Tesla could use more of Elon Musk’s focus, former board member says

Former Tesla board member Steve Westly suggested that the company could benefit from CEO Elon Musk’s divided focus during a key time for the electric vehicle sector.

“Any CEO of the world’s best companies must be laser-focused on what they do. And it appears that Mr. Musk’s approach is too broad,” Westly told CNBC at the annual VivaTech conference in Paris.

Westly cited Musk’s lack of focus as a contributing factor to Tesla’s gap behind its “Magnificent Seven” rivals. He suggested Musk emulate the leadership style of Nvidia, a tech powerhouse.

“If you look at someone like Jensen Huang, who is perhaps the best CEO in the world right now and continues to provide outstanding outcomes, focus is crucial. Tesla could use more of it,” said Westly, managing director of The Westly Group, a venture capital firm and early Tesla investor.

Recent controversies over staff layoffs and Musk’s salary have added to the serial entrepreneur’s rising distractions, with a recent revenue miss implying the company has “lost ground,” he said.

Westly said it was up to the board to determine how much of a liability Musk is for Tesla.

Westly personally predicted that Tesla would release a new $25,000 car by next year, without providing any evidence that such a vehicle is in development. He stated, “I think it’ll be a big seller.” According to Reuters, Tesla has just canceled plans for a new low-cost EV.

During a first-quarter earnings call, Musk provided only limited details regarding Tesla’s new product plans. He simply stated that Tesla intends to begin manufacture of “new vehicles, including more affordable models,” on its current factory lines. He did not provide specifications or pricing for these EVs.

“Don’t bet against the guy [Musk], he’s got a pretty good track record,” Westly stated.

CNBC has reached out to Tesla for comment.

Last month, Tesla stunned investors with its worst quarterly sales decline since 2012, adding to negative headlines for the firm as it revealed a more than 10% reduction.

Meanwhile, Musk’s parallel obligations at his other enterprises, including as SpaceX, X, Neuralink, and The Boring Company, have fueled the remuneration package.

Tesla’s slowdown comes at a critical time for the electric vehicle sector, with rising competition and a brewing trade war between Washington and Beijing over alleged Chinese subsidies. Last week, U.S. President Joe Biden imposed new 100% tariffs on Chinese electric vehicles, effective this year, in an effort to prevent China from “dumping” low-cost products into the market.

— Lora Kolodny of CNBC contributed to this article.

Correction: This post has been modified to better reflect Tesla’s comments about potential lower-cost models.