Elon Musk Seeks Increased Control in Tesla Amid Troubled Times for the Automaker

South Africa - In a move that underscores his famous ambition and sometimes contentious leadership style, Elon Musk is reportedly pressuring the board of Tesla Inc. to arrange a sizable stock award, hinting at a desire for increased voting influence within the pioneering electric vehicle company. Musk, who currently holds an approximately 13% stake in Tesla, seeks to ensure his grip on the company's direction remains firm, particularly in the vital areas of artificial intelligence (AI) and robotics.

The pursuit of a new compensation plan comes on the heels of Musk's recent financial moves, including the sale of nearly $40 billion worth of Tesla stock in 2022, primarily to fund his acquisition of social media giant Twitter. Despite acknowledging the Tesla board's competence, Musk hinted on social media that any new compensation arrangements are in limbo, pending the outcome of an ongoing Delaware Chancery Court case involving allegations against the board's independence in finalizing his $55 billion compensation in 2018.

The timing of Musk's latest demands coincides with a period of turbulence for Tesla. The company has seen its market value plummet by $94 billion amid slowing growth and shrinking profit margins – its worst start to any year since going public. Furthermore, Musk has found himself at the center of a media storm concerning his alleged drug use and the associated concerns raised by executives and directors at his companies, including Tesla. Notably, even as these challenges mount, Tesla shares recently saw a modest uptick of 0.7% in New York trading.

Tesla, with its current market capitalization of $695.8 billion, has undeniably flourished under Musk's leadership since January 2018, when his latest pay award was announced. The EV automaker's valuation previously peaked at over $1.2 trillion before Musk's Twitter deal influenced a notable decline. Despite the setbacks, including being the unprecedented eraser of $200 billion from his net worth, Musk's wealth has regained momentum, bolstered by Tesla's stock performance and the soaring valuation of Space Exploration Technologies Corp.

The controversy deepens as Musk's recent discomfort in developing Tesla's AI and robotics capabilities contrasts with his earlier claims of Tesla being a leader in these fields. The company's AI initiatives, including the notable Project Dojo, are set to position Tesla as a key player in supercomputing for autonomous driving technology. This ambition is compounded by Musk's establishment of the xAI startup, intended to compete with industry giants such as OpenAI and Google's DeepMind.

The situation prompts questions about the core identity of Tesla – whether it remains an automobile manufacturer at heart or is evolving into a profound AI enterprise. Daniel Kollar, head of Intralink’s automotive and mobility practice, comments on Musk's latest actions, noting that they do little to benefit his companies from a reputational standpoint, regardless of the broader strategic goals at play.

As Musk navigates his dual role as a leader in both the automotive and social media industries, his influence at Tesla remains the focal point of speculation and scrutiny. The outcomes of his requests for more control and the court's ruling on Tesla's executive compensation could significantly shape the future trajectory of one of the world's most innovative carmakers.