Morgan Stanley stock analyst Adam Jonas warned Mr Musk that his Tesla company is unlikely to be acquired by another tech or auto business. According to the Los Angeles Times, Mr Jonas put a “worst-case” price of $10 (£7.90) on Tesla stock, with its target price still $230 (£181). He currently works to support Tesla and a recording of his briefing with the company was leaked online.
On Wednesday, Tesla’s stocks sunk by a further six percent, leaving it to close on $192.73 (£152).
That figure represents the lowest Tesla has gone since December 6, 2016.
Mr Jonas said that it was more likely for Mr Musk’s SpaceX to purchase the electric car maker, as opposed to any other firm.
Tesla has been deploying driver-assist autopilot technology in its vehicles across the world.
However, with driverless technology the future, the company has began to struggle.
Mr Jonas added: “They built this hulking infrastructure to support more like one million cars a year, not 350,000 cars a year.
“If someone could get access to Tesla’s assets and have it with the right number of employees and no debt, there is asset value there.”
He said in the recording that any merger with SpaceX “would not be a permanent solution”.
But “it would be a good way to get Tesla off the stock market potentially so it could the dirty work of restructuring without, as Elon says, having someone outside your house yelling the price of your house every 30 seconds”.
He claimed that it would also help Tesla “keep the executive team together, which has been tough for this company to do to date”.
The latest revelation comes at a time when Mr Musk’s SpaceX announced its speeding-up with space programme by expanding its Starship Hopper construction project.
SpaceX completed assembly of the test-flight version of SpaceX’s Mars-colonising Starship vehicle in January.