Today's Edition
(REUTERS)
Tesla Chair Robyn Denholm on Thursday denied a Wall Street Journal report that said board members about a month ago had reached out to several executive search firms to find a replacement for CEO Elon Musk.
Tesla shares rose 2.8% in early trading on Thursday after Denholm called the report "absolutely false" and said on X the EV maker's board is "highly confident" in Musk's ability to "continue executing on the exciting growth plan ahead."
The Journal said in a statement it stood by its reporting on Wednesday that the board was seeking a new CEO due to Musk's heavy involvement with President Donald Trump's administration, citing people familiar with the discussions. The Journal said the current status of the board's push could not be determined.
Musk said on X the report was a "deliberately false article".
Activist investors have long accused Tesla's board of lacking independence and failing to rein in Musk.
Tesla is at a crucial juncture. Musk has pivoted from his promise of making a new affordable EV platform to rolling out driverless taxis and humanoid robots, highlighting Tesla's future as an AI and robotics company instead of an automaker.
Much of the company's valuation is based on that vision and some investors say Trump will help further it. Last week, federal regulators eased rules for testing autonomous vehicles, boosting Tesla's stock.
Tesla shares have been sliding for months, as its EV sales have slumped in the U.S. and Europe in a backlash to his embrace of far-right politics and as competitors have started to take up market share with newer models.
Musk's role in the Trump administration overseeing efforts to cut federal jobs has resulted in a considerable resentment in the U.S. and other countries, especially in Europe. Tesla sales plunged again in April, down 59% in France and 67% in Denmark from a year ago.
Musk's work at Trump's Department of Government Efficiency has been widely unpopular among Americans, and his time away from Tesla has been an added concern for investors.
Musk said last week he would cut back significantly on the time he devotes to the Trump administration and spend more time running Tesla.
But his political shift has led to protests against Musk and the company, as well as vandalism at its showrooms and charging stations in the U.S. and Europe.
The board members met Musk and asked him to acknowledge publicly that he would spend more time at Tesla, the WSJ report said.
Some Tesla directors, including co-founder JB Straubel, have been meeting with major investors to reassure them the company is in good hands, the WSJ said.
But Denholm, hand-picked by Musk whose controversial pay package she defended, has drawn criticism for her own pay package along with questions on whether that compromised her oversight of Tesla and Musk.
Denholm has dismissed the allegations, and a spokesperson has said her pay was fair.
In March, Denholm sold about $33.7 million worth of electric automaker's stock, according to a regulatory filing.
The eight-person Tesla board, which includes Musk's brother Kimbal Musk and James Murdoch, son of media mogul Rupert Murdoch, has been looking to add an independent director, the report said.
