Investor's Corner
BMW CEO reportedly risks replacement amid poor sales, weak EV strategy, and the rise of Tesla’s Model 3
BMW CEO Harald Krüger has always preferred to work in the background. Content to leave the stage for others, Krüger has mostly led BMW in an almost understated manner. Yet, in a recent meeting with German Chancellor Angela Merkel and fellow executives from rivals Volkswagen and Daimler, the CEO proved assertive, announcing that BMW will be looking to sell around 300,000 electric and electrified vehicles annually by 2021.
Krüger’s assertive stance on EVs is likely due to pressures that BMW is feeling in the electric vehicle market, which has, in more ways than one, started affecting the security of the CEO’s post. The 53-year-old BMW executive’s contract expires in May 2020, and theoretically, the company’s Supervisory Board could extend it. Unfortunately, reports are now emerging that Krüger’s contract as BMW’s chief executive might not be extended anymore, according to information gathered by German news agency Handelsblatt.
Amidst BMW’s current challenges, the publication alleges that the automaker no longer considers an extension of Krüger’s CEO contract as the most plausible scenario in the near future. Talks of tensions in BMW’s leadership have emerged, and an insider has even noted that there is “high pressure in the boiler.” If Krüger is not able to keep his CEO post, two board members are reportedly set to take over his seat: the ambitious Head of Development Klaus Fröhlich and the more tempered Oliver Zipse, who took over BMW’s production department from Krüger back in 2015.
BMW is currently facing a number of challenges. The company has initiated a group-wide “hiring freeze,” and the CEO’s critics were quick to point out that despite BMW’s “biggest model offensive in the company’s history,” sales have stagnated. Over the past nine months, the German automaker surprised with two profit warnings, and margins for its vehicles are under pressure. Krüger, for his part, remained cautiously optimistic, stating that “In the second half of the year, we expect a tailwind” amid the upcoming release of large vehicles like the BMW X7 SUV.
Hiring freezes and poor sales aside, one thing that has notably irked the German automaker’s shareholders is its poor electric vehicle strategy. In 2013, Krüger’s predecessor, Norbert Reithofer, launched the BMW i3, a curiously futuristic electric car that was compared to the Tesla Model S. BMW has not released a pure battery-electric vehicle since then. Jaguar has started its push with the I-PACE, Audi has released the e-tron, and Mercedes-Benz has already unveiled the EQC. BMW’s iX3, on the other hand, won’t be ready for at least another year. Speaking to the publication, a competitor noted that “BMW was ahead, now they are suspended.”
The emergence of Tesla as a player in the premium sedan market has also become a painful pill to swallow for BMW. With its international rollout, the Tesla Model 3 continued to hack away at the sales of BMW’s iconic 3-Series sedan. Tests from publications such as Top Gear, which have been traditionally pro-petrol in the past, have also recognized the Silicon Valley-made Model 3 as superior in more ways than one to a BMW. Tesla’s rise has not escaped the attention of BMW’s investors, who appear to be getting quite impatient with the German automaker’s delayed, if not half-hearted EV strategy.
These sentiments were expressed during BMW’s annual shareholder meeting in May. Addressing the company, shareholder protector Daniela Bergdolt did not mince words. “I now expect an electric offensive that sweeps Tesla off the table,” she said, and the company did not really have a strong response. There’s the i4 and the iNext, but both vehicles don’t currently have a concrete release date. The impressive BMW Vision M Next, which was recently revealed, is also an eye-catching concept vehicle, but it still remains to be seen if or when the car will enter production.
Elon Musk
California snubs Tesla in its newly passed EV incentive that favors Rivian and Lucid
California passed a $135 million EV incentive that rewards Rivian and Lucid while sidelining Tesla
California just drew a line in the EV incentive sand to put Tesla on the wrong side of it. The state recently passed a $135 million program offering first-time electric vehicle buyers a direct incentive with no application required, but the rules were written in a way that leaves Tesla at a structural disadvantage compared to Rivian and Lucid.
The program caps eligible vehicles at $50,000 for new EVs and $25,000 for used ones. That pricing threshold rules out a significant portion of Tesla’s lineup, though some lower-priced Model 3 and Model Y configurations would still qualify. California-based automakers are exempt from the price cap entirely, regardless of what their vehicles cost. Rivian, headquartered in Irvine, and Lucid, based in the San Francisco Bay Area, both benefit from that exemption. Rivian’s R2 starts at roughly $45,000 but has versions above the cap. Lucid’s Air and Gravity start at $70,990 and $79,990 respectively, well above any threshold a non-California company would face.
California hits Tesla Cybercab and Robotaxi driverless cars with new law
Tesla built its reputation and a significant portion of its early market share in California, where EV adoption has consistently led the nation. The company operates its original factory in Fremont, California, and the state was home to Tesla’s headquarters for most of its existence. That changed in 2021 when Tesla moved its corporate headquarters to Austin, Texas. Since then, the relationship between the company and California Governor Gavin Newsom has been openly adversarial, with Musk and Newsom trading public criticism on multiple occasions.
California’s EV incentive landscape has shifted repeatedly in recent years, and Tesla has previously lost eligibility for state-level programs as its vehicles exceeded income-adjusted price thresholds. The federal $7,500 EV tax credit, which Tesla models have qualified for and lost depending on policy cycles, is no longer available after it expired without renewal, making state-level programs more meaningful to buyers than they have been in years.
