Elon Musk, the world's wealthiest person, is inescapable these days. Ever since Trump’s inauguration, he’s been spotted hobnobbing with the US President more often than First Lady Melania Trump herself. Musk has practically rooted himself at Mar-a-Lago, staking out a cottage there. Some are dubbing him the unofficial “Co-President.” He’s even elbowing his way into Trump’s cabinet meetings, a tech titan turned political power player.
But while SpaceX owner's political star is rocketing up, Tesla—his automotive empire—seems to have hit a reverse gear. The Wall Street isn’t swooning over this new Musk-the-politician persona.
Driving the news - The numbers don’t lie: Tesla shares are skidding, and the market’s love affair with him might just be stalling out.
- Tesla’s sales are plummeting as CEO Elon Musk tightens his political ties to President Donald Trump, alienating a significant portion of the brand’s traditional customer base. The company reported its first annual sales drop in over a decade, and polling suggests Tesla’s appeal among Democratic buyers has cratered.
- Meanwhile, Tesla’s stock has lost 35% of its value this year, erasing most of the post-election gains that investors initially expected from Musk’s close relationship with the White House. The decline comes as Musk faces growing backlash over his far-right political endorsements and increasingly divisive rhetoric.
- Musk’s deepening role in Trump’s administration—essentially functioning as a “Co-President” overseeing government efficiency department(DOGE)—has turned Tesla into a cultural lightning rod. Some customers now see the car as a political statement rather than a technological marvel, leading many longtime supporters to jump ship.
Why it matters Tesla’s decline is more than just a business issue—it’s a case study in how a CEO’s personal brand can shape a company’s fate. Musk built Tesla’s success by appealing to environmentally conscious, tech-savvy buyers who saw the company as a beacon of innovation and sustainability. But his embrace of nationalism and right-wing politics is driving many of them away.
At the same time, Tesla faces fierce competition from other automakers, many of whom have caught up or even surpassed Tesla in EV technology, quality, and affordability. The company’s once-loyal customers now have more options, and many are choosing to take their business elsewhere.
The big picture: Sales slump - Tesla’s US sales fell 7% in 2024, even as overall EV sales rose 25%.
- In Germany, Tesla’s February sales plunged 76%, while France saw a 26% drop.
- In China, a crucial market, Tesla’s February deliveries fell nearly 50%.
- Some analysts attribute the slump to increased competition, but Musk’s political controversies are also a factor—especially in Europe.
Brand erosion: In 2022, 22% of car shoppers said they would “definitely consider” a Tesla.
- By mid-2024, that number had dropped to just 7%—on par with brands like Dodge and Lincoln.
- Among Democrats, the decline is even sharper: The percentage of Democratic buyers willing to consider a Tesla fell from 23% in 2023 to just 13% in February 2025.
- Meanwhile, Republican interest in Tesla has risen, but conservative buyers remain hesitant about EVs in general.
Political backlash - Protests have erupted at Tesla showrooms in Los Angeles, New York, and Berlin.
- Some Tesla vehicles have been vandalized or spray-painted with swastikas in response to Musk’s political endorsements.
- Tesla owners report being harassed in public—with some saying their cars now symbolize Musk’s politics more than sustainability.
What they’re saying - Garth Ancier, TV executive and former Tesla owner, told the WSJ:"I’m getting uncomfortable driving this car around because it’s like driving a big red MAGA hat.”
- Jennifer Trebb, ex-Tesla owner, told NYT: "Two weeks ago, I was called a Nazi in the parking lot at Kroger. I came home and told my husband, ‘That’s it. I’m done.”
- Tesla investor Gene Munster told WSJ: “Tesla investors are seeing Musk as having more authority than Trump. There’s some brand damage that comes from that.”
Between the lines Musk’s deep involvement in Trump’s administration—where he is spearheading efforts to shrink the federal workforce and deregulate industries—has supercharged his political brand at the expense of Tesla’s.
His endorsements of far-right political figures in Germany, the UK, and the US have intensified the divide. European markets, once among Tesla’s most enthusiastic, are turning against the company as Musk aligns himself with nationalist parties that oppose climate change policies.
Meanwhile, Musk’s public comments downplaying climate change have clashed with Tesla’s original mission of accelerating “the world’s transition to sustainable energy.” Some Tesla employees and engineers have resigned in protest, questioning whether the company’s environmental commitment still holds.
As per a Wall Street Journal article, inside Tesla, executives are struggling to balance the political fallout with declining sales. Some senior leaders reportedly see Musk’s proximity to Trump as a strategic advantage, giving Tesla influence over EV subsidies, regulatory decisions, and federal contracts. But others worry that the backlash is undermining Tesla’s future.
Stockholders are getting nervous. Tesla’s stock has erased most of its post-election gains, wiping out $660 billion in value. Investors who once believed Musk’s government ties would benefit Tesla are now rethinking their bets as the brand faces intensifying scrutiny.
"Tesla still holds a massive market valuation, but the cracks are showing," said one analyst. "This could be the year Tesla’s stock finally collapses."
Read also: Elon Musk loses $81 billion in net worth in first two months of 2025 What’s next? - Tesla’s future hinges on whether it can regain trust with disillusioned buyers while keeping its shrinking conservative customer base engaged.
- Musk has promised a self-driving “Cybercab” service by 2026, which could be a game-changer—if he delivers. However, Musk has been making similar promises about full autonomy for over a decade, and many investors remain skeptical.
- Meanwhile, competitors like BYD, Ford, Hyundai, and Volkswagen are aggressively cutting into Tesla’s market share with cheaper, more technologically advanced EVs.
- The growing divide in Tesla’s customer base—with liberals rejecting Musk but conservatives slow to adopt EVs—creates an unprecedented identity crisis for the company.
- The bottom line: Tesla’s decline isn’t just about Musk’s politics—it’s about whether Tesla can still sell itself as the future of driving in an era when customers have more options than ever.
- For years, buying a Tesla was about technology, sustainability, and innovation. Today, for many, it’s a political statement.
- And that shift could cost Musk his once-unshakable grip on the EV market.
(With inputs from agencies)
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