Elon Musk has said many times that artificial intelligence –including self-driving cars and humanoid robots – is the key to Tesla’s future value – not building electric cars.
Now, Musk is threatening to take the AI golden goose away from Tesla if the automaker’s board does not find a way to roughly double his voting control of the company to 25%.
Here’s an excerpt from Musk’s posts Monday on X.com:
I am uncomfortable growing Tesla to be a leader in AI & robotics without having ~25% voting control. Enough to be influential, but not so much that I can’t be overturned.
Unless that is the case, I would prefer to build products outside of Tesla. You don’t seem to understand that Tesla is not one startup, but a dozen. Simply look at the delta between what Tesla does and GM.
Tesla shares dipped as investors and analysts speculated as to whether Musk is serious about taking AI assets – including people – out of Tesla and putting them into ventures he controls, including his new xAI startup or SpaceX.
Musk owns 12.9% of Tesla shares after selling about $40 billion worth of the EV company’s stock to fund his acquisition of Twitter. In a second post, Musk wrote he would “be fine with a dual class voting structure to achieve” securing 25% voting control. But, he added, “am told this is impossible to achieve post-IPO in Delaware.”
Musk alluded to the dual class share structure that gives Meta CEO Mark Zuckerberg control of the social media company. An example from the auto industry, of course, is Ford, where descendants of Henry Ford have 40% of share votes through ownership of Class B stock.
Tesla’s board and Musk are negotiating a new compensation plan. But that process is stalled awaiting a court’s decision on a lawsuit challenging Musk’s previous compensation plan, which helped to make him the world’s richest human.
Corporate governance experts – and shareholder rights litigators – will have plenty to talk about if Musk pursues his demand.
How Tesla’s institutional shareholders, including Vanguard (7.1%) and BlackRock (3.8%) will respond is another question. AI is magical, but it cannot change math: Giving 25% control to Musk means diminishing the voting power of other investors.
