Commerce Secretary Lutnick’s Public Endorsement of Tesla Sparks Ethics Concerns and Investor Backlash
Commerce Secretary Howard Lutnick’s recent public endorsement of Tesla (NASDAQ: TSLA) and its CEO Elon Musk has triggered a wave of criticism from ethics experts, investors, and public figures. Lutnick’s bold statements, made during a televised Fox News appearance, not only praised Musk but also encouraged viewers to invest in Tesla stock, claiming it was significantly undervalued. His comments have raised concerns over potential conflicts of interest and the appropriateness of a government official promoting a private company.
Lutnick’s Bold Endorsement on Fox News
During his Fox News interview, Lutnick lauded Musk as “probably the best person to bet on I’ve ever met,” expressing unwavering confidence in Tesla’s future. He insisted that Tesla stock was a bargain, urging viewers to buy shares immediately.
“It’ll never be this cheap again,” Lutnick declared, suggesting that people would one day regret not investing in the EV giant.
Going beyond the stock, Lutnick also hyped Tesla’s upcoming products, particularly the humanoid robot Optimus and the self-driving Cybercab robotaxi. He claimed the Optimus robot, which Tesla has been developing for household and industrial tasks, could sell for around $30,000.
“Anybody who does not have a Tesla robot will be silly,” Lutnick said. “They will mow our lawn, make us coffee, and renovate our bathroom. I’m telling you, we’re both going to have really nice bathrooms.”
He also expressed enthusiasm for the Cybercab project, predicting that robotaxis would become a mainstream fixture in the near future.
Musk Tempers Expectations
Interestingly, even Musk himself has attempted to dial down the hype surrounding Tesla’s ambitious plans. In November, Musk cautioned on X (formerly Twitter) that the $30,000 price tag for Optimus and Cybercab would only be feasible in the long term. He indicated that Tesla would need to reach a production volume of over one million units annually to achieve such a price point, without clarifying if this target applied to each product individually or combined.
Although Musk previously stated that Optimus would eventually retail for under $30,000, he acknowledged that initial production would be limited to factory use in 2025, with a broader rollout potentially happening by 2026. Similarly, the Cybercab is not expected to hit production lines until sometime before 2027.
Ethics Experts Raise Red Flags
Lutnick’s glowing endorsement of Tesla has sparked outrage from ethics watchdogs, who view the promotion as a potential conflict of interest.
“It’s an ethics issue, and it’s an optics issue,” said Jordan Libowitz, head of communications at Citizens for Responsibility and Ethics in Washington. “When someone spends hundreds of millions of dollars to elect a president and then that president’s administration takes action that appears to be an attempt to boost that person’s net worth.”
The concerns stem from Lutnick’s close ties to the current administration and the possibility that his public support could influence stock prices or future regulatory decisions. Critics argue that such public endorsements from government officials create a perception of favoritism and raise questions about impartiality.
Investor Backlash and Market Reactions
Lutnick’s comments have not only alarmed ethics experts but also sparked criticism from prominent investors, including longtime Tesla bull Gary Black. While Black has been a vocal supporter of Tesla, he voiced concerns over the potential reputational damage caused by Lutnick’s controversial promotion.
Meanwhile, Tesla shares experienced short-term volatility following Lutnick’s appearance, with some analysts attributing the movement to investor uncertainty over the political ramifications.
