Musk searches for new Twitter CEO, Tesla (TSLA:NASDAQ) investors worried about the ‘distractions’

Elon Musk confirmed he will step down as chief executive officer of Twitter Inc. after finding a successor, though he plans to retain control over the company’s engineering teams.

“I will resign as CEO as soon as I find someone foolish enough to take the job! After that, I will just run the software & servers teams,” he said.

The billionaire executive embarked on a search for a new CEO, after losing a poll he posted on the social media site that asked whether he should relinquish his role as head of the company. Sources close to the matter said Musk’s search for a new CEO has been ongoing and began before the Twitter poll was made.

Musk’s Twitter takeover has been rocky, as his leadership has resulted in massive staff cuts, a spike in racist hate speech, advertisers fleeing or slashing their spending on the platform, as well as the reinstatement of previously banned accounts.

More than 10 million votes, or 57.5%, were in favor of Musk stepping down, according to results that came in Monday morning. Musk committed to abide by the results when he launched the survey.

Musk has sold billions of dollars worth of Tesla (TSLA:NASDAQ) shares this year to finance the Twitter takeover. Musk has been almost single-handedly running Twitter since he bought it in October for $44 billion.

He has also pulled in talent from Tesla, SpaceX and the Boring Co., including executives, engineers and attorneys, to assist him at Twitter. Musk is CEO of Tesla and SpaceX and founder of the Boring Co.

The “Chief Twit,” as Musk has previously called himself, claims that Twitter usage has reached an all-time high since he took over, and that hate speech impressions have fallen.

However, the billionaire’s management of Twitter has raised concerns about his other ventures.

Long-time Tesla bull Ross Gerber wrote in a tweet, “Tesla stock price now reflects the value of having no CEO. Great job tesla BOD – Time for a shake up. $tsla.” Gerber has launched an informal campaign to have fellow shareholders vote to appoint him to Tesla’s board of directors.

The Tesla chief has a lot of distractions, as Gerber notes: Musk has been stirring controversy as the new owner and CEO of Twitter, the social media giant which he acquired in a leveraged buyout in late October, and is also the CEO of a major defense contractor, SpaceX.

On Monday, Sen. Elizabeth Warren, wrote to the chair of Tesla’s board, Robyn Denholm, expressing concern that Musk and the board may have violated legal obligations to Tesla shareholders.

The lawmaker, who has sparred with Musk in the past over the idea of a wealth tax, asked the board to answer specific questions about the alleged misappropriation of Tesla resources and conflicts of interest resulting from Musk’s purchase of Twitter.

IMusk responded in a tweet the same day saying “the United States has definitely been harmed” by having Warren as a senator. A representative for Warren did not immediately respond to requests for comment.

Earlier this month, NASA Administrator Bill Nelson asked SpaceX President and COO Gwynne Shotwell whether Musk’s “distraction” at Twitter might affect SpaceX’s work with the space agency, NBC News reported. Nelson said she reassured him it would not.

CEO Elon Musk tried to blame macroeconomic factors for the drop in Tesla shares. Musk said, in a tweet, “As bank savings account interest rates, which are guaranteed, start to approach stock market returns, which are not guaranteed, people will increasingly move their money out of stocks into cash, thus causing stocks to drop.”

However, critics point to his acquisition of Twitter as a distraction, and Tesla stock has underperformed versus other automakers and the S&P 500 since he announced the deal in April.

Tesla’s stock has dropped more than other larger automakers since Musk announced his plans to buy Twitter in Apr. 2022. Since that date, Tesla shares are down 59%, versus 26% for Ford (F:NYSE)and 12% for GM (GM:NYSE). The S&P 500 is down 14%.

Shares in electric vehicle maker Tesla sank to a new 52-week low on Tuesday, closing around $138 per share, or 8% lower for the day in an otherwise mixed day for stocks.