Musk rarely invests $1 billion in buying TSL! TSL breaks through $410, but three major concerns remain unresolved.

Tesla (TSLA) CEO Elon Musk rarely splashed out $1 billion in the open market to increase his stake in the company, pushing the stock price to briefly surpass $410, setting a new high since the summer. However, with multiple challenges including sales pressure, regulatory uncertainty, and extremely high operational targets, whether this rebound can be sustained remains the focus of investors.

Largest Insider Buy in History: Confidence or Emotion?

(Source: Trading View)

According to SEC public documents, Musk bought approximately 2.57 million shares of TSL in batches through a family fund and a revocable trust last Friday, totaling about $1 billion. This marks the first major purchase in the open market since 2020 and is also the largest insider buy in history.

The market interprets this as Musk's expression of confidence in the company's prospects, stimulating a sharp pre-market surge for TSLA, which closed up more than 3% to $410.04. However, the final gains converged, indicating that funds are still in a tug-of-war between sentiment and fundamentals.

$975 billion sky-high compensation case and governance controversy

The Tesla board is promoting a new compensation plan for Musk worth up to $975 billion over ten years, divided into 12 tranches, which will be unlocked upon achieving market value and operational targets:

1. Market capitalization increased from 1.3 trillion dollars to 8.5 trillion dollars.

2. Annual vehicle sales reach 20 million units.

3, 10 million valid subscriptions for FSD

4. 1 million humanoid robots and 1 million Robotaxis in commercial operation

Although the board claims that this move is to "bind" Musk's attention and voting rights, there are doubts from the outside about whether launching an unprecedented massive compensation package amid pressure on delivery and profitability is consistent with long-term shareholder returns, and the shadow of the 2018 compensation package being overturned in Delaware court has not yet dissipated.

Demand Cooling and Market Share Loss: The Moat is Narrowing

Cox Automotive data shows that the growth rate of the U.S. pure electric market is slowing down, and Tesla's market share has significantly declined from its peak, approaching and possibly falling below 40%.

The main pressure comes from:

1. Multi-season sales sluggishness and product line aging

2, The strong resurgence of Chinese automakers and hybrid vehicle models

3. Brand controversies and changes in U.S. policies disrupting demand

Analysts point out that even though the narratives of AI, autonomous driving, and robotics support long-term imagination, short-term delivery of data and profit margin improvement is still needed to support stock prices.

The Landing Challenges of Three Major New Narratives

Most of Tesla's optimistic expectations come from FSD (Full Self-Driving), Robotaxi, and the humanoid robot Optimus:

FSD: The regulatory environment in the Chinese market is tightening, and starting in 2025, the OTA approval standards will be raised. Tesla's "pure vision" approach needs to prove its safety under complex road conditions; otherwise, the paid penetration rate and cash flow will be restricted.

Robotaxi: Although it has obtained more testing permits in the United States, large-scale commercialization still needs to overcome thresholds such as regulation, liability attribution, and operational efficiency.

Optimus: Still in the prototype and demonstration stage, far from mass production and revenue contribution.

Conclusion

Musk's $1 billion stake increase has indeed provided a short-term boost for TSLA, but with weak sales, regulatory uncertainties, and high target challenges, investors should view this rebound as an opportunity for risk management and position adjustment, rather than a signal for blind chasing. In the next 12–24 months, TSLA's true test will be whether it can transform its technological narrative into stable revenue and cash flow.