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Investors Urge Musk to Commit to Full-Time Role at Tesla Amid Crisis

Investors Urge Musk to Commit to Full-Time Role at Tesla Amid Crisis

News EditorBy News EditorMay 28, 2025 U.S. News 6 Mins Read

Recent developments at Tesla indicate mounting pressures for CEO Elon Musk to dedicate more time to the company amidst concerns about its declining market performance and reputation. A letter from a group of pension fund leaders outlines their apprehensions regarding stock price volatility, declining sales, and human rights allegations linked to Musk’s external activities. The investors are calling for formal conditions on Musk’s compensation and a management succession plan as part of a restructuring effort to stabilize Tesla’s prospects.

Article Subheadings
1) Investors Express Concerns Over Tesla’s Performance
2) Musk’s Expanded Role Raises Eyebrows
3) A Shift in Brand Value and Reputation
4) Demands From Investors for Structural Changes
5) Tesla’s Board Composition and Future Direction

Investors Express Concerns Over Tesla’s Performance

A coalition of prominent pension fund leaders recently voiced serious concerns regarding the trajectory of Tesla, particularly highlighting the declining performance of the company under Elon Musk‘s leadership. The investors, who collectively manage about 7.9 million shares in Tesla, noted increasing volatility in the company’s stock price, accompanied by a substantial drop in sales—particularly highlighted by a nearly 50% decrease in European sales in April compared to the same month last year.

This alarming trend follows a year-long analysis where the investors have closely monitored Tesla’s performance in light of reports suggesting severe human rights violations and a marked global reputation decline. The investors articulated their concerns in a publicly shared letter addressed to Robyn Denholm, the chair of Tesla’s board, presenting a case for Musk’s heightened involvement to ameliorate the current crisis.

Musk’s Expanded Role Raises Eyebrows

In addition to managing Tesla, Elon Musk has taken up significant roles in various initiatives, such as his involvement with xAI and SpaceX. The investors have specifically called for Musk to commit to a minimum of 40 hours per week at Tesla to ensure that his focus is primarily directed at the electric vehicle sector—a condition that they suggest should be tied to any new compensation plan arranged for him. This request stems not only from concerns about Tesla’s performance but also from his actions outside of the company, particularly his high-profile role as an architect of the U.S. Department of Government Efficiency (DOGE).

The required commitment underscores a growing sentiment that Musk’s wide-ranging interests may be hindering his capability to adequately serve as Tesla’s CEO, prompting stakeholders to advocate for a more focused leadership model to ensure the company’s competitiveness in a rapidly evolving market.

A Shift in Brand Value and Reputation

Tesla’s brand value has experienced a tumultuous decline since 2024. Initially ranked eighth in the Axios Harris Poll of American brands, the company has seen its position drop dramatically to 95th, trailing other automakers in public perception—a stark shift that signifies lost consumer trust. This decline is largely attributed to a series of controversial statements and activities by Musk, including significant political donations and endorsements that are perceived as inflammatory.

For instance, Musk’s support for efforts aimed at reinstating Donald Trump as President, including a financial commitment nearing $300 million, alongside endorsing extreme political factions abroad, has alienated many customers and stakeholders. As public sentiment shifts, these actions have prompted a critical reassessment of Tesla’s standing in an increasingly competitive automotive market where reputational integrity is paramount.

Demands From Investors for Structural Changes

The investors’ letter outlines a series of structural requests to the Tesla board, reflecting their concerns about the current governance and strategic direction of the company. Among these demands is the necessity for a clear succession plan that provides clarity on future leadership—an essential component in ensuring long-term stability amidst uncertainty. This request is aimed at preventing any abrupt leadership voids that could exacerbate current challenges.

Additionally, the investors are advocating for a policy that would limit outside board commitments for all Tesla directors, thereby ensuring that their primary focus remains on Tesla’s operational and strategic goals. This recommendation further emphasizes the need for accountability within Tesla’s governance framework, framing it as crucial for restoring investor confidence and ultimately revitalizing company performance.

Tesla’s Board Composition and Future Direction

In the face of criticism regarding its governance and board composition, Tesla appointed Jack Hartung, former CFO of Chipotle, to the board earlier this month. While this move is a step towards bolstering the board’s expertise, it raises questions about the interconnectedness of board members, given Hartung’s past associations with Kimbal Musk, Elon Musk’s brother. As investors push for a more independent board structure, the appointment’s value will be observed in terms of its impact on decision-making and management oversight.

Unsurprisingly, Tesla has yet to formally respond to the investors’ letter or provide any comments regarding these significant demands. However, the ongoing scrutiny from key stakeholders highlights a pressing need for stable governance and a revitalized corporate strategy focused on returning to basics, primarily enhancing Tesla’s production and sales capabilities while regaining customer trust.

No. Key Points
1 Investors demand Musk to commit at least 40 hours a week to Tesla.
2 Concerns about declining sales and stock volatility reported by pension fund leaders.
3 Tesla ranks 95th in public perception among American brands, a significant decline.
4 Demand for improved governance, including a clear succession plan for leadership.
5 Appointment of Jack Hartung to the board raises questions about independence.

Summary

As Tesla faces mounting pressure from its investors regarding leadership and governance, the current situation underscores pivotal questions about the company’s future direction. The calls for Elon Musk to recommit to the company reflect broader concerns about its declining market performance, brand reputation, and operational stability. The outcomes of these demands will likely shape Tesla’s trajectory, impacting not only its stock price but also its ability to innovate and lead in the electric vehicle market.

Frequently Asked Questions

Question: What specifically do investors want from Musk?

Investors are urging Musk to commit to a minimum of 40 hours a week with Tesla and are advocating for a clear succession plan for future leadership in the organization.

Question: How has Tesla’s brand value changed recently?

Tesla’s brand value has significantly decreased, dropping from eighth place to 95th in public perception among American brands, attributed to Musk’s controversial public actions and statements.

Question: What structural changes are investors demanding from Tesla’s board?

Investors are demanding a formal governance structure that includes limiting outside commitments for directors and establishing clear succession plans to ensure the company’s long-term stability.

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As the News Editor at News Journos, I am dedicated to curating and delivering the latest and most impactful stories across business, finance, politics, technology, and global affairs. With a commitment to journalistic integrity, we provide breaking news, in-depth analysis, and expert insights to keep our readers informed in an ever-changing world. News Journos is your go-to independent news source, ensuring fast, accurate, and reliable reporting on the topics that matter most.

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