It goes without saying that Tesla is in deep trouble. In May, new car sales in Europe fell for the fifth month on the trot. The European Automobile Manufacturers Association (ACEA) has just released new figures. It’s an indicator that customers are quickly gravitating toward cheaper EVs from Chinese companies. This new trend in buyer behavior has the potential to undermine Tesla’s dominance of the region’s emerging EV market. Tesla has long enjoyed a used car monopoly there.
In short order, amid all of these challenges, Tesla’s head of manufacturing, Omead Afshar, was unceremoniously fired by Elon Musk. Afshar was vice president of manufacturing and operations. He played an absolutely critical role in overseeing production, though, and in that respect, he led a team of more than half a dozen high-level employees. His reporting directly to Musk made real the power of his role in the company.
Afshar’s firing comes after a years-long saga at Tesla that saw her become the target of an internal investigation in 2022. This inquiry focused on claims regarding his directives for difficult-to-obtain construction materials. One of those materials was for a specially designed security glass for an undisclosed government project connected to Musk. Afshar first joined Tesla from SpaceX — Musk’s own aerospace and defense contractor — before rejoining Tesla and later, getting promoted.
The recent turmoil at Tesla is not an outlier. Palo Alto In May, Milano Kovac, head of Tesla’s Optimus humanoid robotics program, resigned under tension. This unexpected exit furthered suspicion over the company’s leadership stability as the electric vehicle market becomes more competitive and sales numbers drop.
As Tesla navigates through these turbulent waters, it faces the dual challenge of addressing internal leadership changes while responding to shifting consumer trends. Chinese manufacturers are making inroads at breakneck speed with their low-cost electric vehicles. If Tesla doesn’t move fast into these areas, these competitive trends will start to chip away at their sales.