Even Norway Doesn’t Want Elon Musk To Get His $56 Billion Tesla Pay
Happy Monday! It’s June 10, 2024, and this is The Morning Shift, your daily roundup of the top automotive headlines from around the world, in one place. Here are the important stories you need to know.
1st Gear: Norway Votes Against Elon Musk’s $56 Bn Pay
The “will they, won’t they” story surrounding Elon Musk’s massive pay package at American electric vehicle maker Tesla has been rumbling on for months now. After a judge in Delaware kicked the $56 billion compensation to the curb, it’s been appealed, put to a vote among Telsa shareholders and the company has even begun taking out ads to try and sway the vote. Now, the Norwegian wealth fund has waded into the argument.
Norway’s $1.7 trillion sovereign wealth fund has invested heavily in Tesla over the years and now owns a 0.98% stake in the automaker, making it the eighth largest investor in the company. The fund has now come out against Musk’s $56B pay package, saying that it will vote down the measures when given the opportunity, according to reports from Reuters. As per the site:
The fund said it appreciated “the significant value generated under Mr. Musk’s leadership since the grant date in 2018″.
Still, “we remain concerned about the total size of the award, the structure given performance triggers, dilution, and lack of mitigation of key person risk,” Norges Bank Investment Management (NBIM), the operator of the fund said.
In 2018, the fund had voted against the package.
“We will continue to seek constructive dialogue with Tesla on this and other topics,” NBIM added.
In response, Musk took his usual steps of angrily posting his on Twitter X. He took to the social media platform that he owns to brand the Norwegian move “not cool” and said that if the fund actually asked the people of Norway then it would find “overwhelming support in favor.”
However, the Norwegian wealth fund isn’t the first to come out against Musk’s massive pay. Last week, an ex-Tesla board member argued that Musk wasn’t worth that much money as it didn’t reflect the value he adds to the company. The pay has also been criticized by think tanks in the U.S.
Despite this, Tesla still demands that the pay package should be passed, basically arguing that it’s gone this far so should just carry on.
2nd Gear: U.S. Softens Fuel Economy Rules For Trucks
People in the U.S. like to shout about how the country is Number One, and while it certainly is in things like prison rates, bankruptcies caused by medical debt and military spending, it definitely isn’t when it comes to clean vehicle ambitions. Now, those ambitions have been further thwarted by new fuel economy rules that push back emission targets by more than two years.
The Biden administration has just confirmed new Corporate Average Fuel Economy (CAFE) requirements that will soon come into force, but instead of tightening emissions they actually push back certain targets, according to a report from the Detroit Free Press. As the site explains:
The National Highway Traffic Safety Administration (NHTSA) said the proposed new rules will result in much lower compliance penalties than originally proposed, a significant win for Detroit automakers.
Automakers praised the changes and environmental groups criticized them.
In July 2023, NHTSA had proposed boosting Corporate Average Fuel Economy (CAFE) requirements by 2% per year for passenger cars and 4% per year for light trucks from 2027 through 2032.
Under the final rule, NHTSA will not require any increase for light trucks for 2027 and 2028 and will only require 2% increases from 2029 through 2031.
It was widely predicted that most American automakers would fall well short of the initial plans, resulting in hefty fines across the board – fines that could have been used to invest in further green infrastructure projects across America. However, under the new rulings fines are much less likely to be handed out thanks to the much softer regulations.
3rd Gear: Volvo Could Shift EV Manufacture To Belgium To Skirt Tariffs
There’s one big, scary word that’s dominating talk of electric vehicles of late, and it’s “tariffs.” After the U.S imposed a whopping 100 percent levy on electric cars imported from China, it’s widely expected that Europe will follow suit, and that’s sure to be followed by China’s own restrictions on foreign vehicles. Now, to try and skirt those stringent tariffs, Volvo is looking to shift production of many of its electric models.
Volvo is now owned by Chinese automaker Geely, which has done a formidable job ramping up its electric lineup in recent years. Now, to ensure its models aren’t on the receiving end of any anti-Chinese tariffs, the automaker is investigating moving its EV manufacturing operations out of China and into Belgium, according to reports from Bloomberg. As per the site:
Volvo Car AB has started to shift manufacturing of Chinese-made electric vehicles to Belgium as the European Union prepares to impose tariffs on China-made EVs, the Times reported.
On top of transferring production of Volvo’s EX30 and EX90 models to Belgium, the carmaker may also move assembly of some Volvo models bound for the UK, the report said, citing unidentified people. Volvo, which is owned by Zhejiang Geely Holding Group Co., is seen as the most exposed among western automakers to the potential tariffs, the Times said.
Volvo Car denied the Times’ report, saying “it’s premature to speculate on the implications of what this investigation will conclude, or any potential measures.”
Instead of suggesting that its decision to build the EX30 EV in Ghent, Belgium, was anything to do with Tariffs, Volvo argued that it’s all down to its aim to build cars exactly where it sells them. It’s for this very reason that stablemate Polestar has plans to build its Polestar 3 electric SUV in America and why the new EX90 electric car from Volvo is entering production in the U.S.
4th Gear: Stellantis Recalls 210,000 Cars Over Software Bugs In Brakes
It’s a big day for big recalls here in America, as Kia just announced measures affecting more than 400,000 cars sold in the U.S. and now Stellantis has been hit by a recall impacting more than 200,000 cars.
The American automaker has identified a software bug in its Dodge Durango and Ram 2500 and 3500 models which impacts the cars’ anti-lock braking systems, reports Reuters. As the site explains:
Chrysler is recalling more than 211,000 vehicles in the United States due to a software malfunction that could disable the electronic stability control system, the National Highway Traffic Safety Administration (NHTSA) said on Saturday.
Due to the malfunction, the Anti-Lock Brake System (ABS) control module may disable the electronic stability control system, the regulator said.
“Driving with a disabled electronic stability control system can increase the risk of a crash,” it said.
In order to fix the issue, dealerships will be able to update the control system in impacted vehicles. The work will be carried out free of charge to anybody that owns an affected vehicle.
If you think your car has been impacted by a recall, there are a few simple things you can do to check. First, the NHTSA has a handy app you can use to check if your vehicle is affected, or you can head to the regulator’s website and plug your VIN into its recall search tool.
