From Twitter to the ‘inevitable’ US recession: six conclusions from Elon Musk at the Qatar forum

SpaceX CEO Elon Musk at the 2022 Met Gala.

Elon Musk covered everything from the status of his deal to buy Twitter to the direction of the US economy and planned job cuts at Tesla in an appearance at the Qatar Economic Forum on Tuesday.

The CEO of Tesla and Space Exploration Technologies Corp. even waded into American politics, saying he had yet to decide who to support in the upcoming presidential election when asked directly if he would consider supporting Donald Trump.

Wearing a white shirt and gray suit jacket, the world’s richest man was eloquent and direct in the video link, answering a series of questions during the 20-minute discussion.

Here are the main things Musk talked about in an interview with Bloomberg News editor-in-chief John Micklethwait:

‘Unresolved issues’ remain in Twitter deal

“There’s the question of whether the debt portion of the round will come together and then the shareholders will vote for it,” Musk said.

The billionaire said last month that he was putting the acquisition “on hold” while he investigated how many of Twitter’s users were real people, later filing a formal letter with the Securities and Exchange Commission in which he told Twitter executives that could be withdrawn. the deal if the company did not do more to demonstrate the true size of its user base.

Musk said at the forum on Tuesday that he would focus on “driving the product” on Twitter, though he doesn’t necessarily plan to be CEO.

The US recession is ‘inevitable’ at some point

The electric car pioneer told Tesla executives earlier this month that he had a “very bad feeling” about the economy, according to an internal email seen by Reuters. Seeking to quell a rise in living costs, the Federal Reserve accelerated its monetary tightening campaign last week with its biggest interest rate hike since 1994.

A recession in the United States is inevitable at some point, he said on Tuesday. “As for whether there’s a recession in the short term, it’s more likely than not.”

Job cuts at Tesla

“Tesla is reducing its salaried workforce by approximately 10% over the next three months,” Musk said, reiterating plans revealed in an email earlier this month. “We hope to increase our hourly workforce. We grew too fast on the salaried side, we grew too fast in some areas.”

But he also provided more clarity on employee reduction plans on Tuesday, saying the cuts will result in an overall reduction of about 3% to 3.5% in Tesla’s total headcount as the workforce is still expected to grow. number of staff per hour, Musk said.

Tesla, now headquartered in Austin, Texas, has grown to around 100,000 employees worldwide, hiring quickly as it built new factories in Austin and Berlin. The cuts, which have affected human resources representatives and software engineers, caught many by surprise, with several employees saying they would be laid off immediately.

“A year from now, I think our workforce will be larger” in salaried and hourly workers, he added.

supply chain issues

Supply constraints are the biggest brake on Tesla’s growth, rather than competition from rival automakers.

“Our limitations are much more on raw materials and being able to increase production,” he said.

Musk said earlier this month that the electric vehicle pioneer has had a “very difficult quarter” as it grapples with supply chain snags and urged workers to help get production back on track.

“As anyone who has tried to order a Tesla knows, the demand for our cars is extremely high and the waiting list is long,” he said. “This is unintentional and we are ramping up production capacity as fast as humanly possible.”

Trump and American politics

Asked if he would support Trump in the upcoming US presidential election: “I’m undecided right now about that election.”

His comments are significant as Musk indicated last week that he was leaning toward supporting Florida Governor Ron DeSantis, who has positioned himself as a staunch conservative and Trump’s heir apparent.

Musk said last week that he voted Republican for the first time in the Texas primary.

praising china

Musk has long had a cozy relationship with China, including being the only foreign automaker allowed to own all of its local operations there and receive support for its Gigafactory near Shanghai.

Asked Tuesday if he sees any problems balancing his Tesla interests in China with the future acquisition of Twitter, Musk said the social media and discussion platform does not operate in the country and “China does not seek to interfere with the freedom expression of the press in the United States, as far as I know”.

He went on to praise Chinese companies, saying, “I am very impressed with auto companies in China, in general, companies in China. I think they are extremely competitive, hard-working and smart.”

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