Elon Musk, the high-profile CEO of Tesla, is facing mounting pressure to prioritize his responsibilities at Tesla over his work with DOGE (Dogecoin).
Following a difficult start to the year for Tesla, Musk’s divided attention is fueling concerns about the automaker’s future, especially with a crucial earnings report on the horizon.
Investors are increasingly restless, and prominent analysts are warning that Tesla faces significant risks if Musk continues to split his focus.
The Pressure Mounts on Musk
Musk’s dual focus on Tesla and his involvement with DOGE has stirred growing tensions.
Wedbush analyst Dan Ives, known for his bullish stance on Tesla, has raised alarms, stating that the automaker faces a “code-red situation” if Musk does not take a step back from his role with DOGE and return to being Tesla’s full-time CEO.
Ives, who has been one of Musk’s staunchest supporters, expressed concern over the financial health of Tesla as the company’s stock price has taken a sharp dive.
The automaker’s stock is down by 40% this year, and first-quarter sales have come in far below expectations.
Tesla’s Struggles and Investor Concerns
Tesla’s difficulties this year are not solely financial.
The company has faced protests and growing political backlash, in part due to Musk’s involvement in political affairs and his support for DOGE.
Ives points to these issues as factors contributing to Tesla’s poor sales performance, describing them as a “brand crisis tornado.”
Wedbush Securities has also reduced its 12-month price target for Tesla stock from $550 to $315, citing the growing political controversy surrounding Musk.
Investors are concerned about the impact of Musk’s external ventures, especially given the lack of clarity about key Tesla initiatives such as the robotaxi service and the much-anticipated affordable electric car.
Musk’s Role in Government and Its Impact on Tesla
Musk’s increasing involvement in political affairs, including his role at DOGE and other political engagements, has led some Tesla investors to question his ability to focus on the company’s future.
A significant number of shareholders have voiced concerns during forums and earnings calls, questioning whether Musk should refocus entirely on Tesla, leaving politics to elected officials.
In response to these concerns, some retail shareholders have asked whether the Tesla board is considering whether Musk should step back from his government duties and resume full-time leadership of the company.
Additionally, rumors have circulated that Tesla’s planned affordable EV, expected to launch in 2025, has been delayed by several months, which has only added to investor uncertainty.
A Critical Crossroads for Musk and Tesla
Ives has remained optimistic about Tesla’s long-term prospects, citing the company’s strong position in AI and robotics.
However, he stresses that Musk’s leadership is crucial to the company’s success and must be prioritized over external political engagements.
Ives described the current moment as a “fork in the road,” emphasizing that if Musk continues his political work, it may lead to permanent brand damage for Tesla.
However, if Musk steps back from his government role, the company will have its most important strategic thinker back in full-time control, which could help steady the ship amid the current turbulence.
What’s Next for Tesla?
As the company prepares for its upcoming earnings call, Musk faces a critical decision: continue with his political and DOGE-related activities or return to the role that has made him one of the most influential figures in the tech and automotive industries.
The outcome of this decision will likely shape Tesla’s future.
Investors and analysts alike are watching closely to see if Musk can refocus his efforts on the company and address the growing concerns surrounding its brand, sales, and product timelines.
In the coming weeks, the company’s direction will depend largely on whether Musk can balance his many roles or if he will decide that returning to Tesla full-time is the best move for the automaker’s future.