Tesla’s profits plummeted by 71% in the first quarter of 2025, a significant decline attributed to a combination of factors including reduced car sales, increased competition, and a growing backlash against CEO Elon Musk’s controversial political activities.

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The company’s net income fell to $2.3 billion, down from $7.9 billion in the same period the previous year. Revenue from car sales dropped by 20%, with deliveries declining by 13% year-over-year. Analysts had anticipated a downturn, but the extent of the decline surpassed expectations.Musk’s involvement in political affairs, particularly his advisory role to President Donald Trump and support for far-right movements, has sparked protests and boycotts, especially in Europe. In Germany, Tesla’s market share fell by 58% in the first two months of 2025, and a survey indicated that over 94% of respondents would no longer purchase a Tesla vehicle.

Despite these challenges, Musk remains optimistic about Tesla’s future. He is focusing on autonomous vehicle technology, announcing plans to launch paid robotaxi services in Austin by June, with other cities to follow. However, competitors like Waymo and Zoox are already operational in this space, raising questions about Tesla’s ability to catch up.

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Tesla’s stock has also suffered, with a 34% decline in 2025, reflecting investor concerns over Musk’s divided attention and the company’s declining performance. Some investors have expressed frustration, with one stating that Musk has “abandoned” Tesla.

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In response to the backlash, Musk has pledged to reduce his involvement with Dogecoin, acknowledging that his focus on the cryptocurrency may have distracted from his responsibilities at Tesla. ​

As Tesla navigates these challenges, the company’s ability to regain consumer trust and investor confidence will be crucial for its future success.