The year 2025 has been a challenging year for Tesla. The stock price is down by 30% from its all-time high earlier in the year, and vehicle deliveries have dropped by 13% compared to the same period last year. To make matters worse, the company’s Cybertruck seems to be falling apart both figuratively and literally, while Tesla’s dealerships, service centers, and charging stations are being destroyed across the globe. For Tesla owners, the situation is grim—imagine the anxiety of leaving your car parked on the street, only to worry about it being vandalized or set on fire.
As if this wasn’t bad enough, Elon Musk, the visionary founder of Tesla, has been preoccupied with political ambitions. Musk has taken his influence from Silicon Valley to Washington D.C., attempting to push through his own vision of government reform—but so far, with little success. His multimillion-dollar effort to elect a Republican judge in Wisconsin failed, even though the state had recently swung in favor of Donald Trump. Now, Musk is packing up his political ambitions and heading back to Tesla. But what does this mean for the company’s future?
Is Elon Musk still Tesla’s greatest asset, or has he become the company’s biggest risk?
In the past, the answer seemed obvious: Tesla was Musk, and Musk was Tesla. His vision, ambition, and sheer force of will were what propelled the company to global prominence. However, Tesla is no longer just Musk’s personal business venture. Tesla is a publicly traded company, and Musk no longer has complete ownership. He now answers to shareholders, a board of directors, and the market itself.
If these forces decide that Tesla would be better off without him, they can remove him. It sounds impossible, but history suggests that nothing is truly permanent—not even the most powerful founder.
A History of Founder Crises in the Corporate World
To understand what could happen to Musk’s position at Tesla, we must look at history. A century ago, Thomas Edison—America’s greatest inventor—found himself in a remarkably similar position. Edison, who had revolutionized electricity and founded what would become General Electric, began to focus his attention on reforming the U.S. government, much like Musk has focused on political change. Edison’s attempt to modernize the U.S. military with the creation of a Naval Consulting Board ended in failure, and while he was distracted with these big ideas, General Electric was quietly moving on without him.
Edison’s loss of control over his own company is a sobering reminder that even the greatest of visionaries can be sidelined. Could the same thing happen to Musk at Tesla?
Musk’s Growing Disconnect with Tesla’s Core Business
Fast forward to 2025, and Musk is not only facing challenges with his political ventures but also struggling to keep Tesla’s core business intact. Sales are down, and the rollout of the Cybertruck is a mess. Meanwhile, Chinese competitors like BYD are closing in fast, offering more affordable and competitive electric vehicle options. The question everyone is asking: Is Musk losing touch with Tesla’s needs?
Even more concerning, Tesla vehicles are being literally burned in the streets around the world. While Tesla has revolutionized the electric vehicle market, its current challenges are undeniable. And while Musk has been preoccupied with reforming Washington and pursuing his ambitious Doge project, Tesla’s stock price continues to take a hit. Investors and shareholders are now left wondering if Tesla’s future could be in jeopardy without a change in leadership.
The Board of Directors: Tesla’s Potential Check on Musk’s Power
At the heart of the issue lies the board of directors. Although Musk has long been seen as the soul of Tesla, the company is a publicly traded entity. The board of directors has the power to remove Musk from his position as CEO if they believe his leadership is too volatile. Let’s take a closer look at who sits on Tesla’s board and how they may or may not have the power to influence Musk’s future at the company.
Who is on Tesla’s Board of Directors?
Tesla’s board is a mix of Musk’s allies, friends, and professional connections. Here are a few key figures:
- Robyn Denholm (Chairwoman): Denholm was handpicked by Musk in 2018 after he was forced to step down as Tesla’s chairman due to an SEC settlement. She has strong financial ties to the company, having earned millions in stock and cash since joining the board.
- Ira Aaron Price: Price has been a close ally of Musk for years and has chaired some of Tesla’s most important committees, including compensation and governance. He played a role in approving Musk’s controversial $56 billion pay package.
- James Murdoch: The son of media mogul Rupert Murdoch, James has been part of Tesla’s board since 2017. His long personal relationship with Musk raises questions about his ability to challenge the CEO’s actions.
- Kimble Musk: Elon’s brother, who has been deeply intertwined with Musk’s companies, sits on Tesla’s board as well. His closeness to Elon makes him unlikely to provide objective oversight.
- Kathleen Wilson-Thompson: She joined Tesla’s board after the SEC mandated the company increase independent directors. Her background in corporate governance and human resources may give her a unique perspective in Tesla’s leadership decisions.
These are just a few members of the board, but what stands out is that many of them have deep financial ties to Musk’s ventures. Critics argue that this results in a lack of true independence and questions whether the board could ever force Musk out if the situation continued to deteriorate.
Could the Board Replace Musk?
The power to remove Musk as CEO lies in the hands of Tesla’s board of directors. However, there is one major hurdle: Musk’s influence over the board. Even though Robyn Denholm officially leads the board, her close ties to Musk raise doubts about the independence of the group.
In the past, investor pressure has played a key role in forcing the hands of corporate boards. For example, at Uber, Travis Kalanick was forced out by the company’s investors and board in 2017 due to a string of scandals and poor leadership decisions. Kalanick was the visionary force behind Uber, just as Musk is to Tesla. However, investors and the board concluded that his leadership was becoming a liability.
Tesla could be facing a similar crossroads, especially if sales continue to decline and competitors like BYD and Rivian gain ground. If Tesla’s stock price keeps falling, shareholders could demand change, and the board may be forced to act.
Shareholder Influence: Could Tesla’s Investors Pressure for Change?
