Morgan Stanley analyst Adam Jonas believes Elon Musk needs his EV company $Tesla (TSLA.US)$ "more than ever before" or as much as the company needs him.

Jonas sees Musk's businesses collectively investing tens of billions of dollars in AI infrastructure in the coming years. Capital, he noted, determines supremacy in the field of AI. The stock climbed 6.7% Tuesday.

"AI's appetite for capital and data increase Tesla's importance within the Muskonomy," Jonas wrote in a note on Monday.

While Tesla's success in AI will lower the cost of capital for Musk's other AI endeavors, Tesla's failure in the field would increase costs for the others, Jonas opined.

"...we believe on a fundamental level that the data, infrastructure built and path to monetization within Tesla is critical to Musk's seemingly 'adjacent AI effort," Jonas wrote. Over time, Jonas also expects Musk's efforts across different segments including social media, generative AI, space, and transportation to become "more conspicuously linked" as the lines between phone, robot, and mobile AI assistant blur.

Morgan Stanley's Adam Jonas has released a new Tesla note: Elon Musk Needs Tesla More than Ever
"AI's appetite for capital and data increase Tesla's importance within the Muskonomy." pic.twitter.com/Z3WzssJy8F

— Sawyer Merritt (@SawyerMerritt) May 20, 2024

Musk has previously expressed discomfort with advancing Tesla in the field of AI without having 25% voting control. The upcoming shareholder vote on his 2018 pay package rescinded by a Delaware court earlier this year will be key to determining if he would get that voting block, Jonas opined earlier this month.

While the approval of the pay package by itself does not assure the CEO of his desired voting block, it would make it "increasingly difficult" for Musk to achieve 25% ownership if the package is rejected, the analyst noted.

Tesla's AI potential will remain limited and its share price dominated by larger EV market developments until Musk's voting control issue is resolved, Jonas then said, while adding that the upcoming shareholder vote scheduled for June 13, 2024, will determine the company's long-term strategic direction.

For the shareholder meeting scheduled for June 13, Tesla shareholders will vote again on Musk's 2018 pay package and deliver a verdict on shifting Tesla's state of incorporation from Delaware to Texas. The event, Jonas warns, could drive material volatility in the stock.