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Tesla bulls and bears call out Musk’s ‘blackmail’

CEO threatens to develop projects in robotics and artificial intelligence outside Tesla unless his stake is nearly doubled to 25%

Elon Musk has drawn investor ire for threatening to develop projects in robotics and artificial intelligence outside Tesla unless his stake is nearly doubled to 25 per cent. Photograph: Haiyun Jiang/The New York Times

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Proinsias O'Mahony
Tue Jan 23 2024 - 06:00

Tesla bulls and bears were united in calling out Elon Musk after the world’s richest man threatened to develop projects in robotics and artificial intelligence (AI) outside of Tesla unless his stake is nearly doubled to 25 per cent.

“Outrageous”, said short seller and Tesla bear Jim Chanos. “Blackmail”, said long-time Tesla shareholder Ross Gerber.

It’s hard to disagree. Although the board is stacked with people close to Musk (including his brother), it can’t be seen to agree to a proposal as outlandish as this.

However, it’s in an awkward position. Tesla bulls often cite the potential for AI projects when justifying the stock’s elevated valuation, so it wasn’t surprising when Tesla shares sold off last week.

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An ordinary chief executive officer (CEO) wouldn’t behave like this, but Musk has never been an ordinary CEO. Yet again, normal rules don’t apply to Musk.

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