Politics and business don’t usually mix. If they do, the outcome is pretty much predictable: disaster, according to Chinese philosophy. Tesla is now facing protests around the world since President Trump’s second inauguration swept Tesla’s chief executive, Elon Musk, into the administration as a senior adviser to the president. Analysts have pointed to Musk’s government role as the reason behind Tesla’s declining sales and weak stock performance because Musk's deep involvement in the administration’s waste-elimination efforts as the head of the Department of Government Efficiency (DOGE). Musk’s forays into the European political scene have also been credited with alienating some of the company's core customers as well as sparking protests around the world.
In Europe, Tesla has suffered severe sales drops in traditionally strong regions as Musk has angered left-leaning and centrist political factions in Europe with his embrace of far-right figures.
Ahead of February elections in Germany, the Tesla CEO presented himself as a vocal supporter of the far-right Alternative for Germany (AfD) party. He told an AfD audience just before the 80th anniversary of the liberation of the Auschwitz concentration camp that Germans should not feel guilt for the sins of their great-grandparents.
European politicians have pushed back against Musk's recent comments, which include the amplification of far-right commentators on Musk’s social media platform X (formerly Twitter). Some accounts have since quit the platform, citing the spread of misinformation. Musk has dismissed criticism against him as an affront to democracy and free speech.
Moreover, Tesla’s sales dropped nearly 60% in January in Germany compared to the same period last year as well as a 63% decline in January sales for Tesla in France, 44% drop in Sweden, 38% in Norway and 42% in the Netherlands. Tesla's UK sales fell nearly 12% in January, even as monthly EV registrations in Europe's biggest battery-electric market surged to a record, according to data recently published by New AutoMotive.
According to USA Today, in the US, where sales declined 5% last year, new data from Wards Intelligence shows that Tesla sales declined more than 13% in January 2025 compared with the same month a year earlier.
More recent data showed that Tesla sales in Australia fell by nearly 72% in February. The dealer company sold only 1,592 vehicles last month compared to the 5,665 sold in the previous year.
Furthermore, in France, a dozen Tesla cars were set on fire near the southern city of Toulouse. The blaze was “not at all accidental,” the prosecutor’s office said. Also in Berlin, several fires broke out at a construction site for the expansion of a Tesla factory. The police in Germany said that they were investigating it as arson.
Pras Subramanian, Yahoo Finance auto reporter, said, "We've seen a lot of negative headlines for Tesla—it seems to be happening in basically all their major regions right now. The headline numbers do not look good, and it's not just in China, the US and Europe, but it's everywhere."
Meanwhile, police across the United States are investigating a series of attacks on Tesla showrooms, charging stations and Tesla vehicles, as vitriol escalates against CEO Elon Musk.
Tesla charging stations were set ablaze near Boston while shots were fired at a Tesla dealership in Oregon one night. Arrests were also made at a nonviolent protest at a Tesla dealership in Lower Manhattan. During the demonstration at the gleaming Tesla showroom in the West Village, protesters joined in chants of “Nobody voted for Elon Musk,” and “Oligarchs out. Democracy in.” One held a sign saying, “Send Musk to Mars Now!!” as Mr Musk also owns SpaceX.
Tesla ownership has also been facing a backlash, with some vehicle owners now selling their cars and trucks to distance themselves from Mr Musk and his political activities.
“I’m sort of embarrassed to be seen in that car now,” one owner told The New York Times before trading in their car. Musk's influence on the brand is becoming increasingly polarising, pushing many buyers to look elsewhere. In California, the largest US car market with more than 1.7 million vehicle registrations in 2024, Tesla sales have fallen by 12%.
Successive reports of sluggish sales have significantly impacted the company's stock price, which has fallen by 28% over the past month. This decline is nearing the point of offsetting its post-election rally, which propelled Tesla to all-time highs in mid-December and is largely responsible for the company's 18% increase over the past six months.
For seven straight weeks, after Elon Musk went to Washington to join the Trump administration, shares in his automaker declined, closing at USD 270.48, which was the longest losing streak for Tesla in its 15 years as a public company.
Tesla shares finished the past week down more than 10% and at their lowest level since November 5th, US Election Day, when they closed at USD 251.44. Since the stock peaked at almost USD 480 on December 17th, Tesla has lost well over USD 800 billion in market cap.
In January, research by Brand Finance, a major brand valuation and strategy consultancy, found that Tesla’s brand value had fallen by 26% in a year, from USD 58.3 billion in early 2024 to USD 43 billion.
“We’re seeing a lot more reports showing brand deterioration, showing the power of consumers,” an analyst said.
Hence, it appears to be true, as Chinese philosophy has said, politics and business don’t mix.
