On Tuesday, one of the major shareholders of Tesla Motors, Baillie Gifford suggested it would make sense for Elon Musk to step down from the CEO position.
Baillie Gifford, the Edinburgh-based investment management firm is Tesla’s second largest shareholder after Musk.
It owns 13 million shares, or 7.7% of Tesla’s stock, valued at USD 3.8 billion, whereas Musk owns 19.7% of the stock.
“We wouldn’t be against him having a different role,” James Anderson, head of global equities for Baillie Gifford, told Barron’s. “I don’t think he needs to be CEO.”
Tesla stock has been falling since Thursday after Musk said the company would shift to an online sales model in the light of the ‘production hell’ and ‘logistics delivery hell’.
Anderson, however, said Musk’s presence is key to Tesla. He said Musk could take up the role of a ‘chief ideologue’.
Amid the falling stock, the billionaire co-founder said the company would not be profitable in the first quarter. Tesla is yet to turn an annual profit since its founding in 2003.
Meanwhile, for Musk, a court hearing is coming up on Monday for flouting an agreement between Tesla and Securities and Exchange Commission (SEC).
Musk was supposed to take prior approval from a counsel before tweeting market moving information on Tesla. SEC had secured the order after Musk took to Twitter last year to announce a possible private buyout of Tesla, disrupting the market. Later on its official blog, Tesla published an email that Musk sent to employees, where Musk justified the possible buyout deal. The whole announcement didn’t sit well with the regulatory body.
SEC found no evidence of a potential buyout talks and moved court to put Musk in place. The court slapped a big fine on Musk and he had to give up Tesla’s chairman position last year. The settlement also prescribed Musk to consult an advisory board before tweeting crucial company information on social media.
In February this year, Musk landed in trouble again when he tweeted, “Tesla made 0 cars in 2011, but will make around 500k in 2019.” Four hours later came the corrigendum: “Meant to say annualized production rate at end of 2019 probably around 500k, i.e 10k cars/week. Deliveries for year still estimated to be about 400k.”
Post the tweets, the SEC has taken the legal route to hold Musk in contempt.