Tesla sales are down around the world because of competition in the market and from brand damage caused by Elon Musk’s political activities and association with President Trump.
A MARTÍNEZ, HOST:
Elon Musk’s fan base has helped his car company, Tesla, succeed. But Tesla’s sales and share price have been falling fast, and Musk may be part of the reason why. Here’s Willem Marx.
UNIDENTIFIED PROTESTERS: (Chanting) Stop the coup. Stop the coup.
WILLEM MARX: A protest took place last week at a Tesla dealership in New York, as anger against Elon Musk and his role at the Department of Government Efficiency was transferred to Tesla. In Massachusetts, a Tesla charging station became the target for an arson attack, while in southwest France, a group calling itself anti-fascist torched a dozen Tesla vehicles.
In Europe, sales of Teslas in January fell 47% compared to last year. And that’s at a time when electric vehicle numbers from other manufacturers are rising, says Sigrid de Vries, director general of the European Association of Automakers that tracks new car sales across the continent.
SIGRID DE VRIES: We see an upward trend. I mean, by any standards, you could say that reaching 15% market share – again, it’s an average – for battery electric vehicles is remarkable in just five years.
MARX: But Tesla’s sales are struggling not only in Europe, but China, Australia and the U.S., too, says Gordon Johnson of New York-based equity research firm GLJ. And the reasons for that are twofold, he says.
GORDON JOHNSON: It’s a combination of competition eating Tesla’s lunch with similar or better range, as well as disgust with Elon Musk, his unwielding (ph) support for Donald Trump. And many of Tesla’s historical customers have been, you know, far-left-leaning liberals. That’s turned a lot of people off.
MARX: Johnson’s been covering Tesla since 2019 and says vehicles are being vandalized, set on fire or painted with swastikas because of Musk’s decision to serve in the new U.S. administration.
JOHNSON: If you talk to any normal auto CEO, they’ll tell you they stay out of politics and they try to stay out of the limelight, because when you create brand destruction for an automobile company, it’s nearly impossible to come back from that. And Elon Musk is creating brand destruction on a grand scale.
MARX: Other auto analysts, though, insist Tesla’s situation is slightly more complicated.
JOHN MURPHY: There’s an extreme conflation of some of the concern around consumer souring on Elon with a major changeover – one of the largest ever done – in the auto industry.
MARX: John Murphy is head of automotive U.S. research at Bank of America and says the lack of updated Tesla models may be a more relevant reason for the company’s sales slumps.
MURPHY: The key driving factor at Tesla is it’s going through a major changeover of its all-important Model Y. That will result in shortages, and we’d expect sales to recover pretty meaningfully in the second and third quarter as that production ramps back up.
MARX: When you compare company revenues, Tesla shares have for a long time traded far higher than those of other U.S. carmakers, so some analysts say that means its stock has further to fall. More than many other stocks, Tesla shares are also traded by ordinary retail investors, some of whom love the company, some of whom hate it. That can make the stock price rise and fall sharply, analysts say, and that volatility in turn encourages hedge funds to join the trading and profit from the price swings. With the recent slump in Tesla’s share price, Musk has seen a dent in his personal fortunes that’s larger than the net worth of fellow billionaire Bill Gates.
For NPR News, I’m Willem Marx in London.
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