Tesla denies CEO search amidst Musk controversy and sales drop
Tesla was reportedly set to begin the search for a new CEO. CNBC reports that the board's decision stems from the company's poor financial performance and controversies surrounding Elon Musk. However, Tesla Chairperson Robyn Denholm has denied these reports.
Tesla began the search for a new CEO, causing shares to drop by 3 percent on the Robinhood platform, according to CNBC.
Will Musk lose his position at Tesla? The company responds
Additionally, The Wall Street Journal reports that the company's board has contacted several recruitment firms to find a successor for Elon Musk.
The board's decision is attributed to the company's poor financial performance and controversies surrounding Elon Musk.
Tesla Chairperson Robyn Denholm denied reports that the board was considering replacing CEO Elon Musk, stating that directors are "highly confident" in his abilities, Bloomberg reports.
"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," reads part of the company's official statement.
Elon Musk's activities as a Trump advisor and head of DOGE are deemed highly controversial, according to Bloomberg.
Tesla has become the target of criticism in Europe and the United States since Musk became a close advisor to Trump and head of DOGE. Attacks on Tesla cars sometimes escalated to vandalism, and the company announced on Tuesday that its sales in the first quarter of this year dropped by 71 percent.
Tesla's sales plummet
Sales of Tesla electric cars in the EU fell by 36 percent in March compared to March 2024, and in the first quarter of this year, they decreased by almost half year-on-year, reported AFP on Thursday, citing data from the European Automobile Manufacturers' Association (ACEA).
Tesla recently presented lower-than-expected financial results for the first quarter, as automotive industry revenues fell by 20 percent compared to the previous year.
The company's revenue was $19.34 billion compared to a consensus of $21.11 billion. Total revenue fell by 9 percent from $21.3 billion a year earlier. Automotive revenue dropped by 20 percent to $14 billion from $17.4 billion in the same period last year.
Net profit dropped by 71 percent to $409 million from $1.39 billion a year earlier.
Tesla stated that one reason for the drop was the need to update lines in four vehicle factories to begin production of a refreshed version of the popular Model Y SUV. The company also cited lower average selling prices and sales incentives as burdens on revenue and profits.
Tesla shares have fallen by 41 percent since the beginning of 2025 and recorded the worst quarterly decline since 2022 in the period ending in March.
