Without offering any supporting evidence, Tesla CEO Elon Musk has attributed the protests occurring at Tesla showrooms in the U.S. and Europe to the Department of Government Efficiency’s (DOGE) elimination of financial fraud. He dismissed the protestors’ claims that their discontent stems from his major, unelected role in government. Musk also suggested that these protestors are being paid to demonstrate against the electric vehicle manufacturer, a theory he has proposed previously.
During Tesla’s first-quarter earnings call, Musk addressed the gatherings by alleging that they were motivated by protestors’ desire to continue benefiting from government programs that had been reduced by DOGE’s policies. He asserted that the protests, which appear organized, are funded, though he did not provide evidence for this claim.
Musk has previously accused wealthy Democratic political figures of financing these protestors. The protests, referred to by some as the “Tesla Takedown,” have encouraged Tesla shareholders to divest and owners to abandon their vehicles. The protest hosts have underscored the peaceful nature of their movement while denouncing any form of violence or property damage.
The protests have escalated in some areas, leading to violent acts such as throwing molotov cocktails and vandalizing Tesla property. These incidents prompted President Donald Trump to label anti-Musk activities against the company as “domestic terrorism.” Recently, a Nevada man was charged with 15 felony counts after vandalizing a Tesla center in Las Vegas and setting five cars on fire. Other individuals in Colorado, South Carolina, and Oregon face charges for similar actions involving molotov cocktails against Tesla assets.
In a March interview with Fox News, Musk held Democrats responsible for the protests, describing their activities as “deranged.” Organizers based in Seattle did not respond to inquiries for comment.
Tesla is experiencing a significant decline in its stock price, plummeting 37% since the beginning of the year. Analysts, including Dan Ives from Wedbush Securities, have issued warnings, suggesting Musk needs to step away from his governmental role and DOGE to refocus on his CEO responsibilities at Tesla. Ives stressed the importance of this shift, noting potential brand damage impacting consumer perceptions in various regions.
Tesla’s financial performance in the recent quarter reflected struggles, with operating income dropping 66% year-over-year to $399 million, and net income falling 71% to $409 million. Revenue decreased by 9% to $19 billion due to factors like fewer vehicle deliveries, decreased average selling prices, and adverse foreign exchange effects.
Despite these challenges, Tesla’s energy revenues rose 67% to $2.73 billion, and service revenues increased by 15% to $2.64 billion. The company’s cash reserves reached approximately $37 billion, marking a 38% increase from the previous year.
Tesla attributes these challenges to production issues with the Model Y update, lower selling prices, and heightened operating expenses linked to AI and other initiatives. Investors are concerned about Musk’s involvement with DOGE and his prominent role in the Trump administration, fearing potential negative implications for Tesla’s future.
This coverage was initially published on Fortune.com.
