Overview

• Tesla’s board initiated a formal CEO succession process in March, engaging executive search firms to explore potential replacements for Elon Musk.
• The decision was influenced by Tesla’s financial downturn, including a 71% drop in Q1 profits and a stock price decline of up to 45% this year.
• Musk’s role as a special government employee in the Trump administration raised concerns over his divided attention and its impact on Tesla’s operations and brand image.
• It remains unclear if Musk was aware of the board’s search efforts or whether his recent pledge to prioritize Tesla has altered the succession planning.
• Tesla’s leadership uncertainty comes as Musk plans to scale back his government duties, with his term as a special employee expected to end in late May or June.