Sales of Tesla Slide to Lows Since 2022 Due to Anti Musk Backlash

Tesla Inc. experienced a 13% decline in vehicle sales during the first quarter, impacted by a transition in its key model and growing international criticism of CEO Elon Musk.

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The electric vehicle maker reported on Wednesday that it delivered 336,681 vehicles between January and March, marking its lowest quarterly sales since the second quarter of 2022. Analysts had anticipated sales exceeding 390,000 units, based on Bloomberg-compiled estimates.

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The results highlight the significant disruptions Tesla faced at the start of the year. One major factor was the company’s effort to upgrade its factories worldwide to produce a redesigned version of the Model Y. Such transitions typically lead to temporary reductions in output as automakers shift from one vehicle generation to the next.

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However, Tesla also faced an unusual challenge: backlash against Musk’s growing involvement in global politics, which fueled protests across the U.S. and Europe.

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In recent weeks, demonstrations have intensified in response to Musk’s outspoken support for far-right political figures and causes. The Tesla CEO played a key role in former President Donald Trump’s initiative to reduce the federal workforce, voiced opinions on Germany’s federal election, and even advocated for the U.S. to withdraw from NATO, the transnational military alliance.

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The controversy surrounding Musk has seemingly contributed to Tesla’s struggles, as consumer sentiment in certain markets has shifted.

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While the company remains a dominant force in the electric vehicle sector, public perception of its leadership could be influencing purchasing decisions, particularly in regions where Musk’s political stances have been met with opposition.

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Tesla’s stock reflected investor concerns following the disappointing sales figures. Shares fell as much as 5.8% in premarket trading on Wednesday in New York. The company’s stock had already declined 44% from its record high, which it reached in the weeks after Trump’s election victory.

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The combination of production challenges and external controversies has placed Tesla in a difficult position as it navigates an evolving market landscape. With the redesigned Model Y now entering production, the company will look to regain momentum in the coming months.

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However, the extent to which Musk’s political activities will continue to impact consumer demand remains uncertain.

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As Tesla works to stabilize production and address supply chain disruptions, its ability to rebound will likely depend on both operational improvements and broader shifts in public perception.

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While the company has successfully managed past challenges, the intersection of business and politics adds an additional layer of complexity to its current situation.

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