Musk faces pressure to quit Tesla as sales plummet: ‘He’s at total odds with the brand’
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Tesla faces a mounting crisis as Elon Musk's political activities alienate customers and sales plummet, with early investors calling for new leadership as competition from Chinese manufacturers intensifies.
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In brief:
- Tesla's value and sales are plummeting, with its market value down over 50% since December and sales in Germany decreased 76% compared to last year, leading to calls from an early investor for Elon Musk to either focus solely on Tesla, or step down as CEO.
- Musk's political activities, including taking a government role as Head of Department of Government Efficiency (DOGE), have created a disconnect with Tesla's traditionally Democratic customer base.
- Tesla faces additional challenges from increased competition, particularly from Chinese manufacturers like BYD, which recently announced an ultra-fast charging system that provides 250 miles of range in just five minutes.
What’s the story?
You’ve probably already seen it - or maybe even forwarded it to a Tesla-owning friend - the viral meme that shows a bumper sticker on the electric vehicle which reads ‘I bought this before Elon went crazy’.
What seems like an internet gag is representative of the mounting pressure Elon Musk is facing over the future of his electric car company.
Protests have been taking place outside of Tesla dealerships in the US and some people are finding their Tesla cars vandalised.
Since joining Donald Trump on the presidential campaign trail last year, then taking a job in the Trump administration after his win, Musk has been dividing his attention between his new role as Head of Department of Government Efficiency (DOGE) and leading his many businesses.
Now, one of Tesla’s early investors has said that something has to give, calling for the “divisive” CEO to either pack in his government role or find someone else to lead the car company.
Ross Gerber told Sky's Business Live; "I think Tesla needs a new CEO and I decided today I was going to start saying it.
"It's time for somebody to run Tesla. The business has been neglected for too long. There are too many important things Tesla is doing, so either Elon should come back to Tesla and be the CEO of Tesla and give up his other jobs, or he should focus on the government and keep doing what he is doing but find a suitable CEO of Tesla."
Tesla's market value has plunged by more than $800bn since December - more than 50 percent of its value.
In Europe, sales have plummeted, with Germany - the continent's largest market for EV’s – seeing Tesla sales down 76% compared to last year.
The plummeting sales are a “crisis,” Gerber says.
"The company's reputation has just been destroyed by Elon Musk.”
Presumably in response to the flailing numbers, Musk went on a unique advertising campaign last week when he staged a promotion for Teslas on the White House Lawn, with President Trump (who can’t drive) saying he will buy one.
What else is to blame for Tesla’s plummeting sales?
While Musk’s own political affiliations play a role in Tesla’s recent troubles, other factors have also contributed.
As traditional manufacturers put a greater focus on electric vehicles, the market has become more competitive since Tesla released its first electric car in 2008.
Most notable is Chinese electric vehicle maker BYD - the world’s second largest producer of battery powered cars in 2024, only marginally behind Tesla.
The company recently announced a new ultra-fast charging system that it claims will provide a 250 mile range in just five minutes of charging time - as quick as filling up a tank of petrol and significantly faster than Tesla’s charging system.
“Funny enough, that's going to be the end of Tesla. It's probably nothing to do with what Musk does,” Emily Maitlis says.
As BYD and other Chinese EV manufacturers continue with expansion plans into Europe, Tesla will face stiff competition - something Jon Sopel has already seen happening. “I got in an Uber last night, and the guy had a Chinese EV, which he'd just taken delivery of. It charges super fast. He absolutely loves it. And he says, ‘I'm trying to get rid of my Tesla, but in effect, it's a write off, because no one is prepared to buy a Tesla right now’.
“Incredible.”
“I love the idea that on the brand stakes, Chinese cars associated with the Chinese Communist Party are better for your street cred than a Tesla,” Lewis Goodall points out.
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What’s The News Agents’ take?
“Tesla has now become the embodiment of Musk,” Emily Maitlis says.
“Somehow, if you are a Tesla owner, then people will assume that you are a buyer or a backer of the man who's currently trying to rip the heart out of the US government.
“I mean, notwithstanding the fact that many people have had Teslas for over a decade.”
This was the reality for one The News Agents listener, Laura, who emailed in to say that her husband - a Tesla driver - was recently verbally abused whilst driving the car.
She explained; “As we often see, what happens in the US comes to the UK.”
“He was driving to work today, and he was stuck in traffic, and a passer by shouted at him and called him a ‘Nazi twat’.”
Laura’s husband, she tells The News Agents, is not a fan of Musk’s, but simply wanted an EV and liked the Tesla the best.
“This is not the first time that an emblem has come to embody the culture war,” Emily points out.
But the irony with the attacks on Tesla drivers, who are assumed to support Musk’s politics, is that traditionally the people who buy Tesla’s are Democrat voters.
“They're not Republicans,” Jon points out.
“I don't think the brand is Musk - the brand is woke, the brand is liberal. The people that are buying EVs in America certainly are Democrat voters.”
“Elon Musk is at total odds with the brand. He's not the embodiment of the brand. He's the anti-brand.”
Whilst this may be the case, most will now look at the Tesla brand and associate it with Musk - and that is his problem, in terms of the company’s plummeting sales.
“That is why Tesla is doing so bloody badly at the moment,” Jon goes on. “There is this disjunction between Musk being the head of Tesla, and people think, I don't want anything to do with Musk, and therefore sales are plummeting.”
Musk, Lewis Goodall says, “has brought this upon himself”.
“He must have known, or at least had some conception, that there was a potential conflict of interest, not just in the traditional sense, but in the way that it could be disadvantageous for him and for his bottom line between his brands, his companies, and the political pursuit and the political interest that he's chosen to cultivate.”
Listen to the latest episode of The News Agents.
