The world’s richest man is known for his long list of grievances. Regulations, “woke” culture, AI that isn’t his own, people who don’t advertise on his social media platform X and Marco Rubio are just some of the things he spends his days stewing about. But one thing really sticks in Elon Musk’s craw: the fact that he and Tesla weren’t invited to President Joe Biden’s electric vehicle summit on the White House lawn in 2021.
Well, Musk finally got his moment in the sun yesterday with a very public, ringing endorsement from President Donald Trump, who also claims to have purchased a red Model S for himself. But will any of this lift Tesla’s sagging sales and sinking stock price?
That’s what’s on deck today at Critical Materials, our morning roundup of technology and industry news. Also: Europe’s onetime battery champion Northvolt files for bankruptcy, and Nissan adds a “plus” to its turnaround plan. Let’s dig in.
30%: Tesla’s White House Lawn ‘Infomercial’
Photo by: White House
“Surreal.” “A Tesla showroom.” “A sales pitch.” “A move aimed solely at helping Tesla.” “Corruption.”
These are just some of the ways headlines and news stories described Trump’s one-make EV summit at the White House on Tuesday evening, where the President of the United States took time out of whatever his schedule looks like these days to hype up Musk’s car company.
For those who haven’t been following, Tesla’s sales have been sinking this year amid Musk’s role in slashing the U.S. government and boosting far-right political candidates worldwide. As protests rage at Tesla stores every weekend, the automaker’s stock price has taken a huge hit, dropping more than 50% in three months at a time when Musk’s relationship with Trump is supposed to be turbocharging the company’s self-driving car goals.
So Trump took to the White House and the TV cameras to boost Musk, who spent more than $200 million to get him elected—and then gave Trump’s political action committee another $100 million as a thank you. “The contribution is unheard of in both amount and type: Musk, who is technically a special government employee, is the world’s richest person,” Axios wrote.
The whole thing felt like a weird, Trumpian take on the Biden White House EV summit where the former president lauded General Motors, Stellantis and Ford, but didn’t invite Tesla (ostensibly because Biden didn’t want to enrage organized labor and Tesla is not unionized.)
I still think that was a huge, unforced error on Biden’s part. But I also think inviting Tesla to that would not have deterred Musk’s current political trajectory in any way.
All in all, it was a very strange spectacle (and an unnerving one, since Trump now claims that Telsa boycotts are “illegal” and violent protests against the stores will be treated as “domestic terrorism“) even for our currently very strange moment.
Will Trump’s ringing endorsement of Tesla actually boost sales? That feels unlikely, especially since it’s Tesla’s traditionally left- and center-leaning base that’s turning away from the brand. Could this bring more Republicans, who are traditionally skeptical of EVs, into the electric fold? Long-term, I think this helps on that front, but the future of Musk’s role in the government—and his own partnership with Trump—are incredibly tough to predict. And will it soften Trump’s anti-EV policies? I think it might, so long as the president sees that he has something to gain from it.
Oh, one last thought: if Trump really bought a Tesla, did he take advantage of the EV tax credit he’s trying to get rid of? I’m told the man likes a deal, after all.
60%: It’s ‘Turnaround Plus’ Time At Nissan
Nissan has a new CEO, 46-year-old Mexico native Ivan Espinosa. The young chief executive has his work cut out maybe more than anyone in the auto industry right now, save for whichever unlucky soul ends up at Stellantis. Nissan is burning cash, sinking in sales, dealing with aging and uncompetitive technology and likely needs some kind of partnership to survive.
As Automotive News reports today, Nissan’s original plan for cost cuts wasn’t deemed aggressive enough. So now Espinosa has to “take that plan to the next level”:
“We call it now ‘turnaround plan plus,’ to express that we are not satisfied with the current one,” said a person familiar with leadership’s thinking. “We must go further. That’s the priority.”
Spurring American sales is a tall order until Nissan can introduce long-awaited hybrid versions of its popular Rogue crossover. A plug-in hybrid version based on the Mitsubishi Outlander isn’t expected to land until late this year at the earliest, followed by an e-Power version in 2027.
“Until we are able to bring a hybrid solution to the U.S., how to stabilize the U.S. market situation and survive until then is the most important question,” a person close to planning said.
Until then, Nissan is expected to drum up as much cash as possible through liquidating assets, the person said. That could include a fire sale of land, buildings, facilities and other holdings.
A few more notable tidbits here: Espinosa is an engineer, unlike the last two CEOs, who were business-side guys. I tend to think the best car companies are led by engineers, though that’s not always the case. There’s also a big change of the guard at Nissan that involves ousting an older generation of leaders now blamed for some of these problems. Per Automotive News:
With Espinosa comes a wholesale change of guard, as an echelon of older leaders steps down.
Those headed for the door include Hideyuki Sakamoto, the longtime manufacturing chief, Kunio Nakaguro, the r&d chief some blamed for Nissan’s missteps on U.S. hybrids, and Asako Hoshino, a longtime sales boss and the former chief brand and customer officer.
Collectively, they are known to their detractors in product planning as the “no brigade” for their habit of shooting down out-of-the box ideas and obsessing over cost.
The “no brigade”! That’s delightful. In any case, this new guard has to move fast and they have little room for error.
90%: Northvolt Files For Bankruptcy
Northvolt Sodium-Ion Battery
The sword has finally come for Northvolt, the battery manufacturer that was supposed to be the European auto industry’s great hope for competing with China and the rest at electric power. It’s been in trouble for months, if not years, and now it’s filing for bankruptcy in Sweden. Via Reuters:
The Swedish company has received more than $10 billion in equity, debt and public financing since its 2016 inception, and its biggest owners include Volkswagen with a 21% stake, and Goldman Sachs, with 19%.
The EV battery maker sought U.S. Chapter 11 bankruptcy protection last November as its cash pile dwindled and it scrambled to secure funds to fix persistent problems in boosting output at its flagship plant in northern Sweden.
“This was a decision we did not take lightly,” Northvolt Chairman Tom Johnstone told a press conference, saying every avenue had been pursued to avoid bankruptcy for the company, which puts 5,000 jobs at risk. “Nevertheless, despite these exhaustive efforts, this decision represents the only realistic path forward for Northvolt and for its stakeholders.”
Nearly every European automaker was invested in and/or counting on Northvolt for battery supplies. It is an undeniably huge setback for Europe’s EV and battery sector, but many voices are urging governments and private companies alike not to give up. “A few years ago, we lost the industrial battle for solar panels,” EU lawmaker Pascal Canfin said in a statement sent to Bloomberg. “It would be a strategic mistake to give up on batteries.”
100%: What Will Trump’s Tesla Showcase Accomplish, If Anything?
Photo by: White House
As I write this, $TSLA is trending up. It’s unclear if that’s a Trump Bump or something else. But in the near term, will the president’s ringing endorsement of Tesla do anything to help sales, Musk or the perception of EVs among his base? Share your thoughts in the comments.
Contact the author: patrick.george@insideevs.com
