Investor Ross Gerber, co-founder of investment firm Gerber Kawasaki, has advised Tesla Inc. CEO Elon Musk to refocus on selling electric vehicles amid a recent decline in the company's stock and a strategic shift toward AI and chip manufacturing. The suggestion comes as Tesla's shares have experienced significant volatility, dropping more than 13% since May 26 and nearly 6% since June 18.

TSLA Stock Performance

Tesla's stock has seen a double-digit percentage decline over the past month. During this period, the stock reached a high of $442.10 per share. In the after-hours trading session on Thursday, Tesla traded at $374.40 per share, a decline of 0.19%. According to Benzinga Edge Rankings, Tesla provides excellent Growth but poor Value and Momentum, with an unfavorable price trend in the Short, Medium, and Long term.

Strategic Commentary and New Models

In a post on social media platform X, Gerber criticized Musk's push toward AI and chip manufacturing while placing the development of new EVs on the back burner. "Maybe Tesla should consider selling EVs again…. It’s a wonderful business," Gerber stated. Despite the critique, Tesla is reportedly mulling the development of an affordable EV targeting the Chinese market, with potential sales in the U.S. Musk has also hinted at another possible new model to boost its aging lineup, which currently includes the Model 3, Model Y, and Cybertruck.

Investor Moves and Industry Developments

Gerber recently expressed admiration for Slate Auto, a company backed by billionaire Jeff Bezos. Slate Auto has touted its modular, ultra-customizable EV pickup truck, which offers a range of 201 miles in its base configuration. "People will totally love this truck," Gerber said, noting the vehicle will retail for close to $25,000 for the base variant. Separately, investor Gary Black of The Future Fund LLC dismissed rumors that Musk is deliberately holding back Tesla's Robotaxi ramp to induce a merger with Space Exploration Technologies Corp. following its $86 billion IPO.

Investor Gary Black of The Future Fund LLC stated on Wednesday that Tesla Inc. continues to trail the Nasdaq 100 despite falling bond yields and lower oil prices, which typically benefit high-growth stocks. Black highlighted that Tesla underperformed the index across one, three, and five years, attributing the divergence to company-specific factors including unmet expectations for Full Self-Driving (FSD) technology and weak marketing. The comments come as the 10-year Treasury yield dropped to 4.39% and Brent crude fell to $73 a barrel, conditions that usually support long-duration assets.

Performance vs. Nasdaq 100

Black used charts on X to illustrate Tesla's relative underperformance compared to the Nasdaq 100 (NDX). The data shows Tesla has consistently lagged behind the broader index over multiple timeframes, even as macroeconomic indicators improved.

The 10-year Treasury yield fell another 10 basis points to 4.39% on Wednesday, while Brent crude reached its lowest level since late February at $73 a barrel. Lower yields reduce the discount rate used to value future profits, theoretically boosting growth stocks, while cheaper oil can ease inflation pressures.

FSD Hype and Marketing Challenges

Despite these tailwinds, Black argued that Tesla's stock has not lived up to the hype surrounding unsupervised Full Self-Driving. He noted that Tesla currently operates only a small number of robotaxis without safety drivers, while Alphabet Inc.’s Waymo continues to expand its autonomous ride-hailing operations. Black has previously characterized Tesla’s FSD as a "great product" that suffers from weak promotion, citing a "total lack of awareness with no advertising." He urged the company to adopt the marketing strategies of Apple Inc. co-founder Steve Jobs.

Capital Rotation and Market Sentiment

Market sentiment has also been influenced by SpaceX’s massive initial public offering. SpaceX raised $75 billion in an oversubscribed listing. Black suggested that investors are rotating out of Tesla, often viewed as the closest public proxy for exposure to Elon Musk, to fund new positions in SpaceX. According to Benzinga Edge Rankings, Tesla stock offers satisfactory Quality and Growth but does not offer a favorable price trend in the short, medium, or long term.

Tesla shares slid 1.61% to $375.46 at market close on Wednesday, before rising 0.62% to $377.80 during the overnight trading session.