Tesla has suffered a significant sales decline, reporting the lowest sales figures in three years. The electric vehicle manufacturer delivered just under 337,000 vehicles in the first quarter of 2025, marking a 13% drop compared to the previous year. Following the release of these disappointing figures, Tesla shares took a hit in early trading on Wednesday.

While increasing competition from Chinese automaker BYD is contributing to the slump, Elon Musk's political controversies are also believed to be playing a role. Experts have noted that the backlash from Musk’s outspoken involvement in the Trump administration and his leadership in the Department of Government Efficiency (DOGE) has led to widespread protests and boycotts.

 

Musk’s Political Role and Tesla’s Struggles

Some analysts point directly to Musk’s controversial role in politics as a key factor in Tesla’s brand damage. Ross Gerber, a Tesla shareholder and CEO of Gerber Kawasaki Wealth and Investment Management, criticized the sales figures on X, calling them “disastrous” and suggesting that the brand could be beyond repair.

Musk’s political activity, including his large financial contributions to Donald Trump’s election campaign, has sparked protests and calls for boycotts at Tesla dealerships across the US and Europe. In one incident, Tesla vehicles were vandalized at a dealership in Berlin, and similar acts of protest have taken place throughout the country.

 

Political Protests and Brand Damage

Musk’s involvement with DOGE has generated a wave of negative publicity for Tesla. Protesters, calling for a Tesla Takedown, have vandalized the company’s dealerships, while Musk’s leadership in the Trump administration has drawn increasing ire. In response, Trump has vowed to charge those involved in defacing Tesla vehicles with domestic terrorism.

Despite these challenges, Musk's wealth remains intact, but his leadership of Tesla is being questioned. In a recent interview, Musk admitted the strain of managing his companies, saying, “I can’t believe I’m here doing this.”

 

Tesla’s Financial Outlook

Tesla’s financial outlook remains uncertain, with the company’s share price down by over one-third in the past year. Wedbush analyst Dan Ives also echoed concerns, noting, “These numbers were a disaster on every metric. The more political Musk gets with DOGE, the more the brand suffers. There is no debate.”

As Tesla grapples with both internal and external challenges, the company’s future may depend on whether Musk can distance himself from the political spotlight and refocus on driving innovation in the electric vehicle sector.

 

For any enquiries or information, contact info@thelawreporters.com or call us on +971 52 644 3004. Follow The Law Reporters on WhatsApp Channels