"Tesla Board Advised to Control Musk's Political Activities"—Musk Responds, "Shut Up"

Wedbush Recommends "Regulating Musk's Tesla Working Hours"

Also Proposes Granting Musk 25% Voting Rights as an Incentive

Wall Street Mostly Critical of Musk's Political Activities

Dan Ives, Wedbush analyst and one of Wall Street's strongest Tesla supporters, received a "shut up" response from Elon Musk after suggesting that Tesla’s board should halt Musk’s political activities by presenting three proposals.

According to CNBC on the 9th (local time), Dan Ives made critical comments about Musk's political activities the previous day. He recommended that Tesla’s board supervise Musk’s political activities. To that end, he advised △ granting Musk 25% voting rights, △ implementing a new compensation system to pave the way for a merger with xAI, and △ establishing guardrails for Musk’s Tesla working hours to control his political activities.

Together with other analysts at Wedbush, Ives released a lengthy report titled, "The Tesla Board Must Act to Set Ground Rules for Musk—The Drama Must End." The analysts asserted that Musk’s founding of a new political party "changed Tesla's story," and action by the board is needed to keep him in check.

Ives's report was published the day after Tesla shares plummeted nearly 7% on the 7th, wiping nearly $68 billion off the company's market capitalization.

Despite this, Wedbush maintained its target price and buy rating for Tesla. Dan Ives is known for providing the most optimistic outlook on Tesla on Wall Street. His target price of $500 for Tesla is the highest among analysts tracked by FactSet.

Following the report, Musk replied on his social platform X, "Shut up, Dan." However, the first suggestion Ives made—to grant Musk 25% voting rights—has been something Musk himself has long argued is necessary to secure his voting power. Musk’s reaction signaled his anger at the board's proposal to establish working-hour guardrails as a measure to keep his political involvement in check.

In an interview with CNBC, Ives commented, "Elon has his own views and I can understand them, but we stick to our recommendations for the right course of action the Tesla board should take."

Musk's 2018 CEO pay package was about $56 billion and rose in value afterward, but was voided last year by the Delaware Court. Judge Kathaleen McCormick ruled that Tesla’s board failed to secure independence from Musk and did not negotiate appropriately with adequate distance. Tesla has appealed the case to the Delaware Supreme Court.

Musk’s ongoing political activities continue to draw criticism from several analysts on Wall Street.

William Blair analysts noted that "Musk's return to politics has only negative effects, and investors are tired of his distractions." They downgraded Tesla from 'buy' to 'hold' due to the negative impact of Musk’s political plans and rhetoric, as well as Trump’s OBBB tax spending bill, on Tesla's margins and EV sales.

James Fishback, CEO of hedge fund Azoria Partners and a Trump supporter, announced a delay in listing the Azoria Tesla Convexity ETF, an exchange-traded fund that invests in Tesla stocks and options. Fishback wrote, "The board should hold an immediate meeting to clarify Elon’s political ambitions and evaluate whether they are compatible with his full-time CEO duties at Tesla."

On Saturday, Musk announced the launch of the American Party, promising to "return freedom" to Americans. However, he did not disclose details such as where the party is registered, its support base, or its preferred candidates.

Tesla’s share price has dropped by about 25% so far this year.

Musk spent most of the first half of the year collaborating with Trump on significant federal downsizing. However, following the end of official executive duties in late May, Musk’s strong criticism of Trump’s OBBB bill led to a public spat, souring their relationship.

Contributed by guest reporter Jung-A Kim kja@hankyung.com