Good morning! It’s Tuesday, June 11, 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: Refreshed Tesla Model Y Won’t Come This Year
A refreshed Tesla Model Y is not in the cards for the automaker in 2024, according to CEO Elon Musk. This can be seen as a bit of a bummer to folks who wanted a Model Y with all of the updates seen in the refreshed Model 3, such as ambient lighting, ventilated seats and a blind spot monitor. But, alas, it is not to be. At least, it is not to be in 2024. The now-very-old Model Y will soldier on in its current form, according to Automotive News:
“No Model Y ‘refresh’ is coming out this year,” Musk wrote on social media platform X on June 8, responding to a Tesla fan. “I should note that Tesla continuously improves its cars, so even a car that is six months newer will be a little better.”
In January, Tesla launched a freshened version of its Model 3 sedan in the U.S., which came after its introduction in Europe and China last year. Among the upgrades were ambient lighting, ventilated seats and a traditional blind-spot monitor near the side mirrors. The Model Y freshen is expected to mirror the Model 3 updates.
On social media sites such as Reddit, there have been ongoing rumors about a possible Model Y freshen in China. Reuters reported last year that an updated Model Y would launch this year.
It would seem that a lot of folks aren’t exactly thrilled with this news from Musk. It’s not exactly shocking since the current Model Y has been in production for nearly 4 years at this point. That’s an eternity without a refresh.
In response to Musk’s June 8 post, some Tesla owners said that they’re waiting for the updates before buying a Model Y, which now has fewer interior comfort features than the lower-priced Model 3. The sedan also has new front and rear fascias and a more mature look compared with the previous model.
“A refresh of the Model Y is what my family and I are awaiting,” wrote X user Waze4Tesla in response to Musk. “Essentially the recent refresh Model 3, but in the Model Y. It’s the only reason we didn’t go for the financing promo last month,” the user said, referring to a Model Y promotion that ended in May.
This aging lineup is even hurting Tesla on Wall Street.
Wall Street analysts cite Tesla’s aging vehicle lineup, with the exception of the Cybertruck launched last year, as a key reason for the automaker’s cooling sales growth globally.
Even with the Model 3’s recent freshen, the sedan’s physical appearance has not changed much since it went on sale in 2017. The Model Y has not been freshened since it was launched in 2020. The higher-priced Model S and Model X also have not changed physically since launching in 2012 and 2015, respectively.
It’s being reported by Auto News that Tesla is expected to introduce the refreshed Model Y in January of 2025 at its factories in the U.S., China and Germany. We should also be getting more clarity on Tesla’s product roadmap during Musk’s August 8 “robotaxi” event.
Despite all of this, the Model Y still sells really well. It’s Tesla’s best-selling vehicle, and it was the fifth-best-selling vehicle in the U.S. overall in 2023.
2nd Gear: UAW Monitor Investigating Shawn Fain
The independent United Auto Workers union monitor is investigating union President Shawn Fain’s actions as well as the actions of Secretary-Treasurer Margaret Mock following a shake-up in union leadership in the past few months. Additionally, the investigator is launching a separate probe into an unnamed International Executive Board member for alleged embezzlement. From the Detroit Free Press:
The information is included in the latest status report from the monitor, which was filed Monday in U.S. District Court in Detroit. The 36-page report, a result of the consent decree that followed the corruption scandal that sent ex-union leaders and auto executives to prison, paints a picture of a union that has not been cooperative and has been slow to produce requested documents. The monitor’s office says it may need to seek court intervention if those things don’t change.
The union, according to the report, has asserted that it can withhold certain documents because they are privileged, which the monitor’s office disputes.
The issues involving Fain and Mock followed the union’s move to reassign nine departments overseen by Mock in February following criticism that she engaged in misconduct by not fulfilling a number of financial requests from Fain’s office and various other leaders. Mock, who has denied wrongdoing, said the actions against her were “improperly instigated in retaliation for her refusal or reluctance to authorize certain expenditures of funds at the request of and/or for the benefit of those in the president’s office,” according to the report.
