Elon Musk has become a lightning rod for Tesla over his role in the Trump administration. (Photo: Vauxford/NYI Collage)
Elon Musk has said on numerous occasions he got involved with Tesla because he thought he could advance the widespread adoption of electric cars by at least a decade.
Musk has been more than providing executive guidance to the company; he has been a brand steward, ambassador and its most visible face.
But today, he is the biggest threat to the car company’s existence, and could set the advent of electric cars back a decade… if not more.
He has betrayed Tesla’s base and his own proselytizing, seriously damaging the car’s branding and threatening the company itself.
For the good of Tesla, it’s workers and car owners, he needs to resign as CEO and cut all ties to the company. Any board would promptly fire a CEO who caused this much damage to a brand.
“It’s lost its status as a progressive ‘badge’ product,” crisis management expert Eric Dezenhall, founder of Dezenhall Resources, told Yahoo Finance.
Tesla’s share price peaked at $479.86 on Dec. 17, but has shed almost 40 percent of its value since then. The downward trend picked up speed after the inauguration.
Elon Musk makes a controversial salute many have likened to the Nazi heil in World War II.
His net worth has fallen by more than $80 billion so far this year and by more than $100 billion since mid-December, according to Bloomberg’s Billionaires Index.
Stock prices can move up and down with fluidity, caused by a number of factors, but brand damage, and worse, falling sales and market share are difficult to recover.
And that’s where Musk has done the most damage.
Tesla’s European sales dropped 49 percent year-on-year in January and February, despite rising registrations of electric vehicles (EVs).
In the United States, Tesla registrations in the US fell 11% year-over-year, according to S&P Global Mobility data. It’s market share is still formidable at 42% of total EV sales, but the brand is suffering nearly irreparable damage.
Car and dealership vandalism has spiked and major, non-violent protests are planned or are ongoing, and Musk is the reason.
Activists across the world have staged so-called Tesla Takedown demonstrations over his role in slashing the federal workforce, canceling contracts that fund global humanitarian programs and embracing right-wing politicians in Europe.
Musk’s controversial salute during Trump’s inauguration celebration in January added fuel to the fire. He turned around and repeated the gesture a second time before saying: “My heart goes out to you.” But many likened it to a Nazi heil; it sent shock waves around the world.
Make no mistake, Tesla became a disruptive innovation and a political target at its outset. But, heretofore, those attacks came from the right.
Trump, for years, disparaged electic cars. He once suggested that promoting electric vehicles “was the idea of the Radical Left Fascists, Marxists, & Communists” and that “within 3 years, all of these cars will be made in China.
“They don’t go far. They cost a fortune,” he said at another event in late 2023. “You go all electric so you can drive for 15 minutes before you have to get a charge.”
Not surprisingly, politically motivated violence was a byproduct.
Early owners were shocked to discover that protesters were vandalizing cars and Tesla charging stations. Protesters also parked huge 4X4 diesel pickup trucks and other gas vehicles horizontally, blocking charging spaces and yelling profanities. EV owners called such attacks “Icing” for internal combustion engine (ICE) cars.
Those protests targeted electric cars generally and were treated as acts of vandalism. But the latest protest has shifted — to Musk.
The billionaire’s brand damage began when he closely allied himself with Trump, and dumped $250 million into his 2024 election campaign.
Since Trump’s election, Musk has become a defacto-president, reeking havoc in a scorched-earth ideological and ethnic cleansing of mostly federal government social programs in the name of “waste, fraud and abuse.”
Tesla cars — not all electrics — are being exclusively targeted solely because they are closely associated with him.
Meanwhile, his original vision and message has been lost.
The thread that ties Musk to Tesla, SpaceX and other projects is a haunting personal fear of economic and social collapse.
“Eventually, there is a certainty of a catastrophic outcome. If we don’t take corrective action the probability of a collapse will increase over time,” he told journalist Walter Isaacson at Vanity Fair’s New Establishment Summit in 2015.
“The longer it takes to make that transition the greater the probability of something like that happening.
“What’s the fundamental good that Tesla can achieve? It would be to accelerate the advent of electric cars by at least a decade,” he said, reflecting his fears about climate change.
The company launched car production at the Fremont, Calif., Tesla Factory in Oct. 2015, nearly a decade after its founding. Musk joined the board in 2004 and became CEO in 2008. Today, he is the largest shareholder, with about 12% of the stock.
Musk’s world view fit neatly with the views of climate activists, who are generally left leaning, while electric cars promised to end the dependence on fossil fuels for transportation.
The transportation sector contributes 16.2% of all greenhouse gas emissions globally and 11.9% of that is from on-road vehicles, according to U.S. Department of Transportation.
Tesla sales soared, especially after the government announced tax incentives to buy EVs. During the third quarter of 2015 it produced a record 13,091 vehicles, and also revised its target sales for 2015 to between 50,000 and 52,000 vehicles, including both models then available for sale.
The Model S won several automotive awards during 2012 and 2013, including the 2013 “Motor Trend Car of the Year,” and became the first electric car in 2013 to top monthly national sales rankings in Norway.
Tesla sales marched steadily upward, peaking at about 1.8 million cars in 2023, but reported its first-ever annual drop in sales last year. While it was only a 1% decline from the 2023 total, it was a stunning change from the previous five years, when annual sales gained between 37% and 87% percent, according to industry reports.
In the face of worldwide opposition to Musk and the brand, Trump, earlier in March, participated in an extraordinary publicity stunt in front of the White House. He turned the South Lawn of the White House into a temporary Tesla showroom in a “conspicuous favor” to Musk.
Trump and Musk inspected five Tesla models in front of reporters and cameras and Trump, in a startling turnaround, heartily endorsed them.
Activists are planning a global protest of Tesla to target Elon Musk’s government role. (Photo: Action Network)
Afterward, he said he planned to buy one. He picked a cherry red Model S. Plaid, a top of the line car that sells for up to $90,000, well-beyond the means of his hard rock, non-college-educated base.
MAGA social media went into overdrive touting Musk and Tesla, but the pr stunt raised immediate ethics issues. Senior government official, including a sitting president, are barred from explicitly endorse consumer products.
The event did little to quell the wave of negative sentiment aimed at the brand and generated further backlash when Trump Attorney General Pam Bondi vowed to prosecute Tesla vandals as “terrorists.”
A number of activist groups on Mar. 29 planned a global protest against Tesla, but aimed at Musk.
“Elon Musk is destroying our democracy, and he’s using the fortune he built at Tesla to do it. We are taking action at Tesla to stop Musk’s illegal coup,” the Activist Network announced.
How the company fares in the coming months remains to be seen. Whatever support for the brand Trump engendered among right-wing supporters is unlikely to reverse the slide in sales.
What’s more, Tesla is facing an increasingly competitive market from the Chinese in Europe and Asia and domestic and imported brands in the United States.
Without a major innovation, steep price cuts or restoring the brand with Musk’s removal, regaining ground will grow more difficult each passing day.
One thing is certain, the Tesla brand has been unfairly tarred by its association with Musk and may never recover as long as the controversial billionaire is identified with the company.