Elon Musk’s eccentricities and provocations are starting to take a toll on his businesses.

The billionaire – who leads the US government’s special task force, Department of Government Efficiency or DOGE – with his status as an “unpaid government employee,” has played with fire and is beginning to get burnt.

The mounting controversies surrounding Musk are having a tangible impact on Tesla, his electric vehicle company, whose share price has plummeted. Meanwhile, his increasing involvement in politics, particularly his alliance with US President Donald Trump, has significantly tarnished his public image.

Losing favour with Tesla’s target market

As head of DOGE, Musk has spearheaded drastic government cuts, including threats to programmes such as Social Security and Medicare, provoking outrage across the political spectrum.

His actions have not only alienated environmentally conscious consumers – once Tesla’s primary market – but have also sparked fierce opposition from advocacy groups.

Musk’s controversial greeting at Trump’s inauguration in January, widely interpreted as a neo-N*zi gesture, deepened public animosity towards him and his brand.

Although Musk dismissed the backlash as unfounded hysteria, the damage was already done. Social media exploded with calls to boycott Tesla, while activists took to the streets in protest.

The anti-Musk movement has translated into concrete actions. The “Tesla Takedown” campaign, which encourages consumers to divest their Tesla investments, has gained global momentum.

Showrooms have become the scene of protests, Tesla vehicles have been defaced with anti-Musk graffiti, and in Berlin, an image of Musk performing the controversial salute was projected onto a Tesla factory.

Yet Musk’s dismissive response has only fanned the flames. By amplifying far-right voices and conspiracy theories on his social media platform, X, he has further alienated former supporters.

Tesla is now feeling the sting of this backlash. Sales have plummeted, and trade-ins of Tesla vehicles have reached record highs as former loyalists abandon the brand. Consumers are increasingly opting for electric vehicle alternatives from companies unburdened by political baggage.

A recent Reuters report indicated that Tesla trade-ins of newer models have quadrupled compared to the previous year – a staggering figure that shows the scale of the brand’s crisis.

Also Read: Is Musk's pay package too much?

Then came safety issues with the Cybertruck

Compounding Tesla’s troubles is the disastrous rollout of the Cybertruck. The futuristic stainless steel design, once hyped as revolutionary, has been ridiculed for its lack of practicality.

Safety issues related to its exterior panels forced a massive recall of 46,000 units, further eroding consumer confidence.

Investors, already uneasy about Musk’s increasingly erratic behaviour, have been spooked by Tesla’s plummeting stock price, which has declined 38% since Trump took office.

Competitors such as Rivian, Ford, and Volkswagen are now capitalising on Tesla’s tarnished reputation, posing a serious threat to its dominance in the electric vehicle market.

Why the future of Tesla looks uncertain

Musk’s poor crisis management approach has only exacerbated the situation. Instead of addressing consumer concerns, he has adopted an aggressive stance, labelling protesters as “domestic terrorists” and threatening legal action.

The Trump administration has echoed these sentiments, further inflaming public opinion.

Meanwhile, Musk has expressed bewilderment at the backlash, insisting he has “never done anything harmful, only productive things”. His refusal to acknowledge the consequences of his actions has drawn widespread criticism and renewed calls for boycotts. Some have even called for Musk to resign as Tesla CEO.

Musk’s international reputation is also in a freefall. In France, prominent business figures have cancelled Tesla orders in protest of US tariffs and Musk’s political affiliations. European markets, once a stronghold for Tesla, are witnessing declining sales as consumers turn to locally produced alternatives.

Also Read: Why Tesla rehired Supercharger team

Given Tesla’s high market valuation and reliance on continued growth, even a modest drop in sales could prove disastrous for the company.

The question now is whether Tesla can recover from this self-inflicted crisis. Unlike previous controversies centred around Musk’s abrasive personality, this time the backlash has taken a financial toll.

Consumers are voting with their wallets. For a company whose stock price is driven more by future potential than current profitability, a sustained boycott could have devastating consequences.

Musk may continue to mock his critics, but the numbers suggest that his critics may well have the last laugh.