automakers boycott Elon Musk and Tesla pays the price

automakers boycott Elon Musk and Tesla pays the price

Automakers have been boycotting Twitter since Elon Musk took over the platform. This is not just about advertising, but a desire to avoid the network.

The takeover of Twitter by Elon Musk drastically changed the management of the social network. But since this operation, several Tesla competitors have totally boycotted the platform.

The brands had quickly slowed down or even stopped advertising on Twitter, as soon as the takeover was formalized. This was the case of General Motors, which had withdrawn all its investments the next day.

Stellantis had done the same, the group justifying that it was waiting to understand the situation of the platform in this beginning of the Musk era. Other companies outside the automotive world, such as United Airlines or the CBS chain, have also announced that they will stop ads and communication on Twitter respectively.

But on the manufacturers’ side, a real boycott is taking place in the United States. Audi USA hasn’t tweeted since October 28, Chevrolet since October 27, and Cadillac since October 18.

These brands have not deserted the platform, where they answer their customers’ questions. Some of them are moreover vehement, denouncing the politicization of these decisions and the alleged wokism builders opposing Musk.

Some counterparts of Elon Musk have also deserted the platform. This is the case of Mary Barra, CEO of General Motors, and RJ Scaringe, CEO of Rivian. They have not tweeted since the takeover by the billionaire. Henrik Fisker had meanwhile announced his immediate departure to Instagram.

Jaguar Land Rover has, for its part, announced a massive recruitment of staff… fired by Musk! The automotive group will indeed pick among the victims of Twitter policy to strengthen its lines.

Adverse effects on Twitter…

However, do not believe that this boycott of Twitter is organized out of pure frustration with Musk. The billionaire’s management of Twitter is causing problems for the platform, which even seemed on the verge of collapse last week.

Musk has indeed launched a campaign to charge a subscription in order to have the famous ‘Blue Check’. This was the mark of certified accounts in the past, and it is now that of premium members of the network. The desire to make Twitter profitable also prompted Elon Musk to lay off a large number of employees.

This caused the departure of hundreds of others, so that the company lost more than 80% of its human force. With, of course, consequences on the proper functioning of the platform, which suffers from slowdowns and other problems related to external modules, such as double authentication.

To overcome the technical problems, Musk rehired several engineers in a hurry. Day-to-day management, which reflects a serious lack of long-term vision, and has harmful effects on Twitter.

Worse, these effects are catastrophic for Tesla, which has suffered since the spring of the takeover of Twitter. In October 2021, the brand valuation reached $1 trillion. At that time, the price of a share was 400 dollars.

… but also on Tesla!

In April, the value of a Tesla share was still $380. But as soon as the proposed takeover of Twitter was announced, Tesla shares had fallen to $224 in less than two months. In particular because of the fact that Musk had sold 4 billion Tesla shares to finance the takeover of Twitter.

When the businessman finally announced that he would not buy the platform, it had the opposite effect. Several times between August and September, Tesla stock exceeded $300. But since the takeover, it’s been a descent into hell for the brand.

Today, Tesla stock is worth $182, after hitting $166 a week ago when Twitter was at its worst. A sign, if any were needed, that the fate of the two brands is linked. Tesla’s overall valuation also suffers, as it is now $573 billion.

Nothing to worry about, of course, but nothing to doubt Musk’s ability to advance Tesla’s value in the long term. And wonder again about the speculation it generates by communicating. We remember that the exchange commission had pinned him in 2018 for announcing the withdrawal of Tesla from the stock market on social networks.

This management seems to be back on the agenda for Musk, who has made Twitter his communication space. Given the 300% growth the company had experienced between March 2020 and October 2021, Tesla’s collapse in value may, however, raise questions about Musk’s side projects.

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