Musk: Tesla Model S on track, despite executive departures

The departure of two Tesla executives was a planned transition, and there's no need to worry, CEO Elon Musk tells investors after the company's stock dropped 20 percent.

Liane Yvkoff
Liane Yvkoff is a freelance writer who blogs about cars for CNET Car Tech. E-mail Liane.
Liane Yvkoff
3 min read
The Tesla Model S electric sedan
The Tesla Model S electric sedan Tesla

There's no need to worry: the departure of two Tesla executives was a planned transition that happened sooner than expected, company Chief Executive Elon Musk said today on an early morning investor call.

News that Peter Rawlinson, Tesla's vice president and chief engineer, and Nick Swanson, who supervised vehicle and chassis engineering, left the electric-car startup before the launch of the Model S sent the stock price plummeting almost 20 percent on Friday. Musk assured conference call listeners that Tesla wasn't trying to "dump news into the weekend." Rather, he said, he had made the mistake of not communicating these organizational changes to the public, and the transition of engineering to Jerome Guillen and Eric Bach somehow became a negative.

"'Personal reasons' is not a euphemism for something else," Musk said of the executives' departures. "The skills that were right for a team of 20 [are] not what's right for a team of 200."

Telsa hired Rawlinson and Swanson to help optimize the chassis and body of the Model S, the development of which began before they started with the company almost three years ago. Musk said Rawlinson was neither in charge of power train nor was the chief engineer of the whole vehicle, implying that his role wasn't critical during the final stages of the product release. In the run-up to Model S production, the skills of the new team are better suited to the remaining tasks, he said.

Responding to an investor question about giving notice of this organization change, Musk said, "I had some sense that there needed to be a transition. With Peter, it happened a little faster than anticipated. With Nick, I decided that [his] skills weren't right for this stage of the game."

Despite the personnel shifts, Tesla CTO JB Straubel said Tesla is on track for the Model S launch in July and will bring the vehicle to market on time. The company has seen strong demand for the electric sedan, which starts at $49,900, after a $7,500 federal tax credit. It had 8,000 reservations for the Model S at the end of 2011. Engineers recently documented a 0-to-60-mph acceleration time of 4.4 seconds for the Performance model of the electric five-seater.

The company expects deliveries to start in July, and it plans to deliver 20,000 cars next year. Executives confirmed that manufacturing was on track and said there is a "low probability" of any difficulties with parts or suppliers. In about three months, according to the company, shoppers will be able to walk into showrooms and test-drive the vehicle. However, Tesla still needs EPA testing and self-certification documentation of crash testing before it can deliver vehicles to customers.

Musk also confirmed that a wry Twitter status update (above) on Friday was a joke. The CEO rearranged the letters of the Denali Conference Room sign to read "Denial Conference Room" and posted a photo on Twitter with a comment, "Seemed more apt."

"Can't say I have the best sense of humor," Musk admitted. "I apologize if people didn't find it funny."