Elon Musk’s Strategic Shift: Focusing on Tesla Over Politics amid Declining Sales
Sales are falling, stocks are fluctuating, and its most emblematic figure, Elon Musk, has promised to reduce his involvement in the Trump administration to focus again on the company. However, the problems that the electric car manufacturer is facing go much further.
During the recent earnings call, Elon Musk announced that he will reduce his participation in politics to just one or two days a week at Tesla, where he has been linked to controversies. This move comes right after Tesla reported quarterly results well below expectations. The company saw a significant drop in stock prices and a 39% decrease in adjusted revenue. Even more concerning, net profits fell by 71% compared to the previous year. Trade tensions and tariffs, while not directly affecting Tesla like other manufacturers, do impact its supply chains.
Elon Musk did not directly blame trade uncertainty for the company’s issues but was critical of tariffs and stated his support for more open policies. However, investors are increasingly worried about his dual role, especially after his support of far-right parties in Europe. Musk justified his actions but assured that his work in politics is almost finished, leading to a 4% increase in Tesla’s stock after hours.
Musk tried to regain market confidence by promising advancements in autonomous driving technologies and humanoid robots, stating that Tesla will experience a period of “sustainable abundance for all.” He also mentioned plans for a “robotaxi” without a steering wheel or pedals by 2026. However, these projects still lack confirmed production, and competition, especially from China, is intensifying. While Tesla still leads in annual sales, it is at risk of losing that position in 2025. Notably, Cybertruck was not detailed in the earnings report.
