a private one. The SEC is also looking to hold Musk legally accountable if he’s proven guilty about this.

The new Tesla board is looking to manage the company with board members that knows the company’s history and has the experience and expertise to carry on with projects in the future. However, CNN notes that the independent board members that are supposed to serve as a neutral side towards Musk are still related to Musk in a way. One of the board members were close to Musk prior to the position and another is Musk’s brother.

If Musk has close allies that mostly agree with him, the company may just go ahead with his plans for the company which are often seen as risks for investors but a spectacle for consumers and onlookers.

As for Tesla’s upcoming projects, the company is planning to release the Model Y crossover SUV later this year. Meanwhile, their upcoming projects are the Tesla Semi truck and the futuristic pickup truck which both have yet to receive any major progress updates from the company.