Tesla chair denies report of replacing Musk as CEO
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New Delhi: Robyn Denholm, Chairman of Tesla's Board of Directors, vehemently denied a report claiming that the company’s board was considering replacing Elon Musk as CEO. The denial came after a report from The Wall Street Journal (WSJ) suggested that Tesla's board was planning to replace Musk due to declining sales and profits, coupled with his growing involvement with the Donald Trump administration.
Denholm responded to the report on the social media platform X, stating, "This is absolutely false,” and clarified that the board had not initiated any search for a new CEO. "The CEO of Tesla is Elon Musk, and the board is highly confident in his ability to continue executing on the exciting growth plan ahead," she posted. She also confirmed that Tesla had already communicated with the media before the report was published to address the misinformation.
Elon Musk also reacted to the claim, calling The Wall Street Journal's reporting a "discredit to journalism."
According to the WSJ report, Tesla’s board was allegedly exploring a replacement for Musk after his attention shifted to other ventures, including his involvement with the Trump administration. This marked a significant shift, as the board had traditionally been seen as highly supportive and deferential to Musk.
Tesla’s recent earnings report reflected the financial difficulties the company has been facing. In the first quarter, Tesla’s total revenue dropped by 9% to $19.34 billion from $21.3 billion in the previous year, with automotive revenue falling 20% to $14 billion from $17.4 billion. Net income also saw a significant decline, plummeting by 71% to $409 million from $1.39 billion a year ago. The company attributed part of the decline to the necessary updates at its vehicle factories, which are preparing for the release of a refreshed version of its popular Model Y SUV.
Despite these challenges, Musk confirmed during Tesla's Q1 earnings call that he would soon dedicate more time to the company, which had a positive effect on Tesla’s stock price. The company also refrained from making promises for growth this year but stated it would revisit its 2025 projections in the Q2 update.
The incident highlights ongoing tension around Tesla’s performance and Musk's focus on multiple high-profile ventures.
With IANS inputs