Tesla experienced a significant downturn in sales during the initial three months of the year, with a 50% decrease attributed to the controversy surrounding Elon Musk's involvement in the US government. Data from the European Automobile Manufacturers' Association indicated that electric car sales in 27 European countries plummeted to 36,000 units in the first quarter of 2025. March alone saw a 36% drop, marking the most substantial decline among major car manufacturers included in the report, despite an overall increase in electric vehicle sales. This followed Musk's commitment to reduce his role in the US government due to the company's declining popularity.
The company also reported a 71% decrease in profits, citing "changing political sentiment" as a contributing factor. During Musk's tenure in the US government, Tesla showrooms faced vandalism and protests, which President Trump characterized as "domestic terrorism." Tesla released a statement acknowledging the increasing uncertainty in the automotive and energy markets, highlighting the adverse impact of evolving trade policies on the global supply chain and cost structure. The statement also noted that changing political sentiment could significantly affect demand for their products in the near term. Earlier in the year, one of the company's early investors urged Musk to either fully dedicate himself to Tesla or step down.
Ross Gerber advocated for a new CEO, stating that the business had been neglected and that Musk should either refocus on Tesla or allow someone else to lead. Musk had been a prominent supporter of President Trump's election campaign, investing in voter incentive schemes and using his platform to promote Republican messaging. However, he has faced controversy since Trump's victory, including an accusation of making a Nazi salute. In Germany, where sales have sharply declined, Musk's vocal support for the far-right Alternative for Deutschland party has further contributed to his divisive public image.
10 Comments
Loubianka
Politics always play a role in business! It's not the end of the world, the cars are still great.
BuggaBoom
The fact early investors are worried is telling, the situation at Tesla is dire.
Loubianka
I hope that new investors see the business is being neglected. The future of Tesla deserves a better leadership.
Katchuka
Tesla is still innovating. The technology speaks for itself regardless of market changes.
Rotfront
Everyone is focused on the CEO instead of the progress that Tesla made in innovation.
Noir Black
Blaming Musk for everything is lazy. The car market is competitive, and there are lots of factors
Loubianka
The future is in EVs, and Tesla is leading the charge. Short-term fluctuations are normal.
KittyKat
Tesla faced issues, but they are an innovative company, they'll figure things out.
Katchuka
It's a rollercoaster. Tesla has been through worse and come out stronger.
Eugene Alta
This reminds me of when he burnt his own reputation by smoking marijuana on the public stage