Investor Ross Gerber attributes the decline in Tesla’s stock to Elon Musk’s numerous ongoing projects within the company. Gerber, a longtime supporter of Tesla, highlighted several challenges the company has faced recently, including increasing competition.
Notably, Tesla has been striving to maintain its foothold in markets like China, where rivals such as BYD pose significant challenges. Last year, Tesla responded to this competition with substantial price cuts on certain models, yet recent data indicates a decline in sales figures in China, which raises concerns.
Gerber emphasized the impact of external competition on Tesla’s focus and attention, leading investors to reevaluate the company more as a hardware manufacturer than a software innovator.
He noted the importance of Tesla’s full self-driving technology, which remains incomplete, suggesting its completion is crucial for the company’s future success.
Moreover, Musk’s actions, including his ultimatum to gain a 25% ownership stake in Tesla, have raised skepticism among investors. Gerber criticized Musk’s demands as “delusional” and highlighted their impact on Tesla’s premium brand image.
He expressed concerns about the company’s valuation, suggesting that Tesla’s market value is adjusting to a more realistic level given these challenges.
Gerber, who previously sought a seat on Tesla’s board, has been vocal about his reservations regarding Musk’s leadership. He criticized Musk’s behavior and accused him of exerting undue influence over the company’s direction, which he described as “blackmailing” investors for greater control.
These concerns about Musk’s leadership style have not gone unnoticed by other Tesla investors. In 2023, a group of 17 shareholders urged Tesla’s board to rein in Musk’s actions, particularly following his tumultuous involvement with Twitter.
Tesla’s stock experienced a nearly 3% decline on Tuesday, trading around $183.15 per share. With shares down 24% since the beginning of the year, some investors believe Tesla can no longer be categorized as one of the top-performing tech giants. Despite these challenges, Tesla has yet to comment on the matter.
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