Tesla pays the price for Elon Musk’s politics
People do strange things when passions are running high. Take the brave protester in Bristol, who last month felt he had to take a stand against the Bond villain/visionary entrepreneur (delete as appropriate) Elon Musk. Armed with an anti-Musk poster and a large metal pole, he set about smashing up a parked Tesla in an orgy of righteous anger.
Unfortunately, the car turned out to be a Volvo so the man’s subsequent arrest was in vain. Nevertheless, he’s far from alone in seeking to express his dislike of Tesla’s founder.
Sales of the pioneering electric vehicle have suffered their worst slump in 14 years and Tesla shares have lost more than a third of their value over the past year. Analysts point to a surge in competition in the electric vehicle market, thanks largely to China’s BYD and the erosion of Tesla’s hard-won head start in the sector.
But something else is going on here, too, and it seems Musk is waking up to it. His enthusiastic support for President Trump and his cost-slashing efforts heading up the Department for Government Efficiency have made him a hate figure for much of the US left, with anti-Tesla protests now a common sight. In Europe, where sales have nosedived, Musk’s vocal support for the far-right AfD party in Germany’s recent election has been blamed for toxifying the brand.
As AJ Bell’s Danni Hewson noted yesterday, “it used to be said that all publicity was good publicity but when a product becomes so entangled with such a hugely political figure with a global reach, that old adage goes out the window.” Tesla’s board is under pressure from some investors to remove Musk as CEO, and it seems that he’s coming to the conclusion that he’s probably riding too many horses. In a recent interview he admitted that running his businesses while also reshaping the federal government was difficult, adding “frankly, I can’t believe I’m here doing this.”
Last night, Politico reported that Trump has told his inner circle that Musk will be stepping back from his role in the coming weeks, with both men apparently now of the view that “the time is right for Musk to return to his businesses.” There is no doubt in my mind that he remains one of the most consequential and brilliant entrepreneurs of our time, but in playing at politics he’s definitely been playing with fire.