The practical impact for buyers is more nuanced than the headline suggests. California residents purchasing a Tesla under $50,000 for the first time can still access the incentive. But the exemption written for California-based manufacturers is a structural advantage that rewards where a company plants its headquarters flag rather than where it builds its products, and Tesla moved that flag to Texas.
Elon Musk
SpaceX’s newest logo confirms everything about what it’s become
SpaceX officially absorbed xAI under the SpaceXAI brand, completing the largest private merger in history.
SpaceX made its corporate transformation official in May 2026 when Elon Musk posted on X that xAI would cease to exist as a standalone company. “xAI will be dissolved as a separate company, so it will just be SpaceXAI, the AI products from SpaceX,” he wrote.
A new SpaceXAI logo was announced today, visually embedding the xAI letters inside the SpaceX identity, which can be seen as a deliberate design choice that signals the merger is not a partnership but a full absorption and XAi a core function of the same company. The same way Starlink is not a separate brand but a SpaceX product. The announcement closed the loop on a process that began February 2, 2026, when SpaceX acquired xAI in the largest private merger in history, valued at $1.25 trillion. SpaceX at $1 trillion and xAI at $250 billion.
We are now @SpaceXAI. pic.twitter.com/ema66xDWC9
— SpaceXAI (@SpaceXAI) July 6, 2026
The reason SpaceX bought xAI was stated plainly by Musk at the time of the deal: to build orbital data centers. SpaceX had simultaneously filed with the FCC to launch up to one million satellites designed to function as AI compute nodes in low Earth orbit, escaping what Musk described as the energy constraints limiting AI development on Earth.
xAI provided the AI software stack, with Grok, the X platform, and the Colossus supercomputer infrastructure in Memphis with over 220,000 NVIDIA GPUs, while SpaceX provided the rockets, Starlink, and the capital base to fund it. The two companies needed each other. xAI was burning $2.5 billion in losses on $250 million in revenue. SpaceX was generating an estimated $8 billion in profit on $15 billion in revenue and needed an AI narrative to command the valuation it was targeting for its IPO.
What SpaceX has done, regardless of how the orbital AI vision ultimately plays out, is walk into a public market as something no company has been before: a rocket manufacturer, satellite internet provider, AI software company, social media platform, and supercomputer operator under one ticker. Whether that combination is worth $2 trillion depends entirely on which of those businesses you believe in most.
Investor's Corner
Tesla challenges startups to score a gig inside its most advanced European factory
Tesla is challenging startups to bring their best battery tech directly to Gigafactory Berlin.
Tesla has issued an open challenge to startups across Europe, inviting them to bring their best battery technology directly to the floor of Gigafactory Berlin. The program, called the JUNI x Tesla Battery Cell Giga Challenge, opened applications this month with a deadline of July 24, 2026, and is targeting startups with solutions that can make battery cell manufacturing faster, cheaper, safer, and more scalable at an industrial level.
The timing of the challenge is directly tied to Tesla’s most aggressive European battery investment yet. On May 12, 2026, Giga Berlin plant manager André Thierig announced a $250 million investment to scale the factory’s annual 4680 cell production capacity from 8 GWh to 18 GWh, more than doubling the previous target set just months earlier in December 2025. Thierig confirmed the expansion on X, saying the investment “will enable 18 GWh of annual 4680 cell production and create more than 1,500 new jobs.” Combined with a previously announced battery investment at the Grunheide site now approaches $1.2 billion.
Today, we announced a $ 250m investment for our Giga Berlin Cell factory. This will enable 18GWh of annual 4680 cell production and create more than 1500 new jobs. Good news during challenging times for the German industry. pic.twitter.com/ou4SWMfWh9
— André Thierig (@AndrThie) May 12, 2026
The challenge is looking specifically for startups with proven solutions across five categories: materials, equipment, operations, automation, and artificial intelligence. Applications are screened directly by Tesla’s cell manufacturing team in Grunheide, and the strongest submissions move through technical discussions, a pitch day in front of Tesla stakeholders, and potentially a paid pilot project with the cell team. Tesla is not looking for ideas at concept stage. The program requires applicants to demonstrate working prototypes, test data, or prior pilots before being considered.
The historical context matters here. Elon Musk first announced plans for what he called the world’s largest battery cell production facility alongside the Giga Berlin car factory back in 2020, targeting up to 250 GWh of annual capacity. Those plans were shelved in 2022 when Tesla shifted its battery investment focus to the United States to take advantage of Inflation Reduction Act incentives. The revival of cell production at Giga Berlin, now backed by over $1 billion in committed capital, represents a return to an ambition that was set aside for three years. As Teslarati has reported, the 4680 format is central to Tesla’s long-term cost reduction strategy across vehicles, energy storage, including the Tesla Semi and Cybercab.
By opening the challenge to outside startups, Tesla is acknowledging that reaching 18 GWh at Grunheide will require technology it does not currently have in-house, and it is willing to pay for the right solutions. For a startup in the battery supply chain, a paid pilot with Tesla’s European cell team is as close to a direct commercial path as the industry offers.
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