Elon Musk has purchased around $1 billion (£735m) worth of Tesla shares, his first open market stock buy since 2020. The filing, disclosed on Monday, showed Musk picked up roughly 2.5 million shares on Friday. Tesla stock rose more than 6% in early trading after the news.
Musk already owns about 13% of Tesla but has pressed for greater influence over the company, particularly as he pushes for investments in robotaxis, automation, and artificial intelligence. Analysts said his new stock purchase signals confidence in Tesla’s future at a time when the company faces slower sales and stronger competition.
Board’s Compensation Plans
Tesla’s board recently outlined compensation proposals that could hand Musk significant additional stock. One plan, worth up to $1 trillion, would give him 12% of Tesla shares if performance targets are met. In August, the board also approved an interim award valued at $29 billion after an older package from 2018 was struck down in court. Musk has previously demanded a 25% stake and even suggested he might leave the company if those demands were not met.
Danni Hewson, head of financial analysis at AJ Bell, said markets often welcome insider buying because it signals leadership’s belief in the company’s prospects. She noted Musk may also have personal motivations, quipping that he could have been influenced by recent headlines about Oracle co-founder Larry Ellison reclaiming the title of world’s richest man.
Challenges Beyond the Stock Price
Tesla’s business outlook remains mixed. The company faces falling demand in key markets and the U.S. government has ended certain EV tax breaks. Musk’s outspoken political activity has also weighed on Tesla’s brand. He campaigned alongside President Donald Trump in 2024 but later had a falling out. More recently, Musk drew condemnation from the British government for “dangerous and inflammatory language” at a far-right rally in London, where he warned of coming violence.
Tesla’s board has tied some of Musk’s compensation to assurances that his political involvement will wind down. Board chair Robyn Denholm recently reaffirmed Musk’s central role at Tesla, calling him “the right CEO” during this transitional period.
What The Author Thinks
Musk’s decision to buy back Tesla stock is clearly a strong show of confidence, but the company’s real hurdles lie outside Wall Street. Tesla needs to prove it can maintain sales growth while fending off Chinese rivals and addressing brand concerns linked to Musk’s politics. Investors may cheer his purchase today, but Tesla’s future depends on whether the company can shift focus back to cars, technology, and innovation rather than constant controversy.
Featured image credit: Roboflow Universe
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