Tesla plans Replacing Elon Musk
Discussions at the company began due to the ongoing decline in earnings, as Musk decided to focus on the government instead.
Quick overview
- Tesla's Board of Directors is initiating a search for a new CEO due to concerns over Musk's focus on government engagements and a decline in stock value.
- Following the report, Tesla shares experienced a drop in after-hours trading.
- The board is considering hiring executive search firms for formal succession planning amidst ongoing declines in earnings.
- Musk has agreed to spend more time at Tesla and will shift his focus back to the company in May, although his government engagements will continue.
Musk’s government undertakings and a steep decline in stock value prompted concern from Tesla’s Board of Directors to initiate a search for a CEO sooner this year, as The Wall Street Journal reported on Wednesday.
Tesla shares dropped in after-hours trading following the report. The board members with knowledge of the matter considered hiring several executive search firms to create a formal succession planning framework.
Discussions at the company began due to the ongoing decline in earnings, as Musk decided to focus on the government instead.
Meanwhile, the board requested Musk to spend more time at Tesla and officially declare his plans. He agreed to do so during the previous week’s first-quarter earnings call, asserting that he would shift his focus back to Tesla in May.
Nonetheless, he noted that those engagements with the government would continue.
The WSJ report stated that Tesla’s succession strategies could not be determined. Furthermore, there was no indication of whether Musk’s commitment to Tesla affected the business. It was also uncertain if Musk, who also serves on Tesla’s board, knew the plans.
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