Tuesday, May 21, 2024
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HomenewsMusk wants 25% voting control at Tesla before fulfilling AI goal

Musk wants 25% voting control at Tesla before fulfilling AI goal

  • Tesla shares rebounded from early losses after CEO Elon Musk said he wants 25% voting control before advancing Tesla’s position in artificial intelligence (AI).
  • Musk said in an X (formerly Twitter) post that he is “uncomfortable growing Tesla to be a leader in AI & robotics without having ~25% voting control.”
  • Wedbush analysts said although Musk owns about 13% of Tesla currently, they anticipate “the Board and Musk will be able to resolve this issue over the next 3-6 months.”

Tesla (TSLA) shares rebounded from early losses Tuesday after CEO Elon Musk said that he wants 25% voting control of the electric vehicle (EV) maker before advancing Tesla’s position in artificial intelligence (AI).1

Musk said he is “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” in a post on X (formerly Twitter), which Musk owns.

He added that “unless that is the case, I would prefer to build products outside of Tesla.”

Tesla story,” adding that “Musk

In July of 2023, Musk launched xAI, an AI-focused company separate from Tesla and X.2 The AI company said it “will work closely” with X and Tesla.

Wedbush analysts said they view Tesla “as a disruptive tech leader and if Musk ultimately went down the path to create his own company (separate from Tesla) for his next generation AI projects this would clearly be a big negative for the Tesla story,” adding that “Musk having a back and forth about such an important issue over X is far from ideal for the investment community around Tesla.”3

However, the analysts said that although Musk only owns about 13% of Tesla currently, they anticipate “the Board and Musk will be able to resolve this issue over the next 3-6 months” and reiterated their “outperform” rating and $250 price target.

Tesla shares were up 1% at $220.97 as of about 11:45 a.m. ET Tuesday, after dropping as low as $212.18 early in the session. The stock has gained 68% over the past year.

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