Anika Begay
X owner Elon Musk (left) and Senator Elizabeth Warren (D-MA).
News
Sen. Elizabeth Warren, D-Mass., asks the Tesla board of directors if it were to examine CEO Elon Musk’s use of company resources to benefit his other ventures, including SpaceX and xAI.
“Tesla’s Board of Directors appears to be failing to fulfill its fiduciary duty to Tesla shareholders by failing to address the apparent conflicts of interest of the company’s CEO Elon Musk,” Warren wrote in a 10-page letter to Tesla Chairwoman Robyn Denholm on Thursday. Musk also runs Neuralink and The Boring Co.
Warren serves on both the Senate Banking and Armed Services Committees and has expressed similar concerns in the past, including calls for the SEC to investigate Musk and Tesla. She also corresponded with Denholm in late 2022 after Musk sold billions of dollars of his Tesla shares in part to finance a leveraged buyout of Twitter, which he later renamed X.
Musk has targeted Warren with criticism for years. He has referred to her as “Senator Karen” since at least 2021, and has bristled at her calls to raise taxes on the very wealthy, close tax loopholes for corporations and billionaires, and crack down on corporate “greedflation.”
The concerns Warren listed in the letter include Musk’s creation of an artificial intelligence startup, xAI, outside of Tesla, despite the automaker calling itself an AI company; his threats to work on robotics and AI outside of Tesla if he did not receive a higher level of voting control at the automaker; his encouragement to Tesla shareholders to approve a $5 billion investment by Tesla in xAI; and his redirection of a shipment of expensive Nvidia AI chips for X originally intended for Tesla.
Warren’s letter comes two months after Vscek reported that Nvidia employee correspondence also indicated that Musk had diverted a sizable shipment of AI processors that had been reserved for Tesla to X. Warren also asks about xAI’s theft of Tesla employees and the exit of a Tesla director, allegedly because the board operated “like a family business with fiefdoms, rather than a public company with strict rules and regulations.”
Warren asked Denholm and Tesla to provide answers to questions about the board’s oversight of Musk and “entanglements” across his various businesses by Aug. 23.
A spokesperson for the senator’s office confirmed that Tesla and Denholm never responded to Warren’s previous letters. Tesla did not respond to a request for comment.
Read the full letter here:
