EV giant Tesla Inc TSLA is deploying advertisements to get its shareholders to vote again for CEO Elon Musk‘s rescinded pay package from 2018.
What Happened: In a filing with the SEC, Tesla showcased the different ads and information the company has put out to inform its shareholders of the upcoming shareholder meeting and the two key votes about Musk’s pay package and the other on shifting Tesla’s state of incorporate from Delaware to Texas.
Musk’s 2018 pay package was rescinded by a Delaware court earlier this year terming it an “enormous” sum. The package was worth $55 billion at the time of issue.
Tesla is now trying to get the shareholders to vote again on the package at the upcoming shareholder meeting which will be held on June 13, 2024, at 3:30 p.m. Central Time (CT). The company is employing both Google ads and X ads to promote the upcoming vote.
Why It Matters: The EV giant has long been wary of advertising despite a push from shareholders. Last month, it was reported that the company laid off its marketing team in the U.S. after he deemed the ads made by the team as “too generic.”
Musk first expressed willingness to try traditional advertising less than a year ago in May 2023. Until then, the company boasted of spending almost no money on advertising but became popular purely via word of mouth.
Since then, Tesla has attempted advertising on different platforms including YouTube, X, and even Meta Platforms' Instagram, and Facebook despite Musk's past criticism of them.
However, in January, Tesla executives clarified during the fourth-quarter earnings call that while the lack of awareness impacted EV adoption, the company would not spend too much on advertising and marketing but instead spend it in areas and geographies where the company has low market share such as Japan.
Investor Reacts: Ross Gerber, the president and CEO of Gerber Kawasaki Wealth and Investment Management and a Tesla investor, criticized the company’s commitment to promoting the shareholder vote for the CEO’s pay while it refuses to scale up advertising for its products.
“They literally cut prices every week to sell cars and don't advertise their weekly sales. But they advertise for Elons pay,” Gerber wrote.
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