U.S. President-elect Donald Trump and Tesla’s CEO, Elon Musk, greeted each other warmly at a rally in Washington D.C., just a day before Trump was set to start his second term on January 19, 2025. This friendly interaction highlighted the unique dynamic between the two influential figures. Musk, having taken on a significant advisory position in the capital, has shareholders curious about his involvement in U.S. politics, especially his support for right-wing candidates and his role in Trump’s Department of Government Efficiency (DOGE).
Shortly after Trump’s second term kicked off, Tesla released its fourth-quarter earnings report. With Musk becoming increasingly visible on the political stage, investors are eager for answers. On Tesla’s investor question platform, a flood of inquiries focused on Musk’s priorities. One investor pointedly asked, “Is Musk balancing his duties at Tesla with his new political roles?” This sentiment stemmed from Musk’s recent contributions, totaling $270 million, to aid Trump’s campaign and other Republican efforts, and his frequent campaign appearances.
Adding to the intrigue, Musk’s heavy involvement in politics hasn’t gone unnoticed. During the fourth quarter, he was more often seen at Trump’s Mar-a-Lago resort than at Tesla’s factory, prompting top-voted questions about his time management. Tesla and Musk, however, were initially silent on these matters.
Further complicating the picture, Musk’s endorsement of Germany’s right-wing AfD party has drawn scrutiny. Brand Finance pointed out that Tesla’s brand value dropped by 26% last year, citing Musk’s controversial moves and a stagnant vehicle lineup as factors. Fewer people are now interested in purchasing a Tesla, according to their findings.
Adding fuel to the fire, Musk was criticized for using gestures perceived as provocative, which historians and some politicians interpreted as a Nazi salute. Such actions have led to neo-Nazi admiration and demands for an apology from shareholders, who feel it would be beneficial for both investors and the public. Musk countered these criticisms by labeling them a “hoax” and further engaged in inflammatory rhetoric online, which drew sharp rebuke from organizations like the Anti-Defamation League.
Questions about the impact of Musk’s political activities on Tesla’s sales have been persistent. While the earnings call presented an opportunity to address these issues, the company isn’t obliged to tackle them head-on. Even during the third-quarter call, there was a notable absence of dialogue on similar concerns, especially that of Trump’s political influence.
Ultimately, the interplay between Musk’s political engagements and his dedication to Tesla remains a focal point of investor concern, leaving many to ponder where Tesla’s trajectory might lead amidst its CEO’s controversial public endeavors.
