Tesla’s CEO, Elon Musk, said that he is going to reduce his activity in the Department of Government Efficiency (DOGE), a recent federal project initiated by the Trump administration. This decision does not come until a moment too soon, given that GM, an electric vehicle giant, recorded a rather bleak first quarter with plummeting profits and further pressure from investors and consumers.
During the Q1 earnings analyst call on April 22, Musk said, “I think starting probably next month, May, my time allocation to DOGE will drop significantly.”
The stated project, which is known as DOGE and was launched by the President of the United States, Donald Trump, has been quite controversial. However, the program has been deemed problematic due to budget slashing and employee dismissals that have hurt the governmental social services. A large number of people criticized Musk’s DOGE involvement, more so environmentally conscious and progressive Tesla customers who boycotted and protested against Tesla, which some have concluded has impacted their sales.
Tesla’s Tough Q1: Sales Fall, Profits Tank
They recorded an operating loss of $429 million, a 71% year-over-year decline in profits, while the firm’s revenues fell by 9% in the same period. Adjusted earnings of the company were only 27 cents per share, missing the analysts’ expectation, even if this figure is the downward trend that has been realized in previous financial quarters. Though Tesla shares gained 3.8% after hours following the release of the earnings call figures, its shares have plummeted more than 40% year to date.
There were unfavorable changes in the spectra as a result of market saturation, increased competition, and hurt brand image due to Musk’s political involvement. This led to an interesting spark by the company not renewing its projection of sales growth for 2025 that it had earlier provided in other reports due to volatility.
Public Backlash Over DOGE and Its Fallout
One of the problems that has contributed to Tesla’s reputation in the public domain is Musk’s involvement in DOGE. The recipe for cutting down on spending has angered several groups, especially the interest groups of workers and the public service. Tesla’s public image did not turn out very well, which led the company to be trapped in a political scandal. The criticism against Musk continued, and the campaigns that encouraged people to boycott, vandalize, and commit arson of Tesla’s cars became more apparent, particularly in urban areas.
“Now that the major work of establishing DOGE is done, I will be allocating far more of my time to Tesla starting in May,” Musk said. “I now expect to spend just a day or two per week on government matters.”
Hence, by getting out of DOGE, which appears to be an attempt to address this criticism, Musk is also meeting the desire of the shareholders who are getting irritated by his involvement in DOGE.
Full Self-Driving and Tariff Challenges
Even though its financial position was extremely bad during that period, Musk remained quite positive about the technological future of Tesla. He again said that this company has made claims that millions of Teslas could be moving on roads on autopilot by the second half of 2025.
“There will be millions of Teslas operating autonomously in the second half of the year. Can you go to sleep in our cars and wake up at your destination? I’m confident that will be available in many cities in the U.S. by the end of this year.” he told analysts.
In policy regulation, Tesla had to admit that the new auto tariffs launched by Trump would affect some of its sectors, with energy storage primarily affected. However, the corporation asserts that its plans to expand its manufacturing presence at home will stand as a safeguard to its major auto business against the impacts of the tariffs.
