Tesla Board Secretly Plotted to Fire Elon Musk Amid Crashing Profits and Political Fallout
In a bombshell revelation, Tesla’s board of directors secretly initiated a search for a new CEO to replace Elon Musk, as the electric vehicle giant plunged into its worst financial performance in history and Musk diverted his focus to government work under the Trump administration. The covert move highlights escalating tensions behind the scenes as Tesla battles collapsing profits, a damaged brand, and a disillusioned customer base.
A Covert CEO Search
According to The Wall Street Journal, Tesla’s board quietly reached out to executive placement firms in March to begin identifying a potential successor for Musk. The decision to launch a replacement effort — without public disclosure and possibly without Musk’s knowledge — was driven by growing alarm over his near-total absence from Tesla operations while he led the White House’s Department of Government Efficiency (DOGE).
The board reportedly confronted Musk with concerns about his lack of focus. Rather than resisting, Musk agreed he needed to re-engage, raising questions about whether he was already considering stepping aside.
Financial Freefall
The backdrop to this leadership turmoil is Tesla’s brutal first quarter, marked by a 71% profit drop and the steepest sales collapse in company history. Tesla’s stock price plummeted as much as 45% this year before recovering slightly, compounding board concerns about leadership at the top.
CFO Vaibhav Taneja openly admitted that public hostility, vandalism, and backlash toward the Tesla brand in several markets — fueled largely by Musk’s polarizing political activity — directly impacted vehicle deliveries.
Musk acknowledged during an investor call that his extended absence had contributed to the company’s struggles. He announced a shift in priorities, vowing to scale back his government role and refocus on Tesla beginning in May.
Political Controversy and Brand Meltdown
Musk’s entanglement with President Trump’s administration has proven disastrous for Tesla’s once-loyal base. Once a darling of environmentalists and progressives, the company now finds itself engulfed in protests and alienation as Musk’s rightward political drift — including amplifying far-right figures on X (formerly Twitter) — damages the brand.
Even Trump’s Cabinet has had its friction with Musk. Treasury Secretary Scott Bessent reportedly clashed with him in a shouting match earlier this month, and while Trump publicly praised Musk on Wednesday, many see his government tenure as a costly distraction for Tesla.
Musk’s Own Exit Strategy?
Insiders say Musk himself has expressed interest in stepping down as CEO, worried that a successor might abandon his autonomous vehicle vision but simultaneously eager to offload daily responsibilities. Compounding the situation is his ongoing legal fight over a multi-billion-dollar compensation package — the largest in corporate history — which has twice been thrown out by Delaware courts.
Although he still controls 12.8% of Tesla stock, with options to raise that to 22.2% if reinstated, Musk’s position is far from secure. Tesla’s board had previously defended his enormous pay as a retention strategy — a rationale that now appears undermined.
For Now, Crisis Averted?
Following Musk’s pledge to return to Tesla full-time, Wedbush analysts declared that “cooler heads have prevailed” and suggested the board has paused its CEO search. Still, the fact that the board had seriously considered removing Musk — the company’s public face and founder — signals a profound shift in confidence.
With Musk recommitting, at least publicly, the board may be pressing pause. But the episode underscores how tenuous Musk’s grip on Tesla has become, even as he tries to reclaim control.