07:34 AM EDT, 07/08/2025 (MT Newswires) -- Tesla's (TSLA) board needs to "act now" and set rules for Chief Executive Elon Musk's political ambitions and actions, Wedbush said in a note to investors on Tuesday.

Musk's launch of the America Party "is a tipping point" and must prompt action by the board restricting Musk's political projects lest they damage Tesla's prospects, Wedbush said.

"Tesla is heading into one of the most important stages of its growth cycle with the autonomous and robotics future now on the doorstep and cannot have Musk spending more and more time creating a political party which will require countless time, energy, and political capital," Wedbush said.

The note said Tesla needs to retain Musk for at least five more years, given his role in autonomous mobility and robotics, while maintaining control over his actions. It suggests that the board devise a new incentive-driven pay package for Musk that increases his ownership stake, specifying the amount of time Musk needs to spend on company affairs, and create a committee overseeing Musk's political forays.

The "soap opera must end," the note says.

Wedbush maintained its $500 price target for the company.

Shares of the electric vehicle maker were up around 1% in recent premarket activity.