Tesla sales dropped by nearly 13 percent in the first three months of the year amid a broader backlash against CEO Elon Musk and his leadership of President Trump’s Department of Government Efficiency (DOGE).
Tesla reported 336,000 vehicle deliveries in the January to March quarter, a notable drop from sales of 387,000 vehicles in the same period a year ago.
The number marks its worst showing since 2022 and is far lower than analysts’ predictions of about 408,000 deliveries.
Tesla’s stock has plummeted nearly 50 percent since late December, and the company has become a political lightning rod for those upset with Musk’s alliance with Trump and leadership of DOGE.
Company showrooms across the country have faced peaceful and violent demonstrations, including vandalism, shootings and arson attacks.
Wedbush Securities analysts called the quarterly report a “disaster on every metric” and called it a “fork in the road moment” for Musk.
“The more political he gets with DOGE the more the brand suffers, there is no debate. This quarter was an example of the damage Musk is causing Tesla,” the analysts wrote in an investor note on Wednesday.
The Tesla CEO admitted last month he is having “great difficulty” running his various companies while juggling the work of DOGE.
The sagging sales could be due to several factors, including the backlash, but also Tesla’s brand changes in the past few years.
While Tesla has long been a dominant player in the EV space, the brand’s focus appears to be shifting more toward artificial intelligence (AI) and robotics. Besides the Cybertruck, Tesla has not released a new EV model in the U.S. since 2020, when it launched the Model Y crossover SUV.
Industry observers are divided on whether this brand change helps or hurts Tesla’s performance.
The report came hours ahead of Trump’s expected announcement on a 25 percent auto tariff on foreign vehicles and automobile parts.
Tesla produces all of its North American vehicles in the U.S. at factories in California and Texas, potentially lessening the impact for the Musk-led company, experts told The Hill earlier this week.
Still, the electric vehicle manufacturer may not be entirely immune as some of its parts do not come from the U.S.
