It’s been a big year already for Elon Musk. The now highly controversial tech billionaire – the world’s richest person – is making headlines from his “bromance” with President Donald Trump, the slashing and burning of US government programs, his conspiracy theories and his support for far right political causes.
It’s now clearly having an impact on at least one part of his business interests. The sale numbers of Tesla electric vehicles, which have for the past decade been the standard bearer for the transition to EVs, are plunging in key markets across the globe, and surveys suggest the actions of Musk are a major cause.
In Australia, the sale of Tesla EVs in the first month of 2025 have plunged 33 per cent from the same month last year, and are now just one quarter of the sales in the same month of 2023. EV sales are weak across the board in Australia, however, but that’s not the case in international markets.
In Norway, the world’s most advanced electric vehicle market, and where EV sales account for an astonishing 96 per cent of new car sales, the overall market is still booming.
But Tesla is slumping, the Model Y has plunged from top spot to number 6, the Model 3 has slumped to No 7, and the top rungs have been usurped by two companies known to be struggling to keep up with the EV transition – Toyota and VW.
In Sweden, the story is similar. Tesla sales are down 44 per cent in the month of January. In France, they are down more than 60 per cent. In both countries, the new car EV market is strong. In Spain, Tesla sales are down 75 per cent, and they are also down significantly in the UK, Portugal, Denmark, and the Netherlands.
There are other factors: More competition, state state of inventories, and the timing of Tesla’s new model releases are often cited. But the reality is that many see the Tesla EV has superior quality and value for money, and so it is not surprising that more surveys directly address the Musk factor.
In Sweden, a survey by Novus found just 11 per cent of people favour the Tesla brand. A survey by British EV news website Electrifying.com found that 60% of car buyers now say Musk’s reputation and political activities are actively discouraging them from purchasing a Tesla car.
That sentiment holds among both current and future EV drivers, according to the UK survey, which notes that Chinese EV company BYD overtook Tesla as the world’s largest producer of EVs.
Chinese EV manufacturers are also gaining ground among British consumers, with 61% of current EV owners and 56% of potential buyers open to purchasing their EV from a Chinese brand – a huge shift in perception.
And it’s true that Tesla’s decline in popularity comes as competition is growing. Consumers now have more choice, and the number of models available has leaped from just 25 a few years ago to more than 133 today.
But EV consultant, strategist and industry commentator James Carter told The Driven he had no doubt Musk’s divisiveness was having an impact on public perceptions of the company.
In November, the Guardian and other outlets reported that Tesla owners were turning against Musk for his divisive politics. Many were sporting stickers such as “We bought this Tesla before we knew that Elon Musk is crazy.” Or president.
In January, research by Brand Finance, a major brand valuation and strategy consultancy, found that Tesla’s brand value had fallen by 26% in a year, from $58.3 billion in early 2024 to $43 billion.
“We’re seeing a lot more reports showing brand deterioration,” Carter said.
“Traditionally we’ve never seen CEOs of OEMs [Original Equipment Manufacturers] be at all controversial in ways that Musk has done, both with regards to social media and also aligning themselves with politics, particularly far-left or far-right.”
Carter said it was important not to underestimate the importance of brand perception, but he pointed out that there were a range of factors at play in Tesla’s fall from dominance in the EV market.
“There’s two main things, the first is [Musk’s reputation], but the second, and probably more important, is that in 2024 Tesla’s products were generally old,” Carter said.
“The Model S and Model X were the same shape as they were eleven and thirteen years ago, and the Model Y, the top seller, was five years old. Model 3 has been refreshed, thank goodness, but it’s still the same shape, and obviously the Cybertruck didn’t hit Europe or Australia.
“So, it’s an ageing product lineup, and that’s really what slowed Tesla I believe.”
Tesla’s audacious Cybertruck hasn’t sold as predicted, with only 5% of reservations reportedly converting to sales.
It’s possible that the updated Model Y, codenamed Juniper, which comes to the Australian market in May, will give the company a significant sales boost.
Carter said the reputational effect commentators were observing was likely to continue into 2025, pointing out that an escalating trade dispute between the US and Canada was spilling over into Musk’s business interests.
Ontario premier Doug Ford has said he would cancel the province’s contract with Starlink, and Canadian former deputy prime minister Chrystia Freeland proposing a 100 per cent tariff on Tesla vehicles. And now Electrek reports that some shareholders are agitating for Musk’s removal from the board.