President Donald Trump and the Republican part have ignored climate change and demonized electric vehicles (EV). The president's so-called “Big Beautiful Bill” phases out the tax credit for buying an EV, with it disappearing in September.
He has also repeatedly called out EVs as being unreliable and “not going very far.”
Before he became buddies with Tesla CEO Elon Musk, he ridiculed him and his businesses.
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“When Elon Musk came to the White House asking me for help on all of his many subsidized projects, whether it’s electric cars that don’t drive long enough, driverless cars that crash, or rocketships to nowhere, without which subsidies he’d be worthless, and telling me how he was a big Trump fan and Republican, I could have said, ‘drop to your knees and beg,’ and he would have done it,” Trump wrote on social media.
Musk, however, became a Trump advisor when he donated nearly $300 million to his election campaign. That got him appointed to lead the childishly-named Department of Government Efficiency, where he gleefully harassed longtime federal workers and eliminated programs that wasted money doing things like feeding hungry people.
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It was a hard-right turn for Musk, which was an odd choice, given that buyers of EVs tend to be Democrats:
“On every dimension, Democrats view EVs more favorably than Republicans do,” shared Pew Research.
Musk has alienated Tesla's audience
While many CEOs lean right or openly embrace right-wing ideology, it's common to step down from any leadership positions before joining the government. Woody Johnson, the owner of the New York Jets, for example, served in the first Trump administration and stepped down from his position running the team.
New York is overly liberal, but Johnson separated his two lives. Musk did not do that, and that's a problem, because Pew data suggests that Republicans are not a real market for EVs.
- Environmental benefits: Democrats and those who lean to the Democratic Party are much more likely than Republicans and GOP leaners to say EVs are better for the environment than gas vehicles (69% vs. 24%).
- Cost to buy: A majority of both Democrats and Republicans say EVs cost more to buy than gas vehicles. But fewer Democrats than Republicans say this (65% vs. 81%).
- Cost to charge/fuel: Half of Democrats say EVs cost less to charge than gas vehicles do to fuel. That compares with a quarter of Republicans.
- Reliability: Very few Democrats or Republicans think EVs are more reliable than gas vehicles, but Democrats are more likely than Republicans to say this (14% vs. 5%). Half of Democrats say EVs and gas vehicles are about the same on reliability, while 34% say EVs are less reliable. Republicans are even more negative, with 69% saying EVs are less reliable.
Musk's hard-right turn and eventual return to the middle has had major consequences for Tesla.
Tesla sales drop, Musk must go
When a CEO does something that overshadows the brand, they get fired. Both Best Buy and McDonald's removed successful CEOs over inappropriate, but not illegal, relationships.
Musk has done something far worse. He has made it so Tesla's (TSLA) core audience, liberals, sees the Tesla name as a sort of swear word. That has led to many existing owners adding an “I bought this before Elon went crazy” bumper sticker and new liberal customers staying away.
Tesla sales dropped 13.5% in the second quarter, after also dropping in the first quarter. The company faces the Musk backlash and concerns over its aging vehicle lineup.
Musk has not hurt Tesla irreparably, but his presence makes it harder to fix the problem.
About half of U.S. adults have an unfavorable opinion of Tesla, including 30% of Republicans, according to a June AP-NORC poll.
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“Musk has acknowledged that his work as head of the Department of Government Efficiency and his embrace of European far-right candidates have hurt the company. But he said earlier this year that much of the sales plunge is due to customers holding off while they waited for an ugrade to Tesla’s best selling Model Y. That new version has been out for months now,” WTOC.com reported.
Take Musk off the top off the masthead, and liberals can go back to saluting the brand for its social responsibility.
But leave him there, and your target audience simply won't buy. That's not a political decision. It's just business.
