Elon Musk's Controversial Role Drags Down Tesla's Brand Amidst Declining Sales
Tesla CEO Elon Musk's involvement in the Trump administration has had adverse effects on both his personal and Tesla's brand reputation. Protests dubbed "Tesla Takedown" and "Tesla Takeover" have taken place across the US and internationally, highlighting concerns such as Musk's alleged support for fascism and government employee layoffs.
Recent surveys indicate significant public disapproval of Musk's actions. A Quinnipiac University poll reveals a 53% to 39% opposition to Musk's role in the administration, particularly among female voters. EV drivers also express mixed feelings, with a 35% positive and 42% negative rating of Musk, according to a poll by American EV Jobs Alliance.
Musk's shifting image from "EV Jesus" to "MAGA god" has damaged Tesla's brand perception, says Mike Murphy, CEO of the Alliance. In a survey of EV buyers, Tesla had the lowest favorable rating (63%) and highest unfavorable (37%) among competitors Ford, Toyota, and VW.
Tesla's dwindling popularity coincides with the potential loss of federal EV tax credits under the Trump administration, potentially leveling the playing field with foreign automakers and impacting the entire EV industry.
Tesla employees have also expressed concerns about Musk's impact on the company's image, with senior managers reportedly indicating his resignation would benefit Tesla.
Musk's foray into politics has coincided with a sharp decline in Tesla sales in key regions, including Germany (-60%), France (-63%), Norway (-38%), and the UK (-12%). Oppenheimer analyst Colin Rusch warns of Musk's political activities as an "overhang on TSLA sell-through," citing concerns in California, the EU, and other markets.
Tesla's brand image and sales prospects have been negatively affected by Musk's controversial role in the Trump administration. As the EV industry faces challenges, the company's future depends on addressing these reputational concerns.