Tesla CEO Elon Musk is seeking to increase his ownership of the electric vehicle company to 25% as he looks to accelerate the brand’s expansion into robotics and artificial intelligence.
In a January 15 post published to X, the executive commented: “I am uncomfortable growing Tesla to be a leader in AI & robotics without having ~25% voting control.” Such a stake, he added, would be “Enough to be influential, but not so much that I can’t be overturned.”
Musk presently commands a 13% share in Tesla, down from 22% before his acquisition of Twitter, now known as X, in 2022. The tech entrepreneur sold off much of his stake to fund his purchase of the social media platform, even as other shareholders in the EV business expressed concern that Musk’s attention would soon be split between three major enterprises: Tesla, Twitter, and SpaceX.
Typical voting control percentages range broadly among high-profile executives; however, in 2022, an Investor’s Business Daily article reported that only eight CEOs representing businesses in the S&P 500 owned 35% or more of their own companies. The piece was written in response to Musk’s criticisms of Twitter board members, who he decried for not owning a larger stake in the brand. A 25% stake, while far from a majority share (50%), would thus likely be considered high for a company of Tesla’s size.
Although Tesla is largely known as a battery-powered vehicles manufacturer, the corporation has expanded into multiple sectors, including energy, AI, and robotics, areas that Musk has claimed will be more important to the brand’s longevity than the automotive industry. Speaking on the Tesla-developed Optimus robot in early 2022, Musk said the machine, still far from a commercial launch, “ultimately will be worth more than the car business and worth more than full self-driving.” That same year, Musk also claimed autonomous driving was “the difference between Tesla being worth a lot of money and being worth basically zero.”
Should the Tesla board decline his request for more voting control, the CEO has already threatened to take his business ideas elsewhere. “Unless that is the case, I would prefer to build products outside of Tesla,” he added to his post on X.
Despite the warning, it is unclear whether the CEO’s attempts to expand his voting control will succeed. Musk and his EV company are facing a wave of backlash over various controversies. A recent Wall Street Journal article claimed board members and executives at Tesla and SpaceX had grown agitated over the entrepreneur’s alleged drug abuse, prompting a fiery response from Musk on X. Last year, a Reuters investigation claimed the automaker had dismissed evidence of defective car parts and charged customers for repairs that should have been covered under warranty. In the first two weeks of 2024, Tesla’s market valuation lost $94 billion or 12%, as investors dialed back expectations due to a stagnating EV market and weakening profit margins.