Fain is also being investigated after he stripped UAW Vice President Rich Boyer of his oversight of the union’s Stellantis Department in May. The report said Fain issued a memo “asserting this action was taken because of that vice president’s ‘dereliction of duty’ in connection with certain collective bargaining issues.”
Here’s the rub, though. The report says Boyer and others later asserted that Fain removed the Stellantis assignment as retaliation against him for “among other things, refusing to engage in acts of financial misconduct to benefit others.”
In a statement provided to the Free Press, Fain said that “taking our union in a new direction means sometimes you have to rock the boat, and that upsets some people who want to keep the status quo, but our membership expects better and deserves better than the old business as usual. We encourage the monitor to investigate whatever claims are brought to their office, because we know what they’ll find: a UAW leadership committed to serving the membership, and running a democratic union. We’re staying focused on winning record contracts, growing our union, and fighting for economic and social justice on and off the job.”
It’ll be interesting to see how this all shakes out for one of, if not THE, most notable union bosses in the U.S.
3rd Gear: Elon Musk Wants Retail Investors To Support $56 Billion Pay Package
Elon Musk wants the money he feels is owed to him — all $56 billion of it. Since major Tesla shareholders are divided on whether or not to endorse it, he and his company are turning to smaller, retail investors for support. They make up an unusually high percentage of Tesla’s stock ownership base.
This may end up being a winning strategy for Musk because small investors usually favor management (especially in this case), but they don’t often vote. So, if Musk can convince them to vote in his favor, those billions will be his. From Reuters:
The company’s June 13 annual meeting is shaping up as a referendum on Musk’s leadership, following a Delaware court’s ruling striking down the hefty pay package. The company has asked investors to vote to reaffirm it and Musk stands to control more than 20% of the company if he gets it. A ‘no’ vote would be a rebuke with unknown consequences.
Tesla also proposes reincorporating in Texas instead of Delaware and re-electing two directors, including Musk’s brother, Kimbal.
While there are a dozen items up for a vote, Tesla is focused on the pay vote and the move to Texas in an ongoing outreach campaign to small shareholders that includes a website, engagement with online influencers, and factory tours for a few of those who vote.
Big investors have sent mixed signals. T. Rowe Price has said the package showed “strong alignment” with investor interests. But the California Public Employees’ Retirement System meanwhile has said it will likely oppose Musk’s pay as not commensurate with Tesla’s performance, and Norway’s sovereign wealth fund came out against the pay package on Saturday.
Although small investors have an array of opinions, experts in corporate vote campaigns say the size and CEO-friendly nature of many individual investors at Tesla make them an obvious target.
“The man ends up 10x-ing my investment and he’s given nothing? It doesn’t seem right or fair,” said Andrew Theyken Bench, a lawyer in Allentown, Pennsylvania with fewer than 5,000 Tesla shares, who voted by proxy with management on all items at the meeting, including Musk’s pay.
In a post on Musk’s social media platform, X, the CEO said “So far, roughly 90% of retail shareholders who have voted have voted in favor of both resolutions,” and that seems to include his pay package. Apparently, 90 percent is just about the normal amount of support from retail investors.
Listen, if the folks who don’t want to give Musk the $56 billion, perhaps they could give it to me instead. It’s just an idea. I’ll use it far better than that weirdo would.
4th Gear: GM Approves $6 Billion Stock Buyback
General Motors is apparently feeling itself right now, which is why the automaker just announced a new $6 billion stock buyback plan. The move comes just a month after GM raised its own dividends on an upbeat annual forecast because of solid prices and demand for gas-powered vehicles. From Reuters:
The company had in November outlined a $10 billion stock buyback on the heels of reaching a costly new labor agreement with the United Auto Workers union.
GM completed the first tranche in the first quarter and is on track to reduce its outstanding share count to under 1 billion. Its market capitalization was $54 billion as of latest close, as per LSEG data.
GM had in April raised its dividend by 33% to 12 cents per share. Its shares were up 1% in premarket trading.
Good for GM. It’s refreshing to see the little guy do well for a change.