Elon Musk, the founder and chief executive officer of Tesla Inc. recently purchased $10 million and has hopes of buying double the amount as a part of the company’s strategic plan. Still, the founder of the electric-vehicle business recently purchased roughly 30, 000 shares for Tesla in three different transactions. Therefore, Musk paid averagely between $334.24 per share and $335.93 per share in the aforesaid transactions. However, a number of controversial issues arose over the past period owing to the increased scrutiny of the company by security regulators and the FBI. The matter of contention involved the allegations citing that the CEO wanted to line up funding to privatize the company.
Mr. Musk’s actions are part of Tesla’s business strategy in terms of the company’s supply chain management and growth. For example, when the CEO pays $20 million to cater for penalties, he intends to own the whole supply chain traversing from manufacturing to distribution. Musk aims at reducing production costs and costs of goods sold to maintain topnotch sustainability in the business environment. By so doing, the company will uphold long-term growth in terms of production, inventory management, and distribution.
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Finally, Musk’s plan to pay an additional $20 million in stock upon the opening of the next window to purchase shares is in line with the company’s anticipated growth strategy. The company increased its research and development expenditures to enhance its ability to modify its assembly line for easy handling of diverse product models. The resultant benefit of this strategy manifested itself in the increased production of Tesla’s Model S and Model X. Hence, Musk’s increased spending on Tesla shares has greatly transformed the company’s infrastructure that promotes the accommodation of a higher number of cars on the road.
