Key Takeaways:
- Tesla has lost $800 billion in market value since December.
- Elon Musk’s alliance with Donald Trump has angered many customers and investors.
- Protests and vandalism against Tesla have surged.
- Analysts warn that politicizing the brand could hurt sales long-term.
- Tesla’s sales are dropping in key markets like Europe, California, and China.
How It All Began
Tesla was once a symbol of environmental progress and liberal values. Its electric cars were seen as a smarter, cleaner alternative to gas-powered vehicles. However, things took a dramatic turn when Elon Musk, Tesla’s CEO, started openly supporting Donald Trump. This alliance has caused a lot of controversy, especially among Tesla’s traditional customer base.
Donald Trump recently hosted an event at the White House to promote Tesla. He even posed with Musk and a line of Teslas on the South Lawn. During the event, Trump said he would buy a Tesla Model S for White House staff and hinted at labeling anti-Tesla violence as domestic terrorism. Photographers caught Trump holding a Tesla sales script, which many saw as a bold and unethical move for a president.
Backlash and Controversy
Tesla’s market value has plummeted by $800 billion since December. This drop is largely due to the backlash against Musk’s political stance. Customers, potential buyers, and even stock investors have turned away from the brand.
Protests called “Tesla Takedown” have popped up outside Tesla dealerships. Some current Tesla owners have reported vandalism and harassment. The situation has become so tense that Trump threatened to classify attacks on Tesla as domestic terrorism.
Analysts are shocked by how quickly Tesla’s brand value has fallen. “We struggle to think of anything similar in automotive history,” said Ryan Brinkman, an analyst at J.P. Morgan.
What Analysts Are Saying
Wedbush analyst Dan Ives, who has long supported Tesla’s stock, warns that turning the brand into a political symbol is a “dangerous path.” He believes associating Tesla with Trump and his policies could hurt the company’s image for a long time.
A 2022 study by Scarborough Research found that Tesla owners were mostly Democrats. Now, the brand is seen as politically toxic to many in that group. The big question is whether Trump’s endorsement will draw enough Republican buyers to offset the losses.
“Car buying means something different to everyone,” said van Drury of Edmunds. “If the price is right, some people might set their personal feelings aside.” However, the damage to Tesla’s reputation could be hard to fix.
The Road Ahead
Tesla’s sales are struggling not just in the U.S. but also in Europe, California, and China—three of its most important markets. Analysts are worried that Musk is focusing too much on politics and not enough on running Tesla.
Ives told Fortune, “As someone who’s covered Tesla for many years, it’s time for Musk to show he’s still committed to Tesla.” He added that Musk needs to spend more time at Tesla’s factories and less time at the White House or Mar-a-Lago.
Ives still believes Tesla’s stock could rebound to $550 within a year—more than double its current value. But he made it clear that this depends on Musk refocusing on the company’s needs rather than political ventures.
Conclusion
Tesla’s alliance with Donald Trump has sparked widespread controversy. The brand, once a symbol of progress, is now seen as politically charged. While some analysts still see potential for recovery, others worry that the damage is done. Only time will tell if Tesla can regain its footing in the automotive world.