Tech-focused Chinese news outlet PingWest reported that Elon Musk will likely announce Tesla Inc.'sTSLA China President Tom Zhu Xiaotong as the global CEO of the electric vehicle maker.
What Happened: Weighing in on the report, Loup Funds Gene Munster said the odds of the appointment of Xiaotong as CEO ARE at 10%. The venture capitalist noted Tesla has been working toward diversifying away from China, with the last two of its Giga factories located in the U.S. and Western Europe.
Xiaotong could be getting some kind of promotion, although not an elevation to the global CEO role, Munster said.
If he does get the CEO job, Tesla investors will likely lose sleep given the geopolitical dynamic, he added.
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Future Fund co-founder Gary Black labeled the rumors of Xiaotong taking over as far-fetched. He pointed to a previous standoff between Tesla and PingWest over a report the latter carried about the companys Giga Shanghai functioning as a modern-day sweatshop.
Bad Blood between $TSLA and PingWest goes back a few years, Black said.
Tesla won the case in November, with the court ordering the publication to remove the report, publicly admit the guilt and also pay monetary retribution.
Why Its Important: Tesla director James Murdoch hinted during the testimony before a Delaware court last month that Musk has identified a potential successor for his role as the CEO of the electric vehicle maker.
Analysts opined at that time that CEO succession planning is good corporate governance and that a change in guard may not materialize any time soon.
Price Action: Tesla shares closed Wednesdays session at $174.04, down 3.21%, according to Benzinga Pro data.
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