Cathie Wood doubles down on Elon Musk support amid Tesla's slow revival

Cathie Wood is still all-in on Elon Musk, even as Tesla stock continues to tank and his political ambitions get louder.

Speaking on Bloomberg Television this week, the Ark Invest founder defended the CEO while shares in the electric car company kept falling.

The stock dropped nearly 7% on Monday, wiping out $68 billion from Tesla’s market cap, after Musk said he was starting a new political party. But Cathie, who’s been holding Tesla in her funds since 2014, said she’s not worried.

According to Bloomberg, Cathie pointed to Elon’s recent decision to take over Tesla’s sales in the US and Europe as a sign that he’s finally focusing on the company again. She said:

“One of the announcements Elon made recently is that he is going to oversee sales in the US and in Europe. When he puts his mind on something, he usually gets the job done. So I think he’s much less distracted now than he was, let’s say, in the White House 24/7.”

The timing comes as Tesla’s market position in Europe and China weakens, with falling deliveries and customer pushback.

Musk forms political party while Tesla stumbles

Elon’s announcement over the weekend added another layer of chaos. He said he’s launching the “America Party” to take on both Republicans and Democrats in the upcoming House and Senate races. He also didn’t rule out backing a presidential candidate. This comes as Donald Trump, now serving again as US President, has regained his grip over the Republican Party.

Wall Street didn’t love that. The stock’s decline added to a rough year, Tesla is now down 27% in 2025 and has dropped in eight of the last nine sessions. Elon’s change toward politics hasn’t helped, especially in international markets where sales are slipping.

But Cathie isn’t pulling back. She’s betting that Tesla’s next growth wave will come from the robotaxi project. She previously told Bloomberg that the stock could hit $2,600 within five years, nearly nine times where it trades now, and that 90% of the company’s future value will come from that robotaxi rollout.

Her support isn’t limited to Tesla. Cathie also holds positions in Elon’s other companies, including xAI, SpaceX, and Neuralink. She’s stayed quiet on the political drama, saying, “We’ve been dealing with controversy around Elon Musk in one form or another since we first bought the stock. We do trust the board and the board’s instincts here and we stay out of politics.”

Dan Ives clashes with Musk over control and accountability

On Tuesday, the heat turned up when Dan Ives, Managing Director at Wedbush Securities and one of Tesla’s most bullish analysts, called for urgent changes. Ives has the highest Tesla price target on Wall Street — $500 — but he took to X to criticize Elon’s political detour and recommended that the board take control. He laid out three suggestions: give Elon a new pay package that gives him 25% voting power, greenlight a merger with xAI, and set clear limits on how much time he spends away from Tesla.

Elon didn’t respond quietly. “Shut up, Dan,” he wrote on X, brushing off all of Ives’ proposals. It didn’t matter that Ives’ first idea actually supports Elon’s long-held desire for more control of Tesla. The post drew even more attention to the mess unfolding inside the company.

That same day, Ives and his team released a detailed note titled, “The Tesla board MUST Act and Create Ground Rules For Musk; Soap Opera Must End.” It said Elon’s decision to enter politics marked a “tipping point in the Tesla story” and warned that the board needs to intervene before more value gets destroyed. Still, Wedbush held its buy rating and price target.

Meanwhile, the stock bounced slightly on Tuesday, climbing 1.3%. But the bigger issues remain. Elon’s involvement in US politics, combined with falling sales and slipping deliveries in Europe and China, has raised fresh concerns about the company’s direction.

Cathie, though, hasn’t budged. She’s still backing the board. She’s still holding Tesla. And she’s still betting on Elon’s long game, robotaxis, AI, and whatever else he decides is the next frontier.

Outside of Tesla, Cathie also called out Apple’s recent loss of its top AI executive to Meta. “If you think about the ultimate mobile device, it’s an autonomous vehicle and that should have been Apple’s to win,” she said.

She believes the Apple Car was the biggest AI project out there and now that another talent is gone, the company is “in a precarious position.” Meta’s CEO Mark Zuckerberg is going all-in on AI, trying to compete with OpenAI and Google. Cathie said Meta’s open-source strategy in generative AI is “quite admired,” but questioned if Zuckerberg is just repeating his metaverse misstep.

Even with all the chaos, Cathie isn’t walking away from Elon or his companies. She’s been through the noise before and doesn’t seem fazed by the current firestorm. As for Dan, he’s not changing his stance either. In an email to CNBC, he wrote, “Elon has his opinion and I get it, but we stand by what the right course of action is for the Board.”

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