Elon Musk’s tenure as leader of the US Department of Government Efficiency (Doge) had not been going wonderfully well for Tesla’s department of shareholder satisfaction.
The stock has been steadily subsiding from wild highs in recent times, with February’s 28 per cent fall marking its worst month since December 2022, when it plummeted a whopping 37 per cent. That this performance coincided with Musk’s first full month as US president Donald Trump’s sidekick-in-chief has not gone unnoticed.
To date, it hasn’t exactly been a great March for the company either. This is despite Musk’s assertion that a “1,000 per cent gain for Tesla in five years is possible” with “outstanding execution”. Sure. But recently the most outstanding numbers concern his loss of personal wealth, some 60 per cent of which is tied to his Tesla shares and options.
According to the Bloomberg Billionaires Index, Musk – still the richest person in the world – saw his wealth peak at $486.4 billion (€448.2 billion) last December. As of March 6th, he is worth $330 billion. That’s a staggering $156.4 billion decline, and one that indicates investors have woken up to both the economic self-sabotage of Trump’s approach to international affairs and Musk’s own unignorable toxicity – both of which also have the capacity to hurt other Musk businesses, such as satellite giant Starlink.
Tesla sales are now falling off a cliff across Europe, with new German figures showing a 76 per cent decline in February. In Australia, too, sales are down 72 per cent compared with the same month last year. None of this will matter if Tesla can somehow crack India, but the presence of Chinese electric vehicle manufacturers there makes this an uphill task.
[ Driving my Tesla in Ireland sometimes feels like wearing a red Maga hatOpens in new window ]
The softness in the company’s earnings report for the fourth quarter of 2024 – attributed to reduced average selling prices – could be a harbinger of a more pronounced trend, while Tesla’s supply chain costs are also exposed to Trump’s on-off tariffs on imports from Canada and Mexico.
But the real Kryptonite here is Musk’s personal brand, now firmly aligned to the White House. This oligarch-like establishment figurehead with a penchant for gestures that resemble Hitler salutes is at odds with the rich-but-cool vibes that some Tesla buyers thought they were channelling. In the US, activists are busy listing dozens of “Tesla Takedown” demonstrations, while in the UK, one advertisement from a campaign group called Everyone Hates Elon renamed Tesla as “Swasticar” and used the tagline “goes from 0 to 1939 in three seconds”.
It may take a little longer for Tesla to reach full crisis mode, but the direction is clear.
