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Elon Musk Just Said He's Most Excited About This Tesla Product, and It's Not a Car
• https://www.fool.comOn its recent conference call with analysts, Tesla (NASDAQ:TSLA) CEO Elon Musk was asked what he was most excited about in Tesla's future, aside from autonomous driving. Musk's answer may have surprised many, since the answer was Tesla Energy.
Tesla's energy segment is mostly an afterthought for investors, who remain focused on the company's automotive segment. This has been especially true as the Model 3 ramped up production over the past year. In the recently reported quarter, Tesla Energy only made up 6.4% of Tesla's total revenue.
Nevertheless, Musk devoted a fair amount of time on the last call to the energy segment, even bringing in Kunal Girotra, the senior director of energy operations to speak at length about how Tesla hasn't forgotten about its commitment to solar and renewable energy.
Musk and his management team made some interesting comments about the segment, with Musk even postulating that the energy segment could one day grow to be as large as the automotive business, which itself is set to grow significantly in the years ahead.
However, there's also reason to be suspect of Musk's motives for emphasizing energy at this time, given the timing of a recent shareholder lawsuit.
A challenge to the SolarCity acquisition
Earlier this year, several large Tesla investors were given class action status for their 2016 suit against the company, following Tesla's $2.6 billion acquisition of SolarCity. More recently, Musk was deposed, and numerous court documents were published at the request of the lawyers for the suing shareholders.
SolarCity was run by Musk's cousin, Lyndon Rive, and Musk was the chairman of SolarCity at the time. While he recused himself from voting on the acquisition, the recent court documents did show that he pushed hard for it in conversations with large investors. Documents also showed that Tesla's advisors would not issue a fairness opinion on the transaction, and that advisors for SolarCity sought alternative bids, but couldn't find a single one.
The lawsuit will likely continue for years in the future, but it's difficult to say exactly how successful (or not) the SolarCity acquisition will turn out. Tesla now groups the SolarCity installation business in with Tesla's home-grown storage division, including Powerpacks for utilities and businesses, and Powerwalls for home storage.