Tesla CEO Elon Musk has admitted that his involvement in the Trump administration’s Department of Government Efficiency (DOGE) is taking a toll on Tesla’s stock price.
Stock Decline and Investor Concerns
Musk, whose fortune is estimated at around $330 billion, holds a substantial portion of his wealth in Tesla stock. The company’s stock initially surged after Donald Trump won the 2024 presidential election, reaching an all-time high of $479 per share on December 17. However, it has since plunged by 48%, closing at $248.28 on Monday after falling another 5.8% in early trading.
Investors are growing increasingly concerned that Musk’s dual role—leading Tesla while serving as an advisor in the government—is creating uncertainty. His influence in DOGE, which is responsible for streamlining government operations, has been met with controversy, particularly as the department pushes to shut down federal agencies and gain access to large amounts of citizen data.
Musk himself admitted the strain during his town hall appearance, stating, "This is a very expensive job, is what I'm saying." He went on to highlight that his work with DOGE is affecting not only his personal finances but also those of all Tesla shareholders. "What [the protesters are] trying to do is put massive pressure on me, and Tesla, I guess, to—you know, I don’t know—stop doing this. My Tesla stock and the stock of everyone who holds Tesla has gone roughly in half. I mean, it’s a big deal."
Despite these concerns, Musk remains optimistic. "Long term I think Tesla stock's going to do fine, so maybe it's a buying opportunity," he suggested.
Public Backlash and Protests
Public response to Musk’s involvement in DOGE has been overwhelmingly negative, with many criticizing his role in cutting government programs and eliminating jobs. Over the weekend, large protests erupted outside Tesla dealerships across the United States and parts of Europe. Demonstrators in cities such as New York, Boston, Austin, and Berlin held signs reading "Honk if you hate Elon" and "Fight the billionaire broligarchy."
Some protesters are former Tesla owners who have decided to part ways with the brand due to Musk’s political affiliations. Social media has been flooded with posts from individuals expressing their disappointment, stating that they can no longer support a company led by someone actively involved in reshaping the federal government in ways they disagree with.
The protests have also extended online, with hashtags such as #BoycottTesla trending on social media platforms. Some Tesla owners have documented their vehicle trade-ins, explaining that they no longer feel comfortable supporting a company led by someone so closely tied to the Trump administration’s policies.
Tesla’s Struggling Sales
Beyond the protests, Tesla’s sales have also suffered. The European market, once a major driver of Tesla’s growth, saw new vehicle sales drop by 45% in January. Additionally, U.S. data suggests a record number of Tesla owners are trading in their cars—many of them opting not to purchase another Tesla. According to Edmunds, a leading car shopping platform, Tesla trade-ins reached an all-time high in March, with most customers choosing different brands for their next vehicle.
Tesla is set to report its first-quarter delivery numbers on April 2. Analysts expect the company’s vehicle deliveries to have dropped by about 7% compared to the previous year. Dan Ives, a Wedbush Securities analyst, highlighted in a recent note that the growing anti-Musk sentiment is likely contributing to Tesla’s weak performance. "The anti-Musk and brand issues are clearly at play and a major factor in this weak 1Q delivery number," Ives wrote. "Musk needs to better balance being CEO of Tesla and running DOGE with investors and employees yearning for Musk’s leadership at this juncture."
Musk’s Response and Long-Term Outlook
Despite the backlash, Musk remains optimistic about Tesla’s future. During the Wisconsin town hall, he downplayed concerns about the stock’s performance, suggesting that the dip could present a buying opportunity for investors. "Long term, I think Tesla stock’s going to do fine," he said.
Musk also addressed the protests, saying, "What [the protesters] are trying to do is put massive pressure on me and Tesla to, I don’t know, stop doing this. My Tesla stock and the stock of everyone who holds Tesla has gone roughly in half. I mean, it’s a big deal."
Tesla’s leadership team has not yet issued an official statement regarding the protests, but internal sources suggest that executives are concerned about the long-term brand impact of Musk’s political entanglements. Some investors are even speculating whether Musk may eventually be forced to choose between his advisory role in DOGE and his position at Tesla.
As Tesla navigates the ongoing controversy, the company faces increasing pressure to reassure investors and customers alike. With the first-quarter delivery report just around the corner, many will be watching closely to see how Musk balances his role at Tesla with his political aspirations. Whether he can successfully steer the electric vehicle company through these turbulent times remains to be seen.
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