Tesla sales plummet amid political scandal surrounding Ilon Musk
By ForGeeks Tesla recorded the biggest drop in sales in three years -the company delivered just 337,000 electric cars in the first quarter of 2025. This is a 13% decrease from the same period last year. Against the background of the publication of these data, Tesla’s shares began to lose value rapidly, and analysts and investors are increasingly blaming not the market, but Ilon Musk himself.
Musk and politics: a toxic alliance?
Although Tesla officially attributes the sales slump to a shift to a new version of its most popular model, many experts point to the negative effect of Ilon Musk’s political activism. Since 2024, he has been in Donald Trump’s administration, leading the DOGE division, an initiative to reduce government spending and the number of government officials.
The appointment sparked mass discontent and boycotts of Tesla products. A wave of protests under the slogan Tesla Takedown swept across the US and Europe, the company’s car dealerships were subjected to vandalism, and the stock continued to fall. Last week, the media reported that Musk was allegedly going to leave his post in the administration, after which the quotes temporarily went to the plus side. However, the White House denied the rumors, saying that Musk is legally allowed to work in the government for up to 130 days a year -his departure is not possible until the summer.
Internal critics: “the brand is broken”
Former supporters of Tesla have begun to publicly turn their backs on the company. One of the early investors, Ross Gerber, wrote on social media X:
“These numbers are a disaster. The brand is broken. It may no longer be recoverable.”
“It’s a failure by every metric. The more actively Musk gets involved in politics, the more the Tesla brand suffers – there’s nothing to argue about.”
Even Musk himself admitted in a recent interview that running businesses is “extremely difficult,” and added: “Frankly, I can’t believe I’m still doing it myself.”
Financial pressures are intensifying
Tesla has lost more than 25% of its market capitalization since the beginning of 2025. Some institutional investors have already sprung into action. For example, New York City Comptroller of the Treasury Brad Lender announced his intention to sue Tesla on behalf of the city’s pension funds, which have lost more than $300 million in just three months.
The head of the largest teachers union in the U.S., Randi Weingarten, also wrote an open letter to pension funds, urging them to reconsider their investments in the company:
“The stock’s decline is due in part to the fact that Musk is in politics rather than running a business.”
What’s next
Tesla’s full first-quarter financial report will be released on April 22. In it, the company promises to disclose revenue, margin and foreign trade impact figures. For now, in a statement to the SEC, Tesla emphasized that the data presented “does not reflect the full picture” and depends on a variety of factors, including average selling price, costs, and currency fluctuations.
The company said that the data presented “does not reflect the full picture” and depends on a variety of factors, including average selling price, costs, and currency fluctuations.
It was also reported that the company temporarily halted production of the Model Y in January, which could have further impacted delivery volumes.
