Tesla Inc. (NASDAQ: TSLA) board members quietly engaged executive search firms last month to explore potential successors to CEO Elon Musk, amid concerns over Musk’s deepening involvement with the Trump administration, according to a new report from The Wall Street Journal.
Citing unnamed sources familiar with the matter, the report states that the board’s inquiry was triggered by growing unease over Musk’s time commitment to his role in the Department of Government Efficiency (DOGE) — a controversial initiative tied to President Donald Trump’s second term. The current status of that search remains unclear.
Musk, who last week publicly pledged to “cut back significantly” on his federal work and refocus on Tesla, had reportedly been asked by board members to make that commitment explicit after sales and investor sentiment began to slide.
Tesla Under Strain Amid Leadership Questions and Product Delays
Tesla’s stock has been under pressure in 2025, with the company facing declining sales of its aging EV models, mounting global competition, and delays in launching a promised affordable electric vehicle platform. Instead, Musk has doubled down on Tesla’s autonomy and robotics vision, including plans for robotaxis and humanoid robots — a pivot that has raised both enthusiasm and skepticism among investors.
The company’s AI-driven future narrative remains key to its long-term valuation, but its near-term fundamentals have become a point of tension, particularly as Musk’s political activism and time in Washington dominate headlines.
His vocal support for far-right political groups in Europe and work under Trump’s DOGE initiative — which includes federal workforce reductions — has sparked protests and vandalism at Tesla showrooms and charging stations in the U.S. and abroad.
Board Dynamics and Investor Relations
While the board’s internal discussions about succession planning may be routine in nature, they underscore the growing pressure to reassert executive focus and governance credibility. Musk, who sits on the eight-member board, may or may not have been aware of the outreach to search firms, WSJ sources said.
In recent weeks, directors including Tesla co-founder JB Straubel have reportedly met with large institutional investors to reassure them of leadership continuity and the board’s oversight responsibilities. The board is also seeking to add a new independent director, as part of efforts to enhance its credibility.
Tesla’s board has long faced criticism over its independence, particularly in light of its composition. It includes Musk’s brother, Kimbal Musk, and James Murdoch, son of media mogul Rupert Murdoch. Board Chair Robyn Denholm, seen as a Musk loyalist, has also faced scrutiny over her compensation and her defense of Musk’s controversial performance-based pay package — the subject of ongoing legal and shareholder battles.
Market and Regulatory Tailwinds?
Despite the leadership concerns, some recent developments have boosted Tesla’s stock. Last week, federal regulators relaxed rules governing autonomous vehicle testing, a move expected to benefit Tesla’s driverless initiatives. Shares rose on the news, though they remain down for the year.
Still, questions around Musk’s attention, political exposure, and Tesla’s ability to deliver on its AI-driven strategy loom large as the company approaches key product launches and investor presentations in Q2.
