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‘Tesla has no working CEO’: As stock drops 61% from its peak, a major Tesla shareholder calls for Elon Musk’s ouster

December 15, 2022, 10:50 PM UTC
Tesla CEO Elon Musk speaks during an event to launch the new Tesla Model X Crossover SUV
Tesla CEO Elon Musk, pictured standing in front of a Tesla Model X Crossover SUV, seems too distracted by Twitter to effectively lead Tesla, investors worry.
Justin Sullivan/Getty Images

Tesla investors are starting to wonder if CEO Elon Musk is still the right man to lead the company. With much of Musk’s attention focused on Twitter, which he’s shaking up following his $44 billion takeover in late October, doubts are increasing about his ability to effectively lead the electric-vehicle maker. 

It doesn’t help that he’s sold vast quantities of his personal Tesla shares this year as the carmaker’s stock has plunged about 61% from its peak late last year. That includes the sale of $3.6 billion in stock that he disclosed on Wednesday. He tweeted in April, after selling 4.4 million shares for $4 billion, “No further TSLA sales planned after today.”

On Wednesday, Leo Koguan, one of Tesla’s largest individual shareholders, called for a leadership change, tweeting: “Elon abandoned Tesla and Tesla has no working CEO. Tesla needs and deserves to have working full time CEO.”

Leo said someone more focused on the operational side of the company, similar to Tim Cook at Apple, should take over the company. Cook became Apple CEO after the death of co-founder Steve Jobs, who like Musk was strong on the visionary side. 

“Elon is a mere hired hands,” Leo added. “He is our employee…Elon was the proud father, Tesla has grown up. An executioner, Tim Cook-like is needed, not Elon.” 

Tesla investor frustration

Leo’s comments were in sharp contrast to ones he himself offered in January, when he tweeted, “Tesla bulls, the future rainbow are here and now. Smile to your fortunate self.”

At that time, Tesla had a market cap of $1.2 trillion and ranked among the world’s most valuable companies. On Wednesday, its market cap dropped below $500 billion for the first time since Nov. 23, 2020. 

“For investors, the clock has struck 12. Frustration has massively built, and Musk appears to be doubling-down, not backing away,” Wedbush Securities analyst Dan Ives told CBS MoneyWatch.

Ives believes Musk overpaid for Twitter by about $20 billion and needed to tap into his Tesla shares to pay for the acquisition. 

“One of investors’ bigger concerns is that Musk is using Tesla as an ATM machine,” Ives said. “That has been a massive overhang on Tesla’s stock.”

Another concern is that Musk’s perceived lean toward far-right beliefs on Twitter could translate to left-leaning car buyers avoiding Teslas. They’ll certainly have more options, with more automakers piling into the EV space. S&P Global Mobility recently predicted that Tesla’s market share in the U.S. will drop from 65% this year to below 20% by 2025

Gary Black, managing partner of the Future Fund and a Tesla shareholder, tweeted on Wednesday about Musk: “He will realize soon (if not already) that his polarizing political views are hurting customer perceptions of $TSLA EVs. Customers don’t want their cars to be controversial. They want to be proud as hell to drive them — not embarrassed.”

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