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This looks like a power play to me. Can Musk really have time to understand the work of more than 2000 people every week?
At most it’s a spot check. Or maybe he has a bash script that looks for certain words. I imagine he hopes that the fear of having an email read by Musk will lead to “extremely hardcore” output.

I wonder what this will do to code quality.

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What’s so difficult or bad about this? I provide status updates to C-Level team all the time. Every now and then the CEO, also a multi billionaire who never stops working, reads one of the updates and slacks me a congratulations message or name drops me on a highlights email.
I just tell them things they want to here in my updates. They have no clue about whats going on.

Anything goes wrong, point at code from people/teams they don't get along with.