Elon Musk, long celebrated as the visionary behind Tesla’s reputation as an innovation leader in the global shift toward electrification, faces mounting backlash as his deepening involvement in politics jeopardizes the company’s future. Musk’s recent alignment with President Trump and active role within the federal government’s Department of Government Efficiency have led to declining consumer perception and financial uncertainty for the automaker.
Tesla’s first-quarter earnings for 2025 underscored these concerns, with the company’s profits plummeting 71% amid slumping sales and widespread negative public sentiment associated with Musk. The automaker delivered only 336,681 vehicles in the first three months of the year, a significant drop from 495,570 delivered in the preceding quarter and fewer than the same quarter last year. This marked a continuation of the disappointing performance seen throughout 2024, driven primarily by production delays, increased competition, and growing polarization around Musk’s public persona.
Consumer dissatisfaction with Musk’s growing connection to divisive political controversies has manifested in multiple ways. Trade-ins of Tesla vehicles have reached record highs, and sales across Europe have suffered heavily—overall European sales for Tesla dropped by 37.2% year-over-year in early 2025. The company was particularly hard-hit in countries previously considered strong markets; Sweden reported an 81% plunge, while a recent German poll revealed 94% of respondents would no longer consider owning a Tesla vehicle.
This adverse sentiment has started manifesting in significant protests around Tesla locations worldwide, with demonstrators urging existing owners to sell their vehicles and investors to divest their shares. Tesla has officially recognized these protests as a material business risk, noting in its latest SEC filings that the demonstrations have sometimes escalated into episodes of violence against its properties and personnel.
Compounding these troubles are geopolitical issues directly tied to Musk’s political affiliations. His visible endorsement of Trump and administration policies have caused international pushback, eroding previously solid consumer markets and impacting the company’s global image elsewhere—Chinese consumers, for instance, have grown hesitant toward Tesla due to Musk’s closeness with the U.S. President. Analysts and Wall Street leaders, even those historically bullish on Tesla, have begun to urge Musk to step away from political activities to restore confidence and stabilize the company’s market valuation, now severely diminished after persistent stock price declines.
In April, the Wall Street Journal reported that Tesla’s board had cautiously begun exploring options for Musk’s potential successor—a claim Tesla’s board chair Robyn Denholm publicly called untrue. Yet the reported succession planning, valid or not, underscored growing investor unease over the brand’s damaged reputation and Musk’s focus away from company operations.
Complicating matters further, Tesla has struggled recently with product-specific setbacks. Its Cybertruck, a highly anticipated addition intended to showcase Tesla’s continuing innovation, has been recalled eight times since launching in 2023, most recently due to a faulty trim panel defect affecting thousands of units.
On top of internal struggles, fierce competition is intensifying from rivals like China’s BYD, whose rapid technological breakthroughs, including five-minute car charging capabilities and affordable, sophisticated driver-assistance systems, threaten Tesla’s dominance. Last year, BYD even surpassed Tesla in global revenue—generating $107 billion compared to Tesla’s $97.7 billion—further amplifying the concerns over the American company’s trajectory.
Amid the growing intensity of backlash, radical incidents have been recorded, including acts of vandalism and violent attacks directed toward Tesla premises and charging infrastructures. Musk himself has become increasingly criticized over gestures and inflammatory remarks that critics perceive as endorsing extreme right-wing ideologies, such as his widely condemned appearance giving what observers interpreted as salutes reminiscent of Nazi symbolism.
Facing severe reputational damage, Musk has attempted to shift public perception of Tesla away from automotive production toward artificial intelligence and autonomous technology solutions. At recent internal meetings, he urged employees to remain focused on long-term initiatives such as the Cybercab fleet—fully autonomous taxis built without traditional human-operated controls—and Tesla’s humanoid robot initiative, asserting they represent Tesla’s true future potential.
However, Musk’s approach has not reassured investors. Prominent market analysts warn that continued politicization of the Tesla brand risks dramatically intensifying existing challenges and could lead to “darker times” if Musk does not rapidly realign his attention squarely onto core business priorities.
Currently, the critical unanswered question remains whether Tesla can reverse this brand erosion and secure its formerly unquestioned place at the forefront of global electrification.
