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Elon Musk Cries Foul, Demands Increased Stake in Tesla, Threatens To ‘Build Products’ Elsewhere If Demands Aren’t Met



Elon Musk demands more money
Elon Musk is demanding a substantial increase in his ownership stake in Tesla. (Image: DB)

In a surprising twist in the saga of Tesla’s leadership, Elon Musk, the eccentric entrepreneur and Tesla CEO, is making headlines once again. Musk has thrown the electric car giant into a tailspin by going public with his discontent and is demanding a jaw-dropping increase in his ownership stake in Tesla, threatening to divert his attention and “build products” outside the electric vehicle giant if his demands aren’t met.

In a series of candid posts on X, Musk revealed his dissatisfaction with the current trajectory of Tesla, particularly concerning the company’s foray into artificial intelligence (AI) and robotics. Musk’s demand for a larger stake aims to secure around 25% of Tesla’s stock, doubling his existing 13% ownership. The outspoken CEO expressed discomfort at the prospect of leading Tesla in AI and robotics without significant voting control.

“I am uncomfortable growing Tesla to be a leader in AI & robotics without having ~25% voting control. Enough to be influential, but not so much that I can’t be overturned,” Musk declared in a post on X. He went on to assert that if his conditions aren’t met, he would prefer to explore ventures outside of Tesla, a move that could potentially shake the foundations of the electric car giant.

The timing of Musk’s demand adds an extra layer of complexity, with Tesla facing increased competition in the electric vehicle market. Musk has been vocal about his belief in Tesla’s future lying in AI and robotics, with a humanoid robot project named Optimus at the forefront of the company’s technological ambitions.

Investors, already on edge about the uncertainties of Tesla’s pivot towards AI and robotics, responded swiftly to Musk’s ultimatum. Tesla’s stock experienced a 1.5% dip in premarket trading on Tuesday, indicating the potential repercussions of Musk’s bold move on the market.

Adding to the turmoil is Musk’s prolonged absence of a new compensation plan. The existing $56 billion package, announced in 2018, has been under legal scrutiny, with a shareholder lawsuit questioning its appropriateness. Musk and Tesla are awaiting a ruling from the Delaware Chancery Court, with Musk citing this ongoing case as the reason for the delay in a new compensation plan.

In a bid to reassure investors, Musk emphasized his concern about the level of ownership he holds in Tesla. He fears that influential asset managers like Fidelity and BlackRock, who own significant stakes in the company, could potentially undermine his transformative vision if he doesn’t have adequate control.

Musk’s rejection of a dual-class voting system for Tesla adds another layer of intrigue to the unfolding narrative. While Musk’s vision for Tesla’s future in AI and robotics takes center stage, the question of whether Tesla’s board and shareholders will yield to his demands remains uncertain, with the potential for significant repercussions on the future trajectory of both Musk and the electric car giant.