Elon Musk says he´ll dedicate more time to Tesla and his role as ‘First Buddy’ will ‘drop significantly’ starting in May after the company reported a breathtaking downfall in first quarter profits.
The automaker’s first-quarter profits cratered 71 percent, with the EV giant pulling in $409 million compared to $1.4 billion during the same stretch last year.
Wall Street expected better — and investors are clearly growing uneasy with the once-dominant EV brand.
The company’s stock price has shed nearly 40 percent of its value since January (though, it has regained some momentum after the earnings release) when Musk started serving as head of the Department of Government Efficiency (DOGE) and being spotted everywhere with Donald Trump.
Tesla’s first quarter earnings conference call allowed investors to ask what they wanted of the CEO and it was clear there was only one thing on their minds.
One asked: ‘Can Elon please provide some reassurance that at some point soon he will be done with DOGE and politics? Many Tesla shareholders wish he would reprioritize the majority of his time and effort to engineering.’
‘Starting probably in next month, in May, my time allocation to DOGE will drop significantly,’ Musk said on the call.
However, he still plans to put in one to two days per week still helping out with DOGE, he claimed.
Elon Musk (pictured left) says he´ll dedicate more time to Tesla and his role as ‘First Buddy’ will ‘drop significantly’ starting in May after the company reported a breathtaking downfall in first quarter profits
Musk has aligned himself with President Trump – a move that has angered fans who previously leaned more centrist and to the left
But ‘starting next month, I’ll be allocating far more of my time to Tesla.’
Musk admitted that his forays into politics have likely damaged his company for the time being, though he added that the global economy was also to blame.
‘This dynamic, along with changing political sentiment, could have a meaningful impact on demand for our products in the near-term,’ he said.
The vibe shift around Tesla, once a crown jewel for liberal Americans, is very real.
The company sold huge amounts of electrified vehicles to tech and environmentally-minded consumers.
Tesla is largely credited for the rise in popularity of EVs, which represent over nine percent of new vehicle sales in the US annually.
But the company’s CEO, Elon Musk, has since pitched rightward, spending millions on President Donald Trump’s campaign and backing hard-right candidates in Europe.
That political pivot has turned off many of the progressive and centrist buyers who once lined up for Teslas.
Elon Musk (pictured lower left) says he´ll dedicate more time to Tesla and his role as ‘First Buddy’ will ‘drop significantly’ starting in May after the company reported a breathtaking downfall in first quarter profits
Demonstrators rally against Tesla CEO Elon Musk during a ‘Tesla Takedown’ protest outside a Tesla Store in San Francisco, California
Angry consumers have responded with impassioned, sometimes fiery, protests at Tesla dealerships.
And, Tesla’s sales have tanked.
Tesla Takedown, an organization that advocates for free speech rights at the dealership protests, took victory for the revenue and sales downfalls.
‘Today’s earnings report sends a very clear message: the Tesla Takedown grassroots pressure is beginning to hit Tesla where it hurts,’ the organization said.
‘The company’s bottom line.’
Despite the hit, Tesla remains the top-selling EV brand in the US and the most valuable automaker in the world by market capitalization.
But investors are worried Musk is losing focus on what made Tesla a juggernaut: building innovative vehicles.
Tesla’s best-sellers — the Model Y and Model 3 — just received some style updates. The Cybertruck, which launched in late 2023, has quickly become the best-selling electric pickup in the US.
But the model lineup is getting old. Global competitors, including Chinese brands BYD, NIO, XPeng, and Zeekr, have massively upgraded their battery capacity and interior tech.
BYD just launched a car that it claims can charge the battery in a third of the time a Tesla takes.
Tesla Takedown, an organization that advocates for free speech rights at the dealership protests, took victory for the revenue and sales downfalls
Some American brands are closing the gap too.
Rivian’s newest EVs beat Tesla’s driving range by nearly 100 miles. Hyundai and Kia are offering lower starting prices than the Model Y.
Even legacy giant GM has leveled up its EV game with massive, well-powered EVs and value offerings like the $35,000 Chevy Equinox EV.
In its earnings report, Tesla blamed shifting trade policies from President Trump and a shaky global supply chain for its struggles.
‘Uncertainty in the automotive and energy markets continues to increase as rapidly evolving trade policy adversely impacts the global supply chain and cost structure of Tesla and our peers,’ the company reported in its earnings.
The stock increases are largely attributed to the company’s forward-looking plans.
Tesla has been developing robots and autonomous vehicle technology that it believes will soon hit the road.
The company also said affordable vehicles, which have been teased for several years ‘remain on track for start of production in the first half of 2025.’
Tesla warned that the value cars will feature ‘less cost reduction’ than previously expected because of supply constraints.
Musk promised a $25,000 electric vehicle in September 2020. He has since called the plans ‘pointless’ and ‘silly.’