Unlike the board of directors, Tesla’s shareholders have the power to vote on important company decisions. They can’t directly remove Musk, but if enough influential shareholders, like BlackRock and Vanguard, push for a change, it could force the board to reconsider its loyalty to Musk. In fact, both BlackRock and Vanguard have already expressed concern over Musk’s political entanglements and divided attention, which they argue could hurt Tesla’s long-term prospects.
If Tesla’s stock continues to slide and investor confidence continues to erode, these institutional investors could use their power to restructure the board or even push for a leadership change.
What’s Next for Tesla? Three Possible Outcomes
So, what happens next? If Musk’s leadership becomes too much of a liability for Tesla, there are three possible paths forward:
1. Moving Musk into a Chief Architect Role
One option is to keep Musk at Tesla but in a reduced capacity. Just as Larry Page and Sergey Brin stepped back and allowed Sundar Pichai to run Google as CEO, Musk could focus on innovation and Tesla’s AI and autonomous driving technologies, while a new CEO takes charge of daily operations. This would allow Musk to continue contributing his vision without being bogged down by the day-to-day management of the company.
2. Tesla Restructures with Musk Holding Super Voting Shares
Another option is to give Musk super voting shares, similar to Mark Zuckerberg’s approach at Meta. This would allow Musk to retain control over Tesla’s direction even if a new CEO is brought in. However, this could also increase the company’s risk, as rating agencies might view it as a governance downgrade, leading to higher debt costs.
3. Musk Stays in Full Control
Finally, Musk could remain in full control of Tesla. While this would carry significant risks, especially if the company continues to face internal and external challenges, it’s still possible that Tesla’s long-term vision outweighs short-term volatility. However, investors would have to be willing to ride out the storm, and Tesla’s future would likely remain unpredictable.
Conclusion: Tesla’s Future is Uncertain, but One Thing is Clear
Whether or not Elon Musk remains at the helm of Tesla in the long term remains to be seen. But one thing is certain: Tesla’s future depends on a delicate balance of leadership, innovation, and investor confidence. As Musk faces political setbacks and Tesla grapples with internal challenges, the company’s board and investors may have to decide if the risks of Musk’s leadership outweigh the potential rewards. Whatever happens, Tesla’s fate is no longer solely in Musk’s hands, and it’s a critical moment for the company as it navigates these uncertain times.
FAQs
1. Why is Tesla struggling in 2025?
In 2025, Tesla faces several challenges, including a 30% drop in stock price since its all-time high in January, a 13% decrease in vehicle deliveries compared to last year, and the troubled rollout of the Cybertruck. Additionally, Tesla vehicles, dealerships, service centers, and charging stations are being vandalized and even set on fire globally. These factors are contributing to the company’s struggles.
2. What is Elon Musk’s role in Tesla’s current situation?
Elon Musk, Tesla’s CEO, has been distracted by various other projects, including a failed political campaign in Wisconsin and his efforts to reform government bureaucracy. His divided attention and ventures outside of Tesla, such as his Department of Government Efficiency (Doge), are seen as detrimental to the company. Investors and the board are now questioning if Musk is still an asset to Tesla or if his leadership is holding the company back.
3. How is Tesla’s board involved in the company’s challenges?
Tesla’s board has long been seen as a group of Musk’s allies and supporters. This close relationship raises questions about the board’s independence and ability to make objective decisions. For instance, when Musk faced SEC sanctions in 2018, the board was forced to appoint independent directors, but many still have financial and personal ties to Musk. If Tesla’s situation worsens, the board may have to make a decision about Musk’s future at the company.
4. Could Tesla’s board remove Elon Musk as CEO?
While the board has the power to remove Musk as CEO if they believe his leadership is detrimental to the company, it’s unlikely to happen easily. The board has historically been loyal to Musk, and major institutional investors such as BlackRock and Vanguard are pushing for changes, including an independent chairman. If pressure mounts, the board could take action, but this would be a difficult decision.
5. What happened to other companies when their founders were removed?
Several companies have removed their founders when their leadership became a liability. For example, Steve Jobs was removed from Apple in 1985, only to return in 1997 stronger and more focused. Similarly, Larry Page and Sergey Brin stepped back from Google, letting Sundar Pichai lead the company to continued success. These examples show that companies can recover and thrive even after removing their founders.
6. What are the potential outcomes for Tesla if Musk is removed?
If Musk were to step back or be removed as CEO, there are a few possible scenarios for Tesla. The company could move Musk into a chief architect role focused on AI and innovation while appointing a new CEO for operations. Alternatively, Tesla could restructure its governance, giving Musk super voting shares to protect his influence. However, the third option is for Musk to remain in control, continuing to lead the company despite the risks.
7. What is the risk of keeping Elon Musk in charge of Tesla?
The primary risk of keeping Musk in charge is continued volatility. Tesla’s stock price has been dropping, and its market cap is at risk due to decreasing vehicle deliveries, shrinking operating margins, and growing competition. If Musk’s leadership remains chaotic, investors may lose confidence, and Tesla could lose its position as a leader in the electric vehicle and AI markets.
8. How are Tesla’s investors reacting to the situation?
Tesla’s institutional investors, such as BlackRock and Vanguard, have expressed concerns over Musk’s distractions and political involvement. They have pushed for an independent chairman, and if the situation doesn’t improve, these investors may demand a change in leadership. While they can’t directly remove Musk, they can pressure the board to restructure Tesla’s governance. This could force the board to act and potentially remove Musk from day-to-day operations.
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