The backlash against Tesla Motors CEO Elon Musk for his political involvement is escalating to a level unprecedented for a major global brand.
The company’s share price has dropped 47% since the beginning of President Trump’s second term Jan. 20, and is down 54% from its 52-week high reached Dec. 18 last year.
There are indications that both Tesla’s board and major institutional investors are expressing concerns about Elon Musk's leadership as CEO. Ross Gerber, a prominent Tesla investor and wealth manager whose firm holds approximately 260,000 Tesla shares, this week publicly called for Musk to step down. “I think Tesla needs a new CEO,” says Gerber.
Gerber cites Musk’s involvement in other ventures and his political engagements, particularly his role in the Trump Admin. and his overt support of controversial right-wing politicians in the Germany and the U.K, as factors that have diverted his focus from Tesla and harmed the company’s reputation.
Musk, in his position as chief advisor to the Department of Government Efficiency, is leading an effort to radically downsize the federal government and reduce government spending, often with negative effects on critical operations such as Medicaid, the IRS, Social Security Administration and National Parks.
Christopher Tsai of Tsai Capital, another significant Tesla investor, has expressed hope that Musk’s government role will be short-lived, allowing him to refocus on Tesla. Tsai acknowledges the market’s dissatisfaction with Musk’s political involvement and its negative impact on Tesla’s stock performance.
Several Tesla insiders have recently sold significant amounts of company stock, according to financial disclosures.
Sales of new Teslas are in freefall in major markets including Germany, France, Norway, Australia, as well as the U.S. Sales are also declining rapidly in China, but the reason for the decline there has more to do with competition from Chinese automakers and Tesla's dated product line. It is already offering zero-percent financing on the just-launched the new Model Y.
Additionally, values of used Teslas are depreciating at three times the rate of other automakers. Data from the automotive online shopping site CarGurus.com shows that used Teslas have fallen an average of 7.26% year-over-year, which is significantly greater depreciation than the average in CarGuru.com's used vehicle index. Cybertruck values, says CarGurus.com, are down a whopping 58%.
Musk himself is trying to combat his negative press with interviews on friendly media outlets, and last week's PR stunt in which he got President Trump to turn the White House driveway into an outdoor Tesla showroom. More problematic, though, are charges that Musk's people tried to influence a German poll showing the depth of Musk's unpopularity in the country.
A survey of over 100,000 Germans by the popular T-Online publication revealed that 94% won’t buy a Tesla vehicle. Musk himself shared the same survey in social media, but with entirely different results; that the survey now points to “70% of people in Germany would buy a Tesla again.“ T Online has now reported that the survey has been manipulated by bots, with 253,000 responses coming from just two IP addresses in the U.S.
Doxing and Vandalism
Tesla stores worldwide have become the object of attacks and vandalism, as are Tesla vehicles themselves.
And a website, Dogequest operated by 404 Media, has taken to “doxing” Tesla owners, meaning their names and addresses are published. Doxing is seen as an extreme measure in social media battles.
Attorney General Pam Bondi on Tuesday called the actions against Tesla, Musk and Tesla owners “domestic terrorism.”
Arizona Democratic Sen. Mark Kelly posted on the Musk-owned X social media platform after selling his Tesla. “I bought a Tesla because it was fast like a rocket ship,” he wrote. “But now every time I drive it, I feel like a rolling billboard for a man dismantling our government and hurting people. So Tesla, you’re fired!”
While the backlash against Tesla is severe, there are comparisons in recent history that show the perils of CEO behavior and companies getting caught up in political culture wars.
- Uber (2017) – Travis Kalanick’s Leadership Controversy: A series of scandals involving Uber's toxic workplace culture, legal battles over employee classification, and then-CEO Travis Kalanick’s aggressive leadership style, resulted in a #DeleteUber social media campaign, and major investors pressured Kalanick to step down. He resigned as CEO in 2017.
- Meta (2018)– Cambridge Analytica & Political Scandals: The Cambridge Analytica data privacy scandal, increasing misinformation concerns, and Mark Zuckerberg’s congressional testimonies resulted in a decline in trust of Facebook. Regulators imposed fines, and stock prices took massive hits. Many advertisers boycotted the platform.
- Disney (2023–2024) – CEO Bob Chapek’s Culture War Backlash: Disney’s handling of Florida’s “Don’t Say Gay” bill led to backlash from both progressives and conservatives, plus the company’s struggle with streaming service losses. Investor frustration led to Bob Chapek’s firing and the return of Bob Iger as CEO.
Musk told FoxNews show host Sean Hannity that he is “shocked” over the backlash. The Tesla CEO says his company has always been “peaceful” and that he’s personally never done anything so “harmful” or “awful” to warrant such a backlash.
Musk says he plans to leave the Trump administration in 2026.
