Tesla is grappling with a significant decline in both financial performance and public perception, largely attributed to CEO Elon Musk’s controversial actions and political affiliations. The company’s recent financial reports indicate a 71% drop in profits compared to the previous year, a downturn linked to Musk’s involvement with the Department of Government Efficiency (DOGE) under the Trump administration. This association has led to widespread protests and boycotts, particularly in Europe, where sales have plummeted. ​

Despite Musk’s pledge to reduce his role in government affairs, concerns persist among investors and stakeholders. State treasurers and pension fund managers have expressed frustration over Musk’s divided attention between Tesla, DOGE, and other ventures like Twitter. They argue that his lack of focus jeopardizes Tesla’s financial stability and reputation, citing a 9% revenue drop and a 41% stock decline from its January peak

Beyond financial metrics, Musk’s approach to free speech has come under scrutiny. While he has publicly identified as a “free speech absolutist,” former employees allege that Tesla enforces strict non-disclosure agreements and retaliates against those who raise safety concerns or criticize the company. For instance, Cristina Balan, a former Tesla engineer, claims she was dismissed after reporting a potential safety issue related to curling carpets under brake pedals. She alleges that her concerns were ignored, and she faced hostility from management.

Tesla’s handling of whistleblowers has also been contentious. In 2018, former employee Martin Tripp alleged that the company was wasting raw materials and misrepresenting production figures. Musk responded by accusing Tripp of sabotage and ordered an internal investigation, which included accessing his phone records. Tripp was later ordered to pay $400,000 to settle a hacking case. ​

These incidents have contributed to a tarnished brand image for Tesla. Public perception of Musk has soured, with over half of registered voters viewing him unfavorably, up from less than 25% three years ago. Analysts warn that while Musk’s departure from certain roles may offer short-term relief, the long-term damage to Tesla’s brand could be challenging to reverse. ​

In conclusion, Elon Musk’s actions and leadership style have significantly impacted Tesla’s financial health and public image. As the company navigates these challenges, stakeholders and consumers alike are questioning whether the brand can recover from the damage inflicted by its CEO’s controversial decisions.