Elon Musk Owns 20% of Tesla, a Stake Worth Roughly $200 Billion. Here's Why His Ownership Level Matters for Shareholders.

Key Points

At the end of 2025, Elon Musk owned roughly 20% of Tesla‘s (NASDAQ: TSLA) shares, inclusive of the over 300,000,000 options he recently exercised. That’s a huge stake, but for comparison, the giant asset manager Vanguard was the second-largest holder with a 6.1% stake in the company. Musk’s massive ownership position changes the game for investors.

Insider ownership is good, but too much can be a problem

Wall Street likes to see CEO’s with skin in the game. It means their interested are aligned with the interested of shareholders. However, in a situation like electric vehicle maker Tesla, where CEO Elon Musk controls a huge 20% of the company’s voting power, insider ownership takes a different form. At this level, the CEO’s interest may supersede those of the shareholders because the CEO’s voting power is so influential.

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Image source: The White House.

This isn’t the only company over which Elon Musk has such sway. He also has 82% voting control at Space Exploration Corporation (NASDAQ: SPCX). The space-focused company only recently held its initial public offering, but already has a massive $1.5 trillion market cap (making it larger than Tesla). The company’s prospectus was very clear about what Musk’s voting control meant: “As a result, Mr. Musk will be able to control the outcome of matters requiring shareholder approval.” While he doesn’t have the same level of voting control at Tesla, Musk’s 20% stake is so large that it would be hard for shareholders to meaningfully oppose him. Even the board of directors, which is supposed to represent shareholders, would likely struggle to oppose a CEO with such a large investment in the company they run.

You are investing alongside Elon Musk

When you step back, you can argue that Elon Musk having so much influence over Tesla and SpaceX is both good and bad. He is clearly a visionary businessman, but he’s also known for making provocative statements and non-business choices that sometimes have real-world economic impacts on shareholders. For example, his involvement with U.S. politics in 2025 led some to boycott Tesla. The company’s deliveries declined materially that year.

Notably, your view of his control should probably be an integral part of your investment decision if you are considering buying the stock. You are, effectively, investing alongside Musk. What he wants to do is likely to happen, with little the board or investors can do to get in the way. If that isn’t OK with you, you shouldn’t buy Tesla or SpaceX stock.

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Reuben Gregg Brewer has no position in any of the stocks mentioned. The Motley Fool has positions in and recommends Tesla. The Motley Fool has a disclosure policy.