Tesla Faces Sales Crisis Amid Musk's Political Controversies

Tesla's sales have dropped to their lowest levels in three years due to a combination of intensified competition and backlash against CEO Elon Musk's political actions, sparking protests and affecting the company's reputation.

Tesla's electric vehicle sales have taken a significant hit, marking the lowest quarterly figures in three years amid mounting backlash against CEO Elon Musk’s political activities. In the first quarter of this year, Tesla delivered approximately 337,000 electric vehicles, reflecting a steep 13% decline as compared to the previous year.

This unexpected drop has led to a sharp decline in Tesla’s stock value. Analysts suggest that while there is growing competition from companies like the Chinese automaker BYD, Musk's controversial political involvement, particularly during the Trump administration, has also adversely affected public perception of the brand.

The company's management attributes this downturn in sales to the ongoing transition towards a new model of its best-selling car. Nonetheless, organized protests, dubbed "Tesla Takedown" events, have emerged globally, with demonstrations at various Tesla dealerships in both the US and Europe. There have been reports of vandalism targeting Tesla vehicles, further contributing to the negative media surrounding Musk.

Musk’s financial backing for Republican candidates, including a substantial contribution during Trump’s electoral campaign, has led to public protests against his political stances. Recently, he expended millions supporting a Republican candidate in Wisconsin, who subsequently lost in a landslide.

Adding to the concern, Musk publicly admitted the challenges he faces in managing his businesses, stating, “I can’t believe I’m here doing this,” reflecting on the struggles during turbulent times. According to Wedbush analyst Dan Ives, Tesla's performance was a “disaster on every metric,” emphasizing that Musk’s increasing political engagement has had a detrimental effect on Tesla’s brand. As a result, shares have plummeted more than a third over the last year, raising alarms about the company's future.