Elon Musk says he will scale back his controversial government role following a sharp downturn in Tesla’s performance, including a 70% drop in profits and a 20% dip in car sales during the first quarter of 2025.
The Tesla CEO, who has been leading the Trump administration’s Department for Government Efficiency (Doge) since last year, confirmed he will now reduce his involvement to just one or two days per week, refocusing on the electric vehicle giant amid mounting criticism and economic pressure.
Musk’s political role has fueled international protests and Tesla boycotts, with some accusing him of abandoning his corporate duties. His appointment to Doge — a temporary government position — is set to expire soon, as federal rules limit such roles to 130 days annually.
Despite the backlash, Musk insisted the role remains “critical” and stated he would stay on “as long as the president would like me to do so and as long as it’s useful.” President Trump recently said he would keep Musk “as long as I could keep him.”
Tesla’s earnings report, released Tuesday, issued no growth forecast and warned that shifting political sentiment and “rapidly evolving trade policy” — including Trump’s new tariffs on Chinese parts — could further strain demand and supply chains. Though Tesla assembles its vehicles in the U.S., it relies heavily on Chinese components.
Shares in Tesla, down 37% this year, saw a slight rebound in after-hours trading despite the disappointing figures. Investors remain wary, especially as competition surges and trust in Musk’s leadership wavers.
Musk blamed Tesla’s downturn on “attacks” against him and the Doge team, and reignited tensions with Trump officials by calling trade adviser Peter Navarro a “moron” over comments questioning Tesla’s manufacturing credentials.
Former Tesla executive Georg Ell told the BBC that Musk’s singular focus can be both a strength and a weakness. “He doesn’t surround himself with much dissent. But if he focuses where he excels — in innovation — the product might speak louder than the politics.”
Still, analysts warn the challenges ahead are serious. With falling sales, global trade tensions, and doubts about Tesla’s AI future, the company is under immense pressure to deliver.
“Tesla’s problems are mounting,” said AJ Bell’s Dan Coatsworth. “The question is whether Musk can reclaim investor confidence before the damage is done.”