Tesla and its board moved swiftly Thursday to reject a report that suggested the electric vehicle maker was actively searching for a replacement for CEO Elon Musk amid growing investor unease, political controversy, and a steep drop in sales.
In a statement posted on Tesla's official account on X, board chair Robyn Denholm stated: "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... 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."
Denholm's comments directly countered a Wall Street Journal report that claimed Tesla board members had approached executive search firms about a month ago to identify a successor to Musk. The report, citing people familiar with the discussions, also indicated board members had pressed Musk to publicly commit to dedicating more time to Tesla.
Musk himself responded forcefully on X, writing: "It is an EXTREMELY BAD BREACH OF ETHICS that the @WSJ would publish a DELIBERATELY FALSE ARTICLE and fail to include an unequivocal denial beforehand by the Tesla board of directors!"
The board's rebuttal comes at a challenging moment for Tesla. The company reported a 71% drop in first-quarter profit last week, posting $409 million in earnings compared with $1.39 billion a year earlier. Tesla's stock has shed roughly 25% of its value year-to-date, amid weak EV sales, growing competition, and consumer backlash tied to Musk's public alignment with right-wing politics.
Sales declines in key European markets have been especially steep. In April, Tesla's deliveries fell 59% year-over-year in France and 67% in Denmark. Protesters have targeted Tesla showrooms in Europe and the U.S., citing Musk's support for the far-right Alternative für Deutschland (AfD) and his role as head of the Trump administration's "Department of Government Efficiency," an advisory post with a 130-day cap that ends on May 30.
Concerns about Musk's attention span have been longstanding, with critics noting his leadership roles across multiple companies including SpaceX and X (formerly Twitter). Last week, Musk told shareholders he would be "allocating far more of my time to Tesla."
Tesla's board, composed of eight members including Musk himself, his brother Kimbal Musk, and James Murdoch, has faced scrutiny over its independence and oversight. Denholm, appointed chair in 2018 following Musk's SEC settlement, has also drawn criticism over her compensation and support for Musk's controversial pay package.
According to the Wall Street Journal, some directors including co-founder JB Straubel have met with major shareholders in recent weeks to reassure them about the company's stability. The report also claimed the board had explored adding an independent director.
