(Bloomberg Opinion) -- No. No no no. Come on. I don’t want to write about Elon Musk calling himself “Technoking” in a new SEC filing. It isn’t just that the name is cringeworthy; I feel like maybe I saw someone with a name like that perform at Brixton Academy 20-odd years ago. It isn’t that Musk also got his Tesla Inc. CFO to take on the title “Master of Coin,” which conjures an image of dudes LARPing in fleece vests.
I just don’t want to fall into the trap. You know the one. The attention-span trap.
So instead I’ll touch briefly on a few more consequential things, and then we can all just get on with our day.
One of them is the obvious: Tesla Inc.’s governance, which at this point also puts me in mind of evenings spent at the Brixton Academy 20-odd years ago. To recap super briefly, in summer 2018 Musk falsely claimed on Twitter to have a deal lined up to take Tesla private, resulting in him being sued by the SEC and being forced to step down as chairman (or, to adapt the latest nomenclature, Technoemperor). He was supposed to learn his lesson etc., but Monday’s frivolous filing suggests maybe that isn’t sticking so well. Fun fact: Musk will be eligible to be reappointed as Technoemperor later this year. I’m guessing he would win that vote.
Second, this appetite for distraction has all the appearances of a tell. When the company casually announced in February it had diverted $1.5 billion of company funds into a bet on Bitcoin — “Master of Coin,” har har — it helped divert attention away from some troubling news in Tesla’s main growth market, China. Today, Tesla has some other issues that ought to be on investors’ radar but probably aren’t.
One is growing competition as rivals release more electric vehicles. In Europe, where the EV market is a little more mature than the U.S. one Tesla dominates, the company’s market share dropped from around a third at the end of 2019 to about 10% at the start of this year, according to a recent report from Barclays.
Another issue is the continuing tale of Tesla’s “full self-driving” feature, for which it charges thousands of dollars as an upsell but which in fact does not self-drive the car in the fullest sense of that bold phrase. This has resurfaced via correspondence published recently on PlainSite wherein Tesla told California officials a few months ago that its “FSD City Streets” software was a “Level 2, advanced driver-assistance feature.” Without getting too technical, “Level 2” is nowhere near being a robotaxi.
For all the noise, the essential story here is quite simple. In trying to overturn a century of dominance by the internal combustion engine, Tesla has achieved a great deal. As an investment, though, it remains a giant ball of risk priced as if it is not a giant ball of risk (current forward P/E multiple: 253 x).
So it really doesn’t need any more risk slathered on. Calling oneself Technoking and giving your CFO a Tolkienesque honorific aren’t daredevil in themselves, obviously. But they dare the SEC to raise its scrutiny of Tesla, which on balance seems like something a $666 billion company ought to avoid rather than court. Moreover, the more outlandish the behavior, the more likely it is there’s something less fun lurking in the newsfeed. Alright, show’s over.
This column does not necessarily reflect the opinion of the editorial board or Bloomberg LP and its owners.
Liam Denning is a Bloomberg Opinion columnist covering energy, mining and commodities. He previously was editor of the Wall Street Journal's Heard on the Street column and wrote for the Financial Times' Lex column. He was also an investment banker.
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