Top Analyst Urges Elon Musk To Do These 2 Things To Restore Investor Confidence In Tesla

Wedbush analyst Dan Ives has urged for significant changes at Tesla Inc. TSLA in response to the ongoing decline in the company’s share price.

What Happened: Ives, a long-time Tesla bull, opines that the future of the electric vehicle manufacturer is contingent on a significant shift in Elon Musk‘s approach. In an investor note, he suggests that Musk should formally reaffirm his commitment to Tesla and outline a clear plan for the launch of its new lower-cost vehicles and full-self-driving car, reported MarketWatch.

Musk’s political affiliations, particularly his involvement with the Department of Government Efficiency (DOGE) and support for far-right groups in Europe, have sparked protests at Tesla facilities and tarnished the brand’s image. Ives cautions that without a change in direction, Tesla could face a “black swan event” that could further damage the brand.

The Tesla bull suggests two things that Musk needs to do to reclaim the erosion in Tesla’s brand value and position. Firstly, Ives urged Musk to formally confirm his commitment to Tesla and DOGE before or during Tesla's May quarterly update. "If he does this the heat from Musk around DOGE will start to dissipate among most of the critics,” as per the Wedbush Analyst.

Secondly, Musk must outline a roadmap and timeline for the 2025 launch of the new lower-cost vehicles, along with details about the full-self-driving car rollout in June, stated Ives.

Why It Matters: This call for change comes at a time when Tesla is grappling with other challenges. Another development on Thursday suggests that the company had to recall over 46,000 Cybertruck vehicles in the United States due to a safety issue with an exterior panel. The recall was prompted by concerns that the cant rail, a stainless-steel exterior trim panel, could delaminate and detach from the vehicle while in motion.

This incident, coupled with the ongoing stock freefall and public outcry over Musk’s political involvement, underscores the need for a significant course correction at Tesla. Top Investor, Ross Gerber told Sky News Australia on Wednesday that Musk needs to step down as the CEO of Tesla as he ‘destroyed’ his reputation.

Tesla stock dropped 1.57% in today’s pre-market trading session. On a year-to-date basis, it declined more than 57%, as per Benzinga Pro.