Elon Musk SLASHES Washington Hours – Why?

Elon Musk decides to step back from Washington duties as Tesla faces a staggering 71% profit plunge, raising questions about whether his political activities have damaged the electric vehicle giant.

At a Glance

  • Musk announced he’ll reduce his time with Trump’s Department of Government Efficiency (DOGE) initiative after Tesla reported a 71% profit drop
  • Tesla’s Q1 profits fell to $409 million from $1.4 billion a year earlier, with total revenue down 9% to $19.3 billion
  • Vehicle deliveries dropped 13% compared to last year, with car sales revenue declining 20%
  • Tesla shares have lost half their value since December, coinciding with Musk’s increased political involvement
  • Musk plans to spend only “a day or two per week” on Washington matters going forward

Tesla’s Financial Crisis Prompts Musk’s Return

Tesla’s latest earnings report has sent shockwaves through the automotive and investment communities, with the electric vehicle manufacturer reporting a dramatic 71% drop in profits for the first quarter of 2025. The company posted a profit of just $409 million, down from $1.4 billion during the same period last year. 

This financial downturn comes as Elon Musk has been dividing his attention between his business interests and his role in President Trump’s administration, where he has been leading government efficiency initiatives.

The company’s vehicle deliveries fell by 13% compared to the previous year, while car sales revenue dropped by a concerning 20%. Total revenue decreased by 9% to $19.3 billion. Tesla cited several factors for these disappointing results, including production line changeovers for the Model Y and increasing competition from Chinese manufacturers. 

The company also experienced its first year-over-year sales decline in over a decade, marking a significant turning point for what has been America’s premier electric vehicle manufacturer. 

Political Backlash Impacts Tesla’s Bottom Line

Musk’s political activities, particularly his support for President Trump, appear to have alienated many of Tesla’s traditional customers, who often lean politically left. During the earnings call, Tesla’s CFO acknowledged that vandalism and hostility toward the brand have negatively impacted sales in certain markets. The company’s stock has lost approximately half its value since December, with significant drops coinciding with Musk’s increasing involvement in government affairs. 

“The real reason is that those who are receiving the waste and fraud wish it to continue,” Musk claimed when addressing recent protests at Tesla showrooms, suggesting the demonstrations were led by those “receiving fraudulent money” who might lose government benefits due to his work with the Trump administration. 

This political dimension adds a unique challenge to Tesla’s business model, as the company has historically benefited from a customer base that values environmental consciousness—a demographic that may be increasingly at odds with Musk’s public political stances. Some shareholders have begun urging Musk to step down entirely from his government role and return to Tesla full-time, concerned that his divided attention is harming the company’s performance and market position.

Musk Scales Back Government Role While Defending Accomplishments

In response to Tesla’s financial challenges, Musk announced during Tuesday’s earnings call that he would reduce his time working with the Trump administration. “My work for the government to get the financial house in order is mostly done,” Musk stated, adding that he plans to spend only “a day or two per week” on Washington matters going forward. This represents a significant scaling back of his involvement with the Department of Government Efficiency (DOGE), which he had helped establish.

“I’ve been on the record many times as saying that I believe lower tariffs are generally a good idea,” Musk remarked when addressing questions about potential tariffs, though he acknowledged that final decisions on trade policy remain with the president. 

Despite the current challenges, Tesla remains the most valuable automaker globally by stock price and continues to lead in electric vehicle sales in the United States. Musk emphasized that the company is positioned to handle potential tariffs due to its localized supply chains. He also highlighted upcoming initiatives, including a robotaxi test program set to launch in Austin, Texas, in June, suggesting that innovation remains a priority even as the company navigates its current difficulties.

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