Jeff Bezos and Elon Musk
Pascal Le Segretain/Getty Images and Michael M. Santiago/Getty Images
Elon Musk said Tesla is “pedal to the metal” whether there’s a recession or not on Wednesday.
The Tesla CEO said the carmaker has no plans to slow ambitious production targets.
Jeff Bezos warned on Tuesday companies should “batten down the hatches” amid an economic downturn.
The two richest men in the world appear to have differing opinions when it comes to weathering the next few months and a potential recession.
Earlier this week, Amazon founder Jeff Bezos warned that companies should be cautious and prepare for an economic downturn.
“The probabilities in this economy tell you to batten down the hatches,” Bezos said in a tweet on Tuesday. The second-richest man in the world made the comment in response to a video clip from Goldman Sachs CEO David Solomon, who said companies should be ready for the US to enter a recession.
—Jeff Bezos (@JeffBezos) October 18, 2022
Bezos’ warning comes as tech companies have issued a slew of layoffs amid slowing economic growth and rising labor costs. While Bezos is no longer CEO of Amazon, his successor appears to share similar concerns. Last month, Amazon CEO Andy Jassy said the company has slowed hiring. The retail giant also abandoned plans for dozens of US warehouses, according to a Bloomberg report.
Meanwhile, Tesla CEO Elon Musk expressed a different sentiment on Wednesday. During the electric-car maker’s earnings call, Musk said Tesla has no intention of slowing down when an analyst asked how the company will fare in a potential recession.
“To be frank, we’re very pedal to the metal come rain or shine,” Musk said. “We are not reducing our production in any meaningful way, recession or not recession.”
Musk said that he believes Tesla is in a “good spot” when it comes to the future economic conditions.
“I wouldn’t say its recession-proof, but it’s certainly recession-resilient,” the billionaire said, attributing Tesla’s stability to a shift from gasoline cars to electric ones.
In the past, Musk has been critical of the Federal Reserve Board as it has hiked interest rates to combat inflation.
“The Fed’s decisions make sense if you’re looking through the rearview mirror, but not if you look out the front windshield,” Musk said on Wednesday, noting Tesla has seen more deflation than inflation when it comes to purchasing commodities.
Despite his recent statement, earlier this year Musk warned the US is likely entering a recession, though he added “recessions are not necessarily a bad thing.” The CEO also said in June he planned to lay off 10% of Tesla’s salaried staff but increase the headcount for hourly workers in the factories.
Musk has always had a “pedal to the metal” mentality when it comes to Tesla. The billionaire has repeatedly pushed ambitious targets at Tesla, planing to scale production by roughly 50% a year. During the earnings call, the billionaire said Tesla is on track to hit the goal, though it would have to produce over 475,000 vehicles in the next quarter to hit the target — about 30% more than it produced in the third quarter.
It’s not surprising that Bezos and Musk would have differing opinions on how to run a company. They’ve come head-to-head in the past on any number of issues from building reusable rockets to vying for NASA contracts.
For the most part, Bezos’ advice appears to echo that of other top executives. JPMorgan Chase CEO Jamie Dimon has been warning of a recession, though the executive has said the bank has no plans to cut its headcount. In July, Facebook founder Mark Zuckerberg reportedly said in an internal meeting that the nation could be “facing one of the worst recessions in recent history.”