Musk’s Empire Under Siege: Tesla’s Stock Plummets Amid Political Backlash
Tesla stock is falling, and it's Elon Musk’s fault. There is currently a trending movement called “Boycott Musk.” The boycott is motivated by Musk's close relationship with President Donald Trump and his leadership of the newly founded Department of Government Efficiency (DOGE). Mass protests and a growing customer boycott of Tesla appear to be affecting the company's bottom line.
The attempted boycott emerged when Tesla's sales were already rapidly declining. According to CCN, Tesla's primary market of California, saw a 12% drop in Tesla’s registered January 2025 compared to the previous year. The trend in Europe is more alarming: Tesla sales have fallen 75.4% in Spain and 60% in Germany. Other large European markets, such as France, Sweden and the Netherlands, have also experienced significant decreases in sales over the past year.
The sales drop is directly related to nationwide boycott protests. Protesters accused Musk of undermining essential federal institutions through massive layoffs and putting billions of dollars in research, education and climate programs on hold. Michigan Public highlighted one of the rallies outside a Tesla store in Ann Arbor, Michigan, as demonstrators urged customers to boycott Tesla to send Musk an economic message.
Tesla's stock, which has long been supported by strong sales growth and investor trust in Musk's vision, is now showing signs of weakness. According to Slate, Tesla's market worth was a whopping $1.15 trillion in early February 2025. However, with declining sales, investor confidence and optimistic forecasts of future earnings are fading.
Tesla's problems began long before the boycott. In China, the firm's 2024 sales growth fell to a mere 8%, a significant drop from previous years’ sales growth of 40%. The delay and decreasing U.S. and European sales have already begun to drive down Tesla's stock value. Tesla shares have fallen by more than 8% in the last week alone, with analysts warning of more drops if consumer confidence continues to decline.
The pushback against Musk seems to be strongest in liberal-leaning areas, where Tesla has a long-standing consumer base. According to CCN, Tesla's customer loyalty rate has fallen in Democratic-leaning states while increasing marginally in Republican-leaning states. This shows that Musk's vocal support of Trump may correlate with consumer purchasing decisions.
Musk's increasing association with European far-right leaders has also tarnished Tesla's brand. Tesla's reputation suffered significantly in Sweden after Musk was accused of doing a Nazi salute during Trump's inauguration. The debate sparked anti-Tesla graffiti in several places, prompting campaigners to refer to Tesla cars as "swasti-cars."
Today's situation raises concerns about Tesla's long-term viability. While Tesla has previously weathered turbulent business environments, the combination of record-low sales, rising competition and Musk's political problems poses a significant challenge. Some analysts believe that Tesla’s stock may even plausibly collapse by around 50%.
According to Slate, Musk's personal fortune is also at risk. Most of his Tesla shares are used as collateral to acquire loans for his other businesses. If Tesla's price continues to fall, Musk may be obliged to sell additional stock, destroying investor confidence and accelerating the downturn.
Tesla's share price decrease is more than simply a normal market shift. It is the result of a consumer boycott of Elon Musk's political views. In an ever-competitive EV landscape with offerings from BYD, Hyundai and Volkswagen, Tesla's ability to maintain category dominance is under attack. If the boycott continues and sales decrease, shareholders may begin to demand Musk's departure as CEO.
Tesla stands at a crossroads. Its future remains uncertain, but one thing is clear: Musk’s once unchecked influence over the company has become as much a liability as it was a strength.
Photo Caption: Tesla Model 3
Photo Credit: Unsplash
