Musk’s Political Push Sparks Investor Backlash
Elon Musk might know how to get attention, but this time, it’s costing him billions—literally. On July 7, 2025, Tesla’s stock plunged nearly 7% after Musk announced he was creating the America Party, a new third-party political project. This wasn’t just any random move—it happened right in the middle of a public spat with Donald Trump, who wasted no time ridiculing Musk, claiming he had "gone off the rails." The timing couldn't be worse for Tesla, which is already facing sliding sales, sinking profits, and a skeptical Wall Street.
Even before the political fireworks, Tesla was struggling. Their profits for the first quarter of 2025 dropped a staggering 71%, and sales didn’t look any better. The company managed to deliver 384,000 electric cars in Q2, which is 13.5% less than last year. That’s a sharp fall for a company used to bragging about its growth. Instead of rallying confidence, Musk’s latest political gambit only deepened the anxiety among investors and customers alike.
Investors and Analysts Sound the Alarm
For those putting money into Tesla, Musk’s latest distraction is frustrating. Analysts are saying out loud what many investors are already thinking: focus on Tesla or risk losing it all. Wedbush’s Dan Ives put it bluntly, warning that Musk’s increasing obsession with politics is "exactly the opposite direction" investors want the company to go. The effect goes beyond finances—some buyers, especially liberals, are turning their backs on Tesla, and used models are fetching lower prices than before. It’s a buyer’s market, but for all the wrong reasons.
Despite the turmoil, Tesla’s board seems paralyzed. No one is eager to push Musk out, but many worry that if he goes all-in on politics, he might simply walk away from the company he made famous. The numbers are piling up. So far in 2025, Tesla’s stock has lost 27% of its value, slicing billions off the company’s—and Musk’s—market worth. It’s not just a blip; analysts are comparing the impact of Musk’s political adventure to economic events at the national level.
This drama shows just how tightly Tesla’s fortunes are tied to Musk’s personal actions. When the company needs stable leadership most, the man at the top seems more distracted than ever, and that’s leaving investors, customers, and even longtime fans wondering: is Tesla still Musk’s main focus, or just a stepping stone for bigger political dreams?
