Wedbush Analyst: Musk’s Political Ambitions Pose Risk as Tesla Reaches Pivotal Moment
Dan Ives of Wedbush has warned that Tesla is approaching a critical inflection point, urging the company’s board to take swift action in response to CEO Elon Musk’s increasing involvement in politics.
Ives expressed concern that Musk’s official launch of a new political movement, the “America Party,” could divert his focus at a time when Tesla (NASDAQ: TSLA) is entering a key phase of growth, particularly in autonomous driving and robotics.
“Tesla is on the cusp of a transformative chapter with autonomy and robotics moving to the forefront,” Ives said. “It can’t afford to have Musk dedicating substantial time and energy to building a political party, which would consume vast personal and political resources.”
The America Party is expected to run candidates in the 2026 U.S. midterms—a move that could potentially clash with the Trump administration, further complicating matters for Tesla, which faces important regulatory developments in the autonomous vehicle space.
“This is the last thing Tesla shareholders want to see,” Ives noted, citing the importance of regulatory clarity for the company’s next wave of innovation.
To address these concerns, Ives recommended the board implement three key measures:
- Introduce a new performance-based compensation plan that would boost Musk’s voting control to about 25% and commit him to remain CEO through at least 2030. Ives suggested this could also lay the groundwork for a future merger with xAI, potentially creating a dominant AI entity under a unified leadership structure within the next 12 to 18 months.
- Set formal time commitments to ensure Musk devotes sufficient attention to Tesla’s operations.
- Form a dedicated oversight committee to monitor how Musk’s political involvement might affect his role as CEO. While the board can’t regulate Musk’s political donations, Ives emphasized that it can—and should—intervene if his political activities start to compromise his executive responsibilities.
Despite the challenges, Ives reiterated his belief that Musk is critical to Tesla’s success, especially in AI and robotics, noting that alongside Nvidia (NASDAQ: NVDA), Tesla stands as one of the world’s top physical AI firms.
“We strongly encourage the board to act swiftly and ensure Musk continues leading Tesla through this next phase,” Ives concluded.
