Tesla Inc.’s executive turnover is higher than major Silicon Valley-based technology companies and is particularly acute among those reporting to CEO Elon Musk, according to a Bernstein analyst.
The electric-vehicle maker has been changing over about 27 percent of its top executives on an annualized basis, said Toni Sacconaghi, a Bernstein analyst. That’s the highest rate among seven companies Sacconaghi benchmarked Tesla against, though Snap Inc. and Lyft Inc. have had similar levels of turnover, he wrote in a report Wednesday.
About 44 percent of executives reporting to Musk have changed over annually, Sacconaghi found, compared with about 9 percent on average at the other companies, which also include Amazon.com Inc., Uber Technologies Inc. and Facebook Inc.
“While one could argue that [Tesla’s] high turnover reflects its unique and demanding culture, we worry that such turnover not only causes instability but could also reflect more significant concerns among senior leaders about the company’s direction or workplace practices,” Sacconaghi wrote.
Tesla’s loss of executives from critical positions and quick departures by external hires have been “worrisome,” and at current rates, the company’s entire executive team of more than 150 people would be gone in less than four years, Sacconaghi wrote.
Tesla shares fell as much as 3 percent to $228.03 in trading Wednesday, amid a broad sell-off in equity markets, and are down about 31 percent for the year.