In a surprising turn, a prominent Tesla bull has voiced sharp criticism against the electric vehicle giant's leadership and a controversial executive pay plan. Ross Gerber, co-founder of Gerber Kawasaki Wealth and Investment Management and a longtime Tesla supporter, has made candid remarks about CEO Elon Musk, highlighting a growing rift between some investors and the company's board.
A Vocal Supporter's Growing Frustration
Speaking on the Chasing Finance podcast, Gerber delivered a mixed but pointed assessment of Musk. "I'm not a fan of Elon," Gerber stated bluntly. However, he was quick to acknowledge Musk's core strength, adding, "But I'm not going to deny the fact he builds great products." This sentiment underscores a complex relationship where admiration for Tesla's innovations is increasingly tempered by concerns over corporate governance.
Gerber's criticism has intensified in recent months. In November, he publicly blasted Tesla for allocating funds to promote Musk's monumental $1 trillion compensation package. This move came at a time when the company was reportedly facing challenges in selling its vehicles. The pay plan, one of the largest in corporate history, has also faced opposition from major investors like Norway's sovereign wealth fund, which cited risks of share dilution and Musk's excessive influence.
The $1 Trillion AGM Showdown
The timing of Gerber's latest comments is crucial, as they come ahead of Tesla's important Annual General Meeting (AGM) scheduled for November 6. During this meeting, shareholders are expected to vote on the ratification of Musk's new compensation award, which is roughly 18 times the size of his 2018 pay package.
Taking to social media platform X, Gerber did not mince words regarding the Tesla board's role. "I've never seen a worse BOD than tesla," he wrote. He accused the board of acting solely in Musk's interests, stating, "It's so transparent that they all represent Elons interests and zero representation of the other 85% of the company." Gerber called the proposed package "absurd," arguing it would transfer $1 trillion of shareholder value to Musk based on "arbitrary goals" and a "threat to leave."
Balancing Critique with Recognition
Despite his frustrations, Gerber conceded to Musk's undeniable track record and work ethic. He acknowledged that Musk has built significant companies that command a premium from investors. "He's built some big companies and he's succeeded," Gerber said.
He also explained why many investors continue to back the visionary CEO. "There's a lot of people who have a belief that Elon's robots are the future," Gerber noted, referring to Tesla's work on robotics and AI. "And they're willing to invest at a massive premium based on Elon's ability to execute." This highlights the central dilemma for Tesla shareholders: weighing unparalleled visionary execution against growing concerns over governance and colossal executive compensation.
The upcoming AGM vote on November 6th is now poised to be a critical test of shareholder confidence, reflecting the divide between faith in Musk's future vision and demands for more balanced corporate stewardship.
