Tom Zhu, Tesla’s 2nd in command and the man expected to one day replace Elon Musk as the Tesla CEO, has resigned from his global duties and has returned to China. This move suggests Tesla’s refocus on expanding its current production facilities.
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Although Tesla is headquartered in Austin, Texas, and the EV maker’s biggest market is still North America, based on production numbers, Tesla is as much a US company as it is Chinese.
Last year, Tesla produced and delivered a record 1.8 million vehicles. Although Tesla has multiple US and European factories, its highly successful gigafactory in Shanghai, China, comprises more than half of the production volume.
Not only that, but Giga Shanghai managed to scale Model 3 and Model Y production at a breakneck speed without the production hangups that plagued Tesla’s other plants.
Giga Shanghai has been an unqualified success for Tesla and as the lead person responsible for the factory and Tesla’s overall business in China, Tom Zhu has become a rising star at the EV maker.
In January of last year, Tom Zhu was promoted to Senior Vice President of Automotive after successfully overseeing the Giga Shanghai production ramp. In his new role, Tom was in charge of global manufacturing, sales, delivery, and service operations.
As Tesla still generates most of the company’s revenue from selling vehicles, being in charge of all automotive sales, delivery, and service, not to mention heading all new future factory build-outs, put Tom Zhu at the center of Tesla’s various businesses.
Tom assumed so much responsibility at Tesla that the executive even revealed that he personally gets a notification on his phone when a Tesla vehicle comes off the production line anywhere in the world.
After Drew Baglino, Tesla’s Senior Vice President of Powertrain and Energy Engineering, left the company, Tom Zhu became one of only three named Tesla executives, along with Elon Musk and Chief Financial Officer Vaibhav Taneja.
Tom was also expected to spearhead the buildout of Tesla’s Mexico factory, which was slated to produce the cheaper next-generation $25,000 vehicle before Musk upended the plans in favor of expanding current production facilities.
Recently, rather than building out new facilities, including Giga Mexico, and introducing next-generation vehicles, Tesla said it would prioritize increasing production capacity at current factories and introducing new cars based on the current Model 3/Y platform.
Tesla says the new vehicles can start production as soon as the end of 2024 or early 2025. The company plans to grow vehicle production to 3 million vehicles a year only by expanding current production lines.
Supplier reports suggest that the start of next-generation vehicle production at Giga Mexico may be delayed until late 2026 or early 2027.
Interestingly, this is only a small part of the changes Elon Musk is making at Tesla. The Austin-based EV maker recently posted its weakest quarterly financial results in the past five years.
In Q1 2024, Tesla also announced that deliveries have decreased by a whopping 20% quarter over quarter.
Following these results, Tesla is currently undergoing massive company-wide restructuring. Just in the last few weeks, Tesla let go of 10% of the company’s workforce. That’s 15,000 people fired in a single day.
Leaked internal communications also revealed that Elon Musk fired Tesla’s Senior Director of Charging Infrastructure, Rebecca Tunnuci, and all 500 individuals on her team.
In addition to firing the entire charging team responsible for the company's highly successful supercharger network, Musk has also decided to fire Daniel Ho, Tesla's Head of New Products.
Amid the ongoing changes, Musk has wholly dissolved the Public Policy & Business Development team formerly headed by departing Tesla executive Rohan Patel. Tesla’s Head of Investor Relations, Martin Viecha, has also revealed that he will leave the automaker.
All these changes have been massive; however, it appears that Musk’s Tesla restructuring efforts have not spared even the company’s second-in-command, Tom Zhu.
Early reports from China suggest that Tom Zhu has resigned from his global responsibilities and has returned to his old position as the Vice President of Greater China.
If the reports are correct, this suggests that Tom Zhu has relinquished many of the responsibilities he assumed during his role as SVP of Automotive.
As VP of Greater China, Tom Zhu will manage business in Greater China and the Asia Pacific region, as well as production in Giga Shanghai. This is a far cry from overseeing Giga Texas, Giga Berlin, the Fremont California factory, and all of Tesla’s other worldwide projects.
What does Tom Zhu returning to China mean for Tesla?
As mentioned above, Tom was expected to lead Tesla’s Giga Mexico build-out; however, this move further corroborates supplier rumors suggesting Giga Mexico has been delayed by several years.
As of writing, it’s unclear whether Tom Zhu’s return to China is due to Musk not being satisfied with Tom's performance in his new role or whether it points to potential massive growth in China.
If we assume the second is true, Tom Zhu's return to China could hint that Tesla has decided to massively expand Giga Shanghai to reach the 3 million vehicles per year goal.
In that instance, Tom Zhu’s relocation to China suggests increased confidence in the executive’s abilities and a bright future for Tesla China.
It’s too early to say what Tom's return to China will mean for Tesla; however, we’ll keep you posted as we receive further information.
Until then, visit our site, torquenews.com/Tesla, regularly for the latest updates.
So, what do you think? Are you surprised to learn that Tesla’s second in command, Tom Zhu, has relinquished most of his responsibilities? Do you think this is a positive or negative move for Tesla? Let us know your thoughts in the comments below by clicking the red “Add new comment” button.
Image: Screenshot from Tesla’s Investor Day
For more information, check out: A Woman Seen Relieved After Her Tesla Model Y Rolls Over 7 Times & Jumps Over Several Vehicles on the Air – Video Captures the Horrifying Accident & Shows Why Teslas Are the Safest Vehicles
Tinsae Aregay has been following Tesla and the evolution of the EV space daily for several years. He covers everything about Tesla, from the cars to Elon Musk, the energy business, and autonomy. Follow Tinsae on Twitter at @TinsaeAregay for daily Tesla news.
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China has recently agreed to…
China has recently agreed to allow Tesla to develop it's full self driving in China. That is likely the reason that Tom is going back to focus on China. FSD is a major priority at Tesla right now.