Tesla Execs Working With Elon Musk Have 'Dramatically Higher' Turnover Rate

There's long been talks that working for Elon Musk is not easy. This workaholic who shuns a good night’s sleep and works up to 14 hours a day could be a hard-driving boss. News of him pushing his team to achieve almost-impossible goals is nothing new.

What’s new, however, is how fast Tesla executives -- those directly reporting to Musk -- are leaving Tesla.

New research from global asset management firm AllianceBernstein Holding L.P. shows the annualized turnover for execs reporting to Musk stands at a huge 44%, or about four in 10 managers. AllianceBernstein analyst Toni Sacconaghi says this turnover rate is “dramatically higher than the turnover of CEOs’ direct reports at comparable companies.”

Sacconaghi said the average turnover is 9% at other companies in Silicon Valley. The second-highest turnover rate for direct reports is at Lyft.

AllianceBernstein research shows Tesla’s general executive turnover is much higher than the competition:

“Our analysis indicates that Tesla’s annualized executive turnover level has been 27%, notably higher than the cohort average of 15%,” but not “outlandish,” said Sacconaghi, who remains worried about the higher Tesla turnover rate.

This fact has been underscored by the number of top execs that have left Tesla this year. Several production heads resigned over the past few months. This includes Peter Hochholdinger, the head of production in charge of all vehicle manufacturing at the Tesla Fremont factory.

The most notable executive departure thus far was that of CTO and Tesla co-founder JB Straubel.

Tesla has always been aware of the high exec turnover rate and in 2017 said it opens the way for new talent.

The company said its ability to attract and retain talent is one of its biggest assets.

“In 2016, the attrition rate across Tesla was below industry average for technology companies. The length of tenure on the senior leadership team has been especially strong. Of Tesla’s most senior executives, 75% have more than three years of tenure, 60% have more than six years of tenure, and 20% have more than a decade of tenure.

“Of everyone who has had a leadership position at Tesla over our 14-year existence, nearly 60% are still with the company today.”

But that was two full years ago, and Tesla hasn’t said anything about today’s much too high attrition rate among managers, especially those that work under Musk.