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Tesla's Musk to jittery Wall Street: Remain Calm!
|Mark Rechtin is West Coast editor of Automotive News.|
LOS ANGELES -- There's a famous scene at the end of Animal House, where Kevin Bacon's lone ROTC cadet tries to calm a rioting crowd by saying, "Remain calm, all is well."
Of course, no one listens, and Bacon's voice rises in pitch until he is screaming, "All is well!" He then gets trampled into the sidewalk.
Such is the herd mentality of Wall Street these days, when high-return investments are few and far between. One sniff of bad news and the herd stampedes away from last week's next big thing.
Playing the role of Bacon today was Tesla Motors CEO Elon Musk, who saw Bloomberg's disclosure of two key Tesla executive departures gut-punch the electric vehicle maker's stock by nearly 20 percent in an afternoon. Its closing price Friday was nearly a 52-week low.
Musk took this slide seriously enough to hold a conference call at 5 a.m. Silicon Valley time today with journalists and analysts to calm the waters before the stock market opened.
Musk tried to cast the departures of top engineers Peter Rawlinson and Nick Sampson as a positive development, a typical evolution of a startup. Rawlinson left for personal reasons, which Musk cautioned was not a euphemism for a more nasty cause.
And like all savvy chief executives, the 40-year-old Musk tried to minimize the impact of Rawlinson and Sampson on Tesla's ongoing operations and this summer's delivery of the Model S sedan. Everything is on track. We have a deep bench. Replacements have already stepped up. We are go for launch, he reassured.
Certainly, young, dynamic companies have lots of turnover as they find their way. Some executives are forged in the startup crucible, while others crumble, especially when it involves evolving, unproven technologies. Personalities in growing companies often clash, as rationed resources conflict with mission priorities.
This isn't the first time Tesla has had top players leave. But Rawlinson and Sampson were key players in engineering, especially as Tesla is now also developing the Model X crossover due in 2014. Simply put, these departures looked bad. The timing was terrible.
Somehow, Musk calmed the mob. The man who launched PayPal had enough magnetism and force of personality to stop the Tesla panic, if only so investors could reassess their holdings. Tesla stock rebounded a solid 17 percent today. Goldman Sachs raised its rating from "neutral" to "buy."
Call him Teflon Elon.
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