Elizabeth Warren, a senator of the United States, and a long-time critic of Tesla owner Elon Musk expressed concern on Monday that the management of the automaker has not addressed the dangers posed by his position as CEO of Twitter.
Perhaps Tesla supporters have asked whether Musk is too distracted to effectively run the electric vehicle manufacturer, where he is personally involved in production as well as engineering. Since taking control of the microblogging platform in October for US$44 billion, Musk’s action has been followed by chaos and dispute.
The stock of Tesla, which is down almost 60% this year and hit a new two-year low on Monday, has been punished by shareholders who have asked for Elon Musk to step down as CEO of Twitter.
A board of trustees must make sure that the majority shareholder does not exploit it “as a private plaything,” according to Ms. Warren, a liberal Democrat who has previously fought with Mr. Musk over her calls for billionaires to pay higher taxes.
“The first weeks of Mr. Musk’s Twitter ownership have raised questions about possible violations of securities or other laws, including whether Mr. Musk is funneling Tesla resources into Twitter,” she said in a letter to Tesla’s board chairman Robyn Denholm.
Tesla director Mr. James Murdoch stated in court last month that the audit team of the firm discussed Mr. Musk’s recruiting of Tesla engineers by Twitter, noting that it shouldn’t affect their job at the carmaker.
Tesla did not reply to a seeking comment and Ms. Denholm was unable to be reached right away.
In the year, Mr. Musk personally made a $40 billion profit from the sales of Tesla stock, further upsetting investors.
As Twitter depended on advertising income from Tesla’s rival manufacturers, Ms. Warren, who requested the Tesla board for a response by January 3, alleged Mr. Musk had not disclosed how he is resolving conflicts of interest between his responsibilities at the two organizations.
The CEO of Gerber Kawasaki Wealth & Investment Management and a major supporter of Tesla, Mr. Ross Gerber, stated last week that he would be running for the Tesla board and had already informed Tesla.
“I work with maybe a thousand investors … Seeing the pain everybody is going through, the disappointment with Elon, unhappiness, it was just like the time for somebody to stand up and say what needs to be said,” he said.
Mr. Leo KoGuan, a major individual Tesla shareholder, wrote on Twitter earlier that Mr. Musk had “abandoned Tesla and Tesla has no working CEO”.
“The whole situation is just weird, and weird is being kind,” said Mr. Matthew Tuttle, CEO of Tuttle Capital Management.
“If I was a long-term investor I would stay away, you never know what Elon is going to do,” he said. REUTERS