Few auto executives are as intently recognized with the businesses they handle as Elon Musk, the chief govt of Tesla, is. And possibly none are extra prolific in broadcasting their political beliefs on social media.
However as Mr. Musk’s public persona has turn out to be 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 plenty of automotive house owners who responded to a questionnaire on The New York Times’s website about whether or not his conduct 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 clarify why Tesla gross sales have been falling. On Tuesday, the company 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 year.
“Musk is a real lightning rod,” mentioned Ben Rose, the president of Battle Highway Analysis, which has a usually constructive 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.
Among the greater than 7,500 individuals who responded to The Occasions’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 referred to as X, since he purchased the corporate in 2022. He fired thousands 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 purple 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’s not doable 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 automobiles worldwide, has misplaced market share in lots of nations for a wide range 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 consumers by introducing new or up to date automobiles extra ceaselessly.
In China, home carmakers like BYD have gained floor on Tesla by providing extra reasonably priced automobiles with know-how options that enchantment to Chinese language customers, like rotating screens. In Europe, BMW, Volkswagen and different native manufacturers are doing properly by providing extra luxurious or cheaper automobiles than Tesla. And in the USA, Hyundai-Kia, Ford Motor and Basic Motors have elevated gross sales by providing a rising collection of fashions.
Occasions readers who responded to the net questionnaire mentioned they’d 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 straight, quite 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 along 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 proper has additionally upset him.
“Tesla is the one producer in modern instances that has unapologetically let its C.E.O. take a tiki torch to its good identify,” Mr. Yocum mentioned. “This automotive would be the final Tesla I personal.”
Such feedback assist illuminate surveys that say Tesla’s status has suffered lately. The corporate slipped to 63rd place within the 2024 Axios Harris Poll 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 the most effective automobiles,” he mentioned at The Occasions’s DealBook Summit in November. “Whether or not you hate me, like me or are detached, would you like the most effective automotive or not the most effective automotive?”
Mr. Musk nonetheless has loads of passionate admirers. And a few mentioned the manager’s public statements wouldn’t affect their resolution to purchase a Tesla. Many individuals gave him credit score for pushing the auto trade to provide electrical automobiles, a strong software to fight local weather change.
“He has led an organization that has efficiently disrupted a corrupt, lazy automotive trade,” 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 alternative of shopper merchandise.”
Robert Dean, an architect who lives in Redding, Conn., echoed these sentiments: “Musk is a huge, disruptive expertise with a transformative and constructive impact on the world we reside 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 automotive consumers whom The Occasions heard from and analysts mentioned Mr. Musk’s political exercise had clearly damage the corporate’s status with left-leaning customers. And there’s little proof that Mr. Musk’s flip to the proper has attracted extra conservatives to purchase Teslas. In truth, 77 percent of Republicans and Republican-leaning voters mentioned this yr that they weren’t desirous about battery-powered automobiles, up from 70 percent who said the same last year, in keeping with the Pew Analysis Middle.
“He is likely to be successful some individuals who like his positions,” mentioned Greg Silverman, the worldwide director of brand name economics at Interbrand, a consulting agency that advises shoppers on advertising methods. However, he added, the chances that Mr. Musk is attracting extra prospects quite than pushing them away “are very low.”
Interbrand analysis signifies {that a} chief govt or different firm consultant who offends prospects can scale back gross sales as a lot as 10 p.c, Mr. Silverman mentioned.
Some automotive 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 individual, I felt like it might 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 removed 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 govt 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 might have options modified instantly just because one man had that a lot management.”
Such considerations might 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 not succeed with out belief from customers.
Many Occasions readers identified that different automotive firms additionally had baggage. Volkswagen had an emissions scandal a number of years in the past. Henry Ford, the founding father of Ford Motor, held and unfold antisemitic views. A decade in the past, G.M. bought automobiles with faulty ignition switches that had been blamed for greater than 100 deaths.
Established automotive 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 govt has as loud a megaphone as Mr. Musk has, or is extra prepared to make use of it.
“If folks assume 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 only don’t have as massive a mouth and/or platform as Elon Musk.”