Tesla, once a towering giant in the electric vehicle realm, finds itself at a crossroads, and one of its earliest backers, Ross Gerber, has dropped a bombshell that’s shaking the industry to its core. In a candid interview on Sky News’ Business Live, Gerber, a prominent investor, declared that Elon Musk must step down as Tesla’s CEO unless he abandons his new role in Donald Trump’s administration. Musk’s appointment to lead the Department of Government Efficiency (DOGE)—a post-election gig tied to sweeping federal staff cuts—has thrust him into a political firestorm, and Gerber argues it’s costing Tesla dearly. With Musk’s attention fractured across widening ventures, Gerber’s call for a leadership shakeup signals a tipping point for a company already reeling from a brutal $800 billion market value drop since December.
Gerber didn’t mince words. “Tesla needs a new CEO,” he told host Darren McCaffrey, marking the interview as his first public push for change. “The business has been neglected for too long. There are too many important things Tesla is doing.” He laid out a stark ultimatum: Musk should either recommit fully to Tesla, shedding his government duties, or step aside for a replacement capable of steering the company through its mounting woes. Gerber’s frustration stems from Musk’s sprawling empire—spanning Tesla, SpaceX, X, and now DOGE—which he says has stretched the billionaire too thin. Since acquiring Twitter in 2022, Musk’s time and focus have splintered, and his provocative social media presence has only deepened the damage, tarnishing Tesla’s once-pristine reputation.
The numbers tell a grim story. Tesla’s stock slid another 4% in U.S. trading on Tuesday, a continuation of a slump that kicked off as Trump’s trade war rhetoric rattled markets. Gerber, who’s offloaded a hefty chunk of his shares in recent months, called the situation a full-blown crisis. “The company’s reputation has been destroyed by Elon Musk,” he said, pointing to plummeting sales despite Tesla’s best-in-class products. Electric vehicle demand has plateaued in key Western markets, even with aggressive discounts, as consumer budgets tighten. Cheap Chinese competitors are gnawing at Tesla’s dominance, and Trump’s tariff threats loom as a potential cost hike, piling pressure on an already shaky foundation. Investors, once unshakably loyal, are jittery—and Gerber’s among them.
Musk’s DOGE role has amplified the chaos. The department’s mission to slash government spending has sparked public outrage and protests, casting Musk as a divisive figure—a liability Gerber says is tanking Tesla’s appeal. “You literally can’t sell the best product in the marketplace because the CEO is so divisive,” he lamented. Musk’s X posts, often brash and polarizing, have fueled negative headlines, alienating customers and dragging the brand into political mud. For a company that once thrived on innovation and Musk’s visionary aura, this reputational nosedive is a bitter pill. Gerber insists Tesla’s tech remains unmatched, but with only 24 hours in a day, Musk’s juggling act is failing the carmaker when it needs leadership most.
The fallout raises big questions. Can Tesla rebound without a focused captain, or is Musk’s exit the only fix? Gerber’s plea isn’t just a critique—it’s a plea for survival. He sees a company adrift, its potential squandered by a CEO too entangled in side hustles to steer the ship. The market’s $800 billion bruise underscores the urgency, and Tuesday’s 4% dip is a fresh wound. Investors like Gerber aren’t waiting for Musk to choose—they’re acting, selling off stakes as faith wavers. Whether Musk doubles down on Tesla or hands over the reins, the clock’s ticking. For now, the electric dream he built teeters on the edge, and Gerber’s blunt warning echoes as a wake-up call: Tesla’s crisis is real, and its savior might need to walk away.
