Elon Musk’s Attempts to Mend Fences with Advertisers and Investors

Elon Musk Attempts to Mend Fences with Advertisers and Investors

Elon Musk, known for his unfiltered communication style, recently took a significant step to repair relationships with advertisers during his visit to Cannes, France. This move comes after a controversial moment in November when he told some advertisers to “go f— yourself.”

Message to Wall Street

Musk’s representatives conveyed similar sentiments of misunderstanding to Wall Street after he expressed discomfort with Tesla’s AI development without a larger ownership stake. As one of the world’s wealthiest individuals with significant influence on social media, Musk’s frequent miscommunications continue to be a point of contention.

Elon Musk’s mixed messages on Tesla’s AI reveal ongoing challenges in communication and expectations, according to WSJ Subscription Offers.

Authenticity vs. Miscommunication

Musk built his reputation on being unfiltered, which many of his supporters see as authenticity. “If you’re a normal human being and you speak freely, there are times when you will say things that you subsequently regret or are foolish,” Musk said in France. “But if you’re constantly going through a filter, now you’re not being real. So I guess I think it’s better to be real than to go through a filter.”

However, what was once celebrated as authenticity now presents risks to his businesses. Advertisers have become wary of X, and some Tesla buyers are turned off by his contentious stances.

Past Misunderstandings

Musk often chalks things up to misunderstandings. Instances include his “funding secured” claim for taking Tesla private without a done deal, calling a cave rescuer a “pedo,” and the sudden announcement in 2019 to close Tesla’s retail locations, which he quickly retracted. “I didn’t handle messaging of that well,” Musk later admitted.

Increasingly, his backtracking makes it challenging to know when to take him seriously, diluting his authenticity. This comes at a critical time for Tesla as the CEO attempts to reassure investors worried about declining electric car sales.

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Bold Predictions and Investor Concerns

Musk predicted that Tesla could surpass half the combined value of the S&P 500, attributing this to future humanoid robots. This prediction arose as investors expressed concerns. They feared that if a recent proxy proposal to reapprove his 2018 pay package failed, Musk might depart from Tesla. In January, Musk tweeted about his discomfort with advancing Tesla’s AI and robotics leadership without maintaining 25% voting control. He hinted that he might prefer to build products outside Tesla if he couldn’t secure control.

Before the annual meeting on June 13, Musk supporters suggested that people had misunderstood his comments. Travis Axelrod from Tesla’s investor relations department quietly expressed this view. JPMorgan analyst Ryan Brinkman conveyed Axelrod’s regret about the misunderstanding. Musk’s desire for control was intended to protect humanity from the potential misuse of AI.

Legal Implications and Credibility

Critics argue that Musk’s comments about building outside Tesla could backfire legally. The plaintiff in a lawsuit that led a Delaware court to rescind Musk’s 2018 pay package might argue that Musk coerced votes under threat of stripping Tesla of its AI capabilities.

Softening Stance at Cannes

At the Cannes ad industry gathering, Musk aimed to soften his stance. He clarified that he wasn’t targeting “advertisers as a whole” with his attacks and emphasized the value of advertising on X. Surprisingly, he praised the artistic value of ads in Vogue magazine, which starkly contrasts with his 2019 tweet stating, “I hate advertising.”

Musk now owns X and is focused on reviving ad spending on the platform. Brands pulled back after Elon Musk amplified a tweet supporting antisemitic vitriol in November, prompting him to lash out publicly. Media Matters for America claimed big-brand ads were running near hate speech, a portrayal X disputes.

Communication and Market Impact

Elon Musk has often suggested that people read too much into his statements. During a 2022 TED Talk interview, he said, “People shouldn’t hold me to these things… These are just guesses, this is a conversation.”

As the CEO of a public company, Musk’s words can move markets. His tone of voice on investor calls can influence Tesla stock depending on his perceived mood about the future. If Elon Musk loses credibility, his power to inspire might fade, posing a significant risk to his influence and Tesla’s future.

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