Tesla faces leadership pressure once again as CEO Elon Musk publicly clashed with Wall Street analysts over his political focus. On Tuesday, Musk fired back at Wedbush analyst Dan Ives, telling him to “shut up” on X.
Ives had offered bold recommendations to Tesla’s board. He proposed giving Musk 25% voting control, merging Tesla with xAI, and placing limits on Musk’s political activities. Despite being one of Tesla’s most bullish analysts, Ives called Musk’s behavior a growing distraction.
Tesla shares dropped nearly 7% on Monday, losing $68 billion in value. This came after Musk revealed plans to form a new political party—the America Party—during the weekend. His announcement targeted Republican supporters of a recent spending bill.
Wedbush described the situation as a “tipping point.” Although they maintained their $500 price target, they urged Tesla’s board to take action. Ives criticized what he called a political “soap opera” that threatens Tesla’s business focus.
Tesla faces leadership pressure not only from Wedbush. Analysts at William Blair downgraded Tesla’s stock on Monday, citing Musk’s growing political involvement. They warned that the recent spending bill could hurt Tesla’s margins and reduce demand.
These analysts noted Musk’s attention appears split, especially with the robotaxi launch approaching. They emphasized that Tesla needs Musk to focus fully on operations during this critical period.
Another issue adding to concerns is Musk’s compensation. In 2018, Tesla granted him a massive $56 billion pay package. However, a Delaware judge later voided it, citing board conflicts of interest. Tesla is appealing the decision and working on a new package.
Ives’ suggestion for 25% voting control aligns with Musk’s wishes but raises governance concerns. Observers argue that any new deal must include stronger checks on Musk’s power.
Tesla faces leadership pressure as investors grow impatient. The company must now balance Musk’s bold vision with the need for stability and transparency. With rising competition, shifting policies, and strategic plans like the robotaxi, Tesla’s board must act soon.
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