Tesla’s sales are plummeting worldwide, and while CEO Elon Musk’s electric vehicle giant blames market conditions, experts warn that his increasingly divisive politics may be driving customers away.
In January, Tesla’s sales in Europe plunged 45%, according to research firm Jato Dynamics, despite a rise in overall electric vehicle sales. Germany and France saw even steeper declines of around 60%. Meanwhile, sales in California—Tesla’s largest U.S. market—are also slipping, and the company posted its first-ever annual global sales drop last year.
While Tesla’s financial filings list a wide range of risks to its business, from lawsuits to battery fires, there is little mention of the political firestorm Musk has ignited by aligning himself with the right. Marketing experts say that omission ignores a crucial reality: many of Tesla’s earliest buyers were progressive, environmentally conscious professionals—many of whom are now abandoning the brand.
“It’s marketing 101: Don’t involve yourself in politics,” said New York brand consultant Robert Passikoff. “People will stop buying your products.”
John Parnell, a Model 3 owner from California, is one of them. “I don’t even want to drive it,” he said, adding that he canceled his Cybertruck order, forfeiting his $100 deposit. “He’s destroying the brand with his politics.”
Musk’s recent political stances have included a $270 million donation to Donald Trump’s presidential campaign and a high-profile role in Trump’s government efficiency team. His inflammatory rhetoric and political activism have sparked backlash from once-loyal customers.
“Musk thinks he can say anything he wants to and doesn’t think Tesla will suffer any consequences,“ said Morningstar analyst Seth Goldstein. “Tesla was in the sweet spot. Now it has competition.”
While some auto analysts argue that Tesla’s troubles stem from growing competition and product updates that have led some buyers to hold off, others are now reconsidering earlier dismissals of a Musk-induced boycott.
“Part of the population is not happy with his views, his political activism,” said Jato senior analyst Felipe Munoz, who had previously downplayed the impact of Musk’s politics but is now having second thoughts.
With Tesla’s stock in freefall and its market dominance fading, the question now is whether Musk’s political crusade will take his company down with it.
