Elon Musk was long considered a critical asset for Tesla, so much so that his leadership continually accrued a sizable valuation premium for the high-momentum stock. Now, however, it seems Musk has become a liability for Tesla, if the Wall Street Journal's latest report is anything to go by.
To wit, WSJ is now reporting that Tesla's board actively started searching for a CEO candidate earlier this year to replace Elon Musk, going so far as to reach out to several firms that specialize in executive placements.
The board had apparently also laid down the proverbial gauntlet, demanding that Musk prioritize his role at Tesla over his DOGE-related activities. By all accounts, Elon Musk appears to have complied by publicly declaring during the recent Q1 earnings call that his DOGE work was "mostly done," and that he would spend a lot more time at Tesla from May onwards.
According to the Wall Street Journal, it is unclear if Elon Musk's earnings call declaration was sufficient to assuage the Tesla board's concerns.
For the benefit of those who might not be aware, Elon Musk's overt political role at the Department Of Government Efficiency (DOGE) has spawned a material backlash and introduced partisanship into Tesla's sales calculus in the US.
Moreover, Elon Musk also alienated a large segment of the German population by vigorously supporting the far-right AfD party in recent elections.
Nonetheless, at the recent earnings call, the EV giant's CFO attempted to underplay the supposed brand damage to Tesla from Elon Musk's political activities, asserting that the "unwarranted hostility" only had an impact in certain markets. Elon Musk then further clarified that "absent from macro issues, we don't see any reduction in demand."
TESLA'S HEAD OF BATTERY ARCHITECTURE VINEET MEHTA DEPARTS - THE INFORMATION
— First Squawk (@FirstSquawk) April 30, 2025
Meanwhile, today's report from the WSJ came just hours after the departure of Vineet Mehta, the head of battery architecture at Tesla.
This back-to-back adverse reporting is currently taking a toll on Tesla's share price, with the stock declining over 3 percent on Robinhood's overnight trading platform.
Update: Tesla Issues A Denial Over Elon Musk's Potential Exit
Earlier today, there was a media report erroneously claiming that the Tesla Board had contacted recruitment firms to initiate a CEO search at the company.
This is absolutely false (and this was communicated to the media before the report was published).
The CEO of Tesla is…
— Tesla (@Tesla) May 1, 2025
Tesla has denied reports that its board contacted executive placement agencies. In a shocking statement, Tesla assets this denial was communicated to WSJ before the publication of this story.
About the author: Writing is my one incontrovertible passion. Over the past six years, he has authored over 2,200 distinct articles on financial and tech-related topics, spanning nearly 1 million words. And he has been a member of Wcctech mobile team since 2025. As an alumnus of the University of Toronto, Rotman Commerce Program, I bring nuance, in-depth knowledge, and a unique perspective to every topic that I cover. When I'm not writing, I'm traveling the world, exploring hidden confectionaries and restaurants as an aspiring food connoisseur.
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