Texas, US: Tesla’s board initiated a search for a new CEO to replace Elon Musk earlier this year, contacting executive placement firms in March, according to a Wall Street Journal report on Wednesday that cited multiple anonymous sources. Dismissing the report as “absolutely false”, the EV firm issued a statement affirming that Elon Musk will continue to operate as the CEO of Tesla.
According to WSJ, the board grew increasingly concerned about Tesla’s nosediving performance and Musk’s prolonged absence due to his role in the federal Department of Government Efficiency (DOGE).
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It remains unclear whether the search is ongoing or if it was paused after Musk announced last week that he would scale back his government role and return full-time to Tesla.
Meanwhile, Tesla claimed that WSJ had “erroneously claimed” so and was told so before the report was published.
“Earlier today, there was a media report erroneously claiming that the Tesla Board had contacted recruitment firms to initiate a CEO search at the company. This is absolutely false (and this was communicated to the media before the report was published). 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,” stated the tweet by Tesla.
Earlier today, there was a media report erroneously claiming that the Tesla Board had contacted recruitment firms to initiate a CEO search at the company.
This is absolutely false (and this was communicated to the media before the report was published).
The CEO of Tesla is…
— Tesla (@Tesla) May 1, 2025
The company’s stock had plunged as much as 45% this year, and sales and profits dropped sharply in Q1, with earnings tumbling 71%—Tesla’s worst quarterly decline on record.
While the board reportedly asked Musk to re-engage with Tesla earlier this year, he did not resist, the WSJ said. Analysts at Wedbush Securities welcomed Musk’s recommitment, noting in a Wednesday research note that the “code red” scenario appeared to be over and predicting Musk would remain CEO for at least five more years.
Still, the behind-the-scenes search raises questions about the board’s long-term confidence in Musk’s leadership, especially as he juggles multiple ventures—including SpaceX and X (formerly Twitter)—and faces public backlash for his controversial political views and ties to former President Donald Trump’s administration and far-right political parties in Europe.
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Musk, who is a Tesla board member, may not have known about the CEO search efforts, the WSJ reported. He has reportedly told confidants that he is ready to step away from the CEO role, citing both burnout and frustration over legal battles, including the court’s rejection of his record-breaking pay package.
Protests, vandalism, and political controversies have battered Tesla’s image, contributing to falling vehicle deliveries. While Musk dismissed the damage on a recent earnings call, Tesla’s CFO Vaibhav Taneja admitted that the company had suffered due to negative sentiment and hostility towards the brand.
