Elon Musk claims he is going to raise salaries for Tesla engineers because Sam Altman’s OpenAI, the world leader in generative artificial intelligence, keeps trying to poach them.
Has OpenAI been poaching Tesla engineers from Elon Musk?
On Wednesday, news came out that Tesla’s Ethan Knight became the electric car maker’s fourth engineer to join Musk’s newest startup, xAI, which was followed by a post on X by the tech billionaire saying his employee was planning to leave and go to OpenAI anyway.
“It was either xAI or them,” wrote Musk, who lured his first AI director away from Altman in 2017. He added that OpenAI has “been aggressively recruiting Tesla engineers with massive compensation offers and have unfortunately been successful in a few cases.”
Musk, who co-founded OpenAI in 2015, is in an ongoing feud with Altman and is actively suing his former business partner over an alleged breach of contract.
Board concerns over Elon Musk’s management
Knight’s departure has raised some concerns, particularly as growth at Tesla’s core car business has come to a complete halt, and investors are harboring uncertainty about Musk’s less traditional management methods, such as moving staff between his businesses.
Testimony in Musk’s recent pay package case showed that board members have very little oversight and weren’t able to come up with a ballpark figure for how many staff Musk reassigned from Tesla to help with his Twitter purchase. “Musk regularly uses Tesla resources to address projects at other companies he owns,” the court ruled, adding no one on the board challenged such decisions.
Alarm bells over Elon Musk’s treatment of his companies have rung louder since he threatened board members, saying he would develop AI technology outside of Tesla if they didn’t approve a compensation package granting him 25 percent control over the company.
“Is there a precedent for the CEO of a public company poaching talent to go over to his private company? Is he acting in shareholders’ best interests?” a writer on the Tesla investors’ club subreddit wondered on Wednesday. Another asked if “the board of directors are cool with this?” while a third joked, “Haha, Elon is brain-draining Tesla.”
One of Elon Musk’s main goals over the past twelve months has been to rebrand Tesla as an AI leader now that investors are willing to pay high multiples for such stocks. In this light, Fortune claims that investors should think of Tesla less as a manufacturer of EVs and energy storage and more as a robotics company – whether it “builds machines on two legs like Optimus or rolling on four wheels.”
By claiming that OpenAI’s Altman is attempting to steal his workers, Elon Musk not only has a convenient excuse for why Knight moved to xAI, but he also raises the reputation of his company.
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