Few auto executives are as carefully recognized with the businesses they handle as Elon Musk, the chief government of Tesla, is. And possibly none are extra prolific in broadcasting their political opinions on social media.
However as Mr. Musk’s public persona has turn into more and more proper wing, Tesla seems to be paying a worth in gross sales, particularly to liberal and left-leaning prospects who’re more likely to purchase battery-powered automobiles than conservatives are, in keeping with analysts and lots of automobile house owners who responded to a questionnaire on The New York Instances’s web site about whether or not his habits affected their views of Tesla.
His picture as an erratic, impulsive supervisor seem to have rubbed off on the automobiles, elevating doubts in some folks’s minds about their high quality and serving to to elucidate why Tesla gross sales have been falling. On Tuesday, the corporate reported that its world gross sales within the second quarter fell 4.8 p.c from the identical interval a yr earlier, after an 8.5 p.c drop within the first three months of the yr.
“Musk is a real lightning rod,” mentioned Ben Rose, the president of Battle Street Analysis, which has a typically optimistic view on Tesla’s inventory. “There are individuals who swear by him and individuals who swear at him. No query, a few of his feedback are an actual turnoff for some folks. For a subset, sufficient to purchase one other model.”
Tesla and a consultant for the corporate’s board didn’t reply to requests for remark.
A number of the greater than 7,500 individuals who responded to The Instances’s questionnaire mentioned they had been offended by what they perceived as antisemitism from Mr. Musk, which he denies. Some had been upset by the way in which Mr. Musk has managed Twitter, now known as X, since he purchased the corporate in 2022. He fired hundreds of workers and eliminated guardrails on content material shared on the social media platform. His more and more pleasant relations with former President Donald J. Trump and different conservative personalities had been additionally cited as considerations. A overwhelming majority of the readers who responded to the questionnaire had been important of Mr. Musk.
“You’re mainly driving round an enormous crimson MAGA hat,” mentioned Aaron Shepherd, a product designer at Microsoft in Seattle who mentioned he was planning to purchase an electrical Volkswagen ID.4 as an alternative of a Tesla.
It isn’t attainable to know what worth Tesla has paid for Mr. Musk’s political statements and actions. What is evident is that Tesla, as soon as the dominant vendor of electrical autos worldwide, has misplaced market share in lots of international locations for quite a lot of causes. Chief amongst them is the corporate’s reliance on the Mannequin Y sport utility car and the Mannequin 3 sedan, which haven’t been considerably up to date in years, for nearly all of its gross sales. Different firms are luring patrons by introducing new or up to date automobiles extra steadily.
In China, home carmakers like BYD have gained floor on Tesla by providing extra inexpensive automobiles with options that attraction to Chinese language customers, like karaoke. In Europe, BMW, Volkswagen and different native manufacturers are doing effectively by providing extra luxurious or cheaper automobiles than Tesla. And in america, Hyundai-Kia, Ford Motor and Normal Motors have elevated gross sales by providing a rising collection of fashions.
Instances readers who responded to the web questionnaire mentioned that they had been turned off by Mr. Musk’s statements and by their expertise with Tesla’s automobiles and repair operations — the corporate sells and providers automobiles instantly, slightly than via sellers.
“There’s a time after I’d have given Musk an organ if he wanted one,” mentioned Tim Yocum, an engineering director at a software program firm. However Mr. Yocum, who lives in Chicago, mentioned that he had skilled issues together with his Tesla Mannequin S and that he had been unhappy with the corporate’s restore and upkeep providers. Mr. Musk’s veer to the best has additionally upset him.
“Tesla is the one producer in modern occasions that has unapologetically let its C.E.O. take a tiki torch to its good identify,” Mr. Yocum mentioned. “This automobile would be the final Tesla I personal.”
Such feedback assist illuminate surveys that say Tesla’s status has suffered just lately. The corporate slipped to 63rd place within the 2024 Axios Harris Ballot 100, which requested respondents about their views on company manufacturers. In 2021, the corporate was in eighth place.
Mr. Musk has maintained that his public statements and persona don’t have an effect on Tesla’s gross sales. “We make one of the best automobiles,” he mentioned at The Instances’s DealBook Summit in November. “Whether or not you hate me, like me or are detached, would you like one of the best automobile or not one of the best automobile?”
Mr. Musk nonetheless has loads of passionate admirers. And a few mentioned the chief’s public statements wouldn’t affect their choice to purchase a Tesla. Many individuals gave him credit score for pushing the auto business to supply electrical autos, a strong instrument to fight local weather change.
“He has led an organization that has efficiently disrupted a corrupt, lazy automobile business,” mentioned Julian Mehnle, a software program engineer who lives in San Francisco. Whereas no fan of Mr. Musk, Mr. Mehnle mentioned, “I’m grownup sufficient to separate these considerations from my selection of client merchandise.”
Robert Dean, an architect who lives in Redding, Conn., echoed these sentiments: “Musk is a big, disruptive expertise with a transformative and optimistic impact on the world we dwell in. He is also an oddball persona, however I’m not marrying him; I’m shopping for automobiles from an organization he brilliantly leads.”
Most of Tesla’s shareholders stay largely supportive of Mr. Musk. Final month, traders endorsed a $45 billion compensation plan for him by a large margin.
But automobile patrons whom The Instances heard from and analysts mentioned Mr. Musk’s political exercise had clearly damage the corporate’s status with left-leaning customers. And there may be little proof that Mr. Musk’s flip to the best has attracted extra conservatives to purchase Teslas. In actual fact, 77 p.c of Republicans and Republican-leaning voters mentioned this yr that they weren’t inquisitive about battery-powered automobiles, up from 70 p.c who mentioned the identical final yr, in keeping with the Pew Analysis Heart.
“He could be profitable some individuals who like his positions,” mentioned Greg Silverman, the worldwide director of brand name economics at Interbrand, a consulting agency that advises purchasers on advertising and marketing methods. However, he added, the chances that Mr. Musk is attracting extra prospects slightly than pushing them away “are very low.”
Interbrand analysis signifies {that a} chief government or different firm consultant who offends prospects can cut back gross sales as a lot as 10 p.c, Mr. Silverman mentioned.
Some automobile house owners’ considerations went past Mr. Musk’s political statements. They cited accusations of racial discrimination at Tesla factories, or the notion that he has allowed racist content material to flourish on X. Tesla has denied that it tolerates discrimination at its factories.
“My mom was severely debating shopping for a Tesla,” mentioned Achidi Ndifang, who works in data know-how in Baltimore. “As a Black particular person, I felt like it could be an insult for my mom to drive a Tesla.”
Derek Morf, a highschool math instructor in Verona, N.J., who owns a Tesla, reported feeling alarmed when Tesla eliminated the Disney Plus app from some dashboard screens late final yr, apparently as a result of Mr. Musk was offended at Robert A. Iger, the chief government of Disney.
Mr. Morf didn’t care that a lot concerning the Disney app, which he hardly used. However, he mentioned, he discovered it unsettling “that the car I bought may have options modified instantly just because one man had that a lot management.”
Such considerations may very well be a legal responsibility for Tesla because it pours sources into autonomous driving know-how. Mr. Musk has promised to unveil a self-driving taxi on Aug. 8. The know-how can’t succeed with out belief from customers.
Many Instances readers identified that different automobile firms additionally had baggage. Volkswagen had an emissions scandal just a few years in the past. Henry Ford, the founding father of Ford Motor, held and unfold antisemitic views. A decade in the past, G.M. offered automobiles with defective ignition switches that had been blamed for greater than 100 deaths.
Established automobile firms nonetheless promote gasoline automobiles that emit greenhouse gases and different pollution. Tesla sells solely electrical automobiles.
However in all probability no different present auto government has as loud a megaphone as Mr. Musk has, or is extra keen to make use of it.
“If folks suppose that the C.E.O.s of different firms are saints, they’re a bit naïve for my part,” mentioned Jan Leys, a Tesla proprietor in Zurich. “They simply don’t have as huge a mouth and/or platform as Elon Musk.”
