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Musk Responds to Tesla Criticism with Sharp Rebuke

Tesla CEO Elon Musk fired back at one of his most vocal supporters, Wedbush analyst Dan Ives, telling him to “shut up” on X (formerly Twitter), after Ives publicly urged the company’s board to impose new governance measures to address Musk’s political ventures and time allocation.

The clash follows a sharp 7% drop in Tesla’s stock on Monday, wiping out over $68 billion in market capitalization, after Musk announced the creation of a new political movement, the America Party. The incident further intensifies concerns that Musk’s extracurricular political pursuits are hurting Tesla’s core business.

The Analyst's Demands: Control, Commitment, and Caution

Ives, who maintains a $500 price target on Tesla—the highest on Wall Street, according to FactSet—published a note titled “The Tesla board MUST Act and Create Ground Rules For Musk; Soap Opera Must End.” In it, he laid out three key recommendations for Tesla’s board:

1. New Compensation Package: Structure a deal that grants Musk 25% voting control, easing tensions around leadership and enabling a potential merger with xAI.
2. Time Management “Guardrails”: Set clear expectations for how much of Musk’s attention Tesla should receive.
3. Political Oversight: Establish board-level oversight to ensure Musk’s political activities do not compromise Tesla’s reputation or shareholder value.

Wedbush did not downgrade the stock but underscored that the current drama is reaching a “tipping point.”

Musk’s Sharp Rebuttal

In response to the public critique, Musk posted:

“Shut up, Dan.”

The blunt response sparked immediate media coverage and investor speculation about Musk’s leadership stability and communication strategy. Ironically, Ives' first recommendation would give Musk the level of control he has long lobbied for—something the Tesla board is still weighing after his $56 billion compensation plan was voided in 2023 by Delaware’s Chancery Court due to lack of proper negotiation and board independence.

Mounting Pressure from All Sides

Ives isn’t alone in sounding the alarm. Analysts at William Blair downgraded Tesla stock on Monday, citing Musk’s political distractions and a Congressional spending bill that could squeeze EV margins.

“Investors are growing tired of the distractions,” the firm noted. “Musk’s focus should be on critical business milestones like the robotaxi rollout.”

Even Trump-aligned hedge fund CEO James Fishback criticized Musk’s recent political activities. Fishback’s firm postponed the launch of the Azoria Tesla Convexity ETF, stating,

“Elon has gone too far.”

He urged Tesla’s board to demand clarification about Musk’s political ambitions and assess whether they’re compatible with his CEO responsibilities.

America Party: A New Political Curveball

Musk's political ambitions escalated after he revealed plans to launch the America Party, intended to challenge both Democrats and Republicans who supported a controversial federal spending bill. Musk has yet to provide legal documentation, fundraising details, or a list of endorsed candidates—but claims the party aims to "give Americans back their freedom."

His political leanings, already a lightning rod in the media, now pose a potential governance risk for Tesla.

A Company Under Strain

As Tesla’s valuation falters—down roughly 25% year-to-date, the worst among tech megacaps—shareholders are demanding stability. Musk spent much of the year engaging with Trump administration officials and pushing for a downsized federal workforce, concluding his involvement in late May.

Meanwhile, Tesla continues to navigate EV demand uncertainty, margin pressure, and investor fatigue from persistent leadership drama.

What Happens Next?

With legal challenges to Musk’s old pay package still under appeal in Delaware and mounting calls for structural reform, Tesla’s board faces a pivotal moment. Will they rein in Musk—or continue to back a CEO whose vision is increasingly split between Silicon Valley and Washington?

For now, Musk remains unbothered—and unapologetic.