Few auto executives are as intently recognized with the businesses they handle as Elon Musk, the chief government of Tesla, is. And possibly none are extra prolific in broadcasting their political opinions on social media.
However as Mr. Musk’s public persona has change into more and more proper wing, Tesla seems to be paying a worth in gross sales, particularly to liberal and left-leaning clients who’re more likely to purchase battery-powered vehicles than conservatives are, in keeping with analysts and plenty of automotive house owners who responded to a questionnaire on The New York Times’s website about whether or not his conduct affected their views of Tesla.
His picture as an erratic, impulsive supervisor seem to have rubbed off on the vehicles, elevating doubts in some folks’s minds about their high quality and serving to to elucidate why Tesla gross sales have been falling. On Tuesday, the company reported that its world gross sales within the second quarter fell 4.8 p.c from the identical interval a 12 months earlier, after an 8.5 p.c drop within the first three months of the year.
“Musk is a real lightning rod,” mentioned Ben Rose, the president of Battle Street Analysis, which has a usually constructive view on Tesla’s inventory. “There are individuals who swear by him and individuals who swear at him. No query, a few of his feedback are an actual turnoff for some folks. For a subset, sufficient to purchase one other model.”
Tesla and a consultant for the corporate’s board didn’t reply to requests for remark.
Among the greater than 7,500 individuals who responded to The Instances’s questionnaire mentioned they had been offended by what they perceived as antisemitism from Mr. Musk, which he denies. Some had been upset by the best way Mr. Musk has managed Twitter, now referred to as X, since he purchased the corporate in 2022. He fired thousands of workers and eliminated guardrails on content material shared on the social media platform. His more and more pleasant relations with former President Donald J. Trump and different conservative personalities had been additionally cited as considerations. A overwhelming majority of the readers who responded to the questionnaire had been vital of Mr. Musk.
“You’re principally driving round a large crimson MAGA hat,” mentioned Aaron Shepherd, a product designer at Microsoft in Seattle who mentioned he was planning to purchase an electrical Volkswagen ID.4 as an alternative of a Tesla.
It’s not potential to know what worth Tesla has paid for Mr. Musk’s political statements and actions. What is obvious is that Tesla, as soon as the dominant vendor of electrical automobiles worldwide, has misplaced market share in lots of international locations for a wide range of causes. Chief amongst them is the corporate’s reliance on the Mannequin Y sport utility car and the Mannequin 3 sedan, which haven’t been considerably up to date in years, for nearly all of its gross sales. Different corporations are luring consumers by introducing new or up to date vehicles extra steadily.
In China, home carmakers like BYD have gained floor on Tesla by providing extra reasonably priced vehicles with options that attraction to Chinese language customers, like karaoke. In Europe, BMW, Volkswagen and different native manufacturers are doing effectively by providing extra luxurious or cheaper vehicles than Tesla. And in the USA, Hyundai-Kia, Ford Motor and Common Motors have elevated gross sales by providing a rising collection of fashions.
Instances readers who responded to the web questionnaire mentioned that they had been turned off by Mr. Musk’s statements and by their expertise with Tesla’s vehicles and repair operations — the corporate sells and companies vehicles instantly, somewhat than via sellers.
“There’s a time once I’d have given Musk an organ if he wanted one,” mentioned Tim Yocum, an engineering director at a software program firm. However Mr. Yocum, who lives in Chicago, mentioned that he had skilled issues along with his Tesla Mannequin S and that he had been unhappy with the corporate’s restore and upkeep companies. Mr. Musk’s veer to the proper has additionally upset him.
“Tesla is the one producer in modern instances that has unapologetically let its C.E.O. take a tiki torch to its good identify,” Mr. Yocum mentioned. “This automotive would be the final Tesla I personal.”
Such feedback assist illuminate surveys that say Tesla’s popularity has suffered just lately. The corporate slipped to 63rd place within the 2024 Axios Harris Poll 100, which requested respondents about their views on company manufacturers. In 2021, the corporate was in eighth place.
Mr. Musk has maintained that his public statements and persona don’t have an effect on Tesla’s gross sales. “We make the very best vehicles,” he mentioned at The Instances’s DealBook Summit in November. “Whether or not you hate me, like me or are detached, would you like the very best automotive or not the very best automotive?”
Mr. Musk nonetheless has loads of passionate admirers. And a few mentioned the manager’s public statements wouldn’t affect their resolution to purchase a Tesla. Many individuals gave him credit score for pushing the auto trade to provide electrical automobiles, a robust device to fight local weather change.
“He has led an organization that has efficiently disrupted a corrupt, lazy automotive trade,” mentioned Julian Mehnle, a software program engineer who lives in San Francisco. Whereas no fan of Mr. Musk, Mr. Mehnle mentioned, “I’m grownup sufficient to separate these considerations from my alternative of client merchandise.”
Robert Dean, an architect who lives in Redding, Conn., echoed these sentiments: “Musk is a huge, disruptive expertise with a transformative and constructive impact on the world we reside in. He is also an oddball character, however I’m not marrying him; I’m shopping for vehicles from an organization he brilliantly leads.”
Most of Tesla’s shareholders stay largely supportive of Mr. Musk. Final month, traders endorsed a $45 billion compensation plan for him by a large margin.
But automotive consumers whom The Instances heard from and analysts mentioned Mr. Musk’s political exercise had clearly damage the corporate’s popularity with left-leaning customers. And there’s little proof that Mr. Musk’s flip to the proper has attracted extra conservatives to purchase Teslas. Actually, 77 percent of Republicans and Republican-leaning voters mentioned this 12 months that they weren’t excited by battery-powered vehicles, up from 70 percent who said the same last year, in keeping with the Pew Analysis Middle.
“He could be profitable some individuals who like his positions,” mentioned Greg Silverman, the worldwide director of name economics at Interbrand, a consulting agency that advises shoppers on advertising and marketing methods. However, he added, the chances that Mr. Musk is attracting extra clients somewhat than pushing them away “are very low.”
Interbrand analysis signifies {that a} chief government or different firm consultant who offends clients can scale back gross sales as a lot as 10 p.c, Mr. Silverman mentioned.
Some automotive house owners’ considerations went past Mr. Musk’s political statements. They cited accusations of racial discrimination at Tesla factories, or the notion that he has allowed racist content material to flourish on X. Tesla has denied that it tolerates discrimination at its factories.
“My mom was critically debating shopping for a Tesla,” mentioned Achidi Ndifang, who works in info know-how in Baltimore. “As a Black particular person, I felt like it will be an insult for my mom to drive a Tesla.”
Derek Morf, a highschool math trainer in Verona, N.J., who owns a Tesla, reported feeling alarmed when Tesla removed the Disney Plus app from some dashboard screens late final 12 months, apparently as a result of Mr. Musk was offended at Robert A. Iger, the chief government of Disney.
Mr. Morf didn’t care that a lot in regards to the Disney app, which he hardly used. However, he mentioned, he discovered it unsettling “that the car I bought may have options modified instantly just because one man had that a lot management.”
Such considerations could possibly be a legal responsibility for Tesla because it pours assets into autonomous driving know-how. Mr. Musk has promised to unveil a self-driving taxi on Aug. 8. The know-how can not succeed with out belief from customers.
Many Instances readers identified that different automotive corporations additionally had baggage. Volkswagen had an emissions scandal a number of years in the past. Henry Ford, the founding father of Ford Motor, held and unfold antisemitic views. A decade in the past, G.M. offered vehicles with faulty ignition switches that had been blamed for greater than 100 deaths.
Established automotive corporations nonetheless promote gasoline vehicles that emit greenhouse gases and different pollution. Tesla sells solely electrical vehicles.
However in all probability no different present auto government has as loud a megaphone as Mr. Musk has, or is extra keen to make use of it.
“If folks assume that the C.E.O.s of different corporations are saints, they’re a bit naïve in my view,” mentioned Jan Leys, a Tesla proprietor in Zurich. “They simply don’t have as large a mouth and/or platform as Elon Musk.”