Donald Trump turning the White House into a Tesla showroom aside, things are looking pretty grim for the electric car company right now.
The Tesla backlash is here
Tesla’s electric slide, briefly explained.
Devan Schwartz is a producer with Today, Explained. He’s an alum of NPR and Hollywood — and lives in Santa Barbara, California, halfway between the ocean and the mountains.
The stock has dropped tremendously.
There have been reports of Tesla chargers being burned, people vandalizing cars, people flipping Tesla drivers off, breaking glass at Tesla showrooms.
There have also been very spirited peaceful demonstrations all across the US in front of Tesla dealerships, with protesters voicing their dislike of Elon Musk, Donald Trump, and his policies, and the government cuts being enacted by Musk’s DOGE group.
And people are selling their Teslas back, often for significant losses.
The vibes are bad in Europe, too — largely thanks to Musk boosting Germany’s far-right party and making what looked like a Nazi salute. There are widespread protests and a movement for people to buy other types of electric cars.
Public opinion is starting to crystalize against Tesla because Musk is the face of the company, and many people aren’t happy with what he’s doing politically. The problem for Tesla (and Musk) is when public opinion has catalyzed against something, it can be very hard to reverse course.
And so then the question becomes: Does Elon Musk care about that?
Faiz Siddiqui, a Washington Post reporter who has written a book on Musk, told me that Tesla’s stock is Musk’s engine. When Musk acquires Twitter or wants to gobble up an AI company, he’s not paying cash. He’s using Tesla stock, based on the understanding that that’s an incredibly profitable, growing asset.
And Musk is going to continue to need a lot of money. Faiz mentioned that the next big thing for Musk seems to be pivoting Tesla to be a robotics and AI company. Those are expensive goals, and if Tesla stock drops too much, that could limit future ambitions. Maybe Musk cares about that.
However, maybe he sees that as a price worth paying for being the second most powerful man in the world — and some might argue, given his influence on Trump, that he is the most powerful man in the world.
Sure, things are rocky for Tesla at the moment, but Musk now has an unprecedented level of access to the American government and power. And he has a giant portfolio — SpaceX, Tesla, Neuralink, Starlink, xAI — that is very affected by government contracts and regulations.
So maybe it doesn’t matter if Tesla incurs great losses if Musk is able to use his position to convince the Federal Aviation Administration to move a $2.4 billion government contract from Verizon to Starlink, which is something the FAA is reportedly at least considering. Perhaps DOGE (the “Department of Government Efficiency”) can make his life easier on the regulation front or allow him to learn valuable information about competitors.
It’s hard to say what Musk’s endgame is, and how secure his position is; there have been some reports of him clashing with other administration officials.
But one thing the recent Tesla drama has shown is that things seem inevitable until they don’t. Tesla seemed to be on this inevitable glide path to remain one of the most profitable carmakers in the world. Now, maybe not. And the same is true with Elon Musk and his political power: Things can rise and fall faster than you might think.
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