Two Tesla Insiders Close To Elon Musk Just Sold Almost $200 Million Worth Of Stocks

Two board members of Tesla (TSLA) who are close to CEO Elon Musk have sold shares worth $194 million, which has raised doubts about the company’s internal confidence as it prepares for a big product launch. Ira Ehrenpreis, who has been on the board for a long time and is close to Musk, sold 477,572 shares for more than $162 million. Kimbal Musk, who is on the board with Elon Musk, sold 91,588 shares for more than $32 million.

The time when these sales take place is significant. Tesla has been promoting its upcoming autonomous ride-hailing service, which is expected to lead to major growth. Still, the company has apparently not met important regulatory requirements from the Texas Department of Transportation, casting doubt on its ability to launch robo-taxis.

This isn’t the only time Tesla’s board has been questioned. This year, Tesla board members, who are known for giving out generous stock compensation, agreed to return nearly $1 billion to shareholders in a lawsuit over excessive pay. Even so, Robyn Denholm, the board chair, is the top-paid board member at any major U.S. company and has been selling her Tesla shares.

Although some of these stock sales were set up through 10b5-1 trading plans, critics say there is not enough transparency about these plans. Ehrenpreis’s trading plan was put in place in December, just after Tesla’s stock rose, which suggests he timed it well.

Ehrenpreis, who helped approve Musk’s $55 billion compensation in 2018, is stepping down from the board this year after serving for nearly two decades. His departure and the large share sale he made have people questioning what lies ahead for the company.

When regulations increase and insiders sell their shares, investors may start to doubt the company. Tesla’s plans for autonomous vehicles are close to a major turning point, but those involved seem to be playing it safe.