Tesla CEO Elon Musk is facing mounting pressure as his deepening involvement in politics—specifically his role in the Trump administration’s Department of Government Efficiency (DOGE)—continues to impact his business empire. The tech billionaire’s push for federal budget cuts has ignited fierce criticism, leading to protests, stock market turmoil, and significant losses for Tesla.
Tesla Stock Plummets as Political Fallout Intensifies
Since late last year, Tesla’s stock has plunged more than 50%, hitting its lowest level since October. A staggering 15% drop on Monday marked the company’s worst single-day performance since 2020. Investors and analysts are increasingly worried that Musk’s focus on political endeavors is distracting from Tesla’s core business at a critical time.
Wedbush Securities analysts labeled the situation a “moment of truth” for Musk and Tesla, warning that if he continues prioritizing DOGE over his companies, Tesla’s brand damage could become irreparable.
Protests and Consumer Backlash Threaten Tesla’s Brand
Public sentiment around Tesla has soured, with demonstrations erupting at dealerships nationwide. Protesters have vandalized Tesla vehicles, while some Tesla owners have added bumper stickers reading, “I bought it before Elon went nuts.” In Colorado, a protestor was arrested after allegedly spray-painting “Nazi” under a Tesla sign and throwing Molotov cocktails.
The backlash isn’t limited to the U.S. In Germany, Tesla sales plummeted by 76% last month following Musk’s support for the far-right Alternative for Germany (AfD) party. Sales have also fallen sharply in Italy, Portugal, Norway, and Denmark, further compounding Tesla’s struggles.
Trump and Musk Double Down Amidst Controversy
Despite the turmoil, former President Donald Trump remains one of Musk’s most vocal supporters. On Tuesday, Trump made headlines by purchasing a Tesla outside the White House, calling it a “great product” and praising Musk’s contributions. The move was widely seen as a statement of solidarity between the two figures.
Trump also suggested that violent attacks on Tesla dealerships could be classified as domestic terrorism. However, legal experts have pointed out that boycotting businesses falls under First Amendment protections.
Investor Concerns Grow as Musk Juggles Tesla and DOGE
Musk has admitted that managing his companies while handling government responsibilities is proving “difficult.” Reports indicate that he has been sleeping in the DOGE office at the Eisenhower Executive Building, shifting his intense leadership style from Tesla’s factory floors to the political arena.
Tesla investors are increasingly calling for Musk to step back from politics. Ross Gerber, CEO of Gerber Kawasaki Wealth and Investment Management, suggested that Tesla needs new leadership, arguing that “politics and selling products just does not mix.”
Michael Cornfield, a political scientist at George Washington University, predicts that shareholders may soon push for a resolution demanding Musk relinquish his role as Tesla’s public face.
Tesla Faces a Defining Moment
As Tesla battles intensifying competition in the EV market and growing political backlash, the coming months could determine its future trajectory. Analysts warn that unless Musk shifts his focus back to Tesla, the company could suffer long-term damage that may be impossible to recover from. The question remains: Will Musk heed the warnings, or will Tesla continue its downward spiral?
