Major Shareholder Turns on Elon Musk, Demands New CEO
The storm around Twitter is rocking the boat at Tesla, leading at least one shareholder to call for a change at the top of the electric vehicle manufacturer.
Elon Musk owns Twitter and is the CEO of Tesla and SpaceX. In recent weeks, his work at Twitter has overshadowed the other two ventures, leading some Tesla shareholders to voice concerns that his controversial Twitter moves are tarnishing Tesla’s value.
To make matters worse, Musk disclosed this week that he sold more than $3.5 billion in Tesla stock late Wednesday, helping to trigger a 16.1 percent decline in Twitter’s stock, according to MarketWatch. The share price hit $150.05, nearing a low not seen since November 2020.
Overall, Musk has sold $39.3 billion in Tesla stock over 13 months. Twitter’s purchase cost Musk $44 billion.
I will make sure Tesla shareholders benefit from Twitter long-term
— Elon Musk (@elonmusk) December 13, 2022
What has shareholders livid is that Tesla has appeared to become a side project while Musk makes his mark at Twitter.
Leo KoGuan, who is the third-largest individual Tesla shareholder, wrote on Twitter that Tesla needs a steady hand at the tiller – and that does not describe Musk.
Elon abandoned Tesla and Tesla has no working CEO
Tesla needs and deserves to have working full time CEO
What Tesla BOD should do, do nothing? Elon will find his own successor under BOD independent supervision https://t.co/AJSvij9ncP
— KoGuan Leo (@KoguanLeo) December 14, 2022
Tesla investor Ross Gerber said the time for change has come.
I will need all of your support to do this. I will devote a good part of my life to tesla if I am added to the BOD. If we all don’t come together we will not win this activist campaign. It’s time for change for the tesla BOD. $tsla @KoguanLeo
— Ross Gerber (@GerberKawasaki) December 16, 2022
“We’re in literally the best part of the company’s history and it’s being totally demolished by Twitter. I think the stock would rally big-time if they just said, ‘Elon’s not CEO of Tesla anymore.’ Now I don’t want that. What I want is him back in Austin,” Gerber said, according to The Washington Post.
Gary Black, managing partner of Future Fund LLC, which invests in Tesla, said there needs to be a separation between Tesla and Twitter.
“He will realize soon (if not already) that his polarizing political views are hurting customer perceptions of [Tesla] EVs,” he tweeted. “Customers don’t want their cars to be controversial. They want to be proud as hell to drive them — not embarrassed.” He expressed hope Musk could “focus on [Tesla] as CEO.”
I expect the $TSLA Board to ramp up pressure on Elon to find a talented, driven 24/7 media exec to run Twitter so @elonmusk can refocus all his energies on running $TSLA, which can be a $3T market cap company in 5 years. @MartinViecha @hiromichimizuno@jgebbia @IraEhrenpreis
— Gary Black (@garyblack00) December 14, 2022
Wedbush analyst Daniel Ives is also concerned about what’s taking shape, according to Ameritrade.
“Musk continues to throw gasoline in the burning fire around the Tesla story by selling more stock and creating Tesla brand deterioration through his actions on Twitter,” he wrote.
“The nightmare of Musk owning Twitter has been an episode out of the Twilight Zone that never ends and keeps getting worse,” Ives wrote.
“In late April Musk said he was done selling Tesla stock, instead the exact opposite has happened and put massive pressure on Tesla shares which have significantly underperformed the market since Musk took over Twitter in late October,” he wrote.
Ives said the connection between Tesla and Twitter is playing out as many feared.
“One of investors’ bigger concerns is that Musk is using Tesla as an ATM machine. That has been a massive overhang on Tesla’s stock,” Ives said, according to CBS.